MGT 4230 - Final Notes
When a company makes a make-or-buy decision, the strategic level is typically focused on the ______-term while the operational level is more focused on the ______-term.
long; short
Predatory pricing exists where a product or service is set at a very (high or low?) price, intending to drive competitors out of the market, or create barriers to entry for potential new competitors.
low
One strategic objective of the logistics and production functions is to ______ costs, when moving from raw materials to the finished product.
lower
The snow equipment produced at Alpine Way Inc. requires specialized design and only a few craftspeople are trained to use the tools to make the products. For this reason, the company should use a _____ decision.
make
Corcoran Computers entered into an agreement with the Belgian government in which the company received a number of counterpurchase credits to be used to purchase goods from Belgium. The company did not need any of these goods so it sold the credits to a third-party trading house at a discount. This trading house then sold the credits at a profit to another company that wished to purchase them. This transaction is an example of _____.
switch trading
When deciding where to locate production facilities, firms must consider?
- Country factors - technological factors - product factors
Foreign service premiums typically range from ______ to ______ of base salary after tax.
10%; 30%
In the upstream portion of the global supply chain, the multinational company should allocate ______ of its efforts to the vendor category.
20%
What are the considerations that help determine where an international firm will locate its production facilities?
Ability to minimize costs and improve quality
Why did many Asian countries turn to countertrade following the 1997 currency crisis?
Because of a lack of hard currency
Best Global Brands
1. Apple 2. Google 3. Coke 4. Microsoft 5. IBM 6. Toyota 7. Samsung 8. GE
What two sources of assistance does the government provide to US exporters to finance their export programs? (Check all that apply.)
Foreign Credit Insurance Association Export-Import Bank
Renata told the marketing department that a pull strategy should be implemented to sell the new line of footwear. Which communication strategy should the department use?
Mass media advertising
What are three arguments in support of global advertising? (Check all that apply.)
Significant economic advantages Many brand names are global One large advertising effort will produce better results
______ policy is concerned with the selection and training of individuals for specific job functions.
Staffing
Human resource management includes which three activities? (Check all that apply.)
Staffing Labor relations Performance evaluation
Which company function involves selecting individuals to do certain jobs, as well as, promoting the desired culture of the firm?
Staffing policy
What are two tasks of the HRM function in a multinational company? (Check all that apply.)
Staffing policy Compensation policy
What is an argument in favor of standardized advertising?
Standardized advertising lowers the cost of value creation by spreading the costs of ad development over many countries.
What are two ways unions disrupt production and derive their bargaining power? (Check all that apply.)
Strikes Refusing to work overtime
Expatriate Selection
Strong self orientation - Strengthen self-esteem, self-confidence and mental well-being Other orientation - Enhance ability to interact with host-country nationals Perceptual Ability - The ability to empathize - understand why people in host-country behave the way they do Cultural toughness - How well an expatriate adjusts to a particular posting tends to be related to the country of assignment
The Six SIgma quality improvement method evolved from the ______ system.
TQM
What three impediments would make it difficult for some companies to gain knowledge of opportunities available in foreign countries? (Check all that apply.)
Time Distance Language
What is the most important aspect of cultural differences that companies need to recognize when marketing to another country?
Tradition
The best way for a firm to overcome cultural barriers when marketing internationally is to
develop cross-cultural literacy and embrace local input.
Trisha's firm has filled all of its key management positions with parent-country nationals. What kind of staffing policy is this company using?
ethnocentric
The three types of staffing policies in international business are: (Check all that apply.)
ethnocentric geocentric polycentric
A(n) ______ manager is a citizen of one country who works abroad in a company's subsidiary.
expatriate
The strengths of the ______ staffing policy are that it makes the best use of a company's human resources and it results in executives who are comfortable in a number of cultures.
geocentric
In ______, most union leaders take a moderate political stance.
germany
An expatriate's willingness to use the (home or host?) country language is the definition of willingness to communicate within the others-orientation.
host
One drawback to a polycentric staffing policy is that ________.
host-country nationals have less chance to gain international experience.
Jensen works for Hudson Department Stores which has locations all over the world. It is her job to determine the staffing needs for the holiday season for retail stores in the European market. Which activity is Jensen involved with?
human resource management
Firms may be prevented from using a geocentric staffing policy because of ______ in the host country.
immigration laws
In order to sell its product line in Japan, a company will need to work its way through many intermediaries before reaching the consumer. When a channel length is long like this, a company is better off using a ______ strategy for its communication.
pull
Brett's Bicycle Shop has decided to export products to Finland without using a letter of credit. One way the shop can insure against payment default would be to
purchase export credit insurance.
Jim's shoe company manufactures shoes and sells them directly to the consumer. In this situation, the channel length can be described as
short.
A(n) ____ draft is payable on presentation to the drawee.
sight
In developing countries, retail systems are (slow or quick?) to grow.
slow
XYZ Company asked an international trade partner to pay for goods prior to delivery. XYZ Company was not fully aware of the company's background and wanted to be sure that it got paid. This is an example of why the lack of ______ has resulted in the development of special mechanisms for financing exports and imports.
trust
Recent survey results suggest that US CEOs earn roughly ______ -times the pay of non-US CEOs.
two
The decision by many computer manufacturers to use Intel brand microchips in their computers is an example of where the importance of brand favors a(n) (make or buy?) decision.
buy
The main reason a company would consider ______ is that it provides a firm with a way to finance its export deal when other methods of financing are not available.
countertrade
When conventional means of payment are difficult in an international sale, ______ is an alternative means of structuring the sale and allows for the trade of goods and services.
countertrade
During her shopping trip, Raquel found a shirt she liked. She decided NOT to buy it because the tag said it was made in India, and the last time she purchased a shirt made there, it fell apart after she washed it. What is affecting Raquel's purchase decision?
country of origin effects
Six Sigma is a(n)
set of techniques and tools for process improvement.
Which situation favors a "buy" decision?
The firm lacks the expertise to make a product.
The Export-Import Bank was chartered by the _____.
US government
Sanjay knows he can buy denim products in the US at a low cost and then resell them at a higher cost in Germany to make a profit. Sanjay is practicing ______.
arbitrage
When a business takes advantage of a price differential for a product between two countries by purchasing the product in the country where the price is lower and then selling it in the country where the prices are higher, it is participating in
arbitrage.
According to the text, compared to domestic managers, expatriates tend to leave their company
at about twice the rate
Saturn Energy Corp. carefully examined the cost of living in the Netherlands before it determined compensation for the manager it was sending from the US. It wanted to be sure the manager would be able to enjoy the same standard of living in the Netherlands as at home. The company is using the _____ approach to determine compensation.
balance sheet
A ______ is a business tool provided by the US Department of Commerce which provides the name, address and basic business information of potential distributors in foreign markets.
best prospects list
Electric Source Inc. produces such a massive volume of data that it cannot use traditional software techniques to process it and relies on "the cloud" to store it. What type of data does this company have?
big data
German and Japanese firms are viewed as having a _____ advantage in exporting compared to US firms.
bigger
Offset is superior to straight counterpurchase because a(n)
company can choose the goods it wants.
For a small fee, the Department of Commerce provides a company with a market research survey on a product of its choice. This is called a(n) ______.
comparison shopping service
While profound differences between countries complicate the HRM function, the major tasks for HRM in an international business still include staffing policy, management training and development, performance appraisal, and
compensation policy.
Scientific research, demand conditions and ______ conditions all contribute to stimulating ideas for new products.
competitive
When Trevor's company transferred him to Tokyo, it provided him with a compensation package that included a(n) ______ allowance to ensure that Trevor would live in the same manner as he did at home.
cost of living
Jacob's company assigned him to work in Indonesia for three years. He and his family moved from their home in Atlanta to Indonesia and quickly adapted to their new living arrangements. Mendenhall and Oddou would say that Jacob demonstrates ______.
cultural toughness
What are the four dimensions identified by Mendenhall and Oddou that predict success in a foreign posting?
cultural toughness self-orientation perceptual ability others-orientation
While mass production allows companies to produce a greater number of goods at a lower cost, flexible manufacturing technology also provides companies with these standards and at the same time allows a company to
customize its products.
Historically, most international businesses ______ the labor relations duties to local managers because labor laws and union power varied so much between countries.
decentralized
When trade barriers are high, fixed costs are low, important exchange rates are unstable, and the value-to-weight ratio is low, a ______ production configuration is preferred.
decentralized
Speeding up inventory turnover can lead to a(n) ______ in warehousing and storage costs and free up working capital.
decrease
The first step in the international research process is to
define the research objectives.
What is the most important determinant of channel length?
degree of fragmentation
A company identifying potential market segments would collect data on what three things? (Check all that apply.)
demography geography sociocultural factors
After defining the research objectives, the next step in the research process is to
determine the data sources.
While the Ex-Im Bank has a loan guarantee program, it also has a(n) (direct or indirect?) lending operation for foreign borrowers to use in purchasing US exports.
direct
When customers in different locales are charged different amounts for the same product, it is called price
discrimination.
