Final answer:
Increased competition is the primary reason behind Melissa Freitag's statement about operating globally. Globalization and technological advances have leveled the playing field, allowing businesses from different economic regions to compete more directly.
Step-by-step explanation:
The primary reason for Melissa Freitag, CEO of SBD Systems, to encourage her executive management team to operate globally is due to increased competition.
In the context of the modern business environment, globalization and advances in communications and information technology have heightened competition by allowing firms from various regions and countries, with different cost structures, to compete in the global marketplace.
For instance, businesses in high-income countries are feeling the pressure from companies in medium-income countries that can offer competitive products or services at lower costs due to cheaper labor and production expenses.
Whether from the perspective of firms in high-income nations like the United States, Japan, or those within the European Union, or those in medium and low-income countries, the global competitive landscape is changing.
Companies must be prepared to innovate, expand, and adapt to capture market share and ensure survival in this competitive global environment.