ISBN: 9783836638104

The Case of Gazprom Inhaltsangabe:Introduction: Ongoing globalization leads to the metamorphosis of social and economic structures and changes the scope of national governmental and non-g… Mehr…

The Case of Gazprom Inhaltsangabe:Introduction: Ongoing globalization leads to the metamorphosis of social and economic structures and changes the scope of national governmental and non-governmental institutions. Not at least, it changes the aspect of national mentality. The creation of the European Union in 1957 is only one example for the fusion of economic and political domains. In fact, financial and capital markets liberalize, the number of global player rise, and the establishment of international non-governmental organizations increased from 1956 to 1997 by 1,600 % from 985 to 15,965. On the whole, the opportunities for business¿ to take influence on the global level are higher and probably more necessary than ever before in history. Economic interrelations and dependencies, international scarcity of non-renewable energy resources and the global climate disaster lead to the necessity of introducing international institutions that act not only in national interest, but serve for the global stabilization of the world economy and its sustainability. A new aspect or logic consequence of globalization arises: Global Governance (in the following abbreviated as GG). GG is one major concomitant phenomenon in the ideology in the disparity in national interests of sovereign states. This difference in the interests of individual items compared to the interests of the entire society exists as long as human beings. Literature calls it the ¿moral hazard phenomenon¿. There might be common, as well as divergent interests on an efficient solution of various problems, for example in the areas of shelter for refugees and asylum seeker, the problem arising from weapons of mass destruction and the regulations of CO2 emissions. With ongoing globalization there arises a complex multidimensional competition framework. Not only global commercial companies, but also national entities start to compete in terms of production factors, fiscal and political environment and legal frameworks with each another. Figure 1 illustrates the global competition framework by showing up the interrelation among country A and country B. The countries are illustrated including first, their official political entity (government) and secondly, to the Trans-National Companies (in the following abbreviated with TNCs) operating within the country. The third party illustrated is ¿the employment¿. National government, TNCs and the employment of civil society are interrelated with each another within one country in two directions. Firstly, the TNCs affect the employment and therefore as a result, the government. The higher the action of TNCs within the country, the higher is the employment rate of the civil society (the lower the unemployment). The lower the unemployment rate, the more satisfied the civil society is, and therefore the more powerful the government becomes (because of higher chances to be re-elected). Secondly, the government has impact on the benefits and competitive advantage of TNCs. The better the education policy, the more valuable becomes the human capital. The better the human capital, the more efficient and thus the higher the productivity of TNCs becomes. On a whole, national government can create benefit for TNCs and the other way around. Figure 1 also illustrates the competitive relationship among country A and country B. Both countries compete in terms of providing attractiveness to the TNCs. Attractiveness can be reached by the creation of valuable factors (such as skilled labour et al.). However, this skilled labour also needs to be attracted. As the model introduces a second country, skilled labour can easily move to a place with better factors for the society (better living conditions, better security system, better employment chances, better environmental care, and much more). Though, governments do not only compete for TNCs, but in addition to that for civil society and as a result, finally for voters and power. To sum up, TNCs compete with each other in terms of production. Governments compete with each other in terms of factors. Both, TNCs and the national government, depend from each another and can therefore form an alliance in order to gain in competitive advantage and Global Power (abbreviated in the following as GP). From the aim driven point of view (as explained further in section 1.3.2), GG aims to face and to deal with global challenges in order to balance the markets, to maximize overall welfare and aspire an equal distribution of resources and wealth all over the world. At the same time, GG can be used as a strategic measure and a tool for regulating markets and gaining in competitive advantage and GP. This thesis is going to deal with GG as business strategy based on the neo-realistic approach. The increased presence of TNCs in local economies