How Managers Cope with Terrorism

by John Ryans, William Shanklin



Terrorism has caused many firms to adopt separate strategies for particular countries or to alter their fundamental approach to international business. Acts ranging from murder and kidnapping to property attack have forced the problem of terrorism to the forefront of multinational decision making. Multinational corporation executives offer a variety of strategies for handling terrorism. The article presents a study in which eighty two top international officials from the largest U.S. and overseas multinational corporations were questioned. The consensus was that traditional financial and direct investment considerations have typically failed to include adequately the risks of terrorism. Terrorism is much worse today than a decade ago. The multinational executives ranked it second to inflation as a barrier to doing business worldwide. They overwhelmingly supported the notion that a multinational firm's return on investment goals in high-risk countries must of necessity be considerably greater than they normally would be.

California Management Review

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Published at Berkeley Haas for more than sixty years, California Management Review seeks to share knowledge that challenges convention and shows a better way of doing business.

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