The main way unions gain bargaining power is by ______ within a company.
disrupting production
Supply chain considerations are complicated by
distance, time, exchange rates, customs barriers, etc. - includes a host of activities spanning acquiring raw materials to delivery of finished offering
A(n) ______ strategy, created by the management of a manufacturing business, specifies how the firm intends to transfer its products to intermediaries, retailers and end consumers.
distribution
Marshall Marine delivers its products to retail stores which then sells the products to consumers. In this scenario, delivering products to the retail stores represents the company's _____ strategy.
distribution
A company collecting information to make marketing mix decisions would collect data on what three things? (Check all that apply.)
distribution pricing communication
What are two ways a diverse workforce will improve workplace performance?
diversity can increase employee satisfaction about the workplace a diverse customer set may appreciate interacting with similarly diverse employees
A potential disadvantage of a JIT system is that a firm
does not have buffer stock.
The portion of the supply chain from the production facility to the end-consumer is the ______ supply chain.
downstream
While a maker initiates a draft, the party to whom the draft is presented is called the ______.
drawee
When a firm sells a product for less than production cost, the company is implementing the practice known as ______.
dumping
Members of a product development team should be comprised of individuals from
each key function in the company.
The four types of allowances that are often included in an expatriate's compensation are hardship, housing, cost of living, and ______.
education
When a small change in price produces a large change in demand for a product, then demand is said to be ______.
elastic
The responsiveness of the quantity demanded of a good or service to a change in its price is its ______.
elasticity
Income level and competitive conditions determine elasticity
elasticity tends to be greater in countries with low income levels - elasticity tends to be greater in countries where there are many competitors
As defined in the text, perceptual ability is synonymous with the ability to ______.
empathize
Host-country nationals would encounter the greatest limits on advancement opportunities when faced with a(n) ______ staffing policy.
ethnocentric
Since it may keep a firm from developing cultural myopia, the polycentric approach is a response to the shortcomings of the ______ approach.
ethnocentric
The chief operations officer at Bradley Motor Corp., based in Omaha, doesn't feel there are qualified individuals in Brazil to staff the senior management positions at the company's new manufacturing facility. Which type of staffing policy should Bradley Motor Corp. use based on this information?
ethnocentric
Aiko is from Japan and recently moved from Japan to work at the US headquarters of Toyota in Texas. In her US job, Aiko is considered to be a(n)
expatriate
Tom's company hired three individuals from the US to work in its plant based in Japan. Unfortunately, at the end of six months, all three of the employees ended up quitting because they did not like adhering to the Japanese principles in place at the plant. This demonstrates ______.
expatriate failure
John Smith is a Seattle, Washington native who works for Microsoft. The company sent him to manage a branch of the company in China, but he was homesick and returned home in six months. This is an example of
expatriate failure.
As compared to other staffing policies, a geocentric staffing policy is ______ to implement.
expensive
Companies that price products low worldwide in attempt to build global sales volume as rapidly as possible are implementing ______ pricing.
experience curve
One way to avoid payment default on a foreign export sent without a letter of credit is to purchase ______ insurance.
export credit
Experience curve pricing:
firms price low worldwide to build market share. Incurred losses are made up as company moves down experience curve and gain scale economies
When a business groups various types of machinery, a common materials handler and a centralized cell controller for manufacturing purposes, it is using the technology known as
flexible machine cells.
When focusing on the strategic perspective, no matter what compensation system is used, international managers should be rewarded for
following the corporate strategy.
Corinne reported to the management team that since there were so many retailers supplying the product, none of them held a major share of the market. This is an example of a ______ retail system.
fragmented
It will cost a company more money to make contact with each individual retailer in a _____ retail system.
fragmented
The newly-hired human resource manager was told that it is company policy to find the best person for all management positions, regardless if that person is from the home country or is located in one of the company's international locations. Which staffing policy does this represent?
geocentric
Compared to 20 years ago, exports play a _____ role in the US economy.
greater
Price elasticity tends to be _____ in countries where income levels are low.
greater
Kevin's evaluation of the performance of his international manager based in Belgium was based solely on the profitability and market share established by the office. Kevin used ______ data in his evaluation.
hard
A source factory ______ than an offshore factory.
has a more significant strategic role
Organized labor _____ had much success in responding to the bargaining power of MNCs.
has not
Which action should a company take if it wants to hedge against potentially adverse moves in currency rates?
have manufacturing plants in different locations
After she accepted the foreign posting for her company, Alysha realized that there wasn't a reciprocal tax treaty with the host government. This means that Alysha will
have to pay income tax in both nations
One drawback to basing production in a foreign location is the potential for poor product quality. This is an example of a(n) cost of foreign production.
hidden
In highly-developed countries, the noise level is typically ______ compared to less-developed countries.
high
Problems with cost-effectively manufacturing a new product is one reason for the (low or high?) rate of new product development failure.
high
A letter of credit is issued by a bank after being requested by an _____.
importer
In a typical international trade transaction, after the importer arranges for a letter of credit, the next step is that the
importer's bank sends a letter of credit to the exporter's bank.
In order for predatory pricing to work, a firm should be
in a profitable position in another national market.
The most indicated reason for expatriate failure with US multinationals is the
inability of the spouse to adjust.
According to research done by R. L. Tung, three common reasons US multinationals experience expatriate failure include: (Check all that apply.)
inability to cope with larger overseas responsibilities manager's personal or emotional maturity inability of spouse to adjust
What are two major strategic objectives of logistics and production?
increase product quality lower costs
Flexible manufacturing involves a range of manufacturing technologies designed to do what three things?
increase utilization of machines reduce setup times improve quality control
When there is improved performance reliability, a company's profits will
increase.
Fine Point Inc. lowered the price of their pens drastically, but only saw a small increase in sales. This is an example of ______ demand.
inelastic
Nora's company plans to export a line of boots to a French wholesaler. Since this is a new export, her company wants to be paid for the boots prior to shipping them; however, the wholesale company in France refuses to pay for the boots until they are received. To solve this problem, the companies could rely on a trusted third party such as a bank, which acts as a(n) ______.
intermediary
If the demand for rocking chairs is 5 million per year and the minimum efficient scale for a plant to manufacture these chairs is 100,000 per year, it (is or is not?) economically feasible for the company to manufacture rocking chairs in several locatio
is
Countertrade
is a barterlike agreement as an alternative means of structuring an international sale when conventional means of payment are difficult, costly or nonexistent
What are the two negatives associated with a letter of credit?
it could limit the importer's ability to borrow since it is a liability the importer has to pay the bank's fee for the letter of credit
A(n) _____ has two drawbacks: the fee paid by the importer to the bank and since this is a financial liability, it may affect the importer's ability to borrow for other transactions.
letter of credit
Brett's company is in competition with four other suppliers who are trying to get similar products into France. One way Brett's company could boost its appeal with the importer would be to forgo a _____ even though it will expose the company to default risk.
letter of credit
What three actions has organized labor attempted in order to deal with the increased bargaining power of MNCs? (Check all that apply.)
lobby for national legislation to restrict MNCs establish international labor organizations achieve international regulations on MNCs
When a firm takes advantage of favorable economic, political, and cultural conditions when identifying a site for manufacturing activities, the benefits it can receive are called ______ economies.
location
Morton Manufacturing decided to locate its new plant in Taiwan because there was an existing pool of labor there with experience in manufacturing the same type of products Morton produces. This existing pool of labor is an example of a(n) _____.
location externalities
Web-based information systems can improve the ______ function by better tracking component parts, optimizing production schedules, and by providing good information about the company's supply chain.
logistics
The person or business who initiates the draft that instructs an importer how much and when to pay is called the ______.
maker
transportation:
managing cost and time in moving inventory through the supply chain
reverse logistics:
managing inventory from point of consumption to origin for value, return or disposal.
The HRM function tries to ______ between the firm and organized labor.
minimize conflict
SInce unit costs decrease as plant output increases, a ______ of output is necessary for a plant to realize all major plant-level scale economies.
minimum efficient scale
The ______ is the smallest amount of production a company can achieve while still taking full advantage of economies of scale with regards to supplies and costs.
minimum efficient scale
Forecasts anticipate that intermarket segments will become (less or more?) common in developed and emerging country markets.
more
It is (less or more?) important to integrate R&D and marketing when dealing with international business.
more
Product returns cost manufacturers and retailers ______ per year in the United States.
more than $100 billion
Kodak and Fujifilm exemplified the use of ______ pricing as they competed against each other around the world in the market for silver halide film. When Kodak issued a price for the product in one market, it affected how Fujifilm priced the product in another market.
multipoint
Refer to Table 15.2. Company ABC is transferring business or information technology processes to suppliers in a nearby country. This is an example of
nearshoring.
two-tiered pricing
one price domestically, and another for foreign products
Data that has been previously collected by organizations, people, or agencies for purposes other than specifically addressing the research problem and objectives at hand is called ______ data.
secondary
FairWay Fitness Inc. does not have the budget to research the European market it would like to sell to so it relies on data it receives from online reports and government documents. What type of data is this company using for information?
secondary
Market ______ is a tool companies use when trying to identify distinct groups of consumers whose purchasing behaviors differ from that of other consumers.
segmentation
Mendenhall and Oddou's dimension known as ______ fosters how an expatriate feels about himself or herself and indicates their confidence level.
self-orientation
A factory established to overcome tangible and intangible barriers in the global market place which supplies specific country or regional markets around the world is a(n) ______ factory.
server
One reason a company would use a(n) _____ factory is that it can minimize the costs that would be necessary if the production facility were further away from its customers.
server
When supply chain members both inside and outside of a business agree on the process to be used, it is an example of
shared decision making.