as a strategy to ensure market control has been labelled ¿glocalization¿. Research Question: At least after WW II, global society started to realize the ongoing trend for economic trade-off, liberalization of markets and the principle of the invisible hand not only on a national stage, but on the global layer. National boarders melt, since the action of trade, the economic power, now shifts from the national level to a global degree. International acting companies gain in power and influence with, for instance, direct investments, rising turnover, increased cash flows, and not at least with their bargaining power (in the following abbreviated with BP). The increase in BP is often linked to (global) political activities. Global player, such as TNCs, serve often as a tie between several nations and economies. Though, there are still national governments, and national interests that are not to bring in line with the interests of the global society as a whole. There sometimes might be also dissensions among governments and the TNCs operating in the same arena. The crucial factor then is the BP of the actor. It is not always the case, that government and TNC are equal in having BP. Often there arises an asymmetric dependency, which causes a drop of BP for one of the parties. That disparity and the management of different parties¿ interests in general, is what Global Governance is all about. During the last 50 years, companies used their BP in order to implement national lobbying as an instrument for gaining in Global Power (in the following abbreviated as GP). Now, as national levels are detached from global platforms and by the GG framework, there arises one important question: Is Global Governance a useful strategy tool for the business sector In most literature, Global Governance is defined to be an aim driven, goal oriented approach in order to solve problems resulting by the globalization process. But there is only little research in order to find an explanation of how exactly GG is organized. The first essential question to answer now is: What are the factors that influence GG The second question is: How do these factors influence GG Third question is: Is there a relation between GG and GP Last question: Can GG be used as a business strategy in order to increase GP If yes, how Research Methods: The thesis¿ objective is it to figure out the relationship of involvement into Global Governance and the business¿ Global Power. It is pre-assumed that an increase in Global Power leads to an increase in a business market dominating power. Thereby it will be found out, what particular can be done to gain in Global Governance involvement. Several strategies are imaginable. This thesis will work out a new strategy approach by combining 1) Porter¿s 5 Forces model with 2) Hirschman¿s model of ¿voice and exit¿ strategies. Further the framework of Global Governance will be transferred to the traditional 5 forces model in order to detect the location of Trans-National Companies in their competitive environment. Further an additional sixth force is going to be introduced. After analyzing the competitive environment of Trans-National Companies and the impact of governmental institutions on the industry, several strategies for gaining in Global Power will be developed, using the new hybrid strategy approach as a tool. In the section of definitions (1.3), the thesis and their basic components are going to be analyzed and explained. Within the theory framework (2.1-2.4), the thesis will be set up theoretically. The case study of Gazprom as Trans-National Company will transfer the theoretical model to a practical example. Thus, Russian influence on the world market (for energy) rises, and the situation concerned Europe directly, the example chosen is very relevant and of actuality. In the end the findings will be evaluated. The unit of analysis used in the theory framework is based on the global level. That is rationale because Global Actors in general are going to form the basis of the framework. However, the topic itself implies choosing the global level as unit of analysis. The case study will concentrate on a specific firm. Here it will be switched to the firma level as unit of analysis. That makes sense, because there are only little volumes of industries that do globalize. On the other hand on the global level there is already everything globalized. Only the smallest unit of analysis fits here, because on the firm level there can be made a decision if to go global or not. Further the unit of the other player is scaled in the same small way.Inhaltsverzeichnis:Table of Contents: 1.Introduction7 1.1Research Question10 1.2Research Methods11 1.3Terms and Definitions13 1.3.1Globalization13 1.3.2Global Governance15 1.3.3Power20 1.3.4Strategy27 2.Theory Framework30 2.1Global Actors in Global Governance`s Competitive Environment30 2.1.1The Role of Civil Society in Global Governance30 2.1.2The Role of International Organizations in Global Governance32 2.1.3The Role of the State in