MGMT 4100 Final Exam

Sustainability

Pillars of Sustainability: - People - Profit - Planet

Integration Paradigm (learning and effectiveness)

- Acknowledges cultural differences among people and recognized the value in those difference. - Expands the notion of what are relevant issues. - Internalizes and incorporates different employee perspectives into the main work of the company. - Allows companies to rethink primary tasks, redefined markets, products, strategies, missions, business practices and even culture. - 8 preconditions for making the shift: 1) Truly value a variety of opinions and insights. 2) Recognizes the opportunities and challenges (persevere.) 3) Expectation of high standards of performance for all employees. 4) Stimulate personal development. 5) Encourage openness. 6) Make workers feel valued. 7) Widely understood mission. 8) Egalitarian and non-bureaucratic.

Managing Diversity

- Entails enabling people to perform up to their maximum potential. - Focuses on changing an organization's culture and infrastructure such that people provide the highest productivity possible.

Assimilation Paradigm (discrimination and fairness)

- Focuses on Affirmative Action - EEO (recruiting, hiring), restructuring the organization to better reflect society. Expects the workforce to be "color blind" with the assumption that "we are all the same or we all aspire to be the same." - Negative Impact: a) Important differences are ignored and lost. People lose their true self for fear and retribution. b) "The staff gets diversified but the work does not."

Why should companies care about diversity?

- Increases in effectiveness, productivity, and morale. - Access to new Segments of the Market Place.

Culturally Contingent Leader Attributes

- Individualistic - Status-Conscious - Risk-Taking

To unleash the benefits of a diverse workforce beyond profits you need to have an organization that supports:

- Learning. - Flexibility. - Growth (organizational and individual). - Ability to adjust.

Building the Business Case for Managing Diversity

- Organizations cannot use diversity as a strategic advantage if employees fail to contribute their full talents, abilities, motivation, and commitment. - It is essential for an organization to create an environment or culture that allows all employees to reach their full potential. - Managing diversity is a critical component of creating such an environment.

Differentiation Paradigm (access and legitimacy)

- Recognize and celebrate differences. - Match diverse employees to niche markets. - Makes business sense through access to a larger labor pool and increased market access - Negative Impact: a) People are pigeonholed into a specific role/organization. Important perspectives and rationales are not identified. b) "We know enough to use people's cultural strengths but never learned from them."

Three tests of Ethical Corporate Actions that you should ask yourself

1) Is it legal? 2) Does it work in the long run? 3) Can it be talked about? Bribery fails all 3!!!!!!!

Three levels of Culture

1) National/Societal Culture - The dominant culture within the political boundaries of the nation-state. 2) Business Culture - Norms, values, and beliefs that pertain to business in a culture. - Tells people the correct, acceptable ways to conduct business in a society. 3) Organizational, Corporate or Occupational Culture - Organizational Culture: the set of important understanding that members of an organization share. - Occupational Culture: the norms, values, beliefs, and expected ways of behaving for people in the same occupational group. ****"Culture trumps organizational structure every time."****

Why do companies go global?

1. EXPAND SALES (Most common reason.) 2. DIVERSIFY markets and customer base. 3. EXTEND THE SALES LIFE of current products. 4. REDUCE DEPENDENCE on current markets by spreading risk. 5. COUNTER SEASONAL FLUCTUATIONS.

Culture

A set of shared values, understandings, assumptions, and goals that are learned from earlier generations, imposed by present members of a society, and passed on to succeeding generations. Culture is based on shared, norms, values, beliefs, and symbols that guide everyday life. - Cultural Norms: tell us what we should do and what we cannot do. - Cultural Values: tell us what is good/beautiful/holy, and what are legitimate goals for life. - Cultural Beliefs: represent our understandings about what is true. - Cultural Symbols, Stories, and Rituals: communicate the norms, values, and beliefs of a society or a group to its members. Doing business internationally is not the same as doing business at home. There are new skills to learn and new knowledge to acquire about the country you will be going to.

Cultural Relativism

All cultures, no matter how different, are correct and moral for the people of those cultures. - "Some see cultural relativism as simply an excuse to violate human rights.

Affirmative Action

An artificial intervention aimed at giving management a chance to correct an imbalance, an injustice, a mistake, or outright discrimination that occurred in the past. - Affirmative action comes from EEO Legislation.

