TIM 431 Final Exam

Define protectionism

- Protectionism refers to countries imposing tariffs, taxes, and regulations on firms outside the country, and restricting imports on firms outside the country to favor their own companies and people. - Less protectionism in the global economy now than ever before, but it still persists.

What are the eight key attributes for Fortune's Most Admired Companies?

1. People management 2. Innovativeness 3. Financial soundness 4. Use of corporate assets 5. Quality of products or services 6. Social responsibility 7. Long-term investment 8. Quality of management

What is a long-term issue for the travel industry?

According to the instructor, a long-term issue for the travel industry is possible political upheavals in totalitarian regimes in mainland China, Iran, Cuba, and/or North Korea.

How do Americans criticize executives?

Americans soften up executives with praise before they criticize, which seems manipulative to Europeans (Italians, Germans, and French), who do not.

What is a frequently used tool in strategy evaluation?

Audit

What can derail even the best strategic plans?

Bad ethics can derail even the best strategic plans.

Are bribes legal in the U.S.?

Bribes are illegal and unethical in the U.S., but is acceptable in some foreign companies.

What do companies monitor?

Companies now monitor not only the price its vendors offer for products, but also how those products are made in terms of environmental practices.

What makes communication between domestic headquarters and overseas operations difficult?

Geographic distance, cultural and national differences, and variations in business practices

How does the government impact tourism?

Government regulates egress of tourists through its policies (ease visa restrictions on South Korea)

What is the riskiest posture in a globalizing industry?

In an industry that is, or is rapidly becoming global, the riskiest possible posture is to remain a domestic competitor

How can India do business with a foreign firm?

India requires foreign firms to form a joint venture with an Indian firm in order to do business. They often fail, but that's the rule.

What is one way that firms can align ethical and strategic decision making?

Integrating ethical decision making into the performance appraisal process is one way that firms can align ethical and strategic decision making.

What creates barriers to communication and problems managing people?

Language, culture, and value systems differ among countries, which can create barriers to communication and problems managing people

What is both a short-term and long-term issue?

Meeting the tastes and preferences of aging, debt-burdened, and increasingly sophisticated, ethnically diverse, and time-impoverished populations in more developed countries (MDCs) is both a short- and long-term issue

What is one reason that makes strategy evaluation more difficult today?

The decreasing time span for which planning can be done with any degree of certainty

Define consonance

The need for strategists to examine sets of trends, as well as individual trends, in evaluating strategies

Define whistle-blowing

Whistle-blowing refers to the policies that require employees to report any unethical violations they discover or see in the firm

Which quantitative criteria is most commonly used to evaluate strategies?

*Financial ratios, which strategies use to compare performance over time periods, to competitors, and to industry averages - ROI - ROE - Profit margin - Market share - Debt-to-equity - EPS - Sales growth - Asset growth

What is enhanced if a firm competes globally?

- A firm's power and prestige in domestic markets may be significantly enhanced if the firm competes globally. - Enhanced prestige can translate into improved negotiating power among creditors, suppliers, distributors, and groups

Who do Americans often do business with?

- Americans often do business with people they do not know because we have this elaborate legal system that can back us up if things don't turn out according to the agreement - In US business relationships are professional and distant.

Define bribe and bribery

- Bribe: is a gift bestowed to influence a recipient's conduct - Bribery is the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official or other person in discharge of a public or legal duty.

What does measuring organizational performance include?

- Comparing expected to actual results - Investigating deviations from the plan - Evaluating individual performance - Examining progress being made toward meeting stated objectives - Both long-term and annual objectives are commonly used

Should a strategic evaluation system be complex?

- Complex strategy evaluation systems often confuse people. - Test of an effective evaluation system is its usefulness, not its complexity.

How can corporate social policy be involved during all stages of strategy?

- Designed and articulated during strategy formulation - Set and administered during strategy implementation - Reaffirmed or changed during strategy evaluation

Why has evaluating strategies have become increasingly difficult?

- Domestic and world economies less stable - Product development cycle is shorter - Change occurring more frequently - Product life cycles are shorter - There were fewer competitors - Foreign companies were weak - There were more regulated industries - Also there has been a dramatic increase in the environment's complexity - The increasing difficult of predicting the future with accuracy - The increasing number of variables - The rapid rate of obsolescence of even the best plans - The increase in the number of both domestic and world events affecting organizations - The decreasing time span for which planning can be done with any degree.

What are the competitive advantages of East Asian countries, Brazil, and Germany?

