Main Menu

My Account
Online Free Samples
   Free sample   International business assignment risks encounter by thyssenkrupp

International Business Assignment: Risks Encounter By ThyssenKrupp


Task: Week 24, students will discover on Blackboard a number of multinational enterprise case studies. They will choose two and write 1,000 words on each, answering and expanding upon specific questions associated with each. This will be an opportunity to demonstrate the full range of module curriculum, with a slight emphasis on micro-level topics.
Marking criteria:
• In-depth research and coverage of topics
• Structured critical analysis
• Realistic problem-solving
• References and appendices presented using Harvard referencing system
Case study 3
Thyssenkrupp is a proud German multinational with a long history of international success in its different businesses. In recent years, however, its performance has flagged to the point of being ejected from the ranks of the country’s DAX30 leading companies.
There are multiple reasons for Thyssenkrupp’s problems, starting with increased international competition in many of the sectors where the company had previously enjoyed market leadership. Add to this the downturn in the global automotive industry, for which Thyssenkrupp had long been a major parts supplier and some analysts now advise the conglomerate to sell off some of its less profitable ventures – especially given fears of a long-term economic downturn in the wake of the coronavirus crisis (not to mention fears about future global automotive sales when ecological standards are further tightened, as seems likely.
Other analysts believe that downsizing will undermine the internal synergies from which Thyssen has always benefited - and that it needs to keep all its parts to benefit from the recovery they expect to occur once the effects of the coronavirus play out. The question is which piece of advice the company should listen to.
Case study 5
Apple has experienced tremendous success in recent years with a business model largely shaped by its reliance on major Chinese suppliers. This industrial outsourcing has served the MNE well but it is now suffering major disruption for two reaaons: the trade war that the Trump Administration has declared with China (with new import tariffs increasing the cost to Apple of the parts it sources from China); and the coronavirus crisis, which has put tremendous strain on all international operations.
The question for Apple then becomes whether it should remedy these two enormous challenges by radically changing its international value chain - or instead if it should wait for the storm to pass and stick with a model that has been very successful so far.


Case Study 3:-
Risk Associated with the Problem explored in this international business assignment
The international German Multinational Giant Thyssenkrupp is facing a huge risk in its business this year compared to its performance in past years. The company was known to hold a rank in the DAX30 leading companies; however, it is losing its competitiveness and presence in the market for supplying to the automotive industry. The company is facing the risk of huge financial squeeze and lowering competitive strength in the coming years. In addition to this, there are also risks from reduced demand for its steel and sub-parts it sells in the international market (Reuters 2020). This information provided in this international business assignment means that the company is facing a risk of reduced profit or even loss in some of its international counter-parts due to various reasons and losing its leadership in the market.

Causes of the Risk
There are number of causes for the risks that ThyssenKrupp is facing in its international markets as discussed in this international business assignment, which is leading to its loss. One of the major reason is the reduction in the demand from automotive industry, which is the largest customer group of the company. The car industry is the biggest customer group, purchasing various kinds of components and steel parts from Thyssenkrupp and its submarine conglomerate (Reuters 2020a). Thus, the reduction in the demand from such giant customer group has caused a loss or profit reduction to Thyssenkrupp. Secondly, it is seen in this international business assignment that the advent of coronavirus crisis has been the major reason that has made the car industry to suspend their production. Moreover, the rising problems due to coronavirus will further expand the crisis (Reuters 2020). This shows that the major cause of profit and selling risks that Thyssenkrupp is experiencing is due to the coronavirus crisis and suspended production of care industries.

Potential Solutions
There have been two advices given to Thyssenkrupp to reduce its risks of cash squeeze that it is facing due to the reasons mentioned above within this international business assignment. One solution include selling off some of its less profitable ventures because of the economic downturn is long term due to the coronavirus crisis. Moreover, there is also a fear about whether the global automotive sales will revive effectively after the economies tightened in future (Reuters 2020a). The other option mentioned in this international business assignment is to wait till the effect of coronavirus play out and benefits from the recovery made by all its divisions. These are the two potential solutions that the company needs to choose from in order to cope up with their cash squeeze and survive in the international market in the long run. Each of these advice and solution has their own strengths and weaknesses and analyzing these would help in coming out with the best advice to choose from.

Solution 1- Downsizing the company by selling off some of the less profitable ventures.

Solution 2- Keep all its divisions and making internal process changes and expect recovery once the effects of coronavirus play out.

