We live in an era of globalization, in which most producers operate internationally on a global scale. We, as consumers, are affected by events taking place on distant shores – to say we live in an age of interconnectedness is a cliché, but it is still true. Just check out the labels on the clothes in your closet. Your shirts, sweaters, jackets, and jeans were probably not produced in the United States. More likely, they were made in China, Bangladesh, Vietnam, India, Sri Lanka, or Mexico. The same is true for your shoes.

You may not know it, but the tomato has always been the subject of controversy. Botanists debate whether the tomato is a vegetable or a fruit (it is actually a fruit). Linguists debate whether it is pronounced as to-may-toe or to-mah-toe (who cares!). Meanwhile, agricultural economists debate where the best place to produce this nutritious and delicious crop might be.

Strategy and Organizational Forms argues for the importance of closely considering the environment in which globally operating firms are embedded, along with the pressures that shape organizational orientations, strategies, and forms. It recognizes the primacy of context and explains how the forces of global integration and local responsiveness shape organizational orientations, strategies, and forms. Major organizational forms in multinational enterprises are described. The ways in which organizations grow includes a particular focus on acquisitions and strategic alliances including joint ventures. Approaches to global business by small- and medium-size enterprises are explored. Trends in organizing related to digital transformations and lateral collaboration are identified.

In 2014, Fabrice Brégier, then chief operating officer of Airbus, called for the European Central Bank to intervene as the strength of the euro was “crazy.” He wanted them to push it down against the dollar by 10% from an “excessive” $1.35 to between $1.20 and $1.25. We learned in Chapter 14 how a strong currency makes it harder for domestic manufacturers to export goods, so we can understand why a European executive trying to sell commercial airplanes might worry that a strong euro was making his job harder. And it is a fact that in 2014, Airbus was registering disappointing sales compared to its rival across the Atlantic, Boeing. But why would it be “crazy” for the euro to be worth $1.35, and yet normal and acceptable for the euro to be worth 10% less than that? And how did Fabrice Brégier expect the European Central Bank to adjust the euro’s value, when the euro is under a floating, rather than a fixed, exchange rate regime?

In January 2017, just three days after taking office, President Donald Trump withdrew the United States from the Trans-Pacific Partnership, or TPP. This trade agreement involving about a dozen Pacific Rim countries would have reduced trade barriers and established rules governing trade in the region. “We’re going to stop the ridiculous trade deals that have taken … companies out of our country,” he stated. Trump had consistently argued that trade agreements such as the North American Free Trade Agreement (NAFTA) with Canada and Mexico were “a bad deal” for US workers and unfair to American business, allowing other countries “to take advantage of us.”

In times of turmoil, one would think that a stable, or relatively stable, exchange rate would be a boon to policymakers, soothing the anxieties of international investors. However, keeping the value of the currency stable against a foreign currency such as the US dollar, when buffeted by shocks, entails sometimes painful tradeoffs.

There is a parable about an entrepreneur who invents an amazing machine. Wheat, soybeans, lumber, and oil are fed into one end of the contraption. As if by magic, smartphones, coffee, and tea, and all manner of clothing and apparel come out the other end. The inventor is praised as a genius – until further investigation reveals that the wheat and the other inputs were being secretly shipped to other countries in exchange for the electronics and apparel that later emerged. When this news is made public, the inventor is denounced as an unpatriotic fraud who is destroying jobs.

In January 2017, just three days after taking office, President Donald Trump withdrew the United States from the Trans-Pacific Partnership, or TPP. This trade agreement involving about a dozen Pacific Rim countries would have reduced trade barriers and established rules governing trade in the region. “We’re going to stop the ridiculous trade deals that have taken … companies out of our country,” he stated. Trump had consistently argued that trade agreements such as the North American Free Trade Agreement (NAFTA) with Canada and Mexico were “a bad deal” for US workers and unfair to American business, allowing other countries “to take advantage of us.”