- East Asian countries are market leaders in labor-intensive industries - Brazil offers abundant natural resources and rapidly developing markets - Germany offers skilled labor and technology. - Low-cost labor in Latin America/Asia.

How often should strategies be evaluated?

- Evaluating strategies on a continuous basis - Allows benchmarks of progress to be established and more effectively monitored

Why is globalization important?

- Important because many corporations cannot survive unless they've expanded overseas because domestic market is fairly stagnant. - Growth in sales is overseas with new emerging middle class markets without an automobile or smartphone

What does business relations revolve around in China?

- In China, business relations revolve around guanxi, or personal relations - They like to do business with people they know and trust because they have low trust in their own legal system to protect them if a contract isn't honored

What should be included in ethics training programs?

- Messages from the CEO or the owner of the business emphasizing ethical business practices - Development and discussion of code of ethics - Procedures for discussing and reporting unethical behavior "The fish rots from the head down," must have ethical behavior emphasized at the top of the organization.

How do conservative economists feel about protectionism?

- Most economists argue that protectionism harms the world economy because it inhibits trade among countries and invites retaliation. - Conservative economists strongly oppose any form of protectionism and believes global economy should be pure free enterprise, but other thinkers say this is hard on developing countries because they cant compete as well on global stage and drives small businesses out of business

Describe contingency plans

- Should be as simple as possible - Only high priority areas require the insurance of contingency plans - Ways to deal with unfavorable and favorable events before they occur - Minimizes threats and capitalizes on opportunities - Cannot plan for all possible contingencies

Define sustainability

- Sustainability refers to the extent that an organization's operations and actions protect, mend, and preserve rather than harm or destroy the natural environment - Has to do with the economic survival of our industry because our industry is so dependent on a clean environment

Will demand for travel continue?

- The demand for travel will continue, in spite of possible interruptions, although in changed forms - Travel has become a means of self-actualization and self-realization for millions of people, and they are willing to sacrifice much for it.

Strategic evaluation should provide:

- Timely information - Approximate information that is timely is generally more desirable than accurate information that does not depict the present.

Why should you strike a balance for the emphasis on evaluating strategies?

- Too much emphasis on evaluating strategies may be expensive and counterproductive. - Too little or no evaluation can create even worse problems.

What do joint ventures enable firms to learn?

Joint ventures can enable firms to learn the technology, culture, and business practices of other people and to make contacts with potential customers, suppliers, creditors, and distributors in foreign countries.

How will more aggressive companies use their global growth?

More aggressive companies will use their global growth to capture economies of scale and learning.

What creates a strategic advantage?

Most firms believe that ethics training and an ethics culture creates strategic advantage.

Is there an ideal strategy evaluation system?

No, there is no one ideal strategy-evaluation system.

What the best way to overcome individuals' resistance to change?

Research suggests that participation in strategy-evaluation activities is one of the best ways to overcome individuals' resistance to change

What unethical behavior is rampant in China?

The sale of pirated American goods

What has become a matter of survival for business?

To see and appreciate the world from the perspective of others has become a matter of survival for business.

What are some tragedies/key events of the 21st century?

• Dot-com bubble burst in March 2000 • Events of September 11, 2001 and subsequent terrorist attacks in Madrid, London, and Bali • SARS epidemic in 2002-03 • U.S. invasion of Iraq in 2003 • Indian Ocean earthquake and tsunami in 2004 • Hurricane Katrina in 2005 • Oil shock during summer 2008 • Global financial crisis and ensuing "Great Recession," U.S. housing and European debt crises in 2008 to present • H1N1 epidemic in 2009 • Earthquakes in Haiti and Chile in 2010 • Volcanic eruption of Eyjafjallajökull in 2010 • British Petroleum oil spill in Gulf of Mexico in 2010 • Popular uprisings in Middle East countries in 2011 • Earthquake in New Zealand in 2011 • Earthquake, tsunami, and radiation leakages in Japan in 2011 • Russian acquisition of Crimea in 2014 • Disappearance of Malaysia Airlines Flight 370 in 2014

What are some ethical issues in business?

• Misleading labeling • Harming environment • Product/service safety • Padding expense accounts • Insider trading • Dumping banned or flawed products in foreign markets • Discrimination against women, minorities, and/or older workers • Overpricing • Moving jobs overseas • Sexual harassment • Employee health • AIDS in workplace • Smoking • Acid rain • Affirmative action • Waste disposal • Foreign business practices • Cover-ups • Takeover tactics • Conflicts of interest • Employee privacy • Inappropriate gifts • Security of company records • Price collusion • Multinational tourism developers not hiring local labor and/or buying locally produced products or services