MCQs - MCQ International Management Exam Paper PDF

lOMoARcPSD|33425069 MCQs - MCQ International Management (University of Limerick) Studocu is not sponsored or endorsed by any college or university Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 MG4035 MCQs: 1. Comparative Management is dedicated to exploring the landscape, c...

lOMoARcPSD|33425069 MCQs - MCQ International Management (University of Limerick) Studocu is not sponsored or endorsed by any college or university Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 MG4035 MCQs: 1. Comparative Management is dedicated to exploring the landscape, contours, and national patterns of development 2. Cross-Cultural Management gives analytical significance to national culture as the key variable when examining acceptable management practice 3. Globalisation (Friedman) described the world as one single globalised marketplace driven by the spread of free market capitalisation 4. Hyper globalisation the convergence towards a global system 5. Intra-Firm MNC that trades between themselves and its subsidiaries 6. MNC Capabilities organisation, technological, managerial, and international 7. BRIC Brazil, Russia, India and China 8. Authoritarianism rule by one or more individuals who have absolute power and no substantive accountability for citizens 9. Dynamic Capability Theory MNCS cannot rely on existing resources but must develop dynamic capabilities to create, deploy and upgrade resources in pursuit of maintaining competitive advantage 10. Democracy system based on accountability of the voting public through regular, free, and fair elections 11. 2 key elements of Managing the Political Environment political constraints and political risks 12. Politically Astute having superior political intelligence and influence skills 13. Two-Party System two broadly based parties that dominate, alternating between government and opposition Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 14. Multi-Party System many parties represent a wide spectrum of views and coalition is likely 15. Ownership Risk government could change structure; firms could be forced to reduce stake by sharing ownership with local firm 16. Operational Risk changes to rules or tax system 17. Transfer Risk impediments to the transfer of FOPs 18. Common Law independent judiciary relying on precedent 19. Civil Law relies on legal code 20. Theocratic Law based on religious code 21. First to File System right to patent 22. Culture the collective programming of the human mind- shared and learned 23. Morrisons Facets of Culture outward expressions, values and belief, communication, norms 24. Ethnic Groupings people drawn together by a sense of common identity, belonging, religion or common descent 25. High Context Cultures information is conveyed non-verbally, primary use of communication is to develop relationships 26. Low Context Culture information is conveyed by explicit expression of words, primary use of communication is the exchange of information, facts, and opinions 27. Hofstede's Cultural Dimensions power distance, indulgence vs restraint, long term orientation, masculinity vs femininity, uncertainty avoidance, individuality 28. Trompenaars’s Relational Dimensions universalism vs particularism, individualism vs collectivism, neutral vs emotional, specific vs diffuse, achievement vs ascription Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 29. Culture Distance the degree to which a firm is unfamiliar with the culture of a foreign business location 30. Ethnocentrism perspective of individuals and organisations that are completely involved in their own culture to the extent that they exclude other cultures 31. Polycentrism perspective of individuals and organisations that recognize that their own culture is one of many and strive to understand differing cultures 32. Hetero stereotypes how we are seen by others 33. Auto-stereotypes how we see ourselves 34. Fatalistic Disposition the belief that life is predetermined, and change is difficult to achieve 35. Convergence Hypothesis technology and economics are making countries more alike 36. Divergence Hypothesis assumes countries will maintain their distinctive characteristics 37. Cross-Variance mix between western-imported ideas and nationalistic, domestic styles 38. Reactive Internationalisation Motives competitive pressures, overproduction, declining domestic sales, excess capacity, saturated domestic market 39. Proactive Internationalisation Motives profit advantage, unique product, technological advancement, tax benefits, economies of scale 40. PEST political, economic, social, technological 41. Trade Related Entry Modes indirect exporting, direct exporting, counter trade 42. Counter Trade seller and buyer from different countries exchange goods with little cash changing hands - barter Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 43. Buying House similar to confirming house but more active in seeking out sellers to match buyers’ particular needs 44. Confirming House act for foreign buyers and is paid on a commission basis 45. Export House buys products from domestic firms and sells them abroad on own account 46. Transfer Related Entry Modes international licensing and franchising 47. International Licensing rights to production of goods are contracted out to another firm 48. International Franchising the transfer of a business concept, with corresponding operational guidelines, to non-domestic parties for a fee. 49. Wholly Owned Subsidiary 100% ownership of a facility in a new country 50. Global Strategic Alliance cross border partnerships between two or more firms from different countries with an attempt to pursue mutual interests 51. Joint Ventures commercial enterprise undertaken jointly by 2 or more parties who otherwise retain their separate identities 52. Equity JVs legally and economically separate entities created by 2 or more parent firms 53. Co-Operative JVs contractual agreements whereby profits, and responsibilities are assigned to each party according to contract without the creation of a new entity 54. Development Assignment employees are sent to understand global operations and are required to have intercultural knowledge 55. Functional Assignment employees are sent to other countries for extended projects and return when done 56. Balance Sheet Approach when package compensation equalises the cost between home country and international employees Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 57. Multinational Enterprise organisation that has operating units is some foreign countries 58. Co-determination when union representatives are given seats on the board of directors in a business 59. Strategic Assignments employees are sent for strategic jobs having intercultural understanding 60. Tax Equalisation Plan aims to protect employees from the negative consequences of tax 61. Technical Assignments employees are sent to perform some limited