Chapter 3: Global management
L03.1
Definitions
Ethnocentric attitude (Home): The parochial belief that the best work approaches and
practices are those of the home country (nationalistic).
Polycentric attitude (host): The view that the managers in the host country know the best
work approaches and practices for running their business.
Geocentric attitude (global): A world-oriented view that focuses on using the best
approaches and people from around the globe.
Parochialism: Viewing the world solely through your own perspectives, leading to an
inability to recognize differences between people.
, L03.2
Countries enter regional trading alliances for a variety of reasons, mainly to stimulate
economic growth.
The European Union
5 countries have applied for membership
A union of 28 European nations created as a
unified economic and trade entity.
NAFTA
North American Free Trade Agreement
Helps Canada, Mexico, and the United States strengthen their global economic
power.
Doesn’t exist anymore.
CAFTA-DR
Latin-America
promotes trade liberalization between the United States and 5 Central American
countries.
Southern Common Market or Mercosur
free trade agreement of 10 South American countries
effective way to combine resources to better compete against other global economic
powers.
ASEAN
Association of Southeast Asian Nations
Trading alliance of 10 Southeast Asian nations
(important region in the global economy)
L03.1
Definitions
Ethnocentric attitude (Home): The parochial belief that the best work approaches and
practices are those of the home country (nationalistic).
Polycentric attitude (host): The view that the managers in the host country know the best
work approaches and practices for running their business.
Geocentric attitude (global): A world-oriented view that focuses on using the best
approaches and people from around the globe.
Parochialism: Viewing the world solely through your own perspectives, leading to an
inability to recognize differences between people.
, L03.2
Countries enter regional trading alliances for a variety of reasons, mainly to stimulate
economic growth.
The European Union
5 countries have applied for membership
A union of 28 European nations created as a
unified economic and trade entity.
NAFTA
North American Free Trade Agreement
Helps Canada, Mexico, and the United States strengthen their global economic
power.
Doesn’t exist anymore.
CAFTA-DR
Latin-America
promotes trade liberalization between the United States and 5 Central American
countries.
Southern Common Market or Mercosur
free trade agreement of 10 South American countries
effective way to combine resources to better compete against other global economic
powers.
ASEAN
Association of Southeast Asian Nations
Trading alliance of 10 Southeast Asian nations
(important region in the global economy)
