Management Week 4 Notes
Management Week 4 Notes
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This 4 page Class Notes was uploaded by Danielle Grek on Friday February 6, 2015. The Class Notes belongs to a course at a university taught by a professor in Fall. Since its upload, it has received 62 views.
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Date Created: 02/06/15
Management 300 Week 4 Notes We are living in a world being changed by globalization the trend of the world economy toward becoming a more interdependent system What began to yield to the electronic exchange of information Transportation Global Village the quotshrinkingquot of time and space as air travel and the electronic media have made it easier for the people around the globe to communicate The Web led to ecommerce electronic commerce which is the buying and selling of products and services through computer networks The global economy the increasing tendency of the economies of the world to interact with each other as one market instead of separate national markets Global economic interdependency can be dangerous because manyjobs are outsourced leaving people in the US jobless There have been a rush of mergers in the last 20 years Minifirms operating worldwide makes 2 things possible 1 Small companies can be stared easier 2 Small companies can maneuver faster Foreign job experience demonstrates resourcefulness independence adaptability inquisitiveness and entrepreneurship Multinational Corporation a business firm with operations in several countries Multinational Organization a nonprofit organization with operations in several countries Three primary attitudes of international managers ethnocentric polycentric and geocentric Ethnocentric managers believe that their native country culture language and behavior are better than all the others parochialism the narrow view where people see things only from their own perspective Polycentric managers they think that native managers in the foreign offices best understand native personnel and practices so the home office should not bother them Geocentric managers they accept their differences and similarities between home and foreign personnel and practices and they use whatever techniques that work the best Reasons why companies expand internationally 1 New Markets 2 Availability of Supplies 3 Access to Finance Capital 4 Lower Labor Costs Maguiladoras manufacturing plants that are allowed to operate in Mexico with special privileges because they employed Mexican citizens 5 Avoidance of Tariffs and Import Quotas How Companies Expand Internationally 1 Global Outsourcing using suppliers outside the Unites States to provide labor goods and services Outsourcing using suppliers outside the company to provide goods and services 2 Joint Ventures a strategic alliance with a foreign company to share the rewards and risks of starting a new enterprise in a different country 3 Importing Exporting and Countertrading Countertrading bartering goods for goods 4 Wholly Owned Subsidiaries a foreign subsidiary that is totally owned by an organization Greenfield venture a foreign subsidiary that the owning organization built from scratch 5 Licensing and Franchising icensing when a company allows a foreign company to pay a fee to make or distribute the first company s service or product ranchising a form of licensing when a company allows a foreign company to pay it a fee and a share of profit for using the first company s brand name and package of services and materials Free trade the movement of goods and services among nations without political or economic obstruction Trade protectionism the use of government regulations to limit the import of goods and services This is exercised by the use of 1 Import Quotas a trade barrier in the form of a limit on the numbers of a product that can be imported 2 Embargoes a complete ban on the import or export of certain goods or services 3 Tariffs a trade barrier in the form of a customs duty or tax levied on imports Organizations that support international trade 1 The World Bank 2 The World Trade Organization WTO 3 The International Monetary Fund IMF Trading Bloc economic community a group of nations within a geographic region that have agreed to remove trade barriers with one another Most favored nation trading status that describes a condition in which a country grants other countries favorable trading treatment like reduction of import duties Lowcontext culture where shared meanings are primarily derived from spoken and written words Highcontext culture where people rely on situational cues for meaning when communicating with each other GLOBE proiect a huge crosscultural investigation of nine cultural dimensions involved in leadership and organizational processes They have 9 cultural dimensions 1 Uncertainty avoidance 2 Power distance 3 ngroup collectivism 4 Institutional collectivism 5 Assertiveness 6 Gender egalitarianism 7 Performance orientation 8 Humane orientation 9 Future orientation You can have a strategic competitive advantage by knowing the cultural tendencies of foreign business partners and competitors 5 basic culture areas language communication interpersonal space religion and time orientation Monochronic time a preference for doing things on time Polychronic time a preference for doing more than one thing at a time xpatriates people living or working in a foreign country Cultural adaptability flexibility patience and tolerance for other beliefs BRC Countries Brazil Russia India and China They are the fastest growinglargest emerging market economies A A trading bloc consisting of 11 countries in Asia Exchange rate the current rate that a company can trade their money for another countries Quotas are used to prevent dumping A type of tariff that is used to raise money for the government is a revenue tariff A type of tariff that is used to raise the price of lower cost imported goods in order to make domestic goods more competitive is called a protective tariff Negative effects of globalization on the United States Service and manufacturing jobs are moved offshore outsourcing jobs to cheaper labor overseas global investment in mortgages contributed to the subprime mortgage meltdown and recession APEC a group of 21 Pacific Rim countries whose purpose is to improve economic and political ties Advantages that result from having foreign work experience an advantage over peers a higher salary and more marketability The World Trade Organization is designed to monitor and enforce trade agreements mportant developments that have contributed to globalization The rise of both megafirms and Internetenabled minifirms worldwide the unification of the world market and the rise of quotglobal village and electronic commerce CAFTA involves the US Costa Rica the Dominican Republic El Salvador Guatamala Honduras and Nicaragua It is aimed at reducing tariffs and other barriers to free trade The European Union 27 trading partners in Europe Power Distance the degree to which a society s members accept unequal power among people institutions and organizations How the Internet and World Wide Web give small business the ability to go global It s easier to get started because products can be sold online and the business can adjust to changes in the business environment quicker
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