tasks and then return home 62. Quantitative Easing buying government bonds 63. Strategic Global Analysis identifying firms with similar strategies or competing on a similar basis 64. Mobility Barrier prevent other firms from entering strategic group and threatening existing firms 65. Five Forces Model competitive rivalry, supplier power, buyer power, threat of substitution, threat of new entry 66. Liability of Foreignness the difficulties that arise because of different norms and rules that constrain human behaviour 67. Bear sent to act as decision makers with high authority 68. Bumble bees guarantee close connections between subsidiaries and HQ 69. Spiders establish communication networks 70. Culture Psychic Distance Paradox when expatriate underestimates culture difference and then experiences greater culture shock 71. Horizontal Merger a merger between companies in the same industry Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 72. Vertical Merger occurs when two or more firms, operating at different levels within an industry's supply chain, merge operations 73. De-internationalisation is a result of company failure or strategic decision making 74. Diversification alliance a partnership between companies in different lines of business 75. Vertical integration alliance an alliance between a supplier and buyer that agree to use and share skills and capabilities in the supply chain 76. Strategic Alliance partners should share strategic and cultural fit 77. Strategic Control control over the means and methods on which the whole conduct of an organisation depends 78. Global Strategy a single strategy for the entire global network for subsidiaries and partners 79. Multi-domestic strategy attempt to achieve maximum local responsiveness by customising product and marketing strategy to match different national conditions 80. Globalisation Index measures levels of integration, personal contact, technology, and political engagement 81. Trompenaars relational dimensions sought to Present a theory of cultural dimensions designed to guide managers in practical situations 82. Trompenaars dimensions were published in 1997 83. Internal Political RisksCorruption, Fragmented alliances, Weak elements of society, alienated groups, Risk of terrorism, Social unrest, Fragile coalition, Power centres. 84. International RisksMilitary invasion, Global imbalance, Trading partner disputes, Spill over of regional conflict, Risk of terrorism, Dispute with neighbours, insecurity of resources, insecure borders 85. "No two countries which both have McDonalds will go to war" 30-45% less likely to go to war Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 86. Legal Issues for MNCs1. Rule of Origin Laws 2. Competition 3. Marketing and Distribution 4. Product Liability Laws 5. Patents 87. Trompenaars 7 relational dimensions are 1. Universalism V Particularism: the former emphasises social codes while the latter emphasises personal relationships 2. Individualism V communitarianism 3. Neutral V emotional; objective & instrumental or emotional 4. Specific V diffuse; focus on contract V whole person 5. Achievement V ascription; judged on achievement V status and connections 6. Sequential Vs Synchronic > view time in a sequential or linear fashion / several events are juggled at the same time 7. Internal Vs Outward directions > the extent to which people believe they control the environment, or the environment controls them 88. Levitt (1983) predicted That there would be a single global market where standardized products would be sold everywhere Tastes and preferences would be homogenized Levitt failed to see persisting diversity of customers 89. Spill Over Effect Opportunities for local firms to benefit from FDI, gaining technological competence which generates new local businesses and technological capacities 90. Polycentrism the perspective of individuals and organisations which recognizes their own culture as one among many and strives to understand differing cultures 91. Fatalistic disposition the belief that life is predetermined & change is relatively difficult to achieve Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 92. Convergence hypothesis technology & economics are making countries more alike, and that with global integration of markets & diffusion of MNC practices convergence will increase 93. Divergence hypothesis assumes countries will continue to maintain their distinctive characteristics and that these may increase over time. Cross-vergence may be a likely trend. 94. Cross-vergence The concept of is used to present the understanding that when different cultures are diverged or converged longitudinally over a given period, there will also be a noticed shift in the ranking of cultural differences between these cultures as they will merge to share certain cross-cultural similarities or dissimilarities 95. International staffing policies include: 1. Ethnocentric; appoint mostly parent country national (PCNs) to top positions in subsidiaries 2. Polycentric; appoint mostly host country national (HCNs) 3. Geocentric; appoint the best person regardless of nationality including third country nationals (TCNs) 4. Regio centric; transferred on a regional basis - midway between a pure 1&2 and 3. 96. The international assignment cycle consists of Recruitment and Selection Hiring Preparation Expatriation Repatriation 97. Cultural Risk occurs when An organisation encounters a new market An event which puts some human value / activity at stake Cultural understanding and appreciation are key for a manager 98. Cultural Risk is heightened by ethnocentrism (due to superiority complex) 99. Parent country national (PCN) Nationality of employee is the same as that of the headquarters of the multinational firm e.g., a German employee working at the Chinese subsidiary of Volkswagen. Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 100. Host country national (HCN) Nationality of employee is the same as that of the local subsidiary e.g., a Chinese employee working at the Chinese subsidiary of Volkswagen. 101. Third country national (TCN) Nationality of employee is neither that of the headquarters nor the local subsidiary e.g., an Indian employee working at the Chinese subsidiary of Volkswagen 102. At the turn of the millennium, ____ of medium and large companies were using expatriates and almost half of those had planned to further increase their expatriate workforce 80% 103. International assignments last between ___ & ____ years two and five years 104. Comparative Management dedicated to exploring the landscape, contours, and national patterns of development 105. Bonache and Brewster (2001) have found that assignments which require a high level of ______________ last the longest, while those assignments for which an expatriate needs merely _______________ in a certain field show the shortest duration. general management knowledge functional expertise 106. SWAAK 1997 came up with the idea of these different types of assignments 1. Management Development Assignments; 2.Business Development Assignments; 3. Technical Assignments. 