Intro to Management Exam 2

Ethics

standards of right and wrong. May vary among countries and cultures

Ethical behavior

actions that are accepted as right and wrong according to standards

ethical dilemma

a situation in which you have to decide to pursue a course of action that may benefit you or your organization but is unethical or even illegal

Two conflicting value systems an organization may have

the value system stressing financial performance and the value system stressing cohesion and solidarity in employee relationships

Five most common unethical behaviors at work

1. misusing company time

2. abusive behavior

3. employee theft

4. workplace cheating

5. violating corporate internet policies

The utilitarian approach

guided by what will result in the greatest good for the greatest number of people

The individual approach

guided by what will result in the individual's best long-term interests

The moral-rights approach

guided by respect for the fundamental rights for humans shared by everyone

The justice approach

guided by respect for impartial standards of fairness and equity

The rock star theory hypothesis

variation in outcomes will primarily be a result of expectations endowments engagement or environments meaning differences will arise due to initial conditions

Feedforward control

focuses on preventing future issues

Concurrent control

Entails collecting performance information in real time

Feedback control

Uses information about the past results to identify and fix issues

Total Quality Management (TQM)

the philosophy that everyone in the organization is concerned about quality, throughout all of the firm's activities, to better serve customer needs

ISO 9000

ethical procedures a company must adhere to but doesn't include environment

ISO 14000

extends ISO 9000 concept by identifying standards for the environmentterm-45

The four developmental processes

1. New strategy

2. New capabilities

3. New business development

4. New product development

Balance Scorecard

strategy implementation tool that harnesses multiple internal and external performance metrics in order to balance financial and strategic goals

The four types of balance scorecards

1. Customer satisfaction

2. Internal processes

3. Innovation and improvement activities

4. Financial measures

The four growth strategies

market penetration, market development, product development, diversification

Managing Cooperative Strategies

Cost minimization

Opportunity maximization

cost minimization

a firm's goal of producing a specific quantity of output at minimum cost

opportunity maximization

Intended to maximize value-creating opportunities by sharing of ideas and resources

Less formal contracts and fewer constraints on partners' behaviors

Based on values of trust, respect, and transparency (open and truthful sharing of information)

Three kinds of change from least to most threatening:

Adaptive - innovative - radically innovative

Lewin's Change Model for the individual

1. Unfreezing

2. Changing

3. Refreezing

4. Feedback loop

Lewin's Change Model for development

1. diagnosis

2. intervention

3. evaluation

4. feedback loop

To be innovative a product must:

Be commercialized and make a profit

code of values

standards a company abides by

Value Chain

The steps it takes to develop a code of values

Joint Venture

a way for a company to form a strategic alliance with a foreign company to share risks and rewards if starting new business in a foreign country

strategic alliance

firms combine some resources for the purpose of creating a competitive advantage

Franchising

firm using contract relationship to describe and control sharing of resources with its franchises

Licensing

allows foreign companies to pay a fee to make and sell its products/services

Globalization

trend of world economy toward becoming a more interdependent system

Rise of globalization is due to:

1. Rise of global village and ecommerce

2. World becoming one market

3. Rise of megafirms and internet minifirms worldwide

Global village

the "shrinking" of time and space as air travel and the electronic media have made it easier for the people around the globe to communicate with one another

Ecommerce

the buying and selling of goods and services over the internet

Ethnocentric

Belief in the superiority of one's nation or ethnic group.

Polycentric

Belief that managers in the host country know the best approaches

Geocentric

Belief that both countries have valid ideas and the best approaches vary between the home and foreign nation based on the circumstance.

Free trade

international trade free of government interference

Proectionism

national policies designed to restrict international trade, usually with the goal of protecting domestic businesses

World Trade Organization (WTO)

designed to monitor and enforce trade agreements

World Bank

an international bank that offers low-interest loans, advice, and information to developing nations

Trading blocs

A group of neighboring countries that promote trade with each other and erect barriers to limit trade with other blocs. Most relevant to us is NAFTA

low-context culture

shared meanings are primarily derived from written and spoken words. includes the USA

high-context culture

people rely heavily on situational cterm-45ues for meaning when communicating with others

Stakeholders

the people whose interests are affected by an organization's activities

Stakeholders exist in 3 organizational environments

1. Internal (owners, employees, board of directors)

2. External- task

3.External- general

Social Responsibility

the manager's duty for ethics and corporate social responsibility is corporate duty for ethics

Benchmarking

a process by which a company compares its performance with that of high-performing organizations

Control Chart

a time-ordered diagram that is used to determine whether observed variations are abnormal

control process steps

1. establish standards

2. measure performance

3. compare performance to standards

4. take corrective action, if necessary

control standard

the desired performance level for a given goal

Deming management

proposed ideas for making organizations more responsive, more democratic, and less wasteful

Financial Ratios

calculations typically used to track a business's liquidity (cash), efficiency, and profitability over time compared to other businesses in its industry

incremental budgeting

a method of budget making that involves adding new funds (an increment) onto the amount previously budgeted (in last year's budget)

backward/forward integration

occurs when a firm owns or controls the inputs it uses

market power

the ability of a single economic actor (or small group of actors) to have a substantial influence on market prices

diseconomies of scale

the situation in which a firm's long-run average costs rise as the firm increases output

economies of scale

a proportionate saving in costs gained by an increased level of production.

diversification strategies

emphasize both new products and new markets to achieve growth

Organic growth

growth achieved through the expansion of current business activities

unrelated diversification

a growth strategy whereby a new business lacks any common elements with the present business

Countertrading

a complex form of bartering in which several countries may be involved, each trading goods for goods or services for services

cross-cultural awareness

ability to interact effectively and appropriately with people from different language and cultural backgrounds

Dumping

selling products in a foreign country at lower prices than those charged in the producing country

Embargo

an official ban on trade or other commercial activity with a particular country.

exchange rate

The measure of how much one currency is worth in relation to another.

expatriate

a migrant worker who is a professional or skilled worker in his or her profession.

Expropriation

Forced transfer of assets from a company to the government with compensation

Foreign Corrupt Practices Act

a law that prohibits U.S. corporations from making illegal payments to public officials of foreign governments to obtain business rights or to enhance their business dealings in those countries

global outsourcing

using suppliers outside the US to provide labor, goods, or services

GLOBE project

a massive and ongoing cross-cultural investigation of 9 cultural dimensions involved in leadership and organizational processes

greenfield venture

establishes a foreign subsidiary by building an entirely new operation in a foreign country

Hofstede model of four cultural dimensions

power distance, uncertainty avoidance, individualism, masculinity