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60 Cards in this Set

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Global business
The buying and selling of goods and services by people from different countries.
Multinational corporation
A corporation that owns businesses in two or more countries.
Direct Foreign Investment
A company that builds new businesses or buys an existing business in a foreign country.
Tariff
Direct tax on imported goods.
Nontariff Barriers
Indirect ways of adjusting prices.
Name the 5 nontariff barriers.
1) Quotas
2) Voluntary export restraints
3) Government import standards
4) Government subsidies
5) Customs Valuation/Classification
What is GATT?
General Agreement on Tariffs and Trade. It made it easier and cheaper for consumers in all countries to buy foreign products.
What are some of the regional trading zones called?
1) EU
2) Nafta
3) FTAA
4) ASEAN and APEC
What do Free Trade Agreements increase and decrease?
Increase: choices, competition and purchasing power.
Decrease: food, clothing, necessities and luxuries.
Global Consistency
When a multinational compeny has offices.plants in different countries and uses the same rules, guidelines, policies, and procedures.
Local Adaptation
When a multinational company modifies its rules, guidelines, policies, and procedures to adapt to differences in foreign customers, governments, and regulatory agencies.
What is the phase model of globalization?
Exporting, cooperative contracts, strategic alliances, wholly owned affiliates and global new ventures.
What are the pros and cons of exporting?
Pros: Less dependance on home market sales; greater control.

Cons: subject to tariff and non-tariff barriers; transportation costs can increase price; may depend on foreign importers for product distribution.
Liscensing
A domestic company receives royalty payments for allowing another company to produce its product, sell a services, or use its brand name in a specified foreign market.
Franchising
A collection of networked firms in which the manufacturer or marketer of a product/service licenses the entire business to another person or organization.
What are the pros and cons of licensing?
Pros: profits without additional investments-royalty stream; licensor has investment risk; helps avoid tariff and non-tariff barriers.

Cons: control loss over product quality; licenses may eventually become competitors.
What are the pros and cons of franchising?
Pros: fast way to enter foreign markets; good strategy when domestic sales have slowed.

Cons: Franchisers may lose some control; franchising success may be culture-bound.
Strategic Alliance
An agreement in which companies combine key resources, costs, risk, technology, and people.
Joint Venture
A strategic alliance in which two existing companies collaborate to form a third, independent company.
What are the pros and cons of joint ventures?
Pros: help avoid tariff and non-tariff barriers to entry; share costs/risks of new venture; advantageous to smaller local partners.

Cons: must share profits; 'merging' multiple cultures; power, leadership stuggles.
What are 2 common factors of global new ventures?
1) Common Vision
2) Simultaneous Entry
Name the 3 factors to consider when finding a business climate?
1) Growing markets
2) Location
3) Political risk
Growing markets consist of what 2 factors?
Purchasing power and the degree of global competition
Name 2 qualitative factors to consider when choosing a business location.
Work force quality and company strategy.
Name 4 quantitative factors to consider when choosing a business location.
1) Facilities
2) tariff and non-tariff barriers
3) Currency/exchange rates
4) Transportation/labor costs
Name 3 factors of political risk.
1) Political uncertainty
2) Policy uncertainty
3) Strategies (avoidance, control and cooperation)
National Culture
the set of shared values and beliefs that affects the perceptions, decisions, and behavior of the people from a particular country.
Name Hofstede's 5 cultural difference.
1) Power distance
2) Individualism
3) Masculinity and femininity
4) Uncertainty avoidance
5) Short-term/long-term orientation
Expatriate
Someone who lives and works outside his or her native country.
What are the two things you need to consider while preparing for an international assignment?
1) Language and Cross-cultural training.
2) Consideration of spouse, family, and dual-career issues.
What are some reasons expatriate managers often fail?
-perceive career blockage.
-culture shock
-lack of cross-cultural training
-overemphasis on technical qualifications
-family problems
What is one of the more difficult tasks of being an expatriate?
Manageing change
Managing in a globall environment has as much to do with ______ as with leadership of technical skill.
interpersonal/cosmopolitan knowledge
What are four additional types of distance?
1) cultural distance
2) administrative distance
3) Geographic distance
4) Economic Distance
The very first step to the change process is to _____.
create a sense of urgency
Often the difference between successful vs. unsuccessful change is ______.
not knowing what to do, bu being able to effectively do it.
What is the technology cycle?
A cycle that begins with the "birth" of a new technology and ends when that technology reaches its limits and is replaced by a newer, better technology.
Organizational innovation
successful implementation of creative ideas in an organization.
Creativity
The production of novel and useful ideas
Organizational change
Creating a difference in the form, quality, or condition of an organization over time.
Innovation streams
Patterns of innovation over time that can create sustainable competitive advantage.
Technological discontinuity
A scientific advance or unique combination of existing technologies that creates a significant breakthrough in performance or function.
Technological substitution
When customers purchase new technologies to replace older technologies.
Era of ferment
When firms compete over various designs for a given innovation; this is called design competition.
Dominant design
Accepted standard, the 'winner' of the design competition.
Incremental change
When firms focus on operational/production innovations over new paradigms (minor innovation)
What are 3 things to manage when creating innovation?
1) Sources of innovation
2) During discontinuous change
3) During incremental change
Creative work environments
Workplace cultures in which workers perceive that new ideas are encouraged.
Flow
The psychological state of effortlessness in which you become absorbed in your work and time seems to pass quickly.
Name three ways to keep innovation alive.
1) Look outside the organization
2) Involve your supply chain
3) Cross functional teams
What are the steps to the experiential approach in discontinuous innovation?
1) Design iterations
2) Testing
3) Milestones
4) Multi-functional teams
5) Powerful leaders
What are the steps in the compression approach to incremental innovation?
1) Planning
2) supplier involvement
3) shortening time of individual steps
4) overlapping steps
5) multi-functional teams
Generational change
Incremental improvements made to a dominant design.
What are the 3 steps Lewin says will manage resistance to change?
1) Unfreezing
2) Change intervention
3) Refreezing
According to Kotter, what are some errors made when elading change?
1) Not establishing a sense of urgency
2) Lacking a vision.
3) Declaring a victory too soon.
What are Kotter's 9 steps for leading change?
1) Create a sense of urgency
2) Decide what to change
3) Create a guiding coalition and mobilize commitment
4) Shared vision
5) Empower others to make change
6) Short-term wins
7) Consolidate gains
8) Anchor the change
9) Monitor progress and adjust the vision
Name 4 tools for change.
1) Results-driven change
2) GE Workout
3) Transitional Management teams
4) Organizational Development
What is a transitional management team?
A team of employees whose full-time job is to manage and coordinate change.
Steps of Organizational development interventions
Intervene, fix, then leave
What are the 3 kinds of OD interventions?
1) Large system interventions
2) Small group interventions
3) Person-focused interventions