1. Management Development Assignments. aim to expose manager to foreign business practices so they can gather international experience. 2. Business Development Assignments. where managers from parent company are required to assist a start-up venture abroad. 3. Technical Assignments. in which expatriates need to share their unique technical skills and knowledge with the foreign office. Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 107. Harzing (2001) classified expats as 1. Bears: are sent to subsidiaries to act as decision-makers with a high level of authority. 2. Bumblebees; fly from plant to plant and thereby guarantee close connections between the subsidiaries and the headquarters, as well as amongst each other 3. Spiders: works on the establishment if communication networks. 108. Culture shock is caused by; The confrontation with a new environment, The failure of intercultural communication, The threat of the emotional well-being of the sojourner and The requirement or even force to adapt the personal behaviour to fit in with the new environment (Selmer 2005). 109. Minimising cultural risk by 1. Fact finding knowledge and interpretation 2. develop a keen interest in the target culture 3. avoid cultural bias 4. develop cross cultural skills 110. Cultural distance describes the extent to which the host culture is different to the home culture and was identified as one of the is most important causes of culture shock 111. Cultural Psychic Distance Paradox causes expatriates, who move to a host country with a culture like that of the home country, to underestimate the differences. 112. Repatriation model issues u-curve model could be more accurately described as a w-curve model 113. What are the four stages of the U Curve Hypothesis? Honeymoon Culture shock Adjustment Integration Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 114. What are the four stages of the W Curve Hypothesis? Honeymoon Crisis Recovery Adjustment Honeymoon (at home) Crisis (at home) Recovery (at home) Adjustment (at home) 115. Why repatriation can be a problem 1. Unrealistic expectations and reverse culture shock 2. Lack of appreciation of expatriate experience 3. Unwelcoming social networks 4. Lack of appropriate jobs and tasks 5. Spouse-or children-related problems 116. Problem of repatriation in academic studies etc. it was often ignored by practitioners as well as the vast majority pf researchers 117. Why is there a lack of appropriate jobs / tasks for expats? Employees see international assignments also as a chance to increase their personal market value for other companies however this is hardly ever the case 118. However, only ______ of companies agree that taking on foreign assignments can have a career-enhancing effect. 4% 119. Improving expat management by 1. improving selection 2. improving preparation 3. improving support 120. Conclusion for repatriation The repatriation of international managers, the preparation for their departure from their host country and the aftercare once they have returned to their home office are, in fact, the most critical issues of successful management of expatriates. Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 121. Feldman and Thomas (2001) report that .... (with regards to expats) numerous repatriates regret taking on international assignments because they felt that rather than it being the springboard for the next step up the career ladder, being abroad for several years in fact hindered them from being promoted 122. What is globalization? ' Being tied together into a single globalised marketplace and village driven by the spread of free market capitalism to virtually every country in the world ' 123. Hyper globalisation Is the convergence towards a global system 124. Globalisation Index measures a level of; Economic integration - trade, FDI etc Personal contact - international travel, tourism etc Technology - number of Internet users and hosts Political engagement - memberships of international organizations 125. Ireland is the worlds ____ most globalised country after _______________ 2nd / Netherlands 126. Impacts of Globalization 1. Economic benefits 2. Diffusion over tech 3. The environment 4. Social 127. Who benefits from globalization? Globalisation carries both promises and threats and has winners and losers at national, regional and organisation level 128. Competitive advantage of the MNC large capital, human, brand, and tech resources that it can leverage in many countries 129. Host Society Benefitsnew jobs, industrialisation, technology transfer, spill over effect 130. Host Society Adverse effectsvulnerable to location shifts, environment degradation Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 131. Home Society Benefitsgrowth in outward FDI, increased corporate profit, increased shareholder value 132. Home Society Adverse effectsincome inequality, loss of low skilled jobs 133. MNC definition "An enterprise that engages in FDI and owns or controls value adding activities in more than one country" 134. A firm engaged in trade activities with no FDI component is referred to as an International firm 135. Dynamic Capability Theory - MNCs cannot merely rely on existing resources but must develop dynamic capabilities to create, deploy and upgrade resource in pursuit of sustained CA MNCs cannot merely rely on existing resources but must develop capabilities to create, deploy and upgrade resource in pursuit of sustained CA 136. • The Wholly Owned Subsidiary 100% ownership in a new country • Investment in green field site or through purchase of existing firm • Offers increased flexibility and control • 137. Production under licence A process whereby the production of goods is subject to patent, brand or other intellectual property rights is contracted out to another firm under terms & conditions agreed with the owner 138. FDI Related Entry Modes & FDI motives 1. Market related - proximity to markets actual & potential is a powerful 'pull' factor. Car manufacturing is a good example where transport costs & delivery times are important 2. Production related - economies of scale or technological capabilities 3. Resource related - seeking proximity to resources or raw materials 4. Control of specific strategic assets - through the acquisition of brands or other assets Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 139. Country competitiveness measures & compares how effective countries are in providing firms with an environment that sustains the domestic & international competitiveness of those firms 140. Country Level Determinants Science, education, innovation Economic Soundness Finance Internationalization 141. Firm Level Determinants Tech. innovation Organizing Factor creation 142. Individual Level Determinants {people focused} Entrepreneurs Managers Engineers Educators Politicians 143. Global Strategic Alliance •'Cross border partnerships between two or more firms from different countries with an attempt to pursue mutual interests through sharing their resources & capabilities' •GSA are a popular way for MNCs to expand globally & improve Competitive Advantage •Most frequently they take the form of a joint venture (JV) between two firms and are another entry made for internationalisation 144. Equity Joint Venture (EJV) Is a legally & economically separate entity created by 2 or more parent firms that collectively invest financial & other resources 145. Greenfield Investment Occurs when a firm invests to build a new manufacturing or administrative facility as opposed to acquiring existing facilities. Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 > Is a form of FDI where the foreign company builds its operations from the ground up in its new home 146. Cooperative joint venture Contractual arrangement whereby profits & responsibilities are assigned to each party according to stipulations in a contract without creation of new entity 147. Joint Exploration special type of non-equity alliance whereby exploration costs are borne by the foreign partner, with development costs later shared by a local entity • Oil exploration in Brazil, Ecuador, and Indonesia 148. R & D Consortium Costs may be allocated according to an agreed formula but the revenue each partner earns depends on what it does with technology created 149. Co-production/ Service AgreementBoeing & Japan Aircraft Development Corp each responsible for manufacturing their part of the product, costs depend on each firm’s efficiency 150. Co-marketing Agreement Provides a platform for each party to reach more customers 151. Long term supply Manufacturing buyer gives supplier free info on products, markets, and technologies – IKEA 152. Co-management arrangement This is a loosely structured alliance in which cross national partners collaborate in training, production management and information systems development 153. Joint Venture advantages 1. allows a firm to enter activities that might be too costly & risky for one 2. allow a firm to acquire partner knowledge or resources to build competitive strength 3. allow a firm to enhance economies of scale or scope to develop synergies 4. allows a firm to prevent or reduce competition 5. allow a firm to boost local acceptance as perceived by foreign consumers 6. allow firms to bypass entry barriers into a foreign country 154. Selecting local partners 1. Goal compatibility 2. resource complementary 3. cooperative culture Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 4. commitment 5. Capabilities 155. 156. over ____ of JVs fail 70% 157. Problems and risks of Joint Ventures 1. Loss of autonomy & control often leads to conflict & alliance instability. 2. The risk of possible leakage of critical technologies may be high & often difficult to avoid 3. Differences in strategic goals decision processes which can be inflexible 4. Local partners may become global competitors into the future 158. Greater centralisation, tall hierarchies, more supervisory staff, large wage differentials and white-collar job values are commonly associated with Hofstede's _________ component High Power Distance 159. High PD index Mexico/Japan 160. Low PD Index Austria/Sweden/Norway 161. Individualism index Mexico/Greece/Taiwan 162. Collectivism index USA/UK/Australia/Canada 163. UK Masculine Index 164. LTO index China/Japan 165. STO index Africa/US 166. Feminine Index Sweden 167. High UA index Greece/Peru/France 168. Low UA index Denmark/Sweden/ UK/USA Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 169. MOTIVES FOR Mergers & Acquisitions 1. Extensions: can be used to extend the reach of a firm in terms of geography, products, and markets. 2. Consolidation: Can be used to consolidate competition in a market or competitors in an industry. 3. Capabilities: to increase inhouse capabilities 4. Financial efficiency- A poor performing company with potential may be attractive to a larger profitable company- acquisition pay out may be lower 5. Tax efficiency- sometimes there may be tax advantages for bringing two companies together- profits or tax losses may be transferrable 170. Ethnocentrism The perspective of individuals and organisation completely imbued with their own culture to the exclusion of differing cultures is best described as which of the following 171. Which of the is considered reactive as opposed to proactive motives for internationalism excess capacity 172. Reactive Motive Haven't noticed the market opportunity but noticed competitors move in 173. Which is an example of a reactive motive for internationalization 1. competitive pressures 2. Overproduction 3. Declining domestic sales 4. excess capacity 174. Proactive Motive Forward thinking, opportunistic 175. Which is an example of a proactive motive for internationalization 1. Profit advantage 2. Unique product 3. Tech. Advantage 4. Tax benefit 5. Economies of scale Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 176. Culture is an elusive concept with many varied definitions. However, there is a consensus regarding the 3 main features Shared / Intangible / Learned by others 177. The globalization index measures the levels of Economic integration Social Political 178. Which is NOT one of Hofstede’s dimension of culture universalism VS particularism 179. What are a proactive motives for internationalization? Gov. Incentives (tax) Economies of scale Tech. advances Access to talent and labour 180. According to Morrison, culture can be defined as shared, learned values and norms of behaviour, means of communication and other outward expressions of distinguishing one group from another 181. Ireland's top ten export product groups include perfumes and cosmetics organic chemicals meat 182. What is a feature of a democratic political system? Editorial & Reporting independence from the state 183. Export house, confirming house and buying house are all types of indirect exporting 184. Indirect Exporting is when Exporting function is outsourced to intermediaries who prepare the export documentation, take responsibility for the physical distribution of good and set up sales and distribution channels in the foreign market. 