AB15120 - Fundamentals of Management and Business.

Question 1

what is globalisation?

Answer 1

Processes by which products, people, companies, money and information are able to move quickly around the world

Question 2

what are the results of globalization?

Answer 2

Increased in trade, companies operating in more than their home country, Increased interdependence on the global economy, Less restricted movement of capital, goods & services.

Question 3

what enables globalisation?

Answer 3

Transportation improvements – larger cargo ships (typically container ships), expansion in airlines, etc.

Improvements in technology and communication

Growth in free trade- WorldTrade Organisation (WTO)

Question 4

what are some causes of globalisation?

Answer 4

1.International travel and cheap flights.

2.The world wide web (internet)and online communication

3.Government policies and reduction in trade tariffs

4.Containerisation

Question 5

what are some advantages of globalisation?

Answer 5

-Employment growth
-Increase in compensation.
-High level of living.
-Encourages economic growth.
-Encourages mutual understanding across cultures.

Question 6

What are the drivers of globalisation?

Answer 6

Political, technological,market, cost, competition, economic liberalisation.

Question 7

Explain ‘political’ being a driver of globalisation.

Answer 7

Trