Chapter 1 (Globalization, Industry 4.0) Flashcards
What is globalization?
Internalization process of individuals, firms, government, and non-governmental institutions, that leads to greater integration and interdependence of nations
What does the globalization of business operation entails?
Internalization of financial capital
Internalization of value chain
Internalization of markets
Internalization of talent and knowledge
What does the internalization of markets in globalization pov means?
Converging tastes
Consumption of same products
Homogenization of culture
Global market opportunities for standardized global products
Difference in tech, culture, Econ and legal
What are some pros of globalization of markets?
Firms can sell their product all over the world
Product standardization
Economies of scale
What are some challenges of globalization of markets?
Not all markets are the same
Cultural differences
Different infrastructure
Political risk
Government regulations
What does the internalization of financial market from a globalization pov means?
Cross border sourcing of capital
Lower cost of capital for borrowers in. international capital markets
Higher returns for cross border investment
Risk diversification
What does the internalization of talent and knowledge means from a globalization pov?
New technology
Cross country cooperation
Global sourcing of skilled labour
Info tech
Global virtual teams
What is a global value chain?
Series of product or services that are value adding. From research and development to its sales support
What is porter’s value chain?
Set of activity that an organization Carrie’s out to create value for its customer. Primary and support activities.
What are porter’s value chain primary activities?
Inbound logistics, operations, outbound logistics, marketing and sales, service
What are porter’s value chain supporting activities?
HR management, tech development, procurement, infrastructure
How does porter’s value chain define value?
Value is defined when the cost outweighs the benefits the product or service
What is outsourcing?
When companies cannot produce/manufacture so they get their product else where (global MNEs)
Buyer driven
What is offshoring?
When a company brings their manufacturing else where, usually because of cost of labour, product….
What are the drivers of global value chain and what is their definition?
Buyer driven, outsource their products, the buyers are whet drives them to sell.
Producer driven, offshore, the low cost of their production is what drives them to open factories else where.