185. Because some firms seem to assume that English is the international language of business, this can be problematic because 1. Prospective foreign customers cannot understand English technical / legal terms 2. Prospective foreign customers are fluent in written English but do not speak it very well Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 186. Export house buys products from a domestic firm & sells them abroad on its own account 187. Confirming house acts for foreign buyers & is paid on a commission basis, brings sellers & buyers into direct contact & guarantees payment for the export 188. Buying house similar to confirming house but more active in seeking out sellers to match the buyers’ particular needs 189. Hofstede argues that national culture is more influential than organisational culture 190. Hofstede found than in some countries, like Germany that have long term orientation while others like the UK have short term. his results mean that British businesses prefer investments with a quick return 191. In which political system does one person/small group of people hold absolute power Authoritarian 192. In countries with a federal system of government like the US, firms wanting public contract.... may have to persuade decision makers at different levels of the federation to award them contracts 193. Tax rates on profits are falling, why would this be the case to retain and attract investment by multinational companies 194. When defining a strong culture, which would be the most correct Uniformity Homogeneous Shared 195. Which represent elements of national culture Location Religion Language 196. Which item describes a legal system based on precedent? Common Law 197. Which describes a legal system based on written rules Civil Law Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 198. Foreign Exchange Risk Also known as currency risk May harm the profitability of a business transaction An organisation can be protected through "hedging" 199. Industry Lifecycle introduction, growth, maturity, decline 200. Political/ country Risk Defined Exposure to potential loss or adverse effects on company operations and profitability, caused by developments and/or legal systems Operate interdependently of each other 201. What is democracy A system which at a minimum is based on accountability to the voting public through regular, fair, and free elections 202. Sources of Political System Country Risk Government Political bodies Legislative bodies Lobbying groups Trade unions 203. The political system role is To integrate the various parts of its society into a viable, functioning whole 204. Sources of Legal System Country Risk Laws, regulations, and rules aim to; Ensure order in commercial activities Protect intellectual property Tax economic outcomes 205. Civil Society the presence of freely functioning voluntary groups (including religious, political and labour) is a substantive indicator of genuine pluralism. 206. Two party system Are two broadly based parties dominate, alternating between government and opposition, reflecting electoral fortunes 207. Multi party systems Are many parties representing a wide spectrum of views and where the government is to be a coalition of parties Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 208. Types of Political Risk Ownership risk Operating risk Transfer risk 209. Ownership riskgovernment could change governance structure or at extreme expropriation. Firms could be forced to reduce their stake by sharing ownership with local firm 210. Operational Riskchange to the rules of the game - new and arbitrary change to the tax system 211. Legal Systems of the world Common law system - UK, USA. Independent judiciary relying on case precedents Civil law - Europe - relies on legal code applied universally Theocratic law - relies on religious code -Iran & Saudi Arabia 212. Transfer risk impediments to the transfer of factors of production such as capital Sources of political risk Systematic Procedural Distributive Catastrophic 213. Systematic Risk created by shifts in public policy, such as a new political leadership that may adopt a different approach than its predecessor 214. Procedural Risk Political actions can sometimes create frictions that interfere with the procedural transactions between unit 215. Distributive Risk Political actions that aim to claim a greater share of rewards 216. Catastrophic Risk random political developments that adversely affect the operations of every company in a country 217. Facets of Culture Outward Expression Values & Beliefs Norms Communication Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 218. Strategic Management is a process of setting long term direction for the organisation 219. A global strategy involves a single strategy for the entire global network of subsidiaries and partners 220. Examples of a global strategy IKEA sells standardised, Swedish designed, self-assembly furniture for a low price Walmart withdrawing from Germany to avoid changing its selling low-priced products 221. Four industry globalizing factors Market Cost Government Competitive 222. Governments can encourage globalization of industries by Creating common, international technical standards 223. Which statements on civil law systems would be seen as an advantage by business Relevant areas of law are much easier to find than common law systems 224. What is the legal basis for common law systems? Precedents and Statutes 225. Which could be seen as a breach of contract Supplying computer chips that do not match the agreed product specifications 226. Laws relating to the Single Market Programme allow EU-based companies To move G&S from any member state to another To transfer managers to any member state To invest anywhere in the EU 227. A PEST analysis is A broad framework to help managers understand the environment in which their business operates 228. The four drivers in Porter's Diamond arise from: 1. Local factor conditions; 2. Local demand conditions; 3. Local related and supporting industries; Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 4. Local firm strategy, industry structure and rivalry 229. The Diamond model assumes that The national home base of a firm plays a key role in shaping that firm's competitive advantage in global markets 230. Which is NOT a strategic alliance Merger 231. Which are examples of strategic alliance Joint Marketing Campaign Cooperative Product development Joint Venture 232. A partnership between companies in different lines of business is called Diversification Alliance 233. An alliance between a supplier and a buyer that agree to use and share skills and capabilities in the supply chain is called Vertical integration alliance 234. What is the most important criterion for selecting an alliance partner? The alliance partner must help the company towards a competitive advantage 235. An optimal business partner in a successful international strategic should have two key qualities Strategic and Cultural Fit 236. Why do alliances between a large multinational firm and an emerging economy often fail The partner objectives are very divergent 237. What is strategic control Control over the means and methods on which the whole conduct of an organisation depends 238. Internationalization stimuli refer to Internal and external factors that influence a firm’s decision to initiate, develop and sustain international business 239. First mover advantage suggests that Pioneering businesses can obtain higher profits and other benefits as the consequences of early market entry 240. Liability of Foreignness means that Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 The difficulties because of the different norms and rules that constrain human behaviour are called Key MNC obstacle 241. First mover’s advantage 1. Opportunity to build up strong market share 2. Opportunity to create barriers to entry (economies of scale) 3. Allows the firm to set the standards and norms of the market 4. Allows cost advantages to develop such as access to resources, patents, and employee expertise 5. Potential for developing consumer loyalty is higher 6. Greater pre-emptive opportunities 7. More strategic options are open to first move 242. Second Movers Disadvantage 1. Potential to be late to market 2. Playing catch up 3. Higher entry barriers 4. Gaining market share through imitation is difficult & can increase costs if money is spent on designing a new product. 