International Management - Exam 3

Study cards based on given study guide for Exam 3

What is strategy formulation?

The process of deciding what to do; also called strategizing.

What is strategy implementation?

The process of performing all the activities necessary to do what has been planned.

What three questions does corporate strategy answer?

In what business we will compete? How can we, as a corporate parent, add value to our various lines of business? How can diversifying our business or entering a new industry help us compete in our other industries?

What is business strategy?

Business strategy refers to the ways in which a firm plans to achieve its objectives within a particular business.

What is a cost leadership strategy?

A strategy in which firms seek to make their products or services at the lowest cost possible relative to their competitors while maintaining a quality that is acceptable to consumers.

What is a differentiation strategy?

An integrated set of actions designed by a firm to produce or deliver goods or services (at an acceptable cost) that customers perceive as being different in ways that are important to them

What is the difference between outsourcing, offshoring, and importing?

Importing is the sale of products or services in one country that are sourced in another country.

Outsourcing is contracting with a third party to do some of a company’s work on its behalf.

Offshoring is taking some business function out of the company’s country of origin to be performed in another country, generally at a lower cost.

What is a mission statement?

An organization’s statement of purpose and describes who the company is and what it does.

What are organizational values?

The shared principles, standards, and goals that are included in the mission statement or as a separate statement.

What is a SWOT analysis?

Analysis of the strengths, weaknesses, oppurtunities, and threats of a business.

What is a multidomestic strategy?

Maximizes local responsiveness by giving decentralizing decision-making authority to local business units in each country so that they can create products and services
optimized to their local markets.

What is global strategy?

An international strategy in which the home office centralizes and controls decision-making authority and seeks to maximize global efficiency.

What is transnational strategy?

An international strategy that combines firm-wide operating efficiencies and core competencies with local responsiveness tailored to different countries.

What are the 5 key elements on The Strategy Diamond?

• Arenas: Areas where the firm will be active.

• Differentiators: Features of products/services that help it beat its competitors.

• Vehicles: Means for participating in targeted arenas.

• Staging and Pacing: Timing and speed, or the pace of strategic moves.

• Economic Logic: How the firm will earn profit

What is entrepreneurship?

The recognition of opportunities (needs, wants, problems, and challenges) and the use or creation of resources to implement innovative ideas for new, thoughtfully planned ventures.

What are the three essential parts of the entrepreneurial process?

1. Identify Opportunities
2. Plan and prepare, and venture
3. Resource the venture and take action

What are some truths & myths about entrepreneurship?

Truths: They work hard, glass half full, integrity, competitive desire to win, want to improve every situation, see failure as a learning tool, believe they can make a difference in their lives.

Myths: They are born, not made, make more money, being original is essential, requires a lot of money to start, must be risk takers.

What is the difference between entrepreneurship and intrapreneurship?

• The intrapreneur acts within the confines of an existing organization.
• The intrapreneur is typically the intraorganizational revolutionary.
• An intrapreneur is someone who operates like an entrepreneur but has the backing of an organization.

What is social entrepreneurship?

A person who founds an organization (either for-profit or nonprofit) with a focus to implement innovative solutions to societal problems

What are born-global firms?

a business organization that, from inception, seeks to derive significant competitive advantage from the use of resources and the sale of outputs in multiple countries

What is a Angel investor?

An affluent individual who provides capital for a business start-up.

What is a venture capitalist?

A person or investment firm that makes venture investments and brings managerial and technical expertise as well as capital to their investments.

What is strategic planning?

Long range planning (3+ years).

• It is conducted across the enterprise.
• It is mainly done by the top management.

What is tactical planning?

Shorter range planning (1-3 years)

• Specifies how strategic planning will be implemented.

• Done by middle level managers

What is operational planning?

Short range planning (less than 1 year)

• It takes the organization-wide or
  subunit goals and specifies concrete action steps to achieve the strategic and tactical
  plans.

What is the POLC Framework?

• Planning: setting objectives and determining a course of action for achieving these objectives.

• Organizing: develops an organizational structure and coordinates human resources within that structure to achieve organizational objectives.

• Leading: influencing and inspiring others to take action.

• Controlling: monitoring performance so that it meets the performance standards established by the organization.

Why is research and development important?