General Study Points

Question 1

What are the factors driving global demographic trends

Answer 1

• modern medicine and technology advancements (ageing population)
• fertility rates (growth in middle class)
• migration (offset population)

Question 2

examples of winners and losers in shareholder value maximisation

Answer 2

winners = shareholders

losers = other stakeholders

e.g. Valeant Pharmaceuticals

Question 3

what are the negative impacts of shareholder value maximisation

Answer 3

short termism, sacrificing long term investments and research and development

financial incentive to cut quality

Question 4

Valeant Pharm new name

Answer 4

Bausch

Question 5

Key points of Alan Rugman’s ‘THINK REGIONAL’

Answer 5

• world is not a single, uniform market
• elements of business strategy must be personalised to each region’s unique cultures, beliefs, regulations

Question 6

Key point of Alan Rugman’s ‘ACT LOCAL’

Answer 6

• local partners overseas ease entry into markets

Question 7

Key points of Alan Rugman’s ‘FORGET GLOBAL’

Answer 7

Forget a one size fits all strategy

only sectors such as electronics (microchips) can be standardised

but certainly not services

Question 8

Why were scholars wrong about jobs being displaced as a result of globalisation

Answer 8

DROP in manufacturing due to offshoring to countries with lower labour costs

BUT SHIFT to higher value work

Question 9

what are the factors that led Thomas Friedman to embrace the metaphor ‘the world is flat’

Answer 9

TECHNOLOGICAL DETERMINIST

1. Rise of personal computers and the internet
2. Collaboration technology (across global boundaries)
3. Offshoring and outsourcing (tap into global talent and resources)
4. Supply chaining

Question 10

what are the critiques of Thomas Friedman’s ‘The world is flat’

Answer 10

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

Question 11

what does Klein speak about in Shock Doctorine

Answer 11

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

Question 12

key impacts on the global environment from the global financial crisis

Answer 12

1. economic downturn (reduced consumer spending and little FDI)
2. Move to less risky investments
3. Emerging marketgrowth
4. Improved political engagement (G20)

Question 13

Evidence and reasoning for economic gravity shifting eastwards

Answer 13

1. Favourable demographic trends
2. High growth rates (cheap labour)
3. Join WTO
4. Infrastructure + technology investments

Question 14

How western economies react to economic activity shifting eastwards

Answer 14

• 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

Question 15

what is the likelihood of the emerging economies surpassing the developed

Answer 15

less about countries

more about people/companies

Question 16

what are the risks arising from global supply chains

Answer 16

1. geopolitical
2. quality control
3. timing
4. unfamiliarity with country
5. technology leak
6. consumer power

Question 17

how can firms mitigate geopolitical risks in their supply chains

Answer 17

locate in politically stable economies

build relationships with local industries

contingency plans

Question 18

how can firms mitigate technology leak risks in their supply chains

Answer 18

Act early

Encryption

Non Disclosure Agreements

Question 19

how can firms mitigate unfamiliarity with local environment risks in their supply chains

Answer 19

strike balance between local and global strategy

i.e. leverage firm specific advantages and location specific advantages

Question 20

how can firms mitigate timing risks in their supply chains

Answer 20

real time tracking

Question 21

how can firms mitigate quality control risks in their supply chains

Answer 21

regular audits

Question 22

what do companies compete for in global supply chains

Answer 22

resources

market share

Question 23

how are companies/countries competing

Answer 23

imposing tariffs

protectionism measures

eg US and China

Question 24

what are the benefits of collaborating

Answer 24

mutual benefits

minimise costs

access to new clients and markets

enhance overall effiiciency

Question 25

what are enablers of collaboration

Answer 25

International Trade Agreements eg EU, CPTPP

International bodies eg. WTO, UN (nations making alliances and working together to find solutions)

Question 26

why would companies collaborate on research and development

Answer 26

risky to invest all this money alone

Question 27

example of companies collaborating on research and development

Answer 27

toyota and BMW fuel cell technology

Question 28

what are the factors contributing to the transformation of global manufacturing

Answer 28

offshoring

offshoring turnaround

automation (3d printing and robots)

Question 29

what are some factors encouraging offshoring

Answer 29

lower labour costs

shareholder value == reducing costs