Chapter 2

Question 1

Name the five stages of internationalization

Answer 1

1-exporting
2-sales office
3-licensing or franchising
4-subsidiaries 
5-IJV, M&A, international alliances

Question 2

What are two auxiliary methods of internationalization

Answer 2

Outsourcing and off shoring

Question 3

What is the difference between off shoring and out sourcing

Answer 3

Off shoring differs from outsourcing in that off shoring involves the relocation of one or more aspects of the firms business processes to a location in another country for the purpose of lowering costs.

Question 4

What is born global?

Answer 4

Companies that tend to be in the IT industry who are almost immediately operating across the globe. This is primarily because of the product they sell for example Internet products or IT applications.

Question 5

What is integration versus local responsiveness

Answer 5

Refers to the varying degrees of required interconnectedness of the MNEs various subsidiaries with each other and with headquarters

Question 6

What is integration

Answer 6

Integration is defined as the extent to which the subsidiaries and the headquarters develop a unified whole that’s provide a variety of competitive advantages such as economies of scale, improved quality, and standardization.

Question 7

What is local responsivenes

Answer 7

The extent to which subsidiaries respond to local differences, which involves the modification the products or services in order to fully meet local customer needs, respond to competition, and culture.

Question 8

Name for MNE business strategies

Answer 8

1. International - low integration and low local responsiveness
2. Multi domestic - low integration and high local responsiveness (Nestle). May open regional headquarters.
3. Global - high degree of integration and low degree of local responsiveness
4. Transnational - high degree of integration and high degree of local responsiveness (Procter and Gamble)

IMGT

Question 9

Name 3 orientations of senior executives

Answer 9

Ethnocentrism
Poly centrism or regio centrism
Geocentrism

EPG OR ERG

Question 10

What is ethnocentrism

Answer 10

Headquarters knows best

Question 11

What is poly centrism or regio centrism

Answer 11

Decentralized approach and local knows best

Question 12

what is Geocentrism

Answer 12

Borrow best practices from around the globe. No

Preference to HQ or local.

Question 13

What is centralized

Answer 13

Decisions are made by HQ

Question 14

What is decentralized

Answer 14

Local offices have the power to work more autonomously and make their own decisions

Question 15

What is convergence

Answer 15

The use of HQs policies and procedures

Question 16

Divergence

Answer 16

Attempts by local subsidiaries to become centers of excellence

Question 17

Name the 3 IHRM strategies

Answer 17

Autonomous
Receptive
Active

ARA

Question 18

What is autonomous IHRM

Answer 18

Local HR can make decision

Question 19

What is receptive IHRM

Answer 19

HQ makes all HR decisions

Question 20

What is Active IHRM

Answer 20

Balance of HQ and local decision making power

Question 21

Exogenous factor

Answer 21

External factors out of the companies control - culture, politics.

Question 22

Endogenous

Answer 22

Internal factors that are of concern - bus strategy, etc.

Question 23

Organizational design

Answer 23

How departments are arranged