International Business Final

Front 1

Small-and medium-sized enterprises (SMEs)

Back 1

firms with fewer than 500 employees in the U.S and with fewer than 250 employees in the European Union

Front 2

Entrepreneurship

Back 2

The identification and exploration of previously unexplored opportunities

Front 3

Entrepreneurs

Back 3

Founders and owners of new businesses or managers of existing firms who identify and exploit her opportunities

Front 4

International Entrepreneurship

Back 4

a combo of innovative, proactive and risk-seeking behaviour that crosses national borders and is intended to create wealth in organizations

Front 5

Microfinance

Back 5

Lending small sums ($50-$300) used to start small businesses with the intention of ultimately lifting the entrepreneurs out of poverty

Front 6

Born global firm

Back 6

A start-up company that attempts to do business abroad from inception

Front 7

Direct exports

Back 7

the sale of products made by firms in their home country to customers in other countries

Front 8

Sporadic (passive) exporting

Back 8

the sale of products prompted by unsolicited inquires from abroad

Front 9

Letter of Credit (LTC)

Back 9

a financial contract that states that the importer's bank will pay a specific sum of money to the exporter upon delivery of the merchandise

Front 10

Licensing

Back 10

Firm A's agreement to give Firm B the rights to use A's proprietary technology (such as a patent) or trade mark (corporate logo) for a royalty fee paid to A by B. ** typically done in manufacturing industries

Front 11

Franchising

Back 11

Firm A's agreement to give Firm B the rights to use A's proprietary assets for a royalty fee paid to A by B *** typically done in service industries

Front 12

Stage Model

Back 12

Model of internationalization that involves a slow step-by-step process a firm must go through to internationalize its business

Front 13

Indirect exports

Back 13

a way for SMEs to reach overseas customers by exporting through domestic-based export intermediaries

Front 14

Export intermediary

Back 14

a firm that acts as a middleman by linking domestic sellers and foreign buyers that otherwise would not have been connected

Front 15

liability of foreignness

Back 15

the inherent disadvantage that foreign firms experience in host countries because of their non-native status

Front 16

location- specific advantages

Back 16

the benefits a firm reaps from the features specific to a place

Front 17

Cultural distance

Back 17

the difference between two cultures along identifiable dimensions such as individualism

Front 18

Institutional distance

Back 18

the extent of similarity or dissimilarity between the regulatory, normative, and cognitive institutions of two countries

Front 19

First-mover advantages

Back 19

benefits that accrue to firms that enter the market first and that later entrants do not enjoy

Front 20

Late-mover advantages

Back 20

benefits that accrue to firms that enter the market later and that early entrants do not enjoy

Front 21

Scale of entry

Back 21

The amount of resources committed to entering a foreign market

Front 22

Modes of entry

Back 22

Method used to enter a foreign market

Front 23

Non-equity mode

Back 23

A mode of entering foreign markets through exports and/or contractual agreements that tends to reflect relatively smaller commitments to overseas markets

Front 24

Equity mode

Back 24

a mode of entering foreign markets through joint ventures and/or wholly owned subsidiaries that indicates a relatively larger, harder-to-reverse commitment

Front 25

Dumping

Back 25

exporting products at prices that are below what it costs to manufacture them, with the intent to raise prices after eliminating local rivals

Front 26

Turnkey project

Back 26

a project in which clients pay contractors to design and construct new facilities and train personnel

Front 27

Build-operate-transfer agreement (BOT)

Back 27

a non-equity mode of entry used to build a longer-term presence by building and then operating a facility for a period of time before transferring operations to a domestic agency or firm

Front 28

Research and development contract (R&D)

Back 28

outsourcing agreements in R&D between firms

Front 29

Co-marketing

Back 29

efforts amongst a number of firms to jointly market their products and services

Front 30

Joint Venture

Back 30

a new corporate entity created and jointly owner by two or more parent companies

Front 31

Wholly owner subsidiary (WOS)

Back 31

a sub. located in a foreign country that is entirely owned by the parent multinational

Front 32

Green-field operations

Back 32

Building factories and offices from scratch (agricultural)

Front 33

Strategic alliacnes

Back 33

voluntary agreements of cooperation between firms

Front 34

contractual alliance

Back 34

an association between firms that is based on a contract and does not involve the sharing of ownership

Front 35

equity-based alliance

Back 35

an association between firms that is based on shared ownership or financial interest

Front 36

strategic investment

Back 36

a business strategy in which one firm invests in another

Front 37

cross-shareholding

Back 37

a business strategy in which each partner in an alliances holds stock in the other firm

Front 38

acquisition

Back 38

the transfer of control of operations and management from one firm to another, the former becoming a unit of the latter

Front 39

merger

Back 39

the combo of operations and management of two firms establish a new legal entity

Front 40

real option

Back 40

an investment in real operations as opposed to financial capital

Front 41

relationship capability

Back 41

the ability to successfully manage inter firm relationships

Front 42

learning race

Back 42

a situation in which alliance partners aim to learn the other firm's "tricks" as fast as possible