Global Governance33 2.1.4The Role of TNC in the Global Governance36 2.2Porters 5 Forces Industry Analysis of TNCs37 2.2.1Rivalry37 2.2.2Threat of Substitutes41 2.2.3Threat of New Entrants42 2.2.4Bargaining Power of Buyer and Supplier43 2.3The Government and International Organizations as Sixth Force45 2.4Elaboration of TNCs¿ BP Rising Strategies52 2.4.1Self Regulatory Institutions (SRIs)54 2.4.2Privatization of the Public Sector54 2.4.3Quasi-Regulation55 2.4.4Public-Private Partnerships (PPPs)55 2.5Conclusion of Theory Framework57 3.Case Study: Gazprom61 3.1History Background of Russians Policy61 3.2Economy Background63 3.3Strategy framework64 3.3.1Gazprom and Russia64 3.3.2Gazprom and NGO¿s65 3.3.3Gazprom and Europe66 4.Conclusion69 Bibliography70 Appendix72Textprobe:Textprobe: Chapter 2.2, Porters 5 Forces Industry Analysis of TNCs: Figure 11 sums up the transformation of GAs to the Porter¿s model. It illustrates the factors that influence the competitive environment in GG in terms of Global Power of TNCs. In the following it will be provided an analysis of the relevant forces and the competitive environment of TNCs on the GG layer in terms of GP. That analysis serves the purpose to detect the best fitting strategy for TNCs in order to increase the industry¿s BP. 2.2.1, Rivalry: Strong competition among rival firms decreases profits and makes the industry less attractive. However, competition is not always perfect and firms are not only price takers, but strive for a competitive advantage over their rivals, too. The intensity of rivalry is influenced by a set industry characteristics. The traditional aspects are the volume of competitors, the market growth, the aspect of the entrance cost and exit costs, the switching costs and the level of product differentiation. Rivalry will be increased by a larger number of firms, because more firms must compete for the same purpose. Rivalry even intensifies, if the firms have similar market volume and impact. When looking at the TNCs as firms, who compete for GP, there is a large number of such. In comparison, there are a lot of global player coming from different countries, representing different intentions, but only less alternatives to influence a global decision making process, or a national decision making process, that affects the world globally (demand). In fact, there are in total sum 44,000 TNCs in the world, with 280,000 subsidiaries and an annual turnover of US$ 7,000 billion. Two-thirds of world trade results from TNC production networks. The share of world GDP controlled by TNCs has grown from 17 percent in the mid-60s to 24 percent in 1984 and almost 33 percent in 1995 (UNCTAD). 51 of the world`s largest economies are in fact TNCs. Continuous mergers and take-overs have created a situation in which almost every sector of the global economy is controlled by a handful of TNCs. On a whole the total volume of TNCs is rather high however there is only little Global Power available. Due to that aspect, rivalry is high. If there is a growing market, firms are able to increase revenues simply because of the economic growth itself. A slow market growth causes firms to combat for market share and rivalry grows. Here we are talking about the market of GP in GG. The market size is only hard to measure. However it will be assumed that ongoing globalization is the factor that results in a growth in the market for assessing GP in GG. According to that argument, rivalry will be decreased within the industry of TNCs. When the majority of costs are fixed, the firm must produce near capacity to attain the lowest unit costs. Since the firm must sell a larger quantity of the product in order to benefit from economies of scale, high levels of production lead to a fight for market share and results in increased rivalry. In this case the ¿product¿ TNCs produce is too abstract, to link it anyhow to fix or variable costs. What TNCs ¿sell¿ is not their actual product (e.g. General Motors sells cars), but the influence they have in economy. As a result, it can be said that the more BP a TNC already has, the more influence it has, the lower costs every additional unit added. So the theory of economies of scale can be covered. However, there are no other fixed costs than the fixed costs of running the business anyhow. To sum up, it can be said that the fixed costs in the TNC¿s industry are indifferent. However, there can be detected an economies of scale effect. Thus, rivalry in the existing market becomes higher. When a customer can freely switch from one product to another there is a greater struggle to capture customers. Low swi, Diplomica Verlag<

ISBN: 9783836638104

The Case of Gazprom Inhaltsangabe:Introduction: Ongoing globalization leads to the metamorphosis of social and economic structures and changes the scope of national governmental and non-g… Mehr…