It makes the most sense for an international business to use a ______ distribution channel in countries where the retail sector is concentrated.
shorter
What is the main reason exporting is preferred by such a large portion of companies using the global marketplace?
small- and medium-sized companies view exporting as a relatively low commitment to gaining global distribution
Which type of factory is used and treated the same as any factory in a global firm's home country?
source
Nigel works at a British advertising agency and has advised his client that it's not worth the company's money to advertise its products in China because he knows there is a strong bias against foreign firms for this particular product. This bias demonstrates how ______ can impact international marketing.
source effects
When a consumer reads an advertisement and evaluates the content of the ad on the basis of the image of the company that placed the ad, he or she is being influenced by
source effects.
Despite minor variations in its menu from country to country, McDonald's is usually described as a company that follows a ______ strategy in international markets.
standardized
Since French law prohibits the use of children in product endorsements, a company would need to edit any commercials using children if it wanted to air those commercials in France. This demonstrates one of the arguments against ______ advertising.
standardized
Global advertising
standardized: - significant economic advantages - scarce creative talent - many global brand names Non standardized: - messages in one country may fail in another - advertising regulations can be a restriction
Brown out expatriate failure
stays in the job but fails at job sub optimal performance
When the warehouse manager received the draft with the shipment of textiles, he noticed that payment for the materials was not due for 60 days. This is an example of a transaction using a ______ draft.
time
The movement of raw materials, component parts, and finished goods through the supply chain is referred to as ______.
transportation
According to critics of Theodore Levitt's arguments, the homogenization and standardization of needs and wants is currently limited largely to people
under the age of 40.
Based on the findings of the Mercer study discussed in the text, it appears that today, women are _____ at all levels in the labor force around the world.
underrepresented
Terry's company will spend $4 billion to set up a production plant in China.This is a high cost for his small business to pay. This price makes it ______ to produce in several locations at once.
uneconomical
Host-nation managers may exhibit a form of ______ bias as a result of their own cultural frame of reference when giving a performance appraisal to an expatriate.
unintentionalv
Needs that are the same all over the world are called ______ needs.
universal
The United States CIBER initiative fosters exporting needs by bringing together US companies and _____.
universities
The portion of the supply chain from raw materials to the production facility is the ______ supply chain.
upstream
Integrating a control system to eliminate global supply-chain disturbances refers to
variance reduction.
Distribution center:
warehousing and needed customization for wholesalers, retailers and customers
Over the past 25 years, the United States' position as the leader of innovative new product development has ______.
weakened
Product atrributes
- Cultural differences (labeling, ingredients, disposal, features, warranties) - Economic differences (level of income) - Product and technical standards ( health standards, packaging, labeling requirements and other legal factors)
Improving export performance
- gain information about foreign market opportunities from various sources and avoid some common pitfalls - An international comparison: Germany and Japan - Information sources at federal (export.gov) and state levels - Export management companies - Thorough export strategy
Flexible manufacturing technology, or lean production, covers a range of manufacturing technologies that are designed to:
- reduce set up times for complex equipment - increase the utilization of individual machines through better scheduling - improve quality control at all stages of the manufacturing process
Considerations in supply chain
1. Ensure quality 2. Be able to accommodate demands for local responsiveness 3. Be able to respond quickly to shifts in customer demand and to external shock
U.S. Expat Satisfaction
1. Switzerland 2. Singapore 3. China 4. Germany 5. Bahrain 6. Thailand 7. Taiwan 8. New Zealand 9. India 10. Hong Kong
Which type of allowance ensures that an expatriate will enjoy the same standard of living in a foreign post as he or she would at home?
Cost-of-living
______ occurs when a company agrees to purchase a certain amount of product back from a country to which a sale is made.
Counterpurchase
What is a reciprocal form of international trade in which goods or services are exchanged for other goods or services, rather than for hard currency?
Countertrade
In her new position as global marketing manager, Shayla will be interacting with local managers to develop marketing campaigns. Shayla wants to be able to understand the viewpoints of each of these managers. Which type of training will best help Shayla be successful in her interactions with host-country nationals?
Cultural
Which department of the US federal government provides the most comprehensive source of information regarding export opportunities?
Department of Commerce
As a result of their lack of foreign exchange reserves, countertrade has grown in popularity among which type of countries?
Developing
Repatriation of Expatriates
Didn't know what position they hold upon return - firm vague about return, role and career progression - Took lower level job - Leave firm within one year - Leave firm within three years
Most companies now rely on ______ to coordinate the flow of materials in all phases of manufacturing.
EDI
_____ is considered the language of world business.
English
Refer to Table 17.1 and match the staffing approach to its compatible strategy.
Ethnocentric ->International Polycentric -> Localization Geocentric -> Transnational
In which type of distribution channel is it difficult for new firms to gain access to retail space?
Exclusive
What firms are export specialists that act as an export department for their clients?
Export management companies
The Foreign Credit Insurance Association operates under the guidance of the
Export-Import Bank
Novice companies have significant problems when trying to do business abroad. What are three pitfalls these companies often run into which makes them hesitant to export in the future? (Check all that apply.)
Failure to customize product to foreign customer Difficulty securing financing Poorly executed promotional campaign
True or false: Hard data allows a manager to evaluate an expatriate based on things such as cultural awareness and the ability of the expatriate to work with local managers.
False
True or false: Repatriated employees are guaranteed the same job with the same company when they return to the home country.
False
True or false: Small and medium-sized businesses are very proactive in identifying opportunities to export.
False
True or false: The United Nations has verified that Brazil is one of the easiest and most cost effective countries to export into.
False
True or false: Cultural differences enhance a firm's ability to use the same marketing message and selling approach worldwide.
False Cultural differences make it more difficult to use the same marketing message and selling approach worldwide. What works well in one country may be offensive in another.
True or false: Most cases of expatriate failure in Japan are the result of poor working conditions.
False Expatriate failure tends to stem from the inability of the manager to adjust or the inability of a spouse to adjust or other family matters.
True or false: When considering international market segmentation, the structure of market segments is typically similar from country to country.
False Managers need to be aware that market segments can vary greatly from country to country.
True or false: ISO 9000 is the principal tool that most managers now use to increase the reliability of the product offering.
False The principal tool that most managers now use to increase the reliability of the product offering is the Six Sigma quality improvement methodology.
True or false: When considering the building blocks for global supply chains, all relationships between vendors, suppliers, and partners are equally valuable.
False When considering the building blocks for global supply chains, all relationships between vendors, suppliers, and partners are not equally valuable.
True or False: With the proliferation of high-tech industries, it is more important than ever to centralize R&D.
False With the proliferation of high-tech industries, leading-edge research is conducted all over the world.
Country factors
Firms should locate manufacturing activities where economic, political and cultural conditions, including relative factors costs, are most conducive - Regulations affecting FDI and trade can significantly affect the appropriateness of specific countries, as can expectations about future exchange rates
Which international staffing policy seeks the best people for key jobs regardless of nationality?
Geocentric
Geocentric staffing policy
Global and transnational strategy seek best people for key jobs, regardless of nationality advantages: uses human resources efficiently helps build strong culture and informal management network disadvantages: national immigration policies may limit implementation expensive
_____ coordination refers to the integrated and coordinated decisions of key global supply chain activities.
Global supply chain
Product and Technical Standards
Government standards can prevent the introduction of global products - different technical standards impede global markets, as well. - come from idiosyncratic historical decisions - different tv signal frequencies, - infrastructure
______ segmentation refers to forming segments of consumers who have similar needs and buying behavior even though they are located in different countries.
Intermarket
ethnocentric staffing policy
International strategy All key management positions are filled by home country nationals advantages: overcomes lack of qualified managers host nation unified culture helps transfer core competencies disadvantages: produces resentment in host country can lead to cultural myopia
What are two benefits associated with a longer distribution channel? (Check all that apply.)
It can make it easier to access an exclusive channel. It cuts selling costs when the retail sector is very fragmented.
In ______, many unions are controlled by left-wing socialists who view collective bargaining as a form of class conflict.
Italy
The inventory model used to decrease costs by having inventory arrive at a manufacturing plant only when it is needed is called ______ inventory.
JIT
______ is an inventory strategy companies employ to increase efficiency and decrease waste by receiving goods only as they are needed in the production process, thereby reducing inventory costs. This method requires producers to forecast demand accurately.
JIT
Which scenario is an example of expatriate failure?
Janis, a US citizen, has been sent to Saudi Arabia to manage an office for Verizon. She is very unhappy and wants to return home.
Currently, you will find the BEST use of countertrading in
Japan.
Of all the companies using the global marketplace, _____ prefer exporting as a form of foreign market entry.
More than 90%
What group benefited from the establishment of international trade secretariats in the 1960s?
Organized labor
Developing steadfast friendships with host-country nationals is an aspect of which dimension in Mendenhall and Oddou's model?
Others-orientation
Which dimension identified by Mendenhall and Oddou refers to understanding why people of other countries behave the way they do?
