MAN 4720 Chapter 9, 10, 11 Final Exam

Auditing

The accounting process that firms undertake to have their financial statements reviewed for accuracy in order to assure compliance with the law and IRS code.

In some states such as () managers can be held personally liable for damages that arise from workplace romance

California

gross domestic product

The sum total of the value of all the goods and services produced in a nation

One of the best ways to be socially responsible is for the firm to proactively conserve and preserve the natural environment. What is one way for companies to do so?

Developing a corporate sustainability report annually is not legally required but such a report based on concrete actions goes a long way toward assuring stakeholders that the firm is worthy of support

Being unethical is abnormal and rare

False

More time and effort are required to identify and evaluate external trends and events in domestic corporations than in multinational corporations

False

The trend in the United States is toward larger boards of directors, with an average of 18 members being the norm.

False

Today, boards of directors are composed mostly of insiders who are becoming more involved in organizations' strategic management.

False

The price and quality of a firms products must be competitive only on a worldwide basis

False globally and locally

Which of the following U.S. industries is NOT yet greatly challenged by foreign competitors?

Furniture manufacturing

Future shock

High anxiety that results when the nature, types, and speed of changes overpower an individual's or organization's ability and capacity to adapt.

Robert waterman offered the following

"successful companies treat facts as friends and controls as liberating"

Widely accepted globally but are voluntary

ISO standards

Contingency plan example

If a major competitor withdraws from particular markets as intelligence reports indicate, what actions should our firm take

Contingency plan example

If a new technology makes our new produce obsolete sooner than expected what actions should our firm take?

Max Killan

If business is not based on ethical grounds it is of no benefit to society and will like all other unethical combos pass into oblivion

Contingency plan example

If certain disasters occur-such as loss of computer capabilities: a hostile takeover attempts: loss of patent protection: or destruction of manufacturing facilities because of earthquakes, tornadoes, or hurricanes-what actions should our firm take

Drucker's ethical leadership

....no one should ever become a strategist unless he or she is willing to have his or her character serve as the model for subordinates

Strategy-evaluation process

1) examine the underlying bases of a firm's strategy 2) compare expected results with actual results 3) take corrective actions to ensure that performance conforms to plans

Contingency plan example

If demand for our new product exceeds plans, what actions should our firm take to meet the higher demand

Contingency plan example

If our sales objectives are not reached, what actions should our firm take to avoid profit loss

guanxi

In China, business behavior is based on "personal relations."

feng shui

In China, this term refers to the practice of harnessing natural forces, which can impact how you arrange office furniture.

Disadvantages of doing business globally

1. Foreign operations could be seized by nationalistic factions.2. Firms confront different and often little-understood social, cultural, demographic, environmental, political, governmental, legal, technological, economic, and competitive forceswhen doing business internationally. These forces can make communication difficult in thefirm.3. Weaknesses of competitors in foreign lands are often overestimated, and strengths are oftenunderestimated. Keeping informed about the number and nature of competitors is more difficult when doing business internationally.4. Language, culture, and value systems differ among countries, which can create barriers tocommunication and problems managing people.5. Gaining an understanding of regional organizations such as the European EconomicCommunity, the Latin American Free Trade Area, the International Bank forReconstruction and Development, and the International Finance Corporation is difficult butis often required in doing business internationally.6. Dealing with two or more monetary systems can complicate international businessoperations.

Reasons to be primarily open with the strategy process and resultant decisions

1. Managers, employees, and other stakeholders can readily contribute to the process. They often have excellent ideas. Secrecy would forgo many excellent ideas. 2. Investors, creditors, and other stakeholders have greater basis for supporting a firm when they know what the firm is doing and where the firm is going 3. Visibility promotes democracy whereas secrecy promotes autocracy. Domestic firms and most foreign firms prefer democracy over autocracy as a management style. 4. Participation an dopiness enhance understanding, commitment, and communication within the firm

Reasons, why some firms prefer to conduct strategic planning in secret and keep strategies hidden from all but the higest-level executives, are

1. free dissemination of a firm's strategies may easily translate into competitive intelligence for rival firms who could exploit the firm given that information 2. Secrecy limits criticism, second-guessing, and hindsight 3. Participants in a visible strategy process become more attractive to rival firms who may lure them away 4. Secrecy limits rival firms from imitating or duplicating the firms strategies and undermining the firm

Exports of goods and services from the united states account for how much of the US gross domestic product (GDP)?