The Case of Gazprom Inhaltsangabe:Introduction: Ongoing globalization leads to the metamorphosis of social and economic structures and changes the scope of national governmental and non-governmental institutions. Not at least, it changes the aspect of national mentality. The creation of the European Union in 1957 is only one example for the fusion of economic and political domains. In fact, financial and capital markets liberalize, the number of global player rise, and the establishment of international non-governmental organizations increased from 1956 to 1997 by 1,600 % from 985 to 15,965. On the whole, the opportunities for business¿ to take influence on the global level are higher and probably more necessary than ever before in history. Economic interrelations and dependencies, international scarcity of non-renewable energy resources and the global climate disaster lead to the necessity of introducing international institutions that act not only in national interest, but serve for the global stabilization of the world economy and its sustainability. A new aspect or logic consequence of globalization arises: Global Governance (in the following abbreviated as GG). GG is one major concomitant phenomenon in the ideology in the disparity in national interests of sovereign states. This difference in the interests of individual items compared to the interests of the entire society exists as long as human beings. Literature calls it the ¿moral hazard phenomenon¿. There might be common, as well as divergent interests on an efficient solution of various problems, for example in the areas of shelter for refugees and asylum seeker, the problem arising from weapons of mass destruction and the regulations of CO2 emissions. With ongoing globalization there arises a complex multidimensional competition framework. Not only global commercial companies, but also national entities start to compete in terms of production factors, fiscal and political environment and legal frameworks with each another. Figure 1 illustrates the global competition framework by showing up the interrelation among country A and country B. The countries are illustrated including first, their official political entity (government) and secondly, to the Trans-National Companies (in the following abbreviated with TNCs) operating within the country. The third party illustrated is ¿the employment¿. National government, TNCs and the employment of civil society are interrelated with each another within one country in two directions. Firstly, the TNCs affect the employment and therefore as a result, the government. The higher the action of TNCs within the country, the higher is the employment rate of the civil society (the lower the unemployment). The lower the unemployment rate, the more satisfied the civil society is, and therefore the more powerful the government becomes (because of higher chances to be re-elected). Secondly, the government has impact on the benefits and competitive advantage of TNCs. The better the education policy, the more valuable becomes the human capital. The better the human capital, the more efficient and thus the higher the productivity of TNCs becomes. On a whole, national government can create benefit for TNCs and the other way around. Figure 1 also illustrates the competitive relationship among country A and country B. Both countries compete in terms of providing attractiveness to the TNCs. Attractiveness can be reached by the creation of valuable factors (such as skilled labour et al.). However, this skilled labour also needs to be attracted. As the model introduces a second country, skilled labour can easily move to a place with better factors for the society (better living conditions, better security system, better employment chances, better environmental care, and much more). Though, governments do not only compete for TNCs, but in addition to that for civil society and as a result, finally for voters and power. To sum up, TNCs compete with each other in terms of production. Governments compete with each other in terms of factors. Both, TNCs and the national government, depend from each another and can therefore form an alliance in order to gain in competitive advantage and Global Power (abbreviated in the following as GP). From the aim driven point of view (as explained further in section 1.3.2), GG aims to face and to deal with global challenges in order to balance the markets, to maximize overall welfare and aspire an equal distribution of resources and wealth all over the world. At the same time, GG can be used as a strategic measure and a tool for regulating markets and gaining in competitive advantage and GP. This thesis is going to deal with GG as business strategy based on the neo-realistic approach. The increased presence of TNCs in local economies as a strategy to ensure market control has been labelled ¿glocalization¿. Research Question: At least after WW II, global society started to realize the ongoing trend for economic trade-off, liberalization of markets and the principle of the invisible hand not only on a national stage, but on the global layer. National boarders melt, since the action of trade, the economic power, now