Business, Government & Society

BUSINESS, GOVERNMENT &

MASTER IN INTERNATIONAL BUSINESS MANAGEMENT SOCIETY AREA: STRATEGY CREDITS: 3

COURSE BASIS

This course focuses on the nonmarket forces that managers encounter. The emphasis is on the political, regulatory, social, and natural environment in which business operates.

COURSE OVERVIEW

Business operates in both a market and a nonmarket environment, the latter being the space where the formal and informal rules governing market competition are set and enforced. Successful corporate strategy aligns the firm’s capabilities with the demands of both its market and nonmarket environment. This course systematically examines the political, regulatory, societal, cultural, and natural factors that shape business’ nonmarket environment. Participants learn how to analyze and proactively manage the nonmarket environment through integrated market and nonmarket strategies. The course is divided into three parts:

In part one, we examine the roles of markets, governments, and society in a market economy. We will examine markets, market failures, the role of government in correcting market failures, and government failures.

The second part begins the systematic analysis of politics as it relates to business. Participants learn to analyze the motives for government intervention to better judge when and how political developments may affect business. Tools for nonmarket analysis and nonmarket strategy formulation are introduced. We then turn to business-government relations in specific regulatory domains, as we analyze how to align market and nonmarket strategy in challenging political environments. We examine the political risk inherent in many international investment decisions, the dynamics of trade policymaking and protectionism, and the challenges – and opportunity – of “thin” regulation at the global level.

In part three we turn attention more explicitly to the role of business in society. Business is often blamed for social ills or gets caught in existing societal rifts. But businesses are often uniquely well-positioned to have a positive impact on social issues and social challenges often provide opportunities for businesses to do well by doing good, an insight that is at the heart of strategic corporate social responsibility. In either case, the ability to work with a broad range of diverse nonmarket actors as well as proper corporate communication are crucial for success.

LEARNING OBJECTIVES

METHODOLOGY

This course will rely intensively on the case method. Through the discussion of the different companies and industries described in the case studies, students will be able to develop analytical, critical thinking and communication skills. Additionally, the professor will lecture on the main conceptual tools and frameworks that will help reinforce and complement the theories provided in the selected articles and technical notes. Moreover, in certain sessions, group exercises will be implemented in which students will take executive decisions from the perspective of the general manager.

ASSIGNED MATERIALS

The course is designed around intensive use of the case method and business case studies therefore constitute the backbone of course materials. In addition, for many sessions there are some short newspaper clippings as well as theoretical articles and technical notes that introduce concepts, frameworks, and tools. For most sessions, there are also recommended readings that either provide a deeper background or further explore the session’s topic. Recommended readings are not required, though participants are encouraged to peruse them and draw on them as appropriate in our class discussions.

There is no required textbook. However, students with either a particular interest in a given topic or who feel the need to get a firmer grounding in a given area should rely on David P. Baron, Business and its Environment, Prentice Hall (any edition), multiple copies of which are available in the IE Library. This textbook provides background and theoretical material for many of the sessions.

Participants are expected to have prepared assigned cases before coming to class and to be familiar with all required background and theoretical readings.

EVALUATION METHOD There are three class requirements that comprise the final term grade in the following way:

Criteria Score % Class Participation 35% Reading Quizes 15% Group Final Project - Report 50%

Class Participation (35 percent) Case analysis requires active participation, before class in groups as well as in class itself.

Through class contributions, students provide valuable insights, different perspectives, and help move the class along. It is therefore only sensible that class participation should comprise a significant part of the grade. What matters though is quality, not quantity. The point of class participation is contributing a new fact or a new perspective to the discussion and thus moving the class forward, not restating previous information. Reading Quizes (15 percent)

After each case you will be responsible to answer a quick online quiz that tests your knowledge of the readings. These quizzes will be open 12 hours before the material is covered in class. The average of the top five scores on the quizzes will be applied as the final grade, allowing some leeway in case a student cannot take the quiz for any reason. Group Project (50 percent)

In coordination with the instructor, each group selects a company and assesses either its overall nonmarket environment or a particular set of nonmarket challenges (and/or opportunities) the company confronted at a given moment, and analyzes its impact on corporate strategy. Each group will prepare a 7-page report (double-spaced) due one week after the class ends.