Perceptual ability
Jose's company decided to implement a push strategy for its new line of health care products. Based on this, what strategy will the company most likely use?
Personal selling
What are two examples of high value-to-weight products that should be produced at the most optimal production location? (Check all that apply.)
Pharmaceuticals Electronic components
What are two potential "hidden" costs of outsourcing production to a foreign location? (Check all that apply.)
Poor product quality High employee turnover
Performance Appraisal
Problems: Unintentional bias - host nation biases by cultural frame of reference Home country biased by distance and lack of experience working abroad - Expatriate managers believe that headquarters unfairly evaluates and appreciates them - many believe a foreign posting does not benefit their career.
What are two advantages of flexible manufacturing technology? (Check all that apply.)
Produce a wider variety of end products Produce at the lowest unit cost
Refer to Table 16.1 Which element of the marketing mix addresses the question of whether customers have similar product needs across international markets segments?
Product strategy
What three factors would encourage a firm to make a product in-house? (Check all that apply.)
Quality control Protect proprietary technology Lower costs
What two factors are particularly important in the others-orientation dimension identified by Mendenhall and Oddou? (Check all that apply.)
Relationship development Willingness to communicate
______ should be seen as the final link in the process of selection and training expatriate managers.
Repatriation
What two things may occur as a result of the limits an ethnocentric staffing policy puts on advancement opportunities for host country nationals? (Check all that apply.)
Resentment Lower productivity
______ is the process of moving goods from their typical final destination for the purpose of capturing value or proper disposal.
Reverse logistics
What two criteria must be met for a country to bring antidumping actions against an importer? (Check all that apply.)
Sales at less than fair value Material injury to a domestic industry
Which type of draft should a company use if it wants immediate payment from the drawee upon receipt?
Sight draft
The statistically-based process used by companies today to reduce costs and boost productivity is
Six Sigma.
Exporters involved in international trade would prefer to ship the goods __ payment is received?
After
A proliferation of retailers in a given market would be found in a ______ retail system.
fragmented
Promotiion
All efforts to influence purchases - perhaps the most culture-bound element - must consider the message, and the medium
What are three attributes of a bottle of shampoo? (Check all that apply.)
Bottle size Scent Texture
Of the types of international staffing policies identified by research, which one tends to be the most attractive to companies?
Geocentric
Refer to Table 17.1 Which staffing approach is notable because it uses human resources efficiently?
Geocentric
Kevin works at a company in Ohio and is in charge of researching available export opportunities. Which two organizations should he initially contact to learn more? (Check all that apply.)
International Trade Administration U.S and Foreign and Commercial Service
______ were established in the 1960s to allow unions to bargain transnationally with MNCs.
International trade secretariats
Which type of factory can be viewed as an information-gathering unit?
Outpost
Which type of packaging is designed to contain several primary packages?
Secondary
Expatriates with high self-esteem, self-confidence, and mental well-being are more likely to succeed in a foreign posting. Which of Mendenhall and Oddou's dimensions does this represent?
Self-orientation
The ______ approach to expatriate compensation seeks a balance of purchasing power between the home and host countries.
balance sheet
According to the text, the two keys to interorganizational relationships are: (check all that apply.)
commitment. trust.
Artisan Inc. needs to find a company that will store its products and when requested provide customization -- then ship the products to the final customer. What type of facility can help Artisan Inc. with this?
global distribution center
Which aspect of global logistics is concerned with the decision-making process on the raw materials, work-in-progress, and finished goods inventory for a multinational corporation?
global inventory management
The concept that valuable knowledge does not just reside in a firm's domestic operations but can be found in foreign subsidiaries is known as ______.
global learning
The CORE diagnostic tool on the globalEDGE website helps a company assess
its readiness to export a product
What three things are mentioned in the text as reasons spouses fail to adjust to international postings? Choose all that apply.
language differences loss of network of friends unable to work
Countertrade is more advantageous to exporters that are
large and diverse.
Companies that have "big data" typically use _____ to store this data.
large-scale servers
The ______ the minimum plant scale relative to total global demand, the ______ is the argument for centralizing production.
larger; greater
A motorcycle company is establishing a new factory to create processes, products, and technologies that the firm will use throughout its global operations. This factory would best be described as being a(n) ______ factory.
lead
Research undertaken during the late 2000s, shows that the rate of expatriate failure
may be dropping.
Based on Mendenhall and Oddou's dimension known as _____ the more effectively an expatriate can interact with host-country nationals, the more likely he or she is to succeed.
others-orientation
A(n) ______ factory is placed near a competitor or the most-demanding customers and acts as an intelligence gathering unit.
outpost
The biggest concern an exporter has is not receiving ______ when shipping a product to customers.
payment
What is considered to be the linchpin that holds a firm's organizational architecture together?
people
One of the four dimensions that Mendenhall and Oddou identified as predicting success in a foreign posting is
perceptual ability
A system that is used to evaluate the performance of managers against stated criteria a firm considers necessary to attain a competitive advantage is called a(n) ______ system.
performance appraisal
Which application of business analytics is used to identify and build models that can help identify trends and relationships?
predictive
The Expatriate Problem: Expatriate failure
premature return of the expatriate manager to his/her home country Cost of failure is high: Estimate - 3x the expatriates anuual salary plus the cost of relocation (impacted by currency exchange rates and assignment location)
Often an expatriate will receive extra compensation for working outside his or her country of origin. This is referred to as a foreign service
premium.
According to the text, a(n) ______ can be viewed as a cluster of attributes.
product
A company must take into account three factors when determining whether to use a push or pull strategy, including: (Check all that apply.)
product type relative to consumer sophistication channel length media availability
All the activities involved in creating a product are known as _____.
production
When discussing global supply chains, _____ is/are sometimes referred to as manufacturing or operations.
production
Kendrik ordered a sweater online. When it was delivered, the box holding the sweater had a large hole in it and as a result, the sweater had gotten wet and was ruined. In this situation, what function did the package fail to perform?
protect
What are the three main functions of packaging?
protect perform inform
Double taxation can be an issue for an expatriate when a(n) ______ tax treaty is not in place.
reciprocal
The HRM function can help a firm achieve its primary strategic goals, including: (Check all that apply.)
reducing the cost of value creation adding value by better serving customers
three different distribution systems:
retail considerations channel length channel exclusivity - Choice of channel: - cost/benefit of each alternative vary from country to country
The companies unique to Japan that trade in a wide range of products and materials and act as intermediaries to identify export opportunities are called
sogo shosha.
Getting a specialized third-party trading house involved in a countertrade arrangement to purchase the counterpurchase credits and sell them to another firm is called
switch trading.
After his company introduced a new line of hair dryers, Jeremy realized that the dryers could not be sold in Europe because the electrical adapters would not fit into the existing design. Jeremy's company failed to take into account ______ standards that limited globalization.
technical
While no longer an area of concern now that most people stream music, originally DVD equipment made in the US would not play DVDs recorded on equipment made in Germany. This shows how _____ can influence consumer behavior.
technical standards
Theodore Levitt believed that _____ was driving the world toward a converging commonalty.
technology
Which global segment is currently becoming increasingly attractive to international marketers?
teenagers
Consumers all over the world have the same preference for iPhone's and Xbox. These two products and others like them serve _____ needs.
universal
Importers involved in international trade prefer to pay ___, (before or after?) the goods are received.
after
Three major reasons for expatriate failure in Japan include: Check all that apply.
Inability to cope with responsibilities Inability of spouse to adjust Lack of technical competence
What type of company is normally used as a trusted intermediary for exporting situations?
Bank
According to calculations by the United Nations, the amount of time associated with the vast documentation required to export to Brazil can amount to _____ of the final value of the exported goods.
10%
It has been evidenced that the presence of diversity in the workplace increases employee satisfaction. The text notes that in the case of minority workers, improved satisfaction occurs when representation exceeds at least _____ of the workforce.
15%
______ demand occurs when a major price change results in only a small change in demand for a product.
Inelastic
The bill of lading serves what three purposes? (Check all that apply.)
A contract A document of title A receipt
What is a disadvantage of relying on an export management company (EMC)?
A firm will fail to develop its own exporting capabilities.
What is the biggest advantage of using an EMC?
Access to experienced specialists
As the text relates, what three factors contribute to a greater retail concentration in developed countries?
An increase in car ownership The number of households with refrigerators and freezers The number of two-income households
Programs such as LISREL, SPSS, and SAS are used in which step of the market research process?
Analyzing and interpreting the data
What are the four main differences between distribution systems? (Check all that apply.)
Channel length Channel exclusivity Retail concentration Channel quality
When a large discount retailer enters a country, they cut out wholesalers. How does this impact the channel length?
Channel length is shortened.
The ______ function of an international firm usually addresses international labor relations.
HRM
What two factors would lead a firm to choose a concentrated production configuration? (Check all that apply.)
High fixed costs Minimum efficient scale of production is high
What are three factors that would lead a company to establish a concentrated production configuration? Choose all that apply.
High fixed costs Value-to-weight ratio is high Product serves universal needs
Which company is taking steps to minimize risk as it enters the export market?
Instead of trying to spread itself too thin by going after 22 foreign markets, Natalie's company focused on three potential foreign markets.
In many cases, which two groups are responsible for evaluating the performance of expatriate managers? (Check all that apply.)
