General Study Points Flashcards
What are the factors driving global demographic trends
- modern medicine and technology advancements (ageing population)
- fertility rates (growth in middle class)
- migration (offset population)
examples of winners and losers in shareholder value maximisation
winners = shareholders
losers = other stakeholders
e.g. Valeant Pharmaceuticals
what are the negative impacts of shareholder value maximisation
short termism, sacrificing long term investments and research and development
financial incentive to cut quality
Valeant Pharm new name
Bausch
Key points of Alan Rugman’s ‘THINK REGIONAL’
- world is not a single, uniform market
- elements of business strategy must be personalised to each region’s unique cultures, beliefs, regulations
Key point of Alan Rugman’s ‘ACT LOCAL’
- local partners overseas ease entry into markets
Key points of Alan Rugman’s ‘FORGET GLOBAL’
Forget a one size fits all strategy
only sectors such as electronics (microchips) can be standardised
but certainly not services
Why were scholars wrong about jobs being displaced as a result of globalisation
DROP in manufacturing due to offshoring to countries with lower labour costs
BUT SHIFT to higher value work
what are the factors that led Thomas Friedman to embrace the metaphor ‘the world is flat’
TECHNOLOGICAL DETERMINIST
- Rise of personal computers and the internet
- Collaboration technology (across global boundaries)
- Offshoring and outsourcing (tap into global talent and resources)
- Supply chaining
what are the critiques of Thomas Friedman’s ‘The world is flat’
Gray 2005
not everyone has the came access to benefits of new technologies
globalisation levels some inequalities but raises others
globalisation thus far has been UK, US centred, as rise of other nations, need to recognise other cultures
what does Klein speak about in Shock Doctorine
Critical views of globalisation
How world leaders exploit times of crises to push through economic agendas that often lead to inequalities
e.g. protectionism benefits companies but not consumers as there is less competition and therefore higher prices
key impacts on the global environment from the global financial crisis
- economic downturn (reduced consumer spending and little FDI)
- Move to less risky investments
- Emerging marketgrowth
- Improved political engagement (G20)
Evidence and reasoning for economic gravity shifting eastwards
- Favourable demographic trends
- High growth rates (cheap labour)
- Join WTO
- Infrastructure + technology investments
How western economies react to economic activity shifting eastwards
- west see as risk (US + China trade war, protectionism, reluctance to source far from home)
as east gains more power they will demand more recognition in common practices
what is the likelihood of the emerging economies surpassing the developed
less about countries
more about people/companies
what are the risks arising from global supply chains
- geopolitical
- quality control
- timing
- unfamiliarity with country
- technology leak
- consumer power
how can firms mitigate geopolitical risks in their supply chains
locate in politically stable economies
build relationships with local industries
contingency plans
how can firms mitigate technology leak risks in their supply chains
Act early
Encryption
Non Disclosure Agreements
how can firms mitigate unfamiliarity with local environment risks in their supply chains
strike balance between local and global strategy
i.e. leverage firm specific advantages and location specific advantages
how can firms mitigate timing risks in their supply chains
real time tracking
how can firms mitigate quality control risks in their supply chains
regular audits
what do companies compete for in global supply chains
resources
market share
how are companies/countries competing
imposing tariffs
protectionism measures
eg US and China
what are the benefits of collaborating
mutual benefits
minimise costs
access to new clients and markets
enhance overall effiiciency
what are enablers of collaboration
International Trade Agreements eg EU, CPTPP
International bodies eg. WTO, UN (nations making alliances and working together to find solutions)
why would companies collaborate on research and development
risky to invest all this money alone
example of companies collaborating on research and development
toyota and BMW fuel cell technology
what are the factors contributing to the transformation of global manufacturing
offshoring
offshoring turnaround
automation (3d printing and robots)
what are some factors encouraging offshoring
lower labour costs
shareholder value == reducing costs
