IBT Flashcards
the taking of private
property by a
government to
make it public.
NATIONALIZATION
The selling of
government- owned
property to the
private sector.
PRIVATIZATION
Characteristic of a government that maintains itself in power and whose fiscal, monetary, and political policies are predictable and not subject to sudden, radical
changes.
STABILITY
Characteristic of a government that cannot maintain itself
in power or that makes sudden, unpredictable, or radical
policy changes.
INSTABILITY
Role of Government in stability and protection
- PROTECTION FROM
UNFAIR COMPETITION - PROTECTION FROM
TERRORISM, CYBERCRIME, AND OTHER THREATS
An assessment of a country’s economic
situation and politics to determine how much risk to employees, property, and investment exists for the firm doing business there.
COUNTRY RISK ASSESSMENT (CRA)
REASONS FOR RESTRICTING TRADE
- PROVIDE FOR
NATIONAL DEFENSE - IMPOSE SANCTIONS
- PROTECT AN INFANT OR
DYING INDUSTRY - PROTECT DOMESTIC JOBS
- ENSURE FAIR COMPETITION
- RETALIATE
selling a product abroad for less than the cost of
production, less than the price in the home market, or less than the
price to third- party countries.
Dumping
financial contributions, provided directly or
indirectly by a government, that confer a benefit, including grants, preferential tax treatment, and government assumption
of normal business expenses.
Subsidies
Additional import taxes levied on imports that
have benefited from export subsidies.
COUNTERVAILING DUTIES
Taxes on imported goods for the purpose of
raising their price to reduce competition for local
producers or stimulate local production.
TARIFFS
3 TYPES OF TARIFFS
- AD VALOREM DUTY
- SPECIFIC DUTY
- COMPOUND DUTY
An import duty levied as a percentage of the
invoice value of imported goods.
AD VALOREM DUTY
A fixed sum levied on a physical unit of an
imported good.
SPECIFIC DUTY
A combination of specific and ad valorem duties.
COMPOUND DUTY
“IN NEARLY EVERY ECONOMIC CRISIS, THE ROOT CAUSE IS POLITICAL, NOT ECONOMIC.”
-Former prime minister Lee Kuan Yew of Singapore
A plan that guides the way firms make
choices about developing and deploying
scarce resources to achieve their
international objectives.
INTERNATIONAL STRATEGY
The ability of a company to achieve and
maintain a unique and valuable competitive
position both within a nation and globally,
generating higher rates of profit than its
competitors.
COMPETITIVE ADVANTAGE
“If you fail to plan, you are
planning to fail.”
-Benjamin Franklin
The process by which an organization
determines where it is going in the future,
how it will get there, and how it will assess
whether and to what extent it has achieved
its goals.
STRATEGIC PLANNING
A set of interlinked activities that adds value to the final
product or service.
VALUE CHAIN
An assessment conducted on the chain of interlinked
activities of an organization or set of interconnected
organizations, intended to determine where and to what
extent value is added to the final product or service.
VALUE CHAIN ANALYSIS
The practices that organizations and their managers use for identifying,
creating, acquiring, developing, dispersing, and exploiting competitively
valuable knowledge.
KNOWLEDGE MANAGEMENT
Knowledge that an individual has but that is difficult to express clearly in
words, pictures, or formulas and is therefore difficult to transmit to others.
TACIT KNOWLEDGE
Knowledge that is easy to communicate to others via words, pictures,
formulas, or other means.
EXPLICIT KNOWLEDGE
A broad statement that defines the organization’s purpose and scope.
MISSION STATEMENT
A description of the company’s desired future position if it can acquire
the necessary competencies and successfully implement its strategy.
VISION STATEMENT
A clear, concise description of the fundamental values, beliefs, and
priorities expected of the organization’s members, reflecting how they
are to behave with each other and with the company’s
VALUES STATEMENT
Action plans to enable organizations to
reach their objectives.
COMPETITIVE STRATEGIES
Centralized product development functions
in the home country and transfer them to
foreign markets to capture additional value.
HOME REPLICATION STRATEGY
Effective when pressure to adapt products
or services for local markets is strong.
MULTIDOMESTIC STRATEGY
Works when a company faces strong pressures for reducing costs and limited
pressure to adapt products for local markets.
GLOBAL STRATEGY
Works when a company confronts simultaneous pressures for cost effectiveness and local adaptation, and that
can gain competitive advantage from
responding to both.
TRANSNATIONAL STRATEGY
A prediction of future sales performance.
SALES FORECAST
An itemized projection of revenues and expenses for a future time period.
BUDGET
Broad guidelines issued by upper management to
assist lower- level managers in handling recurring
issues or problems.
POLICIES
Guides that specify ways of carrying out a
particular task or activity.
PROCEDURES
KINDS OF STRATEGIC PLANS
Time Horizon
Level of the Organization
Planning process that begins at the highest level in the organization and continues
downward.
TOP- DOWN PLANNING
Planning process that begins at the lowest level
in the organization and continues upward.
BOTTOM- UP PLANNING
Repetition of the bottom- up or top- down
planning process until all differences have been
reconciled.
ITERATIVE PLANNING