Strength and Weaknesses of Solution 1
The first solution that Thyssenkrupp can adapt as discussed in this international business assignment is to downsize its business and sell some of its divisions. The company has already adopted this solution before where it sold its elevator division to ease out financial pressure on the conglomerate. This shows that the downsizing activity of the company was not successful in the past due to unfortunate conditions like coronavirus. However, selling the division has helped the company to get some financial leeway to save themselves from the cash squeeze by getting around 17.2 billion euros (Reuters 2020a). Thus the company explored in the segments of international business assignment can indulge in more such selling of its division that is facing huge loss in the global market to avoid financial loss. The solution of downsizing the company has various strengths and weaknesses to be considered in the scenario of international business assignment.


  • Downsizing allows the company to get some financial leeway to face the crisis and lowering profit situation effectively.
  • Downsizing would help the company to reduce its cost of manufacturing in most of its low profit divisions and achieve cost effectiveness (Bravo and Egaña 2017).
  • The company will be able to get greater value from its low profitable divisions when sold in market compared to if the organization would decide to keep the division,


  • Formal and informal communication and synergies between the divisions will be interrupted by the downsizing activities.
  • The company will face a loss in its skills and knowledge by losing good quality employees in the less profit making divisions that it will choose (Martin and Davis 2013).
  • The company will lose trust of the employees due to such sudden downsizing activity to keep up its financial abilities.
  • Loss of competitiveness in the market.

Strengths and Weaknesses of Solution 2
The next solution outlined in this section of international business assignment that the company would choose is to wait for the crisis to reduce and the market to recover again. In doing this the company can take other measures that help them eliminate the issues related to downsizing such as giving short-time working allowances to employees or production cut measure (Reuters 2020). They can also resort to maintaining field of activity by trimming physical resources and reducing output.


  • Help retain large number of employees even if they are running out of work due to the crisis and demand crunch.
  • Maintaining a strong synergy and communication between all its divisions internationally.
  • Retaining trust of employees to be in the company for a longer time and their presence is valued even in the time of crisis (Zatzick et al. 2009).
  • Regain its production easily when the crisis is over and market recovers.


  • May lead to further cash crush or loss of financial stability in the long run because the duration of coronavirus crisis is uncertain and after effects are unknown.
  • May increase the loss of the company in some of the divisions leading to high pressure on the company (Zatzick et al. 2009).
  • Employees will suffer due to low pay or reduced production.

Final Solution
From the above analysis done within this international business assignment it can be stated that making use of second solution that is waiting for crisis to be over and indulging in short-time working allowances for employees, reducing physical resources and production is a better option. This is because downsizing would be costly to the company later on due to need of restructuring processes to build up internal synergies again and has also proved to be unsuccessful in the past.

Case Study 5:-
Risk Associated
The case presented in this international business assignment shows that Apple is facing huge risks of disruption in the international markets due to the rising trade war between Trump administration and China and the rising instances of coronavirus. This is causing huge risk of strains on international sales and rising costs of the company. The company will face a threatened rise in its prices for most of its gadgets that consisted parts imported from China such as Apple Watch, Airpods, IMac and others (Bloomberg 2020). Further, the cost of manufacturing tends to increase in the coming years tremendously, increasing the risk of lower sales in international counterparts as well. In addition to this, the international value chain of Apple is at risk, which the company built in decades. The brand examined in the segments of international business assignment is also facing the risks to lose its market share to its competitors in its international counter parts if it increases the price of goods to cope up with rising costs (Reisinger 2019). All this is putting strains on its international operations and success.

What are the causes of risk discussed in this international business assignment?
The two major causes of the risks that is increasing in Apple is the trade war that Trump has declared with China by adding a tariff of 15% on all Chinese imported good and the rising coronavirus crisis that is impacting its international sales. Apple is known to import most of its value chain and sub-parts from China through industrial outsourcing. This means that they are highly exposed to tariffs. Moreover, the decision of the company to increase the price of some of its gadgets will further create reduction in sales in international market and put strain on the success of the company (Reisinger 2019). Moreover, the coronavirus crisis has also been the major cause behind the disruption of its international operations and most of the manufacturing and other operational activities are in hold seeing the urgency of the time (Livemint 2019). This has caused tremendous pressure on the company to come up with a solution that is effective for them to manage the two enormous challenges that is affecting their business and reduce the risk of disruption.

Potential Solutions
There are two potential solutions that the company can adopt in the giving situation such as to radically change its international value chain or to be patient and wait for the situation to heel with the given business model of relying on major Chinese suppliers. The first option is changing the international value chain by shifting their reliance on Chinese suppliers and moving out of China for its outsourcing needs (Kuboto and Mickle 2019). On the other hand, the second solution would ensure that the company trusts its Chinese suppliers and existing model of industrial outsourcing that has been successful for them so far and wait for such difficult situation to pass (Livemint 2019). Each of the solution illustrated in this international business assignment has their own strengths and drawbacks and it becomes essential to choose the best possible solution. Moreover, scaling the impact of each solution will help in choosing the most effective one.

