Global Financial Management Essay Example | Topics and Well Written Essays - 500 words

Global Financial Management - Essay Example nations have different practices and foreign policies, Ghosn encouraged the building of new production plants across different countries to cut on the costs. Foreign currencies often caused price fluctuations for Nissan Company; production of its equipment and motor vehicles in yen made it vulnerable to fluctuation problem. This is because not all of its foreign customers made their purchases at the same exchange value. Carlos studied the problem and established that the starting of new assembling plants in the foreign countries would save the company from unnecessary costs (Heidrich, 2007). Further, he set a program that would weigh the commodity costs over to the foreign currencies such that Nissan would not entirely bid. It defined its investment into short-term and long-term ones, thus, coming up with definite objectives activities of core interest. To reduce the entire production cost of its vehicles, CEO encouraged to source spares from suppliers; this reduced the costs of employees and further shifted the risks to the suppliers accordingly. However, the practice did not affect much on the commodity cost reduction. Therefore, Nissan set an approach to technological advancements; eventually, this would help to minimize usage of expensive raw materials. The exercise has proved to bring useful increment in profits over the past financial periods. Nissan directly employs a cost shifting policy whereby all costs are periodically set such that whenever there are no changes in the selling price, there are no changes in the purchasing price. The concept that risks exposed Nissan to conflicts of exchange elevates the meaning that it employs measures to maintain interests and put lesser concerns on profitability. Nissan Company merges relatively comfortably with the entire business community. The effective, harmonious environment it poses to its employees facilitates it; company affiliates, for example, Mercedes Benz and Renault, set it above par (Heidrich, 2007).