Front 43

acquisition premium

Back 43

the difference between the acquisition price and the market value of target firms

Front 44

strategic fit

Back 44

the effective matching of complementary strategic capabilities between two or more firms

Front 45

organizational fit

Back 45

the similarity in cultures, systems, and structures between two or more firms

Front 46

initiator

Back 46

the party who begins the process of ending the alliance relationship

Front 47

hubris

Back 47

exaggerated pride or overconfidence

Front 48

managerial motives

Back 48

a manager's desire for power, prestige, and money, which may lead to decisions that do not benefit the firm overall in the long run

Front 49

integration-reponsiveness framework

Back 49

an MNE management framework for simultaneously dealing with the pressures for both global integration and local responsiveness

Front 50

local responsiveness

Back 50

the need to be responsive to different customer preferences around the world

Front 51

home replication strategy

Back 51

a strategy that emphasizes duplicating home country-based competencies in foreign countries

Front 52

localization strategy

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a strategy that focuses on a umber of foreign countries/regions, each of which is regard as a stand-alone local (domestic) market worthy of significant attention and adaption

Front 53

global standardization strategy

Back 53

a strategy that relies on the development and distribution of standardized products worldwide to reap the maximum benefits from low-cost advantages

Front 54

centre of excellence

Back 54

an MNE sub. explicitly recognized as a source of important capabilities that can be leveraged by and / or disseminated to other subs.

Front 55

worldwide mandate

Back 55

a charter to be responsible for one MNE function throughout the world

Front 56

transnational strategy

Back 56

a strategy that endeavours to be simultaneously cost efficient, locally responsive, and learning driven around the world

Front 57

international division

Back 57

an organizational structure that is typically set up when a firm initially expands abroad, often engaging in a home replication strategy

Front 58

geographic area structure

Back 58

an organizational structure that organizes the MNE according to different countries and regions

Front 59

Country (regional) manager

Back 59

the business leader of a specific country (or geographic region)

Front 60

global product division structure

Back 60

an organizational structure that assigns global responsibilities to each product division

Front 61

global matrix

Back 61

an organizational structure often used to alleviate the disadvantages associated with both geographic area and global product division structures, particularly when adopting a transnational strategy

Front 62

subsidiary initiative

Back 62

the proactive and deliberate pursuit of new opportunities by a subsidiary to expand its scope of responsibility

Front 63

organizational culture

Back 63

the collective programming of the mind that distinguishes members of one organization from another

Front 64

knowledge management

Back 64

the structures, processes, and systems that actively develop, leverage, and transfer knowledge

Front 65

explicit knowledge

Back 65

knowledge that is codifiable (can be written down and transferred with little loss of richness)

Front 66

tacit knowledge

Back 66

knowledge that is non-codifiable, whose acquisitions and transfer require hands-on practice

Front 67

Human Resource Management (HR)

Back 67

activities that attract, select and manage employees

Front 68

staffing

Back 68

HR activities associated with hiring employees and filling positions

Front 69

host-country national (HCN)

Back 69

an individual from the host country who works for an MNE

Front 70

parent-country national (PCN)

Back 70

an employee who comes from the parent (home) country of the MNE wand works at its local sub.

Front 71

third-country national (TCN)

Back 71

an employee who comes form neither the parent country no the host country of the MNE

Front 72

ethnocentric approach

Back 72

a staffing approach that emphasizes the norms and practices of the parent company by reeling on PCN's

Front 73

polycentric approach

Back 73

a staffing approach that emphasizes the norms and practices of the host country by relying on the HCNs

Front 74

geocentric approach

Back 74

a staffing approach that focuses on finding the most suitable managers, who can be PCN's, HCN's, or TCN's

Front 75

expatriation

Back 75

leaving one's home country to work in another country

Front 76

training

Back 76

specific preparation to do a particular job

Front 77

development

Back 77

longer-term, broader preparation to improve managerial skills for a better career

Front 78

repatriate

Back 78

a manager who returns to his or her home country to stay after working abroad for a length of time

Front 79

repatriation

Back 79

returning to an expatriate's home country after an extended period overseas

Front 80

psychological contract

Back 80

an informal understanding of expected delivery of benefits in the future for current services

Front 81

inpatriation

Back 81

relocating employees of a foreign sub. to the MNE's headquarters for the purposes of filling skill shortages at headquarters and developing a global mindset for such inpatriates

Front 82

compensation

Back 82

salary and benefits

Front 83

performance appraisal

Back 83

the evaluation of employee performance for the purposes of promotion, retention, or ending employment

Front 84

going rate approach

Back 84

a compensation approach that pays expatriates the prevailing (going) rate for comparable positions in a host country

Front 85

balance sheet approach

Back 85

a compensation approach that balances the cost-of-living differences based on parent-country levels and adds a financial inducement to make the package attractive

Front 86

labor relations

Back 86

a firm's relations with organized labor (unions) in both home and host countries