13 percent (this means the nation is still largely domestic continental economy)

Bears will be extinct by what year if hunting is not decreased or stopped

2040

Across 190 countries average income tax rate is

22 percent

ISO international standardization organization based in Switzerland has published nearly how many international standards covering almost every industry including...

22,000 healthcare, agriculture, food, safety, and technology

German, Chinese, and Singapore exports comprise of

46, 20, and 172 of their economies

According to a recent Wall Street Journal article, ________ percent of all firms sampled had no restrictions on boss-subordinate love affairs at work.

5

Inhwa

A South Korean term for activities that involve concern for harmony based on respect of hierarchical relationships, including obedience to authority.

code of business ethics

A written document specifying expected employee/manager behavior/conduct in an organization.

Bribery involves

A) bestowing a gift to influence the recipient's conduct.

What must be done to ensure an ethical culture?

Managers must take care in considering the specific details of how the content of the code, how it will be implemented, and how adherence to it will be monitored

Who said organizations have no obligation to do any more for society than is legally required. And it may be irresponsible for a firm to give monies to charity

Milton Friedman

Which of the following business actions is considered to be unethical?

Misleading labeling

Revised EFE Matrix

Part of activity #1 in the strategy evaluation process whereby a firm reassesses its previously determined external opportunities and threats.

Revised IFE Matrix

Part of activity #1 in the strategy evaluation process whereby a firm reassesses its previously determined internal strengths and weaknesses.

Who said that organizations have tremendous social obligations

Ralph Nader

Measuring Organizational Performance

Activity #2 in the strategy evaluation process; includes comparing expected results to actual results, investigating deviations from plans, evaluating individual performance, and examining progress being made toward meeting stated objectives.

Workplace Romance

An intimate relationship between two truly consenting employees, as opposed to sexual harassment, which the EEOC defines broadly as unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature.

High corporate tax rates A) encourage investment in new factories. B) provide strong incentives to avoid and evade taxes. C) attract foreign investors. D) make a nation a desirable location for investment. E) have been a growing trend since the 1980s.

B) provide strong incentives to avoid and evade taxes.

Who developed the balanced scorecard and when?

Robert Kaplan and David Norton in the early 1990s in Harvard business school when they were professors

What is the most corrupt country in terms of bribery?

Somolia

Why is "good ethics good business?"

The Institute of business ethics IBE recently conducted a study titled Does Business ethics pay and concluded that companies displaying a clear commitment to ethical conduct consistently outperform companies that do not display ethical conduct

Which of the following is a valid reason for a firm's power and prestige in domestic markets to be significantly enhanced if it competes globally?

This can translate into improved negotiating power among important groups.

too many organizations prepare contingency plans just for unfavorable events

This is a mistake because both minimizing threats and capitalization on opportunities can improve a firms competitive position

What company is doing great corporate social responsibility?

Toms (explain)

Firms with the greatest CSR (corporate social responsibility) are generally also the firms with the highest financial performance

True

Firms with the lowest CSR tend to have higher CSR tend to have higher performance than those with moderate social responsibility

True

Intuitive judgments are almost always involved in deriving quantitative criteria.

True

No society anywhere in the world can compete long-term or successfully with people stealing from one another or not trusting one another

True

Organizations that conduct business operations across national borders are called international firms or multinational corporations.

True

The code of business ethics is not sufficient to ensure ethical business behavior.

True

The securities and exchange commissions SEC whistle blowing policies virtually mandate that anyone seeing unethical activity must report such behavior

True

Trade barriers are one of the unique and diverse risks that face multinational corporations.

True

U.S. firms doing business internationally face the complications of having to deal with two or more monetary systems

True

contingency plans can promote a strategists ability to respond quickly to key changes in the internal and external bases of an organizations current strategies

True

Only a few countries such as Norway Iceland and japan favor and engage in commercial whaling

True supporting wildlife welfare and global social responsibility

Nemaswashio

U.S. managers in Japan have to be careful about this phenomenon, whereby Japanese workers expect supervisors to alert them privately of changes rather than informing them in a meeting.

