As organizations go global, they choose different approaches depending on the stage at which they conduct global business. In the initial stages of globalization, managers adopt methods that allow them to enter international markets without requiring large capital investments. At this stage, the company may adopt global sourcing to start global operations, that is, purchasing the cheapest materials and labor from abroad. Their goal is to gain a greater competitive advantage through lower costs. For example, Massachusetts General Hospital invited radiologists from India to explain the use of CT scanners. While global outsourcing is often the first step toward globalization, many organizations, no matter how ambitious, still adopt this approach because of the competitive advantages it brings. However, with the exception of global outsourcing, each stage a careerist achieves will require more investment and, in so doing, the organization will take on more risk. Next, authorities enter international markets by exporting products to other countries—that is, manufacturing products domestically and selling them abroad. This is a passive first step towards globalization. In addition, an organization may initially go global by importing products, that is, selling products manufactured overseas. Exporting and importing are only in the embryonic stages of becoming a global enterprise, and the investments and risks involved are minimal. Most organizations, especially small businesses, continue to operate globally through import and export operations. For example, Ha'ibhai's Spice Emporium (revenues around $7 million), a small business in Durban, South Africa, sells spices and rice throughout Africa, Europe and the United States. However, some organizations have built some multi-million dollar businesses through importing or exporting, and Pier l Imports has done the same. The company imports products from more than 40 countries and sells them in more than 1,100 stores across North America. Finally, in the initial stage of global operations, managers can adopt two similar methods: licensing and franchising. They all give other organizations the right to use trademarks, technology or product specifications through a one-time payment or a fee based on sales. The only difference is that licensing is mainly used for manufacturing organizations that produce and sell products for other companies, while franchising is used for service industry organizations that use other companies' brand names or business ideas. For example, consumers in Thailand can enjoy Bob's Big Boy burgers, Filipinos can enjoy Shakey's Pizza, and Malaysians can enjoy Schlotzky's sandwiches - all because of franchising. In addition, Anheuser-Busch granted licenses to Canada's Abatt, Mexico's Modelo and Japan's Kirin to brew and sell Budweiser beer. Generally speaking, once an organization has operated globally and gained experience in international markets, managers may decide to make greater use of direct investment. Among them, they can take the form of strategic alliance. A strategic alliance is a partnership established between an organization and a foreign company in which both parties share resources and knowledge when developing new products or establishing production facilities. Both parties in the alliance bear the risks and enjoy the benefits. For example, IBM of the United States, Toshiba of Japan, and Siemens of Germany formed a partnership to develop a new generation of computer chips. A joint venture is a special strategic alliance in which both parties agree to establish an autonomous and independent organization for a certain corporate goal. For example, Hewlett-Packard has formed numerous joint ventures with various suppliers around the world to develop different components for computer equipment. This partnership provides a fast, low-cost way for the company to compete globally, relative to the company's own independent investment.

Finally, management can invest directly abroad by establishing foreign subsidiaries - autonomous and independent production facilities or offices. This subsidiary can be managed as a multinational company (domestic control) or a global company (centralized control). As you might have guessed, this approach involves the most resources and the greatest risks. For example, Illinois-based United Plastics Group has opened three injection molding plants in Suzhou, China, and it plans to build at least two more. Chuck, the company's executive vice president of business development?