243. The "second mover advantage" is When a company gets advantage from following others into a market or mimicking an existing product Facebook. Google. Microsoft. Amazon 244. Second Mover Advantage 1. Firm can learn from the mistakes and experience of Mover No. 1 2. Less risk is involved 3. More time to evaluate options 4. Possibility of 'free rider' or coat tails momentum 5. Lower marketing and R&D co 245. High psychic distance can Discourage the firm's use of strategic alliances 246. The Uppsala model can help to understand Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 A firm’s initial choice of international location and its mode of entry into the foreign markets 247. Which are modes of entry into foreign markets Export International joint venture Franchising 248. Which is NOT a mode of entry into foreign markets Internationalisation 249. franchising involves the transfer of a business concept, with corresponding operational guidelines, to non-domestic parties for a fee 250. De-internationalization involves the company failure and strategic decision making 251. Why do alliances between a large Western MNF and an emerging economy firm often fail The partner objectives are very divergent 252. What is strategic control control over the means and methods on which the whole conduct of an organisation depends 253. The average lifespan of a strategic alliance is about _____ years 7 years 254. What advantage comes from trust between alliance partners It makes partners more willing to share information 255. Strategic group analysis refers to identifying firms with similar strategies or competing bases 256. Mobility barriers are Ones in which prevent other firms from entering the strategic group and threatening the existing members 257. Michael Porter has argued that the most important determinant of a firm’s profitability is / are Industry attractiveness 258. The 5 forces model can be used to Analyse a firm’s competitive position in a specific market segment or similar market segments 259. Obstacles which potential newcomers would encounter when entering a market is called Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 Barriers to entry 260. Which of these are barriers to entry? Economies of Scale Production differentiation Expected retaliation 261. Which of these are NOT barriers to entry? Buyer switching costs 262. International Product life cycle suggests a developed country is initially an exporter then loses its expected markets and then finally become an importer of the product from developing countries 263. The international product life cycle does not apply to non-standard industrial products such as Luxury products 264. Forecasts are Educated assumptions about future trends and events 265. the process of training, planning and reassignment of employees to their home countries is called repatriation 266. Globalisation refers to a more integrated and interdependent world 267. War What is a push factor in emigration? 268. What does NOT facilitate globalization barriers to trade and investment 269. What factors facilitate globalization 1. Improvements in communication 2. Looser immigration laws 3. Removal of controls on movement of capital across borders 270. What constitutes FDI A UK energy company buying territory abroad where it expects to find oil reserves 271. What could be defined as an MNC A firm owning a chain of supermarkets outlets outside its country of origin 272. What are drivers of globalization Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 1. Technological advances 2. Reduction of trade barriers 3. A will for market liberalization 4. Integration of world financial markets 273. What are NOT drivers of globalization 1. Trade barriers and controls on inflows of FDI 2. Weak competition 3. Economies of scale being exploited to the max 274. Globalisation is beneficial for firms because it opens new market opportunities 275. The internet facilitates globalization by Cutting the cost for firms of communicating across borders 276. Globalization can create problems for businesses because It can result in more competition 277. An environment which is increasingly complex and turbulent displays Increased speed of innovation 278. Strategy involves the following 1. Allocating resources to take advantage of opportunities arising from the organisations ext. environment 2. Determining the long-term direction of the org. 3. Understanding the goals of the org. 279. Stakeholders can be best defined as Any. individual group or org. that is affected by or can affect the activities of a business 280. In stakeholder mapping, one with a high level of power but low interest Should be kept satisfied 281. An impact analysis helps Firms to prioritize responses to the forces of the external environment 282. Exploring the strategic implications of global warming is best described as Scenario planning 283. PEST is an analytical tool which helps to undertake Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 An external analysis 284. An analysis of the external environment enables a firm to identify Opportunities and Threats 285. Raising income taxes would be included in which section(s) of a PESTLE analysis? Political, Economic, Social, Financial and Legal 286. Applying EUC definition of a SME (200 employees / 30€million turnover) Medium size 287. Which primary activity would be used to describe assembly work? Operations 288. Which primary activity would be used to describe "channel management" work? Marketing and Sales 289. What statements are correct when considering the concept of globalization It is the opposite of protectionism It refers to the growing inter dependency between It is a trend away from distinct national economic units 290. Porter identified 4 elements (porters diamond) present to varying degrees in every country that form the basis of the national competitiveness. Which refers to the four elements 1. Factor conditions 2. Firm strategy, structure, and rivalry 3. Demand conditions 4. Related and supporting industries 291. Porter identified 4 