Cultural Intelligence

An outsider's seemingly natural ability to interpret someone's unfamiliar and ambiguous gestures in just the way that this person's compatriots and colleagues would, even to mirror them. According to HBR, there are 3 sources of cultural intelligence: 1) Cognitive (Head) - Do you pick up on the subtle clues to a culture's shared understandings. 2)Physical (Body) - Can you mirror local behaviors and demeanor; and also receive and reciprocate gestures. 3) Emotional/Motivational - Confidence to persevere in the face of obstacles and reengage.

Non-Verbal Communication

Any messages sent or received independent of the written or spoken word. - Example: Gesture, body language, etc. - Subtle messages account for between 65%-93% of interpreted communication.

Stereotyping

Assumes that all people within one culture behave, believe, feel, and act the same.

Universal Impediments to Leadership Effectiveness

Being a loner and asocial --> Non-cooperative --> Dictatorial

Foreign Corrupt Practices Act (FCPA) was created to help Americans distinguish between harmless practices (e.g., gift-giving) and ____________. The primary purpose being to prohibit illegal payments to foreign officials.

Bribery.

The most common form of corruption is _____________.

Bribery.

Multinational Company

Broadly defined as any company that engages in business functions beyond its domestic borders. - This includes all types of companies that engage in international business.

Managing Multicultural Teams

Challenges on multicultural teams can create barriers to success and arise from multiple sources including: 1. Direct vs. Indirect Communication - Western Cultures: Message meaning is on the surface, as direct questions. (Low Context) - Eastern Cultures: Meaning is embedded in how the message is presented. Unwritten norms for how to communicate. (High Context) 2. Trouble with accents and fluency. - Can create negative perceptions of competence and result in underutilization of talent. 3. Differing attitudes toward hierarchy. and authority. - Teams are generally flat in structure which can be difficult for those from high power distance cultures. 4. Conflicting norms for decision making - How fast decisions are made and the level of detail and involvement will differ.

Global Trends

Cross-Border Trade - World merchandise exports were valued at US$ 15.46 trillion in 2016. The rise of global products and global customers - The needs of customers for many products and services are growing more similar. The internet and information technology - Electronic Communication -- E-mail, World Wide Web, etc. allows multinationals to communicate with company locations throughout the world. Foreign Direct Investment (FDI) - Occurs when a multinational company from one country has an ownership position located in another country. Privatization - Sale of government-owned business to private investors. Rise of global standards

Cross-Cultural Motivation

Cross-cultural motivation and leadership are complex. We need to adjust how we motivate people according to what they "need." Their needs are based on how they are raised -- largely influenced by culture. Management styles stem from habits develop;oped over a lifetime and therefore are difficult to change.

Ethnocentrism

Describes the attitude of those who operate from the assumption that their ways of doing things are best--no matter where or under what conditions they are applied.

Classifications of World Economies

Developed countries - Countries with mature economies, high GDPs, and high levels of trade and investment. Generally means the country is advanced in terms of infrastructure, industrialization, income per capita and standards of living. - US, Canada, Japan, France, Germany, UK, Italy. Emerging Markets - An emerging market economy describes a nation's economy that is progressing toward becoming more advanced, usually by means of rapid growth and industrialization. These countries experience an expanding role both in the world economy and on the political frontier. - Argentina, Brazil, China, India, Indonesia, Mexico. Transition Economies - Countries in the process of changing from government-controlled economic systems to free market or capitalistic systems. - Albania, Serbia, Ukraine, Armenia. Developing Countries - Countries with economies that have grown extensively in the past two decades. A country having a lower standard of living or level of industrial production, a country that is not yet highly industrialized. - Egypt, Cuba, Ethiopia.

Foreign Subsidiaries in the US

FDI in the US is increasing, Americans are becoming more sensitive to what they perceive as a lack of control of their own country's business. In Japan, CSR traditionally means taking care of employees. In the US it often means sharing responsibility for the community. - What is one driver of this difference? a) We get tax breaks in the US for corporate philanthropy, Japan does not;

Hofstede's Model of National Culture

Five Dimensions: 1) Power Distance - The level of acceptance by a society of the unequal distribution of power in institutions. 2) Individualism - The tendency of people to look after themselves and their immediate families only and to neglect the needs of society. 3) Collectivism - The desire for tight social frameworks, emotional dependency on belonging to "the organization." and a strong belief in group decisions. 4) Uncertainty Avoidance (Want things set, rules, no risks) - The extent to which people in a society feel threatened by ambiguous situations.

The FCPA allows for _____________ payments which are small payments meant to expedite routine transactions.

Grease.

Unconscious Bias

Happens outside of our control. It occurs automatically and is triggered by our brain making a quick judgement. - Unconscious bias is different from and more predominant than conscious prejudice. Tips to Minimize Unconscious Bias: 1) Check your assumptions - 2) Increase your awareness of stereotypes and behaviors that may disengage others. 3) Be mindful of potential unconscious bias that may show up in the selections, development, and promotion of talent. 4) Use appreciative inquiry and fact-based decision making. 5) Guide your actions by your stated values.

Power Distance

High - Leadership more autocratic and centralized. - Formal authority and hierarchy respected. Low - More comfortable with ambiguity. - Companies are less formal and structured. - Managers take more risks. - Employees have more mobility.

Uncertainty Avoidance

High - Very uncomfortable with ambiguity. - Strict laws and closely followed procedures. - Make low-risk decisions. - Lifetime employment common. - Wages: based on seniority, expertise. - Decision making: hierarchy, formal procedures. - Leadership: task-oriented. - Motivation: people feel security. - Risk averse Low - More comfortable with ambiguity. - Companies are less formal and structured. - Managers take more risks. - Employees have more mobility. - Wages: based on performance. - Decision making: flat organization, fewer rules. - Leadership: person-oriented. - Motivation: people are self motivated. - Risk taker.

High-Context Cultures vs. Low-Context Cultures

High-Context - Rely heavily on situational cues (non-verbal) for meaning when perceiving and communication with others. Low-Context - Written and spoken words carry the burden of shared meanings.

Triple Bottom Line

In addition to the traditional economic bottom line focused on (1) Economic Profits, environmentalists and social justice advocates have brought a broader definition to "bottom line" by adding (2) Social Impacts and (3) Environmental Impacts and costs into play, known as full-cost accounting.

Individualism/Collectivism

Individualism - Countries tend to have higher GDP. - Freer political systems. - "Social Loafing" is more common. - Wages: based on market value. - Decision making: individual or smaller group. - Leadership: individual based on performance. - Hiring/Promotion: based on individual traits. Collectivism - Tight social framework. - Emotional dependence on the organization. - Strong belief in group decisions. - Wages: based on group membership. - Decision making: Group, usually slower. - Leadership: based on duty and commitment. - Hiring/Promotion: slow, based on group membership.

Corruption often results in higher ________ due to economic instability.

Inflation.

Inclusion

Involvement and empowerment, where the inherent worth and dignity of all people are recognized. - An inclusive organization promotes and sustains a sense of belonging; it values and practices respect for the talents, beliefs, backgrounds, and ways of living of its members. - Inclusion is the deliberate act of welcoming diversity and creating an environment where all different kinds of people can thrive and succeed. - Is the act of "making the mix work."

Leadership vs. Management

Management is about control. - It is the control and interplay of quality, time, and cost/money, called the "Triple Constraint of Management." Leadership is about people. - If you push people you never know which way they will go. If you lead them and get them to follow you, you have the skill to be a leader.

In some parts of the world corruption and bribery are considered part of the culture. Nonetheless, gift-giving differs from bribery in that the former usually is ___________.

Not covert.

Discrimination

Occurs when employment decisions about an individual are due to reasons not associated with performance or are not related to the job.

Parochialism

Occurs, for example, when a Frenchman expects those from or in another country to automatically fall into patterns of behavior common in France.

Foreign Corrupt Practices Act (FCPA)

Primary purpose of FCPA is to prohibit the payment of bribes, in any form, to foreign officials in order to secure or retain business. The FCPA prohibits illegal payments, or other gifts, or political contributions to foreign government officials for the purposes of influencing them in business transactions. Grease Payments: Are usually a relatively small amount, provided to a low-level government official or business person, in order to expedite a business decision, shipment, or other transaction. - A grease payment is not intended to make a business deal happen, it merely makes it happen faster. Under FCPA, grease payments don't change the outcome of the foreign official's decision. If they did, the payment would instead be considered a bribe, and therefore illegal.

