Gms200 Chapter 2

Front 1

challenges of globalization:

Back 1

Global economy

International management (trading in 1/2 countries)

Global manger (trading with multiple countries)

Front 2

Global economy:

Back 2

Resource supplies, products, and business competition is worldwide rather than local

Front 3

Globalization:

Back 3

The process of growing inter-dependance of components in a global economy

Front 4

why do businesses go global?

Back 4

profit

customers

suppliers

capital

labour

Front 5

Global sourcing:

Back 5

buying materials/resources/services around the world for local use

Front 6

Global management:

Back 6

managing operations in more that one country

Front 7

Exporting vs Importing

Back 7

Exporting:local products sold abroad to foreign customers

Importing:selling in domestic markets of products required abroad

Front 8

Licensing vs Francising

Back 8

Local firm pays fee to a foreign firm for rights to make/sell its product

New Balance paid China to produce shoes

Front 9

Licensing vs Francising cont.

Back 9

fee is paid to a foreign business for rights to locally operate using its name/branding/methods (McDonalds, Wendys, Subway)

Front 10

Foreign Direct investment:

Back 10

building/buying all or parts of a business in a foreign country

Front 11

Insourcing:

Back 11

having people with the company do jobs that would normally be outsourced

Front 12

Types of DI

Back 12

Direct Investment:

Joint Ventures - operate in a foreign country through co-ownership by foreign/local partners

Front 13

International Joint ventures are called:

Back 13

Global Strategic Alliance

Front 14

Global Strategic Alliance:

Back 14

foreign and domestice firms share resources and knowledge for mutual gains

Front 15

Foreign Subsidiary:

Back 15

local operation owned by foreign firm

Front 16

Greenfield Investment:

Back 16

building an entirely new operation in a foreign country

Front 17

Political Risk:

Back 17

The potential loss in value of foreign investement due to instability & changes in host country

(terrorism, civil wars, armed conflicts)

Front 18

political risk analysis:

Back 18

Trying to forecast political disruptions that can threaten the value of foreign investment

Front 19

Intellectual Property Protection

Back 19

having patents/copywrite to protect your property (movies/music/games)

Front 20

World Trade Organization:

Back 20

resolves trade & tariff disputes among countries

Front 21

Protectionism:

Back 21

a call for tariffs and favorable treatment to protect domestic(local) firms from foreign competition

This can complicate global trading relationships

Front 22

NAFTA

Back 22

North American Free Trade Agreement - Canada, United States, Mexico

Provides minimal barriers for trading

Front 23

EU

Back 23

European Union - political and economic alliance of european countries

(euro = common european currency)

Front 24

SADC

Back 24

Southern Africa Development Community

Front 25

Local Legal Systems:

Back 25

complex and unfamiliar laws can create problems

Front 26

Global Corporations (Multinational Corporations)

Back 26

MNCs

Business with extensive operations in more than one foreign country

Front 27

Transnational Corporation:

Back 27

an MNC that operates worldwide on a borderless basis

Front 28

Issues for MNC

Back 28

Host country local businesses are damaged

ethical issues like sweatshops/corruption/child labour

Front 29

Corruption:

Back 29

illegal practices to further one's business interests

Front 30

Child Labour:

Back 30

full-time employement of children for work usually done by adults

Front 31

Sweatshops:

Back 31

Low wage jobs for long hours in poor working conditions (china, sri lanka, philippines)

Front 32

Sustainable Development:

Back 32

meets that needs of the present without hurting future generations

Front 33

Culture:

Back 33

shared set of beliefs and values/behaviour common to a group of people

Front 34

Culture shock:

Back 34

confusion/discomfort of being in an unfamiliar culture

Front 35

ethnocentrism:

Back 35

the tendency to consider one's culture superior to others

Front 36

Cultural Intelligence:

Back 36

ability to accept and adapt to new cultures

Front 37

Stages in adjusting to new culture:

Back 37

confusion

small victories

the honeymoon

anger

reality

Front 38

Low-context cultures:

Back 38

emphasize communication via spoken/written words (west)

Front 39

High-context cultures:

Back 39

rely on non-verbal and situational cues as well as spoken/written words in communication

Front 40

monochronic time:

Back 40

people tend to do one thing at a time

Front 41

polychronic time:

Back 41

time used to accomplish many different things at once

Front 42

proxemics:

Back 42

how people use space to communicate

Front 43

Geert Hofstede warns us about:

Back 43

ecological fallacy

-assuming a generalized cultural value applies equally well to all members of the culture (like individualism in american applies to all americans)

Front 44

Power Distance:

Back 44

the degree to which a society accepts unequal distribution of power

Front 45

Individualism/Collectivism:

Back 45

the degree to which a society emphasizes individuals and their self-interests

Front 46

Uncertainty avoidance:

Back 46

The degree to which a society tolerates risk and uncertainty

Front 47

Masculinity/Femininity:

Back 47

the degree to which a society values assertiveness and materialism

Front 48

Time orientation:

Back 48

the degree to which a society emphasizes short-term/long-term goals

Front 49

Comparitive Management:

Back 49

Studies how management practices differ among countries and cultures

Front 50

Are management theories universal?

Back 50

No (explain using Hofstede's framework)

Front 51

ethnocentric attitudes:

Back 51

best approaches are found close to home and control foreign operations

Front 52

polycentric attitudes:

Back 52

respect local knowledge and allow foreign ops to run with freedom

Front 53

What are global businesses and what do they do?

Back 53

MNC's, transnational company, ethics

Front 54

what is culture and how does it impact global management?

Back 54

Define culture

hofstede