MGMT 80 Midterm 1
Cross cultural risk
Cultural differences, decision making styles, ethical practices
Country Risk
Harmful or unstable political system, laws and regulations unfavorable to
foreign firms
Currency Risk
Currency exposure, foreign taxation, inflationary and transfer pricing
Commercial Risk
weak partner, operational problems, timing of entry, competitive intensity,
poor execution of strategy
Value chain
the sequence of value-adding activies the firm performs in the course of
developing, producing, marketing, and servicing a product
Phase 1
1830's-late 1800s. Railroads and ocean transport. Manufacturing and
trading companies
Phase 2
1900-1930. Electricity and Steel. Early MNE
, Phase 3
1948-1970. GATT=General Agreement on Tariffs and Trade. Post war,
reduction of trade barriers.
Phase 4
1980-2006. Privatization of state companies. Information technologies,
rapid liberalization in makets. China moved to communism.
Phase 5
2007-present. Rise of digital technologies and other technologies
Ethnocentric
Using one's own culutre as a standard for judging other cultures
Polycentric
A host-country mindset where the manager develops a strong affinity for
the country in which they conduct business
Geocentric
A global mindset that allows the manager to understand a business market
without regard to country boundaries
Self-reference criterion
The tendency to view other cultures through the lens of ones own culture
Critical incident analysis
A method for analyzing awkard situations in cross-cultural encounters by
developing objectivitiy and empathy for other points of view
Cross cultural risk
Cultural differences, decision making styles, ethical practices
Country Risk
Harmful or unstable political system, laws and regulations unfavorable to
foreign firms
Currency Risk
Currency exposure, foreign taxation, inflationary and transfer pricing
Commercial Risk
weak partner, operational problems, timing of entry, competitive intensity,
poor execution of strategy
Value chain
the sequence of value-adding activies the firm performs in the course of
developing, producing, marketing, and servicing a product
Phase 1
1830's-late 1800s. Railroads and ocean transport. Manufacturing and
trading companies
Phase 2
1900-1930. Electricity and Steel. Early MNE
, Phase 3
1948-1970. GATT=General Agreement on Tariffs and Trade. Post war,
reduction of trade barriers.
Phase 4
1980-2006. Privatization of state companies. Information technologies,
rapid liberalization in makets. China moved to communism.
Phase 5
2007-present. Rise of digital technologies and other technologies
Ethnocentric
Using one's own culutre as a standard for judging other cultures
Polycentric
A host-country mindset where the manager develops a strong affinity for
the country in which they conduct business
Geocentric
A global mindset that allows the manager to understand a business market
without regard to country boundaries
Self-reference criterion
The tendency to view other cultures through the lens of ones own culture
Critical incident analysis
A method for analyzing awkard situations in cross-cultural encounters by
developing objectivitiy and empathy for other points of view