Host-nation managers Home-office managers
Multinationals' approach to labor relations
Labor laws, union power and nature of collective bargaining vary from country to country need to control labor costs Must adapt to local conditions while also maintaining a global perspective
In which type of factory should cutting-edge production take place or be tested?
Lead
What are the three broad groups of factors that a company should consider when making decisions on where to produce its products? (Check all that apply.)
Technological factors Production factors Country factors
What three factors helped the US rank highest in post-World War II new product development? (Check all that apply.)
The US spent more on R&D than other nations. There was a large scientific community. Consumer base was affluent.
Which of these advertising campaigns allows a company to capture the benefits of standardization, but still respond to local differences?
The campaign uses actors from each region where the ad is run to reflect the local population, but the actors say the same lines.
In what way are time drafts negotiable?
The maker can sell the draft to an investor at a discount from face value.
Which situation is using market segmentation?
The marketing report detailed that more women than men were buying the company's products and most of these women had an income over $50,000.
True or false: Many academics feel that Levitt's argument only applies to basic industrial products, such as steel.
True Many academics feel that Levitt's argument only applies to basic industrial products such as steel and does not apply to consumer goods markets.
In order for a company to use a pull strategy, ______ must be available in the location the company is targeting.
advertising media
True or false: A company would need to account for cultural differences in data collection when conducting international market research.
True
True or false: A global distribution center is used to store quantities and assortments of products and allow for customization of those products.
True
True or false: An offset is similar to a counterpurchase except the party can fulfill its obligation with any firm in the country where the sale is made.
True
Counter trade: Pros and Cons
Way of dealing with lack of financial options or satisfy a government requirement - May result in exchange of unusable or poor quality goods that hamper profitability - Small firms typically don't have the distribution network that large firms do for sale of counter traded products - Incur costs of an in-house department to handle counter trade arrangements
In which situation should a firm decide to make a product in-house?
When it wants to protect proprietary technology
Multi point pricing strategy
When two or more international firms compete against each other in two or more national markets. A firm's pricing strategy in one market may impact a rival in another market.
When an importer is in a strong bargaining position and is having suppliers compete against one another, an exporter might be forced to forgo ______ in order to get the order.
a letter of credit
The expertise, competencies, and skills of established retailers in a nation refers to channel ______.
quality
Which document indicates that the carrier has received the merchandise described in the document?
bill of lading
An exporter writes a draft on the Bank of Italy to Mercury Corp. In this case, Mercury Corp. is the
drawee.
Importance for global supply chain
- Major opportunity for cost reduction - Lean manufacturing can lower costs and improve quality, but poses buffer risks. - supply chain management entails responsiveness, reliability, quality and support. - use of data facilitates scheduling, tracking and communication, reducing costs - manage supply chain strategically
Export pitfalls
- Poor market analysis - Poor understanding of competitive conditions - Lack of customization, poor distribution and bad promotion - Underestimation of needed expertise for the market and challenges of export process
Expatriate Compensation
- Salary increase - may include hazard pay - Cost of living adjustment - Tax equalization - Housing - Spouse assistance - Any number of other "perks"
Benefits of exporting
- Volume of exports increasing due to lower trade barriers and economic cooperation - Can benefit large and small firms - From national economy standpoint, exporting can create jobs
Technological factors firms should consider
1. The level of fixed costs involved - if they are very high, centralize operations. 2. The minimum efficient scale of the technology - the larger the minimum efficient scale of a plant, the more likely centralized production makes sense
Buying componet parts from independent suppliers (outsourcing) is attractive because it:
1. gives the firm greater flexibility 2. may help drive down the firm's cost structure 3. helps the firm to capture orders from international customers 4. may facilitate innovation
making component parts (vertical integration) is attractive because it:
1. is often associated with lower costs 2. facilitates investments in highly specialized assets 3. protects proprietary technology 4. facilitates the scheduling of adjacent processes
Product Factors location depends on?
1. product's value-to-weight-ratio - if the value-to-weight ratio is high, centralize production and export - if the value to weight ratio is lo, decentralize manufacturing 2. Whether the product serves universal needs - if so, there is less need for local responsiveness, and operations can be centralized
Current statistics show that about ______ of major R&D projects in the chemical, drug, petroleum and electronics industries turn into commercially successful products.
20%
A global company should devote ______ of its efforts to the customer category in the downstream portion of the supply chain.
30%
Expatriate failure can be reduced through training, but despite the known benefits of training, one study showed that only about ______ of managers sent on an expatriate assignment receive training prior to departure.
30%
Recent statistics from the Small Business Administration show that about _____ of US firms with fewer than 500 employees are involved in exporting.
5%
What are two examples of location externalities that a firm would consider when making a foreign investment decision? (Check all that apply.)
Appropriately skilled labor pool Supporting industries
A firm is considering two countries as sites for production facilities. Both countries have similar factor costs and political climates. Country A has poor infrastructure; Country B has access to technology and relatively easy transport of raw materials. Country ___ seems to offer better location economies.
B
Types of countertrade
Barter - direct exchange of goods/services Counter purchase - reciprocal buying agreement where the firm uses some payment to buy local product Switch trading - 3rd party buys firm's counter purchase credits and resells them Offset - similar to counter purchase, but firm can buy from any firm within the country Compensation or buyback - take percentage of plant output for partial payment
Natalie is happy to work with the retailers that she has relationships with in London. They are able to sell and support her product line and are experts in the field. Natalie is basing her opinions on which of the following?
Channel quality
The Foreign Credit Insurance Association provides coverage against which two risks? (Check all that apply.)
Commercial Political
Refer to Table 16.1. Which element of the marketing mix addresses the question of the role of social media in getting in touch with customers?
Communication strategy
Exports only account for a small percentage of US business for which two reasons?
Companies are unfamiliar with opportunities. Companies are intimidated by language, culture and currency differences.
Production and Supply Chain
Conducted internationally to: 1. Lower the costs of value creation 2. Add value by better serving customer needs, including quality
Economic differences
Consumer behavior is influenced by economic development - consumers in highly developed conuntries tend to have extra performance attributes in their producs - consumers in less developed countries tend to not demand these extra performance attributes - cars: no ac, power steering, power windows, sound systems - product reliability is more important
What two factors are critically important to the success of global supply chain coordination? (Check all that apply.)
Coordination Integration
Training for Expatriate Managers
Cultural - seek to foster an appreciation of the host-country's culture Language - can improve expatriates effectiveness, relate more easily to culture and fostered a better firm image Practical - ease into day-to-day life of the host country
An advertisement that ran in a French magazine showed a picture of a black woman breast-feeding a white baby. When that same ad ran in a US magazine, civil rights groups were immediately on the attack and claimed the ad promoted white racial domination. Which variable to international communication did the advertiser fail to take into account?
Cultural barriers
Since it was the first time his company would be selling its line of snack products in Japan, it was Mahut's job to work with a Japanese-based advertising company to make sure the company's US advertisements would be suitable for the Japanese consumer. Which variable of international communication is Mahut's company taking into account?
Cultural barriers
What are three critical variables that can impact a company's international communications? (Check all that apply.)
Cultural barriers Source effects Noise levels
What are the two main arguments against using standardized advertising? (Check all that apply.)
Cultural differences Advertising regulations
______ is the lack of interest in learning about other cultures or recognizing what works in other cultures.
Cultural myopia
Which two types of training have been found to reduce expatriate failure? (Check all that apply.)
Cultural training Language training
Phase Two Athletics is located in the United States. The company would like to export to Italy but preliminary meetings with representatives from Italy have proven difficult. The representatives don't understand the value of the company's fitness gear because they feel most Italians prefer to exercise at a health club where the gear is provided. What impediment to exporting is Phase Two Athletics facing?
Culture
The HRM function has a critical impact on which three elements of a firm's organizational architecture? (Check all that apply.)
Culture Incentive systems People
Understanding the scope of the research problem is a critical aspect in which step of the research process?
Defining the research objectives
High failure rates of new product development projects are linked to which two reasons? (Check all that apply.)
Development of technology for which demand is limited. Failure to adequately commercialize new technology.
What two main issues should a manager be aware of when considering market segmentation in a foreign country? (Check all that apply.)
Differences between countries in the structure of market segments Existence of segments that transcend national borders
What are the four elements that make up a firm's marketing mix? (Check all that apply.)
Distribution strategy Pricing strategy Product attributes Communication strategy
Connor runs a small business and is interested in exporting his product to Ireland, but he needs some advice on the legal issues this would entail. Which organization would provide him with a free initial consultation for his legal questions?
ELAN
Sunny Soups has never exported their products before but would like to start. What company can provide Sunny Soups with a full menu of services to handle all aspects of their exporting needs?
EMC - Export Management Company
In which three ways can companies that have tight cross-functional integration among R&D, production, and marketing improve the potential for new product success? (Check all that apply.)
Ensure development costs are kept in check. Ensure that product development projects are driven by consumer needs. Make sure new products are designed for ease of manufacture.
The Foreign Credit Insurance Association and the _____ are two forms of government-backed assistance in the United States that help finance export programs.
Export-Import Bank
What organization is an independent agency of the US government that was set up to provide financing to facilitate exports, imports and the exchange of commodities?