elements (porters diamond) present to varying degrees in every country that form the basis of the national competitiveness. Which DOES NOT refer to the four elements free trade 292. The resource-based approach has been attributed to several scholars > which would be associated with the theory? Barney Penrose Wernerfelt Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 293. The resource-based approach has been attributed to several scholars > which would NOT be associated with the theory? Porter 294. of the top 100 TNCS, 58 belonged to 6 industries, select the industry NOT part of the six> banking 295. of the top 100 TNCS, 58 belonged to 6 industries> motor vehicles pharmaceuticals petroleum electrical and electronic equipment telecommunications 296. Consider Competitive strategy and strategic positioning. which are true about positioning and what it can be based on on serving most or all the needs of a particular group of custom on segmenting customers who are accessible in different ways on producing a subset og an industry's products / services (variety) 297. Consider Competitive strategy and strategic positioning. which is the least true about positioning and what it can be based on is choosing activities that are like rivals but perform better 298. In the PEST framework for environmental analysis what does E stand for Economic 299. analysing processes of change in the business environment involves conceptualising it as Dynamic 300. The performance of businesses in the private sector is conventionally measured on Profitability 301. what key word can be used to describe the basic economic problem that all societies face scarcity 302. What does the Term "third sector" refer to>? Voluntary sector 303. The idea that consumers oversee the economic system because their preferences drive business decisions about what to produce is called Consumer Sovereignty 304. A multinational corp. is defined as Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 carrying out production in more than 1 country 305. BRIC Brazil, Russia, India, China 306. Which would NOT be classified as innovation advance? a company's R&D facility 307. Which would be classified as innovation advance? the launching of a completely new product a modification that improves an existing G&S a major improvement in a production process 308. Tacit knowledge is lost when a company leaves the firm 309. Which can be seen as part of a commercial firm's intellectual property? a brand name such as coke 310. when looking for new ideas to exploit commercially, multinationals may collaborate with rivals, suppliers, or customers 311. which is likely to be the most active innovators a large Chinese producer of smartphones 312. technological advance does NOT guarantee that a business will be successful 313. Information and communications technology (ICT) means that international firms can monitor their employees more closely 314. The development of "the cloud" can result in Big multinationals facing more competition from small and medium sized rivals 315. Schumpeter's concept of "creative destruction" involves.... oligopolists competing through innovation 316. Buying and selling of prods and services from firms in other countries is called Importing and exporting 317. If an employee is citizen of a country where the company HQ is located and work in another country where its operation is located, then the employee is considered to be Expatriate 318. Exporting Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 Direct Exporting Indirect exporting Counter trade (barter) 319. The dimension of culture which refers to the preference of people about unstructured / structured situations is classified as Uncertainty avoidance 320. Global assignments in which employees are sent to understand global operations and are required to have intercultural understanding are called development assignments 321. Global assignments in which employees are sent to other countries for extended projects and return after completing the project are called functional assignments 322. A type of organisation which has operating units in some foreign countries is classified as multinational enterprise 323. Practice by which representatives of unions is given position in Board of directors of company is classified as co-determination 324. Possible global assignments do NOT include transnational assignments 325. classification of international employees includes expats host country nationals third country nationals 326. Global assignments in which employees are sent for strategic jobs having intercultural understanding are classified as strategic assignments 327. If an employee is a citizen of India, working in the US and is employed by a company whose HQ is in Japan, the employee is classified as Third County National 328. factors that affect global human resources management are economic societal cultural 329. Kind of organisation which have integrated worldwide corporate units in different countries are classified as global enterprises 330. if an employee is a citizen of a country where the operation is located but the HQ is in another country then the employee is classified as Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 host country national 331. In global assignments, if an individual is sent to perform some limited tasks and then return home, the assignment is called technical assignment 332. concept which defines inequality among nation explained in cultural dimension is classified as power distance 333. the dimension of culture which defines the extent of people how they act as individual instead of representing as groups is classified as individualism 334. dimension of culture in which masculine values prevails feminism values is classified as masculine / feminine 335. all societal forces that affect values, actions, beliefs of different groups of people are together called culture 336. What is globalisation? viewing the world as an integrated marketplace and a unified global marketplace is being created due to decline in trade barriers / the internet 337. 1830s to late 1800s rise in manufacturing telegraph / telephone growth in rail networks 338. 1980 to present on timeline growth in cross border trade and investments Rise of SMEs and technological advances 339. 