shifts from the national level to a global degree. International acting companies gain in power and influence with, for instance, direct investments, rising turnover, increased cash flows, and not at least with their bargaining power (in the following abbreviated with BP). The increase in BP is often linked to (global) political activities. Global player, such as TNCs, serve often as a tie between several nations and economies. Though, there are still national governments, and national interests that are not to bring in line with the interests of the global society as a whole. There sometimes might be also dissensions among governments and the TNCs operating in the same arena. The crucial factor then is the BP of the actor. It is not always the case, that government and TNC are equal in having BP. Often there arises an asymmetric dependency, which causes a drop of BP for one of the parties. That disparity and the management of different parties¿ interests in general, is what Global Governance is all about. During the last 50 years, companies used their BP in order to implement national lobbying as an instrument for gaining in Global Power (in the following abbreviated as GP). Now, as national levels are detached from global platforms and by the GG framework, there arises one important question: Is Global Governance a useful strategy tool for the business sector In most literature, Global Governance is defined to be an aim driven, goal oriented approach in order to solve problems resulting by the globalization process. But there is only little research in order to find an explanation of how exactly GG is organized. The first essential question to answer now is: What are the factors that influence GG The second question is: How do these factors influence GG Third question is: Is there a relation between GG and GP Last question: Can GG be used as a business strategy in order to increase GP If yes, how Research Methods: The thesis¿ objective is it to figure out the relationship of involvement into Global Governance and the business¿ Global Power. It is pre-assumed that an increase in Global Power leads to an increase in a business market dominating power. Thereby it will be found out, what particular can be done to gain in Global Governance involvement. Several strategies are imaginable. This thesis will work out a new strategy approach by combining 1) Porter¿s 5 Forces model with 2) Hirschman¿s model of ¿voice and exit¿ strategies. Further the framework of Global Governance will be transferred to the traditional 5 forces model in order to detect the location of Trans-National Companies in their competitive environment. Further an additional sixth force is going to be introduced. After analyzing the competitive environment of Trans-National Companies and the impact of governmental institutions on the industry, several strategies for gaining in Global Power will be developed, using the new hybrid strategy approach as a tool. In the section of definitions (1.3), the thesis and their basic components are going to be analyzed and explained. Within the theory framework (2.1-2.4), the thesis will be set up theoretically. The case study of Gazprom as Trans-National Company will transfer the theoretical model to a practical example. Thus, Russian influence on the world market (for energy) rises, and the situation concerned Europe directly, the example chosen is very relevant and of actuality. In the end the findings will be evaluated. The unit of analysis used in the theory framework is based on the global level. That is rationale because Global Actors in general are going to form the basis of the framework. However, the topic itself implies choosing the global level as unit of analysis. The case study will concentrate on a specific firm. Here it will be switched to the firma level as unit of analysis. That makes sense, because there are only little volumes of industries that do globalize. On the other hand on the global level there is already everything globalized. Only the smallest unit of analysis fits here, because on the firm level there can be made a decision if to go global or not. Further the unit of the other player is scaled in the same small way.Inhaltsverzeichnis:Table of Contents: 1.Introduction7 1.1Research Question10 1.2Research Methods11 1.3Terms and Definitions13 1.3.1Globalization13 1.3.2Global Governance15 1.3.3Power20 1.3.4Strategy27 2.Theory Framework30 2.1Global Actors in Global Governance`s Competitive Environment30 2.1.1The Role of Civil Society in Global Governance30 2.1.2The Role of International Organizations in Global Governance32 2.1.3The Role of the State in Global Governance33 2.1.4The Role of TNC in the Global Governance36 2.2Porters 5 Forces Industry Analysis of TNCs37 2.2.1Rivalry37 2.2.2Threat of Substitutes41 2.2.3Threat of New Entrants42 2.2.4Bargaining Power of Buyer and Supplier43 2.3The Government and International Organizations as Sixth Force45 2.4Elaboration of TNCs¿ BP Rising Strategies52 2.4.1Self Regulatory Institutions (SRIs)54 2.4.2Privatization of the Public Sector54 2.4.3Quasi-Regulation55 2.4.4Public-Private Partnerships (PPPs)55 2.5Conclusion of Theory Framework57 3.Case Study: Gazprom61 3.1History Background of Russians Policy61 3.2Economy Background63 3.3Strategy framework64 3.3.1Gazprom and Russia64 3.3.2Gazprom and NGO¿s65 3.3.3Gazprom and Europe66 4.Conclusion69 Bibliography70 Appendix72Textprobe:Textprobe: Chapter 2.2, Porters 5 Forces Industry Analysis of TNCs: Figure 11 sums up the transformation of GAs to the Porter¿s model. It illustrates the factors that influence the competitive environment in GG in terms of Global Power of TNCs. In the following it will be provided an analysis of the relevant forces and the competitive environment of TNCs on the GG layer in terms of GP. That analysis serves the purpose to detect the best fitting strategy for TNCs in order to increase the industry¿s BP. 2.2.1, Rivalry: Strong competition among rival firms decreases profits and makes the industry less attractive. However, competition is not always perfect and firms are not only price takers, but strive for a competitive advantage over their rivals, too. The intensity of rivalry is influenced by a set industry characteristics. The traditional aspects are the volume of competitors, the market growth, the aspect of the entrance cost and exit costs, the switching costs and the level of product differentiation. Rivalry will be increased by a larger number of firms, because more firms must compete for the same purpose. Rivalry even intensifies, if the firms have similar market volume and impact. When looking at the TNCs as firms, who compete for GP, there is a large number of such. In comparison, there are a lot of global player coming from different countries, representing different intentions, but only less alternatives to influence a global decision making process, or a national decision making process, that affects the world globally (demand). In fact, there are in total sum 44,000 TNCs in the world, with 280,000 subsidiaries and an annual turnover of US$ 7,000 billion. Two-thirds of world trade results from TNC production networks. The share of world GDP controlled by TNCs has grown from 17 percent in the mid-60s to 24 percent in 1984 and almost 33 percent in 1995 (UNCTAD). 51 of the world`s largest economies are in fact TNCs. Continuous mergers and take-overs have created a situation in which almost every sector of the global economy is controlled by a handful of TNCs. On a whole the total volume of TNCs is rather high however there is only little Global Power available. Due to that aspect, rivalry is high. If there is a growing market, firms are able to increase revenues simply because of the economic growth itself. A slow market growth causes firms to combat for market share and rivalry grows. Here we are talking about the market of GP in GG. The market size is only hard to measure. However it will be assumed that ongoing globalization is the factor that results in a growth in the market for assessing GP in GG. According to that argument, rivalry will be decreased within the industry of TNCs. When the majority of costs are fixed, the firm must produce near capacity to attain the lowest unit costs. Since the firm must sell a larger quantity of the product in order to benefit from economies of scale, high levels of production lead to a fight for market share and results in increased rivalry. In this case the ¿product¿ TNCs produce is too abstract, to link it anyhow to fix or variable costs. What TNCs ¿sell¿ is not their actual product (e.g. General Motors sells cars), but the influence they have in economy. As a result, it can be said that the more BP a TNC already has, the more influence it has, the lower costs every additional unit added. So the theory of economies of scale can be covered. However, there are no other fixed costs than the fixed costs of running the business anyhow. To sum up, it can be said that the fixed costs in the TNC¿s industry are indifferent. However, there can be detected an economies of scale effect. Thus, rivalry in the existing market becomes higher. When a customer can freely switch from one product to another there is a greater struggle to capture customers. Low sw, Diplomica Verlag<

ISBN: 9783836638104

The Case of Gazprom. 1. Auflage, The Case of Gazprom. 1. Auflage, [KW: PDF ,BETRIEBSWIRTSCHAFT ,BUSINESS ECONOMICS , DISTRIBUTION ,TRANSPORTWESEN ,SOZIALWISSENSCHAFTEN RECHT WIRTSCHAFT , … Mehr…

The Case of Gazprom. 1. Auflage, The Case of Gazprom. 1. Auflage, [KW: PDF ,BETRIEBSWIRTSCHAFT ,BUSINESS ECONOMICS , DISTRIBUTION ,TRANSPORTWESEN ,SOZIALWISSENSCHAFTEN RECHT WIRTSCHAFT , WIRTSCHAFT , BETRIEBSWIRTSCHAFT ,GLOBAL GOVERNANCE PORTERS FIVE FORCES GAZPROM BARGAINING POWER INTERNATIONAL ORGANIZATION] <-> <-> PDF ,BETRIEBSWIRTSCHAFT ,BUSINESS ECONOMICS , DISTRIBUTION ,TRANSPORTWESEN ,SOZIALWISSENSCHAFTEN RECHT WIRTSCHAFT , WIRTSCHAFT , BETRIEBSWIRTSCHAFT ,GLOBAL GOVERNANCE PORTERS FIVE FORCES GAZPROM BARGAINING POWER INTERNATIONAL ORGANIZATION<