Export-Import Bank
In which two situations would a company want to emphasize a pull strategy instead of a push strategy? (Check all that apply.)
Extensive media available Selling consumer goods
True or false: The majority of major R&D projects turn into commercially successful products.
False
True or false: The term production is only used to denote a physical product.
False
True or false: Refer to Figure 17.1. Within the organizational architecture of a firm, human resources is responsible for both structure and processes.
False Human resources is responsible for people, culture, and incentives and controls but not for structure or processes.
True or false: Cost and marketing functions are the two critical factors determining the make-or-buy decision.
False Most make-or-buy decisions are based on two critical factors: cost and production capacity.
True or false: One disadvantage of a JIT system is that firms are often left with large inventories that they need to sell off at a reduced cost.
False One disadvantage of a JIT system is that firms are left without a buffer stock of inventory and might be short-stocked when demand is high.
antitrust legislation
Federal laws (starting with the Sherman Act of 1890) that tried to prevent a monopoly from dominating an industry and restraining trade.
What are two allowances that are typical in expatriate compensation? (Check all that apply.)
Housing Education
What two benefits can a company derive from flexible manufacturing technologies? (Check all that apply.)
Improve efficiency Lower costs
What is an example of a long distribution channel?
In Japan, it is common for a product to go through several wholesalers before arriving at a retail outlet.
Which three decisions are part of global inventory management? (Check all that apply.)
In what form to hold inventory How much inventory to hold Where to locate inventory in the supply chain
Why is it especially important to integrate R&D and marketing when involved in international business?
It may be necessary to create different versions of a product for various countries.
An advantage of ______ inventory systems is that parts enter the production process immediately. In that way, defective parts can be spotted quickly.
JIT
Product quality is improved when a ______ inventory system is used because substandard inputs are identified immediately as parts enter the manufacturing process.
JIT
According to the text, what three things help managers develop a global mindset? (Check all that apply.)
Learn foreign languages as a part of family life Live in a foreign country Grow up in a bicultural family
Instruments of trade
Letter of credit - issued by bank at importers request, and specifies payment Draft - also called bill of exchange, instructs payment on sigh or time Bill of Lading - Issued by exporter by common carrier transporting merchandise - serves as receipt, contract, and document of title
A company that engages in international purchasing, but does so in a reactive and uncoordinated way, is at which level of global purchasing?
Level II
A company that engages in global purchasing activities that are integrated across worldwide locations and functional groups is at which level of global purchasing?
Level V
Staffing policy role of hr
Recruiting and selecting individuals with requisite skills to do a particular job, and developing and retaining them - tool for developing and promoting corporate culture and sustaining strategy
How does the Ex-Im Bank fund the financing aid it provides to facilitate exports, imports, and the exchange of commodities between the US and other countries?
Loans
What term is given to the activities that encompass the movement of physical materials through the supply chain?
Logistics
Supply chain management refers to the integration and coordination of what three activities from raw material to the end-customer? (Check all that apply.)
Logistics Operations Purchasing
In which type of distribution channel is it more likely for the consumer to end up paying a higher price for the final product?
Long
What are three factors that would lead a company to adopt a decentralized production configuration strategy? (Check all that apply.)
Low value-to-weight ratio Lower fixed costs High trade barriers
Select the three methods by which improved quality control can reduce costs. (Check all that apply.)
Lower re-work and scrap costs Increased productivity Reduced warranty costs
When a company is able to expand its operations by exporting globally, it can often achieve greater economies of scale while results in ______.
Lower unit costs
How are medical and pension benefits typically treated for expatriates?
Many firms provide the same level of benefits they would receive at home.
Export/Import financing
Mechanisms for financing exports and imports have evolved over the centuries in response to a problem that can be particularly acute in international trade: the lack of trust that exists when one must put faith in a stranger.
Guidelines for performance appraisal
More weight given to on-site manager's evaluation Former expatriate who served in the same location should assist home-office manager with the evaluation - if foreign on-sight manger preparing evaluation, home-office manager consulted before evaluation is finalized
Polycentric staffing policy
Multi domestic strategy host country nationals manage subsidiaries, home country nationals have key positions at headquarters Advantages: Alleviates cultural myopia inexpensive to implement disadvantages: limits career mobility isolates headquarters from foreign subsidiaries
______ pricing is in evidence when a company aggressively prices a product in one market and this pricing strategy elicits a competitive response from a rival company.
Multipoint
What is NOT a method of quantitative data collection?
Observation methods
Which form of transport is the least expensive?
Ocean
What are three strategic roles a foreign factory might have?
Offshore factory Outpost factory Server factory
Which staffing policy requires host-country nationals to be recruited to manage subsidiaries while parent-company nationals occupy key positions at corporate headquarters?
Polycentric
Advertising laws
Prohibitions - tobacco - nudity -sex Product comparisons - Germany - competitor can take you to court to prove claims made about product Canada - no "puffery", use the credulous person standard - United states "puffery" is okay
Export assistance
Prospective U.S. exporters can draw on two forms of government - backed assistance to help their export programs - Export-import bank - exim.gov - Export credit insurance - FCIA
What two functions are performed by the Ex-Im Bank? (Check all that apply.)
Provides direct lending to foreign borrowers for purchasing US exports Guarantees repayment of US commercial bank loans made to foreign borrowers for purchasing US exports
A US company decides that the best way to sell its product line in Argentina is to create a sales force within the country since there are few trade publications to advertise in. What aspect of international business is the company determining?
Push and pull strategies
Push vs Pull promotion
Push strategy - for industrial products and/or complex new products - short distribution channels - few print/electronic media available Pull strategy - for consumer goods - long distribution channels - sufficient print/electronic media to carry message
In order to reduce the possibility of new product failure, a company should dedicate itself to creating tight cross-functional coordination and integration among which three core functions involved in the development of new products? (Check all that apply.)
R&D Marketing Production
Anti-dumping regulations
Selling a product for a price that is less than the cost of producing it antidumping rules place a floor under export prices and limit a firms ability to pursue strategic pricing antitrust regulations
Which organization oversees volunteers who have international trade experience and who use this experience to provide one-on-one counseling to active and new export businesses?
Service Corps of Retired Executives
Defining the research objectives in international market research includes which two steps? (Check all that apply.)
Setting objectives for the research Defining the research problem
______ are the Japanese trading houses that work with their affiliated companies to identify export opportunities.
Sogo shosha
Following a month-long social media attack on German imports, German electronic manufacturers decided to implement an advertising campaign to negate the attack and reassure US consumers that German-made electronics were of the highest quality and relied on US parts to complete the product. Which international communication barrier did the German electronic manufacturers address?
Source effects
What two characteristics are associated with using an EDI system? (Check all that apply.)
Suppliers and shippers can communicate with no time delay. Paperwork between suppliers and shippers is virtually eliminated.
What are three components of a typical expatriate compensation package? (Check all that apply.)
Tax differentials Benefits Foreign service premium
What are two advantages of a geocentric staffing policy? (Check all that apply.)
The executive team feels comfortable working in a variety of cultures. The firm makes best use of human resources.
After the exporter presents the draft to the bank in a typical international trade transaction, what happens next?
The exporter's bank presents the draft to the importer's bank.
True or false: Antidumping regulations are provided under the GATT agreement.
True
True or false: Commercial banks are more willing to lend cash to foreign enterprises when the Ex-Im Bank guarantees the transaction.
True
True or false: Companies new to exporting are more likely to underestimate the time and expertise needed to cultivate relationships in foreign countries.
True
True or false: For most consumer durable goods, product reliability may be a more important attribute in less developed nations.
True
True or false: In order to reduce the risks associated with exporting, it makes sense for a company to initially focus on one market.
True
True or false: Japanese firms have historically used an ethnocentric staffing policy.
True
True or false: Language training can help improve an employee's effectiveness in a foreign posting.
True
True or false: Since the international market is significantly larger than the domestic market, exporting is nearly always a way to increase a company's revenue.
True
True or false: The HRM function plays a valuable role in helping a firm achieve its primary strategic goals.
True
True or false: When creating a product development team, if possible, all members should be in the same physical location.
True
True or false: Flexible machine technologies allow companies to customize products based on the needs of small consumer groups.
True Flexible machine technologies drive down the cost of customization even for a small quantity.
True or false: Today, the level of centralized input into labor relations practices is increasing.
True More and more international companies are trying to centralize this practice since labor costs account for a large percentage of total costs.
True or false: Nokia's use of a standardized slogan spoken in local languages in an example of how to capture the benefits of global standardization, yet at the same time responding to local cultures.
True Nokia's use of a standardized slogan spoken in local languages in an example of how to capture the benefits of global standardization, yet at the same time responding to local cultures.
True or false: Shared decision making is best described as decision making involving joint considerations.
True Shared decision making is not joint decision making; it is decision making involving joint considerations.
True or false: When conducting international research, it is advisable to include at least one native of the country being researched.
True When conducting international research, it is advisable to include at least one native of the country being researched to aid in the understanding of the findings.
Which scenario demonstrates the concept of source effects in relation to international communication?
US customers refuse to buy products sold out of Indonesia after that country takes two US reporters hostage.
Which country ranked the highest in new product development for most of the post-World War II period?