As of 2018 which of the following countries had the highest corporate tax rate?

United Arab Emirates

sexual harassment (and discrimination)

Unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature; this activity is illegal, unethical, and detrimental to any organization, and can result in expensive lawsuits, lower morale, and reduced productivity.

CSR also extends to?

Wildlife welfare

sustainability report

a form of annual report produced by organizations to reveal their progress and activities aimed at helping, rather than harming, the natural environment

balanced scroecard

a framework of desired objectives: derives its name form the need of firms to "balance" quantitative with qualitative objectives that are oftentimes used in strategy evaluation

bribe

a gift bestowed to influence a recipients conduct

board of directors

a group of individuals above the CEO who have oversight and guidance over management and who care for shareholders interests: sometimes called governance-should never be a CEO

globalization

a process of doing business worldwide so strategic decisions are made based on global profitability of the firm rather than just domestic considerations

ISO 14000

a series of voluntary standards in the environmental field whereby a firm minimizes harmful effects on the environment caused by its activities and continually monitors and improves its own environmental performance

ISO 14001

a set if standards adopted by thousand firms worldwide to certify to their constituencies that they are conducting business in an environmentally friendly manner. These standards offer a universal compliance that more and more firms are requiring not only of themselves but also of their suppliers and distributors

Generally Accepted Accounting Principles (GAAP)

a set of accounting standards that is used in the preparation of financial statements

Generally Accepted Auditing Standards (GAAS)

a set of accounting standards used by independent auditors to evaluate an organization's financial statements

International Financial Reporting Standards (IFRS)

a set of procedures or rules used by accountants, particularly outside the united states to develop financial statements

reviewing the underlying bases of an organization's strategy

activity #1 in the strategy-evaluation process; entails a firm developing a revised EFE matric and IFE matrix to determine if corrective actions are needed.

Taking Corrective Action

activity #3 in the strategy-evaluation process; involves a firm making changes to competitively reposition a firm for the future

corrective actions possibly needed to correct unfavorable variances

alter the firms structure replace one or more key individuals divest a division alter the firms vision or mission revise objectives alter strategies devise new policies install new performance incentives raise capital with stock or debt add or terminate salesperson, employees, or managers allocate resources differently outsource or reshore business functions

contingency plans

alternative plans that can be put into effect if certain key events do not occur as expected

companies are following a triple-bottom-line

approach in which success depends on the financial bottom line the social bottom line and the natural environmental bottom line

What term is defined as "a systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between these assertions and established criteria, and communicating the results to interested users"?

auditing

7 principles of admirable business ethics

be trustworthy, open-minded, honor all commitments and obligations, avoid misrepresenting exaggerating, or misleading with print materials actions or words, visibly be a responsible community citizen, use your accounting practices to find and eliminate questionable activities, and follow the golden rule do unto others as you would have them do unto you

Main ingredient for establishing an ethics culture is to develop a

clear code of business ethics

4 particular challenges that face all strategists

deciding whether the process should be more an art or a science deciding whether strategies should be visible or hidden from stakeholders contingency planning auditing

bribery

defined by black laws dictionary as the offering giving receiving or solicitating of any item of value to influence the actions of an official or other person in discharge of the public or legal duty

Global Strategy

designing, producing, and marketing products with global needs in mind, instead of solely considering individual countries

strategy implementation can be more difficult because of

different norms values and work ethic

What challenge facing all organizations requires managers to formulate strategies that preserve and conserve natural resources and control pollution?

ecological

Companies ranked in regards to CSR are based on 7 different categories...

environment climate change employee relations human rights corporate governance financial performance philanthropy community support

The first activity in the strategy-evaluation process is to

examine the underlying bases of a firm's strategy.

