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ISM > KEYWORDS > Flashcards

KEYWORDS Flashcards

1
Q

Home country advantages

A

Country-specific advantages that a firm has by virtue of the fact that it was founded in a specific country

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2
Q

Host country location advantages

A

The advantages from operating in the host country

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3
Q

Market seeking

A

Search for new customers and new markets

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4
Q

Resource seeking

A

Search for new resources such as physical or Human Resources, in the host country

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5
Q

Efficiency seeking

A

Search for efficiency, from scope or scale economies, technology or regulation

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6
Q

Strategic asset seeking

A

Search for assets such as core technology, up- or downstream knowledge, or reputations resources

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7
Q

Uppsala

A

Describes entry as a process

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8
Q

Born global

A

Firms can directly enter even very distant markets almost immediately without having to build a domestic base

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9
Q

Generic country attractiveness framework

A

Identifies risks and opportunities at the country, market and industry level

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10
Q

Country risk analysis

A
  1. Political risks
  2. Economic risks
  3. Operational risks
  4. Cultural risks

The point? To understand that there is no place like home

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11
Q

Market opportunities

A
  1. Market size
  2. Market growth
  3. Market quality
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12
Q

Industry opportunities

A
  1. Industry competitive structure
  2. Resource endowment
  3. Investment incentives grated by government
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13
Q

CAGE model

A

Firms from developed countries have less difficulty entering developed countries

Cultural distance
Administrative and political distance
Geographic distance
Economic distance

Closer countries are more attractive

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14
Q

Alliances

A

More favorable in the face of high environmental uncertainty and knowledge dispersion because collaborations increase strategic flexibility and rapid learning

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15
Q

Acquisitions

A

Better in situations with less need for strategic flexibility and when the transaction aims to utilize sustaining economies of scale and scope efficiently

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16
Q

Business strategy

A

Concerned with HOW a firm competes with a particular market

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17
Q

Corporate strategy

A

Concerned with WHERE a firm competes i.e. the scope of its activities

Dimensions of scope;
- vertical scope
- geographical scope
- product scope

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18
Q

Transaction cost economics

A

Dedicated to answering the question of where a transaction should take place; internally or externally

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19
Q

Types of transaction costs

A
  1. Search and information costs
  2. Bargaining costs
  3. Policing and enforcement costs
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20
Q

Bounded rationality

A

The decision making is bounded by uncertainty

21
Q

Bounded reliability

A

Homo economicus is assumed to be a self interested individual

22
Q

Level of transaction costs

A
  1. Asset specificity
  2. Uncertainty / complexity
  3. Frequency
23
Q

Strategic alliances

A

Formal arrangements between otherwise independent firms, who pool resources, to achieve a mutually agreed goal

24
Q

Joint venture

A

Partners form a jointly owned enterprise to peruse the goals of the alliances

25
Q

Problems with M&A

A
  1. Costs of integrating the target are often underestimated
  2. Expected benefits from the deal are often overestimated
26
Q

Forces for globalization

A
  • cost benefit of scale
  • serving global customers
  • learning in multiple national environments
27
Q

Forces for nationalization

A
  • transportation and communication costs arising from geographical distance
  • differences in customer needs and behavioral norms
28
Q

The global functional model

A

Worldwide centralization at functional level; global R&D, global marketing, global HRM.
All strategic decisions are made at HQ level

29
Q

The geographical model

A

Worldwide decentralization of decision making; European manager, North American manager
Strategic decisions are made at the regional level

30
Q

The single matrix model

A

Equal power is given to both function and geography; European manager & global R&D manager

31
Q

Multi-business global product division model

A

Product managers are given full strategic and operational responsibilities for their product line across territories; global pens manager, global sticky-tape manager

32
Q

Multi-business geographic model

A

Country managers act autonomously and are given full strategic and operational responsibilities for all product lines in their territory

33
Q

Multi-business matrix model

A

Shared power; function, region, product

34
Q

Agency costs

A

Losses that are made when the agent fails to act fully in the interest of the principal, increase;
1. Uncertainty
2. Information asymmetry

35
Q

Corporate governance

A

The system of mechanisms, processes and relations used to control and direct a firm

36
Q

Industry-based view

A

Suggest that the firm must position itself against five external environmental forces;
- threat of rivalry
- threat of substitutes
- threat of new entrants
- power of suppliers
- power of buyers

And competitive advantage comes from the firm’s ability to structure itself to face this

37
Q

Resource-based view

A

Focusses on the internal resources of the organization in considering the source of competitive advantage

38
Q

Resources

A

Factors that are owned of controlled by the firm;
- tangible
- intangible
- human

39
Q

VRIN

A

Resources can be evaluated using the VRIN framework

Valuable
Rare
Inimitable
Non-substitutable

40
Q

Impediment to imitation

A
  • Legal restrictions
  • superior access to inputs and customers
  • market size and scale economies
  • intangible barriers to imitation
41
Q

Early mover advantage

A
  • learning curves
  • reputation and buyer uncertainty
  • switching costs
  • network effects
42
Q

4 dimensions of innovation

A
  • type
  • level; radical vs incremental
  • location
  • effect; competence enhancing vs destroying
43
Q

Institution-based view

A

Highlight the importance of formal and informal institutions in explaining firm performance

Two fundamental claims;
1. That individuals and organizations are limited by what is ‘expected’ of them by their institutional environment
2. Conforming to expectations confers ‘legitimacy’

44
Q

Non-market strategy

A

Is about
- advantages for our firm
- disadvantages for our competitors

45
Q

Non-market analysis

A

Four I’s;
1. Interest
2. Institutions
3. Information
4. Issues

46
Q

Corporate social responsibility

A

Self regulating mechanism, which encourages the firm to comply with the spirit of the law

Goal is to have firms make a positive social impact

47
Q

Corporate political activity

A

Involves the activities taken by organizations to acquire, develop and use power to obtain an advantage

48
Q

Liability of foreignness

A

Set of costs based on a particular company’s unfamiliarity with and lack of roots in a local environment

49
Q

Isomorphism

A

Type of entry mode that imitates local/domestic competitors

ISM (1 decks)

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