The simplest definition is: Corruption is the misuse of public power (by elected politician or appointed civil servant) for _________.

Private gain.

Individualist Culture

Promotion and rewards would be based on an employee's performance and skills rather than on their team membership.

Value Dimensions

Provide an approximation of national character. Values: - Are society's ideas about what is good or bad, right or wrong. - Can vary across subcultures. - Help managers anticipate likely cultural effects. - Determine how individuals will probably respond in any given circumstances. - Allow for contingency management.

Communication Process

Sender - Person wanting to communicate information-the message. Receiver - Person, group, or organization for whom the message is intended. Encoding - Translates thoughts into code or language that can be understood by others. Decoding - Occurs when receivers receive a message. - Process of interpreting and making sense of a message. Feedback - The sender gets a reaction from the receiver. Noise - Anything that interferes with the transmission and understanding of a message.

What might limit globalization?

Tariffs - Duty or tax on a particular class of imports/exports. Trade Barriers - Government imposed restriction on international exchange of goods/services. - Examples of Trade Barriers: FDA in US, Trade Quotas, Tariffs, Laws, Subsidies for local businesses. Technology Jobs Nationalism Time Zones Language War/Terrorism Economic Crisis Natural Disasters Political Uncertainty

Communication

The exchange of information between a sender and receiver and the inference (perception) of meaning between the individuals involved. - Communication is the most important aspect of management.

Long-Term Orientation

The extent in which people in society are willing to persist to achieve goals.

Convergence

The phenomenon of shifting individual management styles to become similar to one another.

Subsidiary--Host Country Interdependence

The process of globalization has resulted in an increasing impact of MNCs on host countries as they expand their operations into more than one country. Multi-National Companies must provide benefits tp the host country in which they operate in order to maintain cooperation. - Benefits to the host country of MNC a) Significant employment and training to the labor force in the host country. b) Transfer of skills and expertise, helping to develop the quality of the host labor force. c) MNCs add to the host country GDP through their spending, for example with local suppliers and through capital investment. d) Competition from MNCs acts as an incentive to domestic firms in the host country to improve their competitiveness, perhaps by raising quality and/or efficient. e) MNCs extend consumer and business choice in the host country. f) Profitable MNCs are a source of significant tax revenues for the host economy. - Criticism of MNC Subsidiary Activities: a) Majority of the stock of most subsidiaries is owned by the parent company. Consequently, host-country people do not have much control over the operations of corporations within their borders. b) MNCs usually reserve the key managerial and technical positions for expatriates. As a result, they do not contribute to the development of host-country personnel. c) MNCs start their foreign operations by purchasing existing firms rather than developing new productive facilities in hist countries. d) Domestic businesses may not be able to compete with MNCs and some will fail. e) MNCs may not feel they need to meet the host country expectations for acting ethically or in a socially-responsible way. - The goal of managing interdependence is to create cooperation, rather than confrontation. - The goal is not to create the dependence of an organization or country on another. - MNCs must learn to accommodate the needs of other organizations and countries.

What is Multinational Management?

The process of planning, organizing, leading and controlling in a multi-cultural/national environment. The formulation of strategies and the design of management systems, that successfully take advantage of international/intercultural opportunities and respond to international threats.

Diversity

The range of human differences, including but not limited to race, ethnicity, gender, gender identity, sexual orientation, age, social class, physical ability or attributes, religious or ethical values system, national origin, and political beliefs. - Diversity is simply a representation of many different types of people. Often focuses on the differences, and is referred to as "the mix." - Diversity is what you have. - Efforts to improve diversity have focused on increasing what is known as "identity groups." (traditionally under-represented groups.) - Companies need to look at diversity more holistically.

Masculinity

The tendency of a culture to support traditional masculine orientation. High (Assertive) - Materialism. - Lack of concern for others prevails. - More job stress. - More work-life conflict. - Hire/Promotion: jobs are gender identified, based on individual traits. - Decision making: individual. - Leadership: authoritarian. - Motivation: based on performance/growth/job recognition. Low (Relational) - Concern for others and relationships. - More work-life balance. - Less job stress. - More women in high-level positions. - Hire/Promotion: jobs independent of gender, slow, based on group membership. - Decision making: group. - Leadership: participative. - Motivation: based on quality of life.

