Global Business - Test 2

Corporate Governance

The system of procedures and processes by which corporations are managed, directed and controlled.

Sustainability

meeting humanity's needs without harming the ability of future generations to meet their needs

Relativists

Those who believe ethical truths are differ from group to group

Normativism

The belief that ethical truths are universal and consistent

Corruption

the abuse of power to achieve illegitimate or personal gain

In countries with minimal corruption

financial and accounting information is transparent

Corporate Social Responsibility

Operating a business to meet or exceed the ethical, legal, commercial, and public expectations of customers, shareholders, employees, and communities.

Ethics

A system of moral principles / rules regarding right and wrong

intellectual property

refers to ideas or works created by individuals or firms

intellectual property rights

are the legal claim through which proprietary assets are protected from unauthorized use by other parties, via trademarks, copyrights, and patents.

4 risk of international business

Cross-Cultural Risk Commercial Risk Country Currency

Culture

The learned, shared, and enduring orientation patterns in a society.

cross-cultural risk

A situation or event where a cultural miscommunication puts some human value at stake. It arises in environments characterized by unfamiliar languages and unique value systems, beliefs, and behaviors

Socialization

The process of learning the rules and behavioral patterns appropriate to one's society

What can culture be described like

An iceberg

individualism

each person emphasizes his or her own self-interest

collectivism

ties among individuals are important

Stereotypes

generalizations that may or may not be factual, often overlooking real, deeper differences

Low context cultures

rely on explicit explanations, with emphasis on spoken words. Direct Communication

High Context Cultures

emphasize nonverbal or indirect language. Communication aims to promote smooth, harmonious relationships

How many dimensions are in Hofstede’s Typology

6

Values

represent a person’s judgments about what is good or bad, acceptable or unacceptable, important or unimportant, and normal or abnormal

Attitudes

and preferences are developed based on values, and are similar to opinions, except that attitudes are often unconsciously held and may not have a rational basis.

monochronic

focused on time schedules punctuality

Polychronic

A flexible, non-linear orientation to time in which the individual takes a long-term perspective; time is elastic, long delays are tolerated before taking action.

Religion

A system of common beliefs or attitudes regarding a being or system of thought that people consider sacred, divine, or the highest truth; and the associated moral values, traditions, and rituals

Ethnocentric Orientation

Using our own culture as the standard for judging other cultures

Polycentric Orientation

A mindset in which the manager develops a greater affinity for the country in which he or she works for than the home country

Geocentric Orientation

A global mindset in which the manager is able to understand a business or market without regard to national boundaries

socialization

The process of learning the rules and behavioral patterns appropriate to one's society

acculturation

The process of adjusting and adapting to a culture other than one's own; commonly experienced by expatriate workers

Power Distance

describes how a society deals  with inequalities in power that exist among people

Uncertainty Avoidance

refers to the extent to which  people can tolerate risk and uncertainty in their lives

Masculine Culture

cultures value competitiveness, ambition, assertiveness, and the accumulation of wealth.

Feminine Cultures

nurturing roles, interdependence among people, and caring for less fortunate people – for both men and women

Long-term orientation

emphasizes the long view in planning and living, focusing on years and decades.

Short Term Orientation

Want Gratification now

Attitudes

and preferences are developed based on values, and are similar to opinions, except that attitudes are often unconsciously held and may not have a rational basis.

Self Reference Criterion

The tendency to view other cultures through the lens of one's own culture- understanding this is the first step

bribery

refers to offering giving receiving or soliciting anything of value to influence the actions of an government official or corporate manager

counterfeit

the process of reproducing assets without compensating those who originally created them is known as

Team

Group of people who collaborate on related tasks toward a common goal

Teamwork

involves shared responsibility and collaboration toward a common outcome/ cooperative effort of a group of people seeking a common end

Teamwork Process

Transition Process Action Process Interpersonal Process

5 Characteristics of effective teamwork

Shared Values Mutual Trust Inspiring Vision Skills Rewards

Conflict Resolution

Working to resolve different opinions in an team environment

Conflict

Friction, disagreement or discord arising between individuals or groups

Cross Function Teams

combine people with different areas of expertise from separate departments such as finance, human resources, and marketing. / Group of people from different dep in an org working towards a common goal

Diverse

Consisting of many different elements variously

efficiency

The extent to which a resource such as electricity is used for the intended purpose the ratio of useful work energy expended

6 types of virtual teams

networked teams parallel teams project development teams functional teams service teams offshore information-systems development teams.

Groupthink

uncomfortable with challenging others in a group

leading

predicts the future

Lagging

Asses the current state of business

Key Performance Indicators (KPI)

Values that measure your organizational success at meeting its objectives

KPI's provide insight into

Predictability, Early return on investment, Product quantity and etc

Wisdom

Knowledge applied

Information

Data that has been cleaned

False

Data only applies to quantitative data

True

Data is best described as raw material

Dashboard

A good data visualization tool

Diversity

What can create many challenges

International Business

Performance of trade and investment activities by firms across national borders

Development of IB

Existed for some centuries

International Investment

Transfer of assets to another country or the acquisition of assets in that country

Cross Border Purchase of Stocks

Not example of an FDI

GDP

Total value of products and services

Cost of Production

Not an example of cross cultural factors

Currency Risk

Fluctuating exchange rates

Focal Firms

Business that starts business transitions

Last decisions

Deciding how to best attack competitors

Visionary Leaders open a firm in India. What should they do 1st

Acquire managers with international mindset showing an openness

firms that emphasize global integration

Products that require minimal adaptation

Firm compelled to seek global integration should

Capitalize on converging customer trends and universal needs

Decentralized Approach

Substantial control over country operations

Product Structure

Management of international operations is organized by major product line

The disadvantage of Geographic Areas structures

Potential lack of global orientations for developing and managing products

Gradual Elimination

the firm starts with numerous prospective target countries and narrows the choices by examining increasingly specific information.

Market Potential Indications Index

Urban Population and electricity consumption

company planning to internationalize should

develop a 3 to 5 year forecast of industry sales

Company sales potential

estimate of the shares of annual industry sales the firm expects to generate in a particular target market

test marketing

Gauge long term sales potential w/o fully committing

global market opportunity

A favorable combination of circumstances, locations, or timing that offer prospects for exporting, investing, sourcing, or partnering in foreign markets