Chapter 8 - International Management

True or false: The "strength" or "weakness" of FSAs and CSAs is a relative notion.

True

In the context of setting up operations in a host country, which of the following are factors that attract a multinational corporation (MNC) to a specific locale?

Easy access to markets; Access to transportation facilities and electric power

___________ ______________ is the need to understand the different consumer tastes in segmented regional markets and respond to different national standards and regulations imposed by autonomous governments and agencies.

National responsiveness

A __________ strategy is best suited for MNCs that face high cost pressures and low demand for localized product offerings.

global

In the context of the use of the finance function to implement strategy, the overseas operation commonly relies on ______.

global financing

In the context of strategic management, _____________ ____________ refers to the production and distribution of products and services of a homogeneous type and quality on a worldwide basis.

global integration

In the context of strategic management, ________________ ____________ refers to the production and distribution of products and services of a homogeneous type and quality on a worldwide basis.

global integration

Identify a strategy often adopted by multinational corporations to meet the demand for global integration.

A strategy that focuses on globalization and mass customization.

In the context of first-mover strategies, what are the significant economies that are associated with being the first to enter a market in a particular industry and economic environment?

Being able to attain scale economies that arise from opportunities for obtaining a greater market share; Being able to capture learning effects that are key to increasing market share; Being able to form alliances with the most attractive local partners

What are the typical forms of total quality management?

Cross-training employees to fulfill the jobs of all members in their work group; Process reengineering that helps find and get rid of redundant and wasteful tasks and efforts; Rewards systems that reinforce quality performance by employees

True or false: In the present day, most companies consider middle management responsible for devising and implementing strategies.

False

True or false: Multinational corporations that have an exclusive focus on economies of scale and standardize their products and services across the globe use transnational strategies for production and marketing.

False

True or false: Research proves that incremental adaptation of existing technologies and products help multinational corporations (MNCs) to fit the needs of the base of the pyramid.

False

True or false: The internationalization of the marketplace and the increasing number of entrepreneurial firms in the global economy have limited the prospects of internationalization available to small and new-venture businesses.

False

_____________ ______________ is defined as a combination of innovative, proactive, and risk-seeking behavior that crosses national boundaries and is intended to create value for organizations.

International entrepreneurship

What is true of a multi-domestic strategy in relation to the conflicting needs for global integration and national responsiveness?

It emphasizes local adaptation.

What is true of internal resource analysis conducted by a firm as part of strategic planning?

It helps assess the firm's current managerial, technical, material, and financial resources and capabilities to analyze its strengths and weaknesses.

In the context of the conflicting demands for global integration and national responsiveness, what is true of a multinational corporation's (MNC's) global strategy?

It is an integrated strategy mainly based on price competition.

Identify a true statement about a multinational corporation's international strategy in relation to the conflicting demands for global integration and national responsiveness.

It is characterized by standardization of products and services across countries.

Identify a recent trend in the use of the production function by multinational corporations (MNCs) to implement strategy.

MNCs are increasingly emphasizing the global coordination of their operations.

In the context of the conflicting demands for global integration and national responsiveness, identify the strategy adopted by multinational corporations when the requirement for differentiation is high and the need for integration is low.

Multi-domestic strategy

In the context of the choice of location for setting up a multinational corporation's (MNC's) operations, identify the features of frontier markets.

These markets are less likely to face drastic effects of global economic fluctuations than those in developed countries. These markets involve high risks and high rewards for investors.

Identify the opportunities available to multinational corporations (MNCs) that employ first-mover strategies in emerging economies that are going through rapid changes.

They are able to establish beachhead positions. They are able to anticipate and prepare for competition.

Why do multinational corporations (MNCs) often opt for advanced industrialized countries to make investments?

They tend to have legal restrictions related to imports that encourage a local presence. They offer the largest markets for goods and services.

True or false: Multinational corporations require strategic management to discard unprofitable ventures to create capital for expansion into higher-growth product and/or geographic markets.

True

True or false: The three general areas that international management considers in strategy implementation are location of the operations, entry and ownership, and functions.

True

A(n) ____________ ______________ approach to management involves strategic formulation and implementation in which a multinational corporation makes strategic decisions based on the merits of the individual situation rather than using a predetermined economically or politically driven strategy.

administrative coordination

A multinational corporation's strategy that targets low-income customers in developing countries is known as the _________ __________ _______ _____________ strategy.

base of the pyramid

Firms that engage in significant international activities shortly after being established are called _________ ________ __________.

born-global firms

The _____________ ______________ refers to a worldwide strategy based on cost leadership, differentiation, and segmentation.

economic imperative

The process of providing management with accurate forecasts of trends related to external changes in geographic areas where the firm currently is doing business or is considering setting up operations is known as ___________ ___________.

environmental scanning

In the context of the conflicting needs for global integration and local responsiveness, a(n) ___________ ______________ refers to a mixed strategy that combines low demand for integration and responsiveness.

international strategy

According to a study, the extent to which a firm carries out strategic planning is an important variable in determining performance. In the context of the international strategy of multinational corporations (MNCs), this extent is known as ______.

planning intensity

The ___________ __________ approach to strategic planning involves strategic formulation and implementation utilizing strategies that are country-responsive and designed to protect local market niches.

political imperative

In the context of the "four Ps" of marketing, ______ is largely a function of market demand.

price

Firms in ______ can benefit from strategies of both low cost and differentiation, while firms in ______ require specific strategies for different types of firms.

quadrants 2 and 3; quadrants 4 and 1

The _____________ ______________ approach to management involves strategic formulation and implementation using strategies of total quality management to meet or exceed the expectations of customers and continuously improve products or services.

quality imperative

The process of determining an organization's basic mission and long-term objectives and then implementing a plan of action for pursuing this mission and attaining these objectives is known as ____________ ______________.

strategic management

The process of providing goods and services in accord with a plan of action is known as __________ ____________.

strategy implementation

A _____________ strategy is best suited for MNCs that face high cost pressures and high demands for local responsiveness.

transnational

A(n) ______________ _____________ is an integrated business strategy that emphasizes the demands for both global integration and local responsiveness.

transnational strategy