1900 -1930 rise of electricity and steel production emergence of MNCs (EU & N. US) 340. COCA-COLA worth 57.3 bn in 2018 61.8 approx. employees 30% sales USA 341. What does Globalisation mean to the consumer?? More Choice Lower prices An increasingly blurred national identity for products and services Impacts on career choice & progression Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 342. Peters & Waterman (1982) > Regarding culture said... A dominant and coherent set of shared values conveyed by such symbolic means as stories, myths, slogans, legends and anecdotes" 343. Facets of Culture (MORRISON 2008) Outward Expressions > Symbols >Art >Music Values and Beliefs >Religion >Moral Codes Norms >Social Interactions Communication >Language/Nonverbal Comm. 344. Restraint (Hofstede) stands for a society that suppresses gratification of needs and regulates it by means of strict social norms and social rules > religion key influencer 345. Criticism of Hofstede IBM has a strong company culture time dependent results western bias ecological fallacy 346. Subcultures > a minority group in a state where a different national culture is dominant 347. Language and Communication (origins of culture) Instils basic socialisation themes & determines how values and norms are expressed and communicated 348. Origins of Culture 1. Nation States 2. Social and Ethnic Groups 3. Religions 4. Language and Communication 2. 349. HIGH CONTEXT CULTURESinfo is conveyed nonverbally, relying on personal understanding of meanings > Asian languages Primary purpose of communication is to form and develop relationships, contextual info is needed 350. LOW CONTEXT CULTURESinformation is conveyed predominantly by explicit expression > through words Primary purpose of communication is the exchange of info, facts, and opinion Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 351. Universalism V Particularism: how people live with respect to relationships and rules 352. Universalism-orientedPeople place a high importance on laws, rules, values, and obligations. They try to deal fairly with people based on these rules, but rules come before relationship > CANADA 353. Particularism-orientedpeople believe that each circumstance, and each relationship, dictates the rules that they live by. Their response to a situation may change, based on what's happening in the moment, and who's involved. > CHINA 354. Neutral V emotional. objective & instrumental or emotional • In a Neutral-oriented culture people make a great effort to control their emotions. Reason influences their actions far more than their feelings. People don't reveal what they’re thinking/how they’re feeling ○ U.K., Sweden, the Netherlands, Finland, and Germany • In an Emotional-based culture people want to find ways to express their emotions, even spontaneously, at work. In these cultures, it's welcome and accepted to show emotion. Italy, France, Spain, and countries in Latin-America 355. In Individualism-oriented cultures people believe in personal freedom and achievement. They believe that you make your own decisions, and that you must take care of yourself. • The individualism-orientated culture people see themselves first as these cultures tend to ascribe success and blame to the individual ○ U.S., Canada, the U.K, Scandinavia, New Zealand, Australia, and Switzerland. •people believe in personal freedom and achievement. They believe that you make your own decisions, and that you must take care of yourself. • The individualism-orientated culture people see themselves first as these cultures tend to ascribe success and blame to the individual ○ U.S., Canada, the U.K, Scandinavia, New Zealand, Australia, and Switzerland 356. In Communitarianism-oriented cultures people believe that the group is more important than the individual. The group provides help and safety, in exchange for loyalty. The group always comes before the individual. • U.S., Canada, the U.K, Scandinavia, New Zealand, Australia, and Switzerland. 357. Specific vs Diffuse: focus on contract vs whole person Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 358. Specific orientated – work and personal lives separate. Relationships don’t have much of an impact on work objectives. People can work together without having a good relationship. Boss is boss at the office but a friend at a restaurant, colleagues in some situations and even inferior in others. E.g., US, UK, Switzerland, Germany, Scandinavia, Netherlands. 359. Diffuse orientated – overlap between work and personal life. Good relationship vital to meeting the business objectives and relationships with others will be the same at work or meeting socially. Spend time outside work with colleagues and clients. Boss is boss. Superior in all relationships. E.g., Argentina, Spain, Russia, India, China. 360. Achievement vs ascription: judged on achievement vs status and connections. 361. Achievement orientated – you are what you do. Base worth accordingly. Value performance no matter who you are. Status results from doing. E.g., US, Canada, Australia, Scandinavia 362. Ascription orientated – status based on such things as social position, age, etc. status results from being. E.g., France, Italy, Japan, Saudi Arabia. 363. Sequential vs synchronic: single tasks vs multi tasks 364. Sequential – time in a linear fashion, order comes from separating activities. E.g., Germany, UK, US 365. Synchronic – several events juggled at same time. E.g., Japan, Argentina, Mexico 366. Internal direction vs outward direction: extent to which people believe they control the environment, or the environment controls them 367. Internal direction – focus on controlling the environment. How to work in teams within organisations. E.g., Israel US, Australia, New Zealand, UK 368. Outward direction – focus on living in harmony with nature. At work or in relationships, employees focus their actions on others and avoid conflict where possible. People often need reassurance that they’re doing a good job. E.g., China, Russia, Saudi Arabia 369. A license Downloaded by Sean Egan ([email protected]) lOMoARcPSD|33425069 A license is a legal contract authorising one business to use the confidential business practices \ assets of another business through an outsourcing arrangement for a fee. 370. repatriation the transition from a foreign country back to the one's own after living overseas for a significant period of time, normally less than 12 months 371. repatriation management the most difficult and important step in the process of expatriation management 372. adaption stage repatriates try to fit into the environment and either start to cope with the new situation or acknowledge that they are unable or unwilling to adapt 373. repatriation problems 1. unrealistic expectations and reverse culture shock 2. lack of appreciation of expatriate experience 3. unwelcoming social networks 4. lack of appropriate jobs and tasks 5. spouse or child related problems 374. repatriates leaving the company the return on the investment consists of the labor they do for the company while abroad but also the experience they have gained, it must be an absolute priority for the organization to retain the repatriate in order to defend this valuable and rare resource 375. improving preparation 1. factual information on living in the host country 2. language training if required 3. raising awareness of the problems that they are likely to experience even though they do not expect them 376. mentoring program a senior manager should look after the expatriates career Downloaded by Sean Egan ([email protected])