MGMT 480 set 2 terms

external industry environment

entry barriers, buyer power, supplier power, substitute availability, and competitive rivalry

industry

a collection of firms that offer similar products or services

natural duty principle

a principle that states a number of general obligations, including the duty to help others who are in need or danger, the duty not to cause unnecessary suffering, and the duty to comply with the just rules of an institution

liberty principle

a principle that states individuals have certain basic liberties compatible with similar liberties of other people

difference principle

a principle that states social and economic inequities must be addressed to achieve a more equitable distribution of goods and services

fairness principle

a principle that states that employees must be expected to engage in cooperative activities according to the rules of the company, assuming that the company rules are deemed fair.

distributive justice principle

a principle that states that individuals must not be treated differently on the basis of arbitrary characteristics such as race, sex, religion, or national origin

global industry

an industry in which competition crosses national borders on a worldwide basis

multidomestic industry

an industry in which competition is segmented from country to country

trend in codes of ethics

companies are adding enforcement measures to their codes, including policies that are designed to guide employees on what to do when they see violations

ecoefficiency

company actions that produce more useful goods and services while continuously reducting consumption and pollution

external operating environment

competitors, customers, creditors, labor, suppliers

transnational strategy disadvantage

difficulties in implementation because of organizational problems

remote environment

economic, social, political, technological, and ecological factors that originate beyond, and usuall irrespective of, any single firms, operating situation

strategic orientations of firms

ethnocentri, polycentric, regiocentric, and geocentric orientations

operating environment

factors in the immediate competitive situation that affect a firm's success in acquiring needed resources

international and multidomestic strategy disadvantage

failure to exploit experience curve effects

multidomestic strategy disadvantage

failure to transfer distinctive competencies to foreign markets

international and multidomestic strategy disadvantage

inability to realize location economies

trend in codes of ethics

increased attention by companies in improving employees' training in understanding their obligations under the company's code of ethics

trend in codes of ethics

increased interest in codifying business ethics

international, multidomestic, and global strategy disadvantage

lack of local responsiveness

pressures for local responsiveness

on the X axis of the graphdifferences in customer tastes and preferences, differences in infrastructure and traditional practices, differences in distribution channels, host government demands

pressures for cost reductions

on the Y Axis of the graph. when companies produce commodity products, where differentiation on nonprice factors is difficult and price is the main competitive weapon, where competitors are based in low cost locations, where there is persistent excess capacity, where consumers are powerful and face low switching costs, the liberalization of the world trade and investment environment

threat of substitutes

one of the five forces of industry competition where it limits profits and reduce the bonanza an industry can reap in boom times.

threat of entry

one of the five forces of industry competition where new entrants to an industry bring new capacity, the desire to gain market share, and often substantial resources

bargaining power of buyers

one of the five forces of industry competition where this group is powerful if 1. it is concentrated and purchases in large volumes 2. the products are standard or undifferentiated 3. the produces form a component of its product and represent a significant fraction of the cost 4. it earns low profits, which reat incentive to lower purchasing costs 5. the product is unimportant to the quality for the group's products or services 6. the product does not save the group money 7. they pose a credible threat of integrating backward to make the industry's product.

bargaining power of suppliers

one of the five forces of industry competition where this group is powerful if 1. it is dominated by a few companies and is more concentrated that the industry it sells to, 2. its product is unique or differentiated 3. its not obliged to contend with other products 4. it poses credible threate of integrating forward into the industry's business 5. the industry is not an important customer of the group

rivalry of existing firms

one of the five forces that occurs when 1. competitors are numerous or roughly equal 2. industry growth is slow 3. the product or service lacks differentiation 4. exit barriers are high 5. fixed costs are high 6. capacity normally is augmented in large increments 7.rivals are diverse in strategy

substantial increase in foreign investment

step four for evolutionary development of global corporation

export-import activity

step one for evolutionary development of global corporation

direct investment in overseas operations

step three for evolutionary development of global corporation

foreign licensing and technology transfer

step two for evolutionary development of global corporation

social justice approach

the approach to ethics that judges the appropriateness of a particular action based on a equity, fairness, and the impartiality to the distribution of rewards and costs among individuals and groups.

moral rights approach

the approach to ethics that judges the appropriateness of a particular action based on a goal to maintain the fundamental rights and privileges of individuals and groups

Michael Porter's five forces model

the concept of industry environment as integral to strategic thought and business planning. they shape the competition in an industry. the framework helps strategic managers link remote factors to their effects on a firm's operating environment.

barriers to entry

the conditions that a firm must satisfy to enter an industry

product differentiation

the extent to which customers perceive differences among products and services

technological factors

the external factors of the remote environment in which to avoid obsolescence and promote innovation, a firm must be aware of its changes that might influence the industry.

social factors

the external factors of the remote environment that affect the beliefs, values, attitudes, opinions, and lifestyles of a person in the firm's external environment as developed from cultural, ecological, demographic, religious, educational, and ethnic conditioning

economic factors

the external factors of the remote environment that affect the nature and direction of the economy in which a firm operates

political factors

the external factors of the remote invironment in which their direction and stability are a major consideration for managers on formulating company factors. The define legal and regulatory parameters within which firms must operate.

external environment

the factors beyond the control of the firm that influence its choice of direction and action, organizational structure, and internal processes

industry environment

the general conditions for competition that influence all businesses that provide similar products and services

transnational strategy

the most common strategy of simultaneously seeking to lower costs, be locally responsive, and transfer competencies in a way consistent with global learning

ecological factors

the most prominent factors of the remote environment that encompass the reciprocal relationship between business and ecology, such as global warming, loss of habitat and biodiversity, as well as air, land, and water pollution

technological forecasting

the quasi-science of anticipating environmental and competitive changes and estimating their importance to an organization's operations

ecology

the relationships among human beings and other living things and the air, soil, and water that supports them

economies of scale

the savings that companies achieve because of increased volume

geocentric orientation

the strategic orientation in which an international firm adopts a systems approach to stategic decision making that emphasizes global integration

polycentric orientation

the strategic orientation in which the culture of the country in which the strategy is to be implemented is allowed to dominate a company's international decision making process

regiocentric orientation

the strategic orientation in which the parent company blends its own predisposition with those of its international units to develop region-sensitive strategies

ethnocentric orientation

the strategic orientation in which the values and priorities fo the parent organization guide the strategice decision making of all its international operations

true global strategy

the strategy of approaching worldwide markets with standardized products

international strategy

the strategy of creating value by transferring competencies and products to foreign markets where indigenous competitors lack those competencies and products

multidomestic strategy

the strategy of developing a business model that allows a company to achieve maximum local responsiveness.

global strategy

the strategy of focusing on increasing profitability by reaping cost reductions that come from experience curve effects and location economies; persuing a low cost strategy on a global scale

forces driving industry competition

threat of new entrants, bargaining power of buyers, threat of substitutes, and bargaining power of suppliers, rivalry among existing firms

pollution

threats to life supporting ecology caused principally by human activities in the industrial society.