Solution 1- radically changing international value chain of Apple out of China

Solution 2- holding on to same business model of Chinese industrial outsourcing and waiting for the crisis situation to pass.

Strength and Weaknesses for Solution 1
Solution one is to shift out the international value chain practices of the company from China and target other countries or home market for assembly needs. This is the most effective solution to be adopted by Apple because it will help the company to protect themselves from the trade war between US and China amid coronavirus and face 15% tariff on its imports from China (Bloomberg 2020). The solution is also effective in reducing production cost of Apple to some extent and attain comparative advantage by making use of assemblies that are now less costly in US compared that of China due to tariff. The solution has its own strengths and weaknesses to be considered.


  • Apple has already moved out of China to some other country or in US itself such as it has partnered with Foxconn in 2015 to move some production in India.
  • Help in reducing manufacturing or component cost by radically shifting value chain to country having low tariff or buy product inside USA and face zero tariff.
  • Will help in reducing the tension from trade through diversification of the value chain.
  • Take advantage from Foxconn partnership that has already made 25% of Apple’s production capacity out of China (Kuboto and Mickle 2019).
  • Help keep the price of product low and gain comparative advantage.


  • The solution would take a long time that is months or ever a year to make the radical shift happen completely.
  • It would be difficulty to get the skills workforce that the company used to get in China.
  • The process would be costly for the business amidst such crisis (Reisinger 2019).

Strengths and Weaknesses for Solution 2
The second option presented in this international business assignment is to hold back the business model in China for its outsourcing and wait for the time to recover on itself. This is because shifting the entire value chain activities out of China is not possible due to the expertise and knowledge the company has received from the country. Apple would only be able to move out 10% of its hardware production out of China (Reisinger 2019). However, this option mentioned in this international business assignment has various drawbacks as well in such a crisis situation.


  • Retain trusts and expertise of Chinese counterparts for value chain activities.
  • Reducing the need for restructuring and help from partner companies.
  • Make use of comparative advantage of China in several Apple gadgets and skilled workforce after the situation revives.


  • Highly risky as Apple might face a huge rise in production cost due to high tariff.
  • Lose out of international sales due to rise in prices of gadgets made mostly in China.
  • Lose out its share price, which is falling every second (Bloomberg 2020).
  • Fail to reduce the tensions caused from trade war between US and China.

Final Solution
The most appropriate solution for Apple discussed in this international business assignment is to make a radical shift in its international value chain activities by moving out of China and setting up its production units or buy assemblies from non-tariffed countries or keep its production inside the USA itself. This will help the company to prevent the loss it will make in the situation of trade war and coronavirus crisis which will not recover soon. Moreover, the financial condition of the company would allow them to take up the restructuring cost as well.

Bloomberg, 2020. Apple’s US iPhones Can All Be Made Outside of China. [online] Industry Week. International business assignment Available at: <> [Accessed 22 May 2020].

Bravo, C.S. and Egaña, A.H.D., 2017. The influences of the downsizing strategy on business structures. Revista Brasileira de Gestão de Negócios, 19(63), pp.118-132.

Kuboto, Y. and Mickle, T. 2019. Apple Explores Moving Some Production Out of China. [online] The Wall Street Journal. Available at: <> [Accessed 22 May 2020].

Livemint., 2019. US-China trade war will hit Apple for real this weekend. [online] livemint.. Available at: <> [Accessed 22 May 2020].

Martin, W.M. and Davis, A.C., 2013. Alternatives to downsizing: An organizational innovation approach. International business assignment International Journal of Business and Social Research (IJBSR), 3(7).

Reisinger, D, 2019. Why Apple, Tesla, and Intel Are Helpless in the U.S.-China Trade War. [online] Fortune. Available at: <> [Accessed 22 May 2020].

Reuters, 2020. Thyssenkrupp considers production cuts as coronavirus spreads. [online] ET. Available at: <> [Accessed 22 May 2020].

Reuters, 2020. Thyssenkrupp sees cash squeeze despite elevator sale due to coronavirus. [online] ET. Available at: <> [Accessed 22 May 2020].

Zatzick, C., Marks, M.L. and Iverson, R., 2009. Which way should you downsize in a crisis?. International business assignment MIT Sloan Management Review, 51(1), p.79.


Related Samples

Question Bank

Looking for Your Assignment?

Search Assignment
Plagiarism free Assignment









9/1 Pacific Highway, North Sydney, NSW, 2060
1 Vista Montana, San Jose, CA, 95134