United States
Exporting Requirements
_ identify export opportunities - Avoid host of potential problems in foreign market - Become familiar with mechanics of export/import process and financing - Learn where to get financing and export credit insurance - Deal with foreign exchange risk
While Connor's company had been selling die-cutting machinery in the United States for many years, the company decided to create a personal sales force in Italy when it began selling to that country so the sales force could educate potential buyers about the products. The sales force demonstrates the idea of _____.
a push strategy
A benefit of flexible machine cells is
a reduction in work in progress.
According to research, a primary reason managers now turn down international assignments is _____.
a spouse's career
Production
activities involving creating a product
A firm's failure to understand that host-countries require different approaches to marketing and management is known as ______.
cultural myopia
______ is the direct exchange of goods between two parties without a cash transaction.
barter
The imbalance that is present between men and women in the workplace tends to get _____ within upper levels of an organization.
bigger
The draft, sometimes called the _____ is used in international commerce to effect payment.
bill of exchange
The ______ is a document issued to the exporter by the common carrier transporting the merchandise and acts as a receipt of goods.
bill of lading
Ulan works for a trucking company that ships products all over the United States. She verifies the merchandise she receives from various companies against the receipt included with the materials. This receipt is a
bill of lading.
Which of these products would have a low value-to-weight ratio?
bulk chemicals
Lisbeth's company has grown quickly internationally and she needs to hire someone who can help her assess all the data of the current business operation and use it to create strategies to help the company continue to grow in the future. Lisbeth needs to hire an individual who has experience in _____.
business analytics
The knowledge, skills, and technology that allow for the exploration of a company's international business strategies to gain insight and affect future strategies is called _____.
business analytics
Company XYZ has an arrangement with Company Ohai in Argentina. XYZ has contributed funds to build 14 hemp processing farms. In return, Ohai agrees to supply XYZ with a certain amount of hemp for 15 years (as partial payment). This is an example of a(n) ______ agreement.
buyback
When a firm agrees to build a plant in a country or supplies technology, equipment and/or training, and then agrees to take some of the plant's output as partial payment, the firm is engaging in a(n) ______.
buyback
According to Mendenhall and Oddou, ______ refers to the relationship between the foreign country and how well an expatriate can deal with living there.
cultural toughness
Heidi's company works through an import agent to get their products to retailers throughout Europe. In this situation, there are two intermediaries between the manufacturer and the consumer -- this refers to the
channel length.
price discrimination or market pricing
charge the profit maximizing price in each market - must keep national markets separate - different price elasticity and/or costs
Using a web-or ______-based information system allows a company to speed up production, if necessary, by flying in key parts to the facility.
cloud
As noted in the text, although American Express may sell the same basic charge card service worldwide, differences in national regulations require it to vary aspects of its ______ strategy from country to country.
communication
A company relies on a ______ to advise prospective customers about the attributes of a product.
communication strategy
In a _____ retail system, most of the market is supplied by a few retailers.
concentrated
When a few retailers supply the majority of the market, it reflects a ______ retail system.
concentrated
When flexible manufacturing technologies are available, this bolsters the argument for _____ production configurations.
concentrated
Manuel has been hired by a clothing distributor based in Ireland. It is his job to travel to US clothing manufacturers and try to purchase denim products at the lowest price possible. He then receives a commission based on his results. Which type of export service provider does Manuel work for?
confirming house
A(n) ______ factory has its own infrastructure when it comes to development, engineering, and production, and often competes with the firm's home factories for testing new ideas and products.
contributor
A firm's performance appraisal systems are a critical part of its _____ systems.
control
A performance appraisal would be part of an organization's ______ system.
control
Jeanne was hired in part because she was comfortable with the company's norms and value systems. In other words, she was a good fit for the company's ______.
corporate culture
A reciprocal buying agreement whereby a firm agrees to buy a specific amount of goods back from a country to which a sale is made is called ______.
counterpurchase
A major disadvantage of ______ is that firms might be paid in unsaleable or shoddy products instead of hard currency, which the firm would prefer.
countertrade
Boeing often enters into agreements in which the company has to purchase certain components parts from the country in which it hopes to do business. This arrangement is an example of _____.
countertrade
Many US consumers prefer to purchase French wine because it is admired around the world. This demonstrates the idea of
country of origin effects.
The replacement of the transistor by the microprocessor is an example of ______.
creative destruction
Eleanor's company is providing her with training in the social and business practices of the country of Morocco. She will be working there for the next two years and it is important for her to understand these practices. This demonstrates expatriate ______ training.
cultural
A problem that arises when a home-office manager evaluates the performance of an expatriate is ______, which can be alleviated by receiving input from on-site managers.
cultural bias
The frozen food division of Nestlé markets fish cakes and fish fingers in Great Britain, but focuses on marketing beef bourguignon and coq au vin in France. This reflects how Nestlé is taking ______ into account when selling products in each country.
cultural differences
Mega Data International wants to export into South America but has no knowledge of the laws or documentation required to do so. Which of these agents can help the company with this problem?
customs broker
An order written by an exporter that instructs an importer to pay a specified amount of money at a specified time is called a _____.
draft
When consumers in Belgium are charged lower prices for Wilson tennis shoes for no particular reason than consumers in Italy, price ______ exists.
discrimination
When Margo learned that the inventory levels were still at 90%, she instructed the sales team to sell the product 35% lower than production costs to bring the inventory down to acceptable levels. This demonstrates the idea of
dumping.
The threat to unions from an MNC keeping highly-skilled tasks in the home country and farming out the low-skilled tasks to foreign plants is that it is (easy or hard?) for the company to switch production facilities, reducing the bargaining power of organized labor.
easy
Shiver Refrigerators Inc. manufacturers a line of refrigerators with no extra features like an ice-maker or a deli drawer. These units are sold in less developed nations where a consumer has less income to spend on a high-end appliance.This scenario demonstrates how _____ can influence consumer behavior.
economic development
Jessica's company recently lowered the cost of their footwear line and suddenly the demand for products increased dramatically. In this situation, demand would be considered
elastic.
If a firm was concerned with transferring its core competencies to a foreign operation, it might elect to transfer parent-company nationals who have knowledge of that competency to the foreign operation. This would be an example of the ______ staffing strategy.
ethnocentric
Morah's company is trying to gain access to shelf space in several upscale department stores for its new line of skin care products. However, it is very difficult to get the stores to carry the skin care line because they prefer to carry products from established manufacturers. What type of distribution channel is preventing the company from gaining access to shelf space?
exclusive
Jiffy Bicycle has had trouble exporting in the past due to the bulky boxes their products require. Which type of company could assist Jiffy Bicycle with this issue?
export packaging company
Carolina Sailboat contracts with a company that identifies businesses in foreign countries that will market and sell their line of sailboats. This company also provides all the documentation for the exports, coordinates logistics, and transportation. What type of company does Carolina Sailboat contract with?
export trading company
Businesses would use the CORE diagnostic tool when making decisions regarding _____.
exporting
According to some researchers, a manager who demonstrates cognitive complexity and a cosmopolitan outlook has a(n)
global mindset.
Levitt promoted the idea that the success of companies like McDonald's and Coca-Cola that sell essentially the same products everywhere reflects the
globalization of markets and brands.
What are two problems associated with bartering?
goods have to be exchanged simultaneously or else one company may be subsidizing another companies may have to accept goods that they don't want
Jamie's company is interested in doing business in South America but they have been unsuccessful because of formal trade barriers that make it too costly to do business there. In this situation, which entity is affecting country attractiveness?
government
A(n) ______ segment refers to a market segment that spans multiple countries, transcending national borders.
intermarket
A(n) ______ allowance is typically provided to an expatriate who is sent to a location that is deemed difficult because of a lack of basic services or amenities.
hardship
When an expatriate is sent to a country where basic amenities such as health care, schools, and retail stores are minimal compared to the employee's home country, a company will often provide the expatriate with a(n) ______ allowance.
hardship
When there are many companies making the same product, it results in _____ elasticity of demand.
high
The two issues that impact compensation practices in an international business are _____ and _____.
how compensation should be adjusted to reflect economic circumstances. how expatriate managers should be paid
The goal of a cross-functional product development team is to take a product from ______ to ______.
initial concept development; market introduction
A(n) ______ is an employee of a multinational company who is from a foreign country, but is transferred from a foreign subsidiary to the corporation's headquarters.
inpatriate
Renee is a citizen of France who has moved to the US to work at Intel. Renee is an example of a(n)
inpatriate.
Review Table 15.2. A company that decides to stop outsourcing products or services and instead starts to produce them internally is
insourcing.
When all other factors are equal, what two conditions foster a greater rate of new-product development in a country?
intense competition affluent consumers
Kevin's company decides to market its products in Europe. To do this, the company implements an advertising campaign that focuses on print advertisements in popular European newspapers and magazines. These advertisements help the company engage in
international communication.
Flexible manufacturing technology is also referred to as ______ production.
lean
According to a study on repatriated employees, 40% of them
leave their firms within 3 years of arriving home.
