Managing Global Transitions

Volume 5 · Number 4 · Winter 2007 · ISSN 1581-6311 (printed) 1854-6935 (online)

The Editor's Corner
Boštjan Antončič
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Theoretical Aspects of the Economic Transition:
The Case of Romania

Cezar Scarlat and Eugen I. Scarlat

For Romania, as for all other ex-communist countries from Eastern Europe, the transition from the rigid centrally planned economic system to the free-market economy, fair competition based, was an amazing experience. From the academic standpoint, the economic reform was a huge research opportunity, as well as having extremely important practical consequences. Based on the case of Romania, the authors have developed an original, bi-dimensional matrix model of this transition process (Scarlat Model), emphasizing the typology of four basic economic systems. Managerial aspects are underlined – both for economic systems and transition process – as well as some stability considerations. Two features of the transition strategy are presented: the transition path and duration of the process. Special attention was paid to assessing the moment by when the economic transition ends. Analysis of the transition path – based on the theory of deterministic chaos (i.e. short-run predictability) – has led to interesting results: a comprehensive research on the evolution of the Romanian currency exchange over a period of sixteen years (1990–2005) revealed three intervals in the Romanian recent history of economic transition and confirmed the diagnostic of transition end. The general model is applied in the case of Romania and some interesting findings are presented, but it is also fully applicable to all Eastern European countries and not only Romania. The EU accessing process is a different type of transition – rigorously planned, regulated and monitored.

Key Words: economy model, economic transition, transition path, deterministic chaos, EU accession
JEL Classification: P21
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Management Mistakes as Causes of Corporate Crises:
Countries in Transition

Drago Dubrovski

A corporate crisis can be defined as a short-term, undesired, unfavourable and critical state in a company which has derived from both internal and external causes and which directly endangers the further existence and growth of the company. Although the state of crisis in the company can be affected by various interrelated external and internal causes, which as to intensity and appearance vary by company, the essence of the causes surely lies in the management of the company. During the period of transition all types of explained management mistakes could be found in Slovene corporate systems. Despite the fact that the hypothesis of an existing pattern of management mistakes which follows the changes in political and economic environment cannot be completely reliably confirmed, some outlines of such a pattern are in spite of all to be seen. If there is really a more or less valid pattern of management mistakes in corporate crises, and these mistakes appear differently with regard to changes in the political and economical environment in countries in transition, this could help decision makers to form a more grounded choice in the process of appointing new crisis or restructuring managers, every time according to their most appropriate competencies.

Key Words: crisis, internal causes, management mistakes, restructuring, transition, Slovenia
JEL Classification: M10
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The Exchange Rate Regime and International Trade
Romulus-Catalin Damaceanu

The study of the relation between the exchange rates regime and international trade is done using an inter-disciplinary vision that contains knowledge from four different disciplines: economics, history, mathematics and computer sciences. In the case of pure theory of international trade, there is made an abstraction of the fact that international trade is done using money. The theoretical analysis of international trade including the monetary factor deals with static equilibrium and linear models. We conceived a macroeconomic model of the world economy and used this model to make three simulation experiments. The conclusion of these experiments is that a broader exchange rate band has a negative impact over the volume of world trade. This conclusion is confirmed by the historical analysis.

Key Words: historical analysis, macroeconomic modelling, simulation of international trade, design of exchange rate regime experiments
JEL Classification: F47, C99
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Trust and Commitment in Professional Service Marketing Relationships
in Business-to-Business Markets

Barbara Čater

This paper examines two very important concepts in marketing relationships – trust and commitment – whereby commitment is regarded as consisting of three components: affective, calculative and normative. The context of this study is professional services in a business-to-business market, more specifically the marketing research industry in Slovenia. The results show that trust in the marketing research provider and its work is very high among interviewed clients. The clients also appear to be affectively committed to the relationship with the provider, whereas calculative and normative commitment are low. The study’s results confirm the positive influence of trust on affective commitment and the weak negative influence of trust on calculative commitment.

Key Words: trust, affective commitment, calculative commitment, normative commitment, business-to-business markets
JEL Classification: M31, M39
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Intercultural Competence in Work:
A Case Study in Eastern Finnish Enterprises

Pirkko Pitkänen

This paper presents the research results of a study that focused on intercultural interaction issues in private sector workplaces in Eastern Finland. The results show that the current challenges caused by the globalisation pressures in the realm of economics behoves work communities to review their personnel training and management practices: the work communities as a whole should be helped to deal with increasing cultural diversity. Although the number of workers with foreign backgrounds has increased in Eastern Finland, so far, there have been only a few attempts to restructure the working practices in an effort to take into account the demands of increasingly diverse working contexts. In all participating companies the mainstream people were the norm. It was common that Finnish language proficiency was seen as a necessary but not yet sufficient qualification for work. In addition, knowledge of the practices of Finnish working life, as well as training and working experience acquired in Finland were desired.

Key Words: cultural diversity, intercultural competence, private sector work, East Finland
JEL Classification: F, A
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