Managing in the Global Environment

Question 1

Global Organizations

Answer 1

organizations that operate and compete in more than one country

Question 2

Global Environment

Answer 2

the set of global forces and conditions that operate beyond an organization’s boundaries but affect a manager’s ability to acquire and utilize resources

Question 3

Why is operating in a global environment is uncertain and unpredictable?

Answer 3

it is complex and changes constantly

Question 4

Two main forces that affect the global environment that

managers need to be aware of:

Answer 4

Task Environment

General Environment

Question 5

Task Environment

Answer 5

a set of forces and conditions that originate with suppliers, distributors, customers, and competitors and affect an organization’s ability to obtain inputs and dispose of its outputs because they influence managers daily.

Question 6

General Environment

Answer 6

the wide-ranging global, economic, technological, sociocultural, demographic, political, and legal forces that affect an organization and its task environment.

Question 7

Four groups that have an immediate effect on the task

environment

Answer 7

• Suppliers
• Distributors
• Customers
• Competitors

Question 8

Task Environment: Suppliers

Answer 8

individuals and organizations that provide an organization with the input resources it needs to produce goods and services

Question 9

Task Environment: Distributors

Answer 9

organizations that help other organizations sell their goods or services to customers.

Question 10

Task Environment: Customers

Answer 10

individuals and groups that buy the goods and services an organization produces

Question 11

Task Environment: Competitors

Answer 11

organizations that produce goods and services that are similar to a particular organization’s goods and services.

Question 12

An important aspect of the supplier/business relationship

Answer 12

bargaining position

Question 13

Bargaining positions

Answer 13

A supplier has a strong bargaining position if the supplier is the sole source of an input and the
input is vital to the organization

An organization has a strong bargaining position when there are many suppliers for a particular input competing for business

Question 14

Global Outsourcing

Answer 14

occurs when a company contracts with suppliers in other countries to make the various inputs or components that go into its products or to assemble the final products to reduce costs.

Question 15

The most threatening force managers must deal

with

Answer 15

Rivalry between competitors

Question 16

Barriers to entry

Answer 16

factors that make it difficult and costly for an organization to enter a particular task environment or industry.

Question 17

Three main sources that are barriers to entry

Answer 17

• Economies of Scale
• Brand Loyalty
• Government Regulations

Question 18

Economies of Scale

Answer 18

• Economies of scale are the cost advantages associated with large operations.
• Economies of scale result from factors such as manufacturing products in very large quantities,
  buying inputs in bulk, or making effective use of organizational resources.

Question 19

Brand Loyalty

Answer 19

• Brand loyalty is a customers’ preference for the products of organizations currently existing in
  the task environment.
• If established organizations enjoy significant brand loyalty, a new competitor will have a difficult time
  obtaining any market share.

Question 20

Government Regulations

Answer 20

• In some cases government regulations function as a barrier to entry at both the industry and the
  country levels.
• At the country level government regulations can limit the goods being imported if they are a competitor or a threat to local organizations or companies. .

Question 21

Five forces that have an effect on the global environment

Answer 21

• Economic Forces
• Technological Forces
• Sociocultural Forces
• Demographic Forces
• Political and Legal Forces

Question 22

Economic Forces

Answer 22

include interest rates, inflation, unemployment, economic growth, and other factors that affect the general health and well-being of a nation or the
regional economy of an organization

Question 23

Technological Forces

Answer 23

the outcomes of changes in the technology managers use to design, produce, or distribute goods and services

Question 24

Sociocultural Forces

Answer 24

are pressures originating from the social structure of a country or society or from the national culture.

Question 25

Social Structure

Answer 25

the traditional system of relationships established between people and groups in a society.

Question 26

National Culture

Answer 26

the set of values that a society considers important and the norms of behavior that are approved or sanctioned in that society.

Question 27

Demographic Forces

Answer 27

outcomes of change in, or changing attitudes toward, the characteristics of a population, such as age, gender, ethnic origin, race, sexual orientation, and social class.

Question 28

Political and Legal Forces

Answer 28

outcomes of changes in laws and regulations, such

as deregulation of industries, privatization of organizations, and increased emphasis on environmental protection.

Question 29

Globalization

Answer 29

the set of specific and general forces that work
together to integrate and connect economic, political, and social systems across countries, cultures, or geographical regions so that nations can become increasingly interdependent and similar.

Question 30

Four forms of capital

Answer 30

Human, Financial, Resource, Political

Question 31

Main factor in increased globalization

Answer 31

decline in barriers to trade and investment

Question 32

Values

Answer 32

the ideas about what a society believes to be good, right, desirable, or beautiful.

Question 33

Norms

Answer 33

the unwritten, informal codes of conduct that prescribe how people should act in particular situations and are considered important by most members of a group or organization

Question 34

Hofstede’s Model of National Culture:

Individualism vs Collectivism

Answer 34

Individualism is the worldview that values individual freedom and self-expression and adherence to the principle that people should be judged by their individual achievements rather than by their social
background.

Collectivism is the worldview that values subordination of the individual to the goals of the group and adherence to the principle that people should be judged by their contribution to the group.

Question 35

Hofstede’s Model of National Culture: Power Distance

Answer 35

the degree to which societies accept the idea that
inequalities in power and well-being of their citizens are due to differences in individual’s physical and intellectual capabilities and heritage.

Question 36

Hofstede’s Model of National Culture: Achievement vs Nurturing Orientation

Answer 36

Achievement orientation is a worldview that values assertiveness, performance, success, and competition.

Nurturing orientation is a worldview that values the quality of life, warm personal relationships, and care for the weak.

Question 37

Hofstede’s Model of National Culture: Uncertainty Avoidance

Answer 37

the degree to which societies are willing to
tolerate uncertainty and risk.

• low uncertainty avoidance; easygoing, value diversity, and tolerate differences in personal beliefs and actions
• high uncertainty avoidance; more rigid and skeptical about people whose behaviors or beliefs are different from the norm.

Question 38

Hofstede’s Model of National Culture: Long-term vs Short-term Orientation

Answer 38

Long-term orientation is the worldview that values thrift and persistence in achieving goals.

Short-term orientation is the worldview that values personal stability or happiness and living for the present.