Paradigms

Traditional Paradigms to date based on: - Discrimination and Fairness (ASSIMILATION) - Access and Legitimacy (DIFFERENTIATION) - New paradigm: Learning and Effectiveness (INTEGRATION)

Corruption

Types of political corruption: 1. Payoffs and Bribes - Bribery may be one of the most common types of political corruption. By definition, bribery is the act of giving money, goods or services to an official in exchange for favorable treatment. 2. Graft Embezzlement - Some elected officials are tasked with the oversight of large sums of money. This money. may be earmarked for local projects like building renovation or development contracts. If the official overseeing tides projects diverts some of that money into their personal accounts, they have committed an act of embezzlement. 3. Blackmail and Extortion. - Political offices can provide their officials with a great deal of power. When an official uses their power and influence to threaten another person into behaving a certain way, the official is committing political extortion. 4. Preferential Treatment - Elected representatives are expected to exercise fairness and discretion when issuing appointments for jobs, contracts and other benefits. Preferential treatment is a type of political corruption that occurs when an official lets their appointments be influences by inappropriate or illegal factors.

Reward Systems

USA - Focus on financial, social status, job content, career and professional. Japan - Focus on seniority, bonuses, and permanent workers; competition discouraged. China - Focus on social benefits, shift to pay-for-performance and equity-based rewards.

The Universal Facilitators of Leadership Effectiveness

Visionary and Communicative --> Inspiration and Motivating --> Trust Worthiness

If ethical problems cannot be resolved, a valid last resort option is to ___________ from the market.

Withdraw.

Which is NOT a part of the Triple Bottom Line? a) Emotional impacts b) Economic profits c) Social impacts d) Environmental impacts

a) Emotional impacts.

What were the 3 major shifts in strategy Nike made? a) Transparency, Fair Labor Association, Sustainability b) Paid settlement, Hired more lawyers, Sued Magazines c) Changed marketing, New financial reports, Cut R&D.

a) Transparency, Fair Labor Association, Sustainability.

CSR is the continuing commitment by business to behave ethically. a) True b) False

a) True.

International CSR is more complex than Domestic CSR? a) True b) False

a) True.

Moral Universalism does not really exist. a) True b) False

a) True.

_______ _______ means "No culture's ethics are better than any other's." (Follow local culture.) a) Cultural Absolutism b) Cultural Relativism c) Ethical Imperialism d) Cultural Sensitivity

b) Cultural Relativism.

What did they do wrong at first? a) Refused to make a financial settlement b) Did reputation management and took a defensive approach. c) Took control of their suppliers. d) Sued Life Magazine

b) Did reputation management and took a defensive approach.

ISO 26000 is a mandatory standard with financial consequences for non-compliance. a) True b) False

b) False. ISO 26000 is the international standard developed to help organizations effectively assess and address those social responsibilities that are relevant and significant to their mission and vision.

According to HBR Chapter 6, which is NOT a core human value? a) Good health b) Financial wealth c) Economic advancement (improved living standard) d) Golden Rule (reciprocity)

b) Financial wealth.

As per our class discussion, CSR stands for? a) Corporate Sustainability Report b) Constant Social Reporting c) Corporate Social Responsibility d) Career Strategy Responsibility

c) Corporate Social Responsibility.

What 1996 event triggered Nike's ethical downfall? a) Financial Irregularities investigation b) Sports Illustrated interview with the CEO c) Life Magazine Picture of a 12 year old boy sewing d) All of the above

c) Like Magazine picture of a 12 year old boy sewing.

What are the Three Pillars of Sustainability? a) Time, cost, quality b) Cost, career, communication c) People, profit, planet d) Technology, temperature, time

c) People, profit, planet.

Most international CSR decisions involve what? a) Bribery b) A lot of time and cost to analyze c) A negative impact on the community d) A trade-off between the rights of various stakeholders.

d) A trade-off between the rights of various stakeholders.

What is Nike doing now instead of "just turning a blind eye" and placing the order? a) Hiring only US suppliers b) Investing in more legal representation c) Doubling their procurement staff d) Auditing factories, mandating and forcing wages.

d) Auditing factories, mandating and forcing wages.