GSCM 211 MIDTERM VERIFIED STUDY GUIDE
Pros of Globalization - Answers - Pros: increased awareness of other cultures and
countries, globalization encourages innovation, income of low cost labor in developing
countries has increased, developing countries have increased access to first world
products.
comparative advantage - Answers - The ability of a country to produce a good at a
lower cost than another country can.
Adam Smith - Answers - Scottish economist who wrote the Wealth of Nations a
precursor to modern Capitalism.
wealth of the nations: absolute advantage: a party can produce a good or service more
efficiently than its competitors
producing goods and services at a lower opportunity cost, ex: cotton sheets form Egypt
Thomas Friedman - Answers - has said "the world has moved from periods of being
round (where trade barriers are high) to periods of being flat (where barriers to trade are
lowered).
Mercantilism - Answers - countries controlling trade so they export more than they
import
Titans of Industry - Answers - Positive name for wealthy business owners of this time.
Says that they helped the country become strong
trading bloc - Answers - consists of those countries that have signed a particular trade
agreement
Bretton Woods System - Answers - - foundation of the majority of world trade
- financial and commodity interdependence
- US dollar as the main trading currency
- Tariffs reduced or eliminated
Protectionism - Answers - taxing imports to protect a country's domestic industries from
international competition
encourage growth within country, sometimes protectionism it fails ex: early Davidson
Benefits of global trade - Answers - standard of living, global competition, innovation,
economic development in developing nations, information sharing
Physical Operations - Answers - Do we open a new physical location we build from the
ground up? These are also called Greenfield Developments. Or do we choose to lease
or rent a property? Or do we choose to outsource operations completely?
, Service Operations - Answers - production activities that yield tangible and intangible
service products
PEST Acronym - Answers - political, economic, socio-cultural, technological
Kaizen - Answers - Japanese term for continuous improvement, Toyota uses, requires a
lean system and close physical suppliers
Offshoring and outsourcing - Answers - Hiring external organizations to perform
business in a country other than the one that the products / services are performed,
developed, or manufactured
offshore - Answers - Moving to work in distant country
Insourcing - Answers - a practice in which a company contracts with a specialist firm to
handle all or part of its supply chain operations, creation of domestic jobs by foreign
employees, third party
Reshoring - Answers - moves jobs back from foreign to domestic locations
Farmshoring - Answers - refers to outsourcing to USA rural-located companies
Homeshoring - Answers - practice of outsourcing work to domestic workers who work
out of their homes
intermediary - Answers - go-between; mediator
Technology Clusters - Answers - regions of interconnected buyers, suppliers, and
producers of complementary solutions
Global Manufacturing Trade-Offs - Answers - -cost, speed, dependability, and quality
-originally short-term trade-off between cost and speed (seesaw)
-not always the case (ferdows and De Meyers)
Sand Cone Model - Answers - cumulative, lasting manufacturing
build quality, dependability, speed, cost (cost @ top, quality @ bottom)
requires a long term approach
Globalization - Answers - an extension of the make or buy decisions beyond national
borders: exhange of information, ideas, goods
increases interactions, ec: iPhone parts
Cons of Globalization - Answers - •Unequal opportunities across the world
•The world's wealth is increasingly concentrated (rich getting richer)
•Globalization strategy is poorly managed (damage of the environment)
Pros of Globalization - Answers - Pros: increased awareness of other cultures and
countries, globalization encourages innovation, income of low cost labor in developing
countries has increased, developing countries have increased access to first world
products.
comparative advantage - Answers - The ability of a country to produce a good at a
lower cost than another country can.
Adam Smith - Answers - Scottish economist who wrote the Wealth of Nations a
precursor to modern Capitalism.
wealth of the nations: absolute advantage: a party can produce a good or service more
efficiently than its competitors
producing goods and services at a lower opportunity cost, ex: cotton sheets form Egypt
Thomas Friedman - Answers - has said "the world has moved from periods of being
round (where trade barriers are high) to periods of being flat (where barriers to trade are
lowered).
Mercantilism - Answers - countries controlling trade so they export more than they
import
Titans of Industry - Answers - Positive name for wealthy business owners of this time.
Says that they helped the country become strong
trading bloc - Answers - consists of those countries that have signed a particular trade
agreement
Bretton Woods System - Answers - - foundation of the majority of world trade
- financial and commodity interdependence
- US dollar as the main trading currency
- Tariffs reduced or eliminated
Protectionism - Answers - taxing imports to protect a country's domestic industries from
international competition
encourage growth within country, sometimes protectionism it fails ex: early Davidson
Benefits of global trade - Answers - standard of living, global competition, innovation,
economic development in developing nations, information sharing
Physical Operations - Answers - Do we open a new physical location we build from the
ground up? These are also called Greenfield Developments. Or do we choose to lease
or rent a property? Or do we choose to outsource operations completely?
, Service Operations - Answers - production activities that yield tangible and intangible
service products
PEST Acronym - Answers - political, economic, socio-cultural, technological
Kaizen - Answers - Japanese term for continuous improvement, Toyota uses, requires a
lean system and close physical suppliers
Offshoring and outsourcing - Answers - Hiring external organizations to perform
business in a country other than the one that the products / services are performed,
developed, or manufactured
offshore - Answers - Moving to work in distant country
Insourcing - Answers - a practice in which a company contracts with a specialist firm to
handle all or part of its supply chain operations, creation of domestic jobs by foreign
employees, third party
Reshoring - Answers - moves jobs back from foreign to domestic locations
Farmshoring - Answers - refers to outsourcing to USA rural-located companies
Homeshoring - Answers - practice of outsourcing work to domestic workers who work
out of their homes
intermediary - Answers - go-between; mediator
Technology Clusters - Answers - regions of interconnected buyers, suppliers, and
producers of complementary solutions
Global Manufacturing Trade-Offs - Answers - -cost, speed, dependability, and quality
-originally short-term trade-off between cost and speed (seesaw)
-not always the case (ferdows and De Meyers)
Sand Cone Model - Answers - cumulative, lasting manufacturing
build quality, dependability, speed, cost (cost @ top, quality @ bottom)
requires a long term approach
Globalization - Answers - an extension of the make or buy decisions beyond national
borders: exhange of information, ideas, goods
increases interactions, ec: iPhone parts
Cons of Globalization - Answers - •Unequal opportunities across the world
•The world's wealth is increasingly concentrated (rich getting richer)
•Globalization strategy is poorly managed (damage of the environment)