A fragmented retail system tends to promote the growth of wholesalers, which is more likely to ______ channels.
lengthen
Collecting secondary data is a (more or less?) costly alternative to collecting primary data.
less
Recently, the Japanese yen has seen steady appreciation against the dollar, as a result Japan has become _____ attractive as a manufacturing location.
less
The two advantages of using a polycentric approach to staffing are: (Check all that apply.)
less expensive to implement fewer cultural misunderstandings
The main advantage of the ________ is that both parties are likely to trust a reputable bank even if they do not trust each other.
letter of credit
A document issued by a bank at the request of an importer that directs the bank to pay money to the exporter upon presentation of specified documents is called a
letter of credit.
Kalee works for Wolf Furniture Corp. and it is her job to control the inventory of raw materials, component parts, and products used in the manufacturing of the company's office furniture line. Kalee works in _____.
logistics
Whether a firm should perform a value creation activity themselves or outsource it is called the _____ decision.
make-or-buy
The ______ is the person or business who initiates a draft or bill of exchange during the exporting process.
maker
Supply chain
managing operations, procurement, logistics and market channels activity from raw materials to end user
Purchasing and inventory:
managing raw materials, components and finished goods for cost and quality 14% of manufacturing cost
Hillary is in the process of determining who buys the company product line based on the consumer's age, income, and education level. Hillary is defining the product's ______ segmentation.
market
The systematic collection, recording, analysis, and interpretation of data to provide knowledge for decision-making in a company is the definition of international _____.
market research
Rasheed's report outlined that consumers living on the West Coast had purchased 80% more of the company's line of "green" products as compared to consumers living in the southeastern part of the country. His report identifying specific groups is an example of
market segmentation.
Ryan's department is responsible for assessing the distribution and pricing strategies for the company's main product lines. This department is responsible for two elements of the ______.
marketing mix
What term is defined as the best possible combination of product, distribution, communication and price that a firm offers to its target markets?
marketing mix
The choices a firm offers to its target markets, such as the products available and the pricing of those products, is known as the
marketing mix.
The term used to describe a company's ability to produce a customized product at low cost is ______.
mass customization
When a company uses flexible manufacturing technology to develop a low cost, customized product, it is using the process of
mass customization.
After working at Toyota for five years and visiting Ford's US facilities,Taiichi Ohno recognized problems with ______.
mass production
Three of the mass production problems that Ohno identified at Toyota were
massive inventories are expensive to maintain. mass production cannot accommodate customer preferences. errors in initial machine settings created large numbers of defective items.
It typically costs a firm _____ to post someone to a foreign country than what it costs to keep that person in the home office.
more
Providing medical and pension benefits for expatriates may be ______ costly for the firm because benefits are not tax deductible out of the country.
more
When a time draft is accepted, the maker can then sell the draft to an investor at a discount. This demonstrates how time drafts are _____.
negotiable
During the management meeting, Randall explained that their recent radio advertising campaign had failed probably because consumers were hearing too many messages and theirs did not stand out. Randall is saying that _____ reduced the company's communication.
noise
When considering the international marketplace, small and medium-sized firms tend to
not pay attention to foreign markets; rather they focus on their energies on local market.
If a payment is made before products are shipped, an importer may be concerned about what two things?
not receiving the product receiving a defective product
A(n) _______ factory is developed and set up to assemble or manufacture products in a country where labor and/or raw materials are cheaper, for export and/or eventual import into the manufacturer's home country.
offshore
Manuel works on the assembly line at a factory in Mexico that produces component parts for a Japanese automaker. The factory is not involved in any decisions on the automobiles but is simply designed for parts production. This is an example of a(n) _____ factory.
offshore
According to most expatriates, more weight should be given to the ______ manager's evaluation than to the ______ manager's assessment during a performance evaluation.
on-site; off-site
At Darla's company, the executives at headquarters are all parent-company nationals, but the foreign subsidiaries all have host-country presidents. This demonstrates the ______ staffing policy.
polycentric
The major drawback to a(n) ______ staffing policy is the separation that might develop between host-country managers and parent-country managers.
polycentric
The lack of a manager's mobility among national operations in ______ firms implies that pay can and should be kept country-specific.
polycentricd
A company that helps the expatriate manager and family ease into day-to-day life in the host country by ensuring access to a support network of friends is providing ______ training.
practical
When the Petersons were posted to Thailand for a management opportunity, they quickly joined the expatriate community to learn the ins and outs of living in the Thai culture. Their actions represent a form of ______ training.
practical
What are the three core applications that business analytics focuses on?
prescriptive predictive descriptive
After the company lowered the cost of its men's suits, sales increased by 30%. This demonstrates the concept of
price elasticity of demand.
Renee buys a new cell phone. It comes in a molded plastic package. This is an example of ______ packaging.
primary
Packaging:
primary, secondary and transit to perform, protect and inform
The costs of collecting ______ data is typically higher than the cost of collecting ______ data.
primary; secondary
In many countries, you would find advertisements for tobacco and alcohol only in ______ due to federal laws.
print media
Jan's company decided to create a cross-functional product development team. This team should consist of members from the following departments: R&D, marketing, and
production.
In the European Union, companies must be certified under ISO 9000. This is a certification of a manufacturing firm's processes and
products.
For most companies, there is a critical link among channel length, the final selling price, and the company's
profit margin.
Charles works for a company that makes toothpaste. He realizes that the best way to advertise the product line to the international market is through mass media advertising because it will reach more consumers. He knows it would be impossible to reach every consumer with a personal sales call. He recognizes that his company should use a ______ communication strategy.
pull
Dave's Ohio-based company plans to use an advertising campaign including print ads, television ads, and billboards to promote their new product in London. The company believes that once consumers in London start demanding the product, intermediaries will want to carry the product. This is an example of a ______ strategy.
pull
Gabriel knows there is a wide array of television stations, magazines, and newspapers in central Europe, so it will be easy for him to advertise his company's product. Gabriel plans to use a ______ strategy for his communication strategy.
pull
If a company chooses to use mass media advertising rather than personal selling as a communication strategy, it is engaging in a (push or pull?) strategy.
pull
When a company sells consumer goods, such as shampoo and lotion, it would be common for the company to use a (push or pull?) strategy.
pull
A business uses the _____ function to obtain raw materials it needs to manufacture goods.
purchasing
The process of a business or organization attempting to acquire goods or services to accomplish the goals of its enterprise is called
purchasing.
In many advanced nations outside the US, it is illegal to advertise pharmaceutical products directly to the consumer. As a result, companies must rely on direct sales efforts to doctors to educate them on a product. These companies are using a ______ strategy.
push
Paul's company sells complex products to hospitals and medical facilities. It would be best for his company to use a ______ strategy as a communications tool.
push
When a company uses a (push or pull?) strategy, it emphasizes personal selling rather than mass media advertising.
push
When introducing a complex product in a developing nation, most companies would use a ______ in order to educate consumers on the attributes of the product.
push strategy
The two mechanisms used to collect data are: (Check all that apply.)
qualitative quantitative
The operational objective called ______ refers to integrating a system so that there are NO defects throughout global supply chains.
quality
Increasing inventory turnover can lead to what two outcomes for a business?
reduction in storage costs decrease in working capital needs
ISO 9000 is used in the EU marketplace as a way to _____.
regulate manufacturing processes
Which type of export service provider buys a product directly from the manufacturer and then packages and labels the product based on their own specifications and sells the product under their own name?
remarketer
The process that involves preparing expatriate managers to return to their home-country organization is called ______.
repatriation
When determining how it will distribute products, a company must recognize the main differences between distribution systems: channel length, channel exclusivity, channel quality, and ______.
retail concentration
What are four examples of communication channels a company can use?
sales promotion social media direct selling advertising
Companies who implement experience curve pricing hope to rapidly build
sales volume.
Standard pricing
same price all over the world
What two things are generally needed for successful piggyback marketing?
same target market complementary products
The main difference between a contributor factory and a(n) ______ factory is that a contributor factory has responsibilities for product and process engineering and development.
server
Channel length is typically ______ in countries where large discount superstores are introduced.
shortened
Since the Industrial Revolution, product life cycles have
shortened dramatically.
Domestic unions encounter particular challenges with multinational firms. What are three of those challenges?
the company can move production to another country an international company can import employment practices and contractual agreements from its home country only low-skilled tasks might be sent to another country
During the interview, the personnel manager told Celine that the company hires individuals who display qualities of honesty, fairness, and open-mindedness -- values which are also considered the mainstay of the company. The personnel manager is describing _____.
the corporate culture
What are three characteristics of the total quality management philosophy?
the work environment be open to employee suggestions mistakes should be eliminated quality of supervision should improve
According to the text, the costs of expatriate failure for the parent company might be as much as ______ times the expatriate's annual domestic salary plus the cost of relocation.
three
A(n) _____ draft allows the drawee to delay payment -- normally for 30 or more days.
time
The management philosophy that takes as its central focus the need to improve the quality of a company's products and services is ______.
total quality management
Once a manager has been selected for an international posting, the next step is to
train him or her in the responsibilities of the specific job.
Once an expatriate manager has been selected, what is the next step in the management development process?
training
Companies using a _____ strategy are more likely to foster management development as these managers must be able to detect pressures for local responsiveness.
transnational
More and more international businesses are incorporating management development techniques. This is especially evident in companies using a(n) _____ strategy.
transnational
A high value-to-weight ratio means that
transportation costs are low.
Strategic pricing
using price as a competitive weapon