In strategy evaluation, a revised IFE Matrix should indicate how effective a firm's strategies have been in response to key opportunities and threats.

false

quantitative objectives

financial ratios and percentages

Best advantage of doing business globally

firms can gain new customers for their products and services thus increasing revenues

international (or multinational) firms

firms that conduct business outside their own country

part of the bill and Melinda gates foundation

get rid of polio globally

What are special natural environment issues?

global warming depletion of rain forests destruction of animal habitats protecting endangered species waste management

Good business ethics is a prerequisite for

good strategic management: good ethics is good business

US EPA

have adopted ISO standards as a part of their regulatory framework and are the basis for much legislation

promoting workplace democracy

helps support productivity and trust

change and results do not come from formulation but

implementation

wa

in japan this term stresses group harmony and social cohesion

Bribery is a crime in most countries including

in the US

Where are whistleblowers protected?

in the US under both the sarbanes-oxley and dodd-frank legislation

ISO standards facilitate

international trade and commerce

The domestic food industry ________, so Kraft Foods is focusing on foreign acquisitions.

is growing 3 percent per year

The strategic management process is conceptually the same for multinational firms as for purely domestic firms: however the process is more complex as a result of?

more variables and relationships

socially responsible examples

offering day care or paying for tuition for employees who are students

The U.S. government's OPIC

offers insurance to offset some risks of doing business internationally.

What terms carry much more specific connotations and expectations due to consumer and government interest in environmental protection?

organic, green, safe, earth friendly, nontoxic, or natural

Modern organizational realities demand many skills of employees. Which of the following is NOT a required skill?

patience

Competitive advantage is normally the result of superiority in resources, skills, or

position

Donald palmer reports that misconduct is a normal phenomenon and that wrong doing is as prevalent as rightdoing and that misconduct is most often done by people who are

primarily good, ethical, and socially responsible

business ethics

principles of behavior/conduct a firm may institute to minimize wrongdoing among employees/managers

Outsourcing

refers to the practice of firms using/paying other firms to perform certain activities such as managing payroll call centers or even R&D

reshoring

refers to us companies working offshore but planning to move some of their manufacturing back to the united states

The idea that the positioning of one's ________ can enhance their combined effectiveness is familiar to military theorists, chess players, and diplomats.

resources

Text believes that strategists should be more

science

effective strategic management

should not dominate decisions

Workplace romance

simply happens so organizations should determine how to best manage the phenomenon.

Special natural environment issues include all of the following EXCEPT

spreading computer viruses

Currencies in Africa are

stabilizing

who decides between strategies being based on science or fact

strategists themselves

The wall street journal report shows that only 5 percent of all firms sampled have no restrictions on such relationships: 80 percent of firms have policies that prohibit relationships like this; 4 percent of firms strictly prohibit all such relationships; 39 percent have policies that require individuals to inform their supervisors whenever a romantic relationship with a coworker begins, and 24 percent of firms require the two persons to be in different departments

subordinate romantic relationships at work

An organization should not strictly forbid workplace romance because

such a policy could be construed as invasion of privacy, overbearing, or unnecessary

qualitative objective

such as employee morale and business ethics

Mintzberg's notion of "crafting" strategies

suggests that strategic decision making be based primarily on holistic thinking, intuition, creativity, and imagination.

sustainability example

switching to solar panels for companies

Governance

the act of oversight and direction, especially in association with the duties of a board of directors

whistle-blowing

the act of telling authorities about some unethical or illegal activites occuring within an organization of which you are aware

Sustainability

the extent that an organizations operations and actions protect, mend and preserve rather than harm or destroy the natural environment

environment

the surroundings in which an organization operates including air water land resources flora fauna humans and interrelation

A few US multinational firms already use IFRS for their foreign subsidiaries, such as united technologies which derives more than 60 percent of its revenues from abroad and is already training its entire staff to use IFRS

true

By 2025, Walmart anticipates being powered by 50 percent renewable energy.

true

Dumping banned or flawed products in foreign markets is considered to be an unethical business practice.

true

Never allow ceo to be chairperson of the board

true

No social need can be met if the firm fails

true

The first social responsibility of any business must be to make enough profit to cover the costs of the future because if this is not achieved, no other social responsibility can be met.

true

green products sell well

true

environmental management systemt

when a firm or municipality operates using green policies/practices/ procedures as outline by ISO 14001

protectionism

when countries impose tariffs taxers and regulations on firms outside the country to favor their own companies and people

When are corrective actions needed?

when external and internal facts have not significantly changed and when the firm is progressing satisfactorily toward achieving stated objectives.

Billy graham said

when wealth is lost nothing is lost when health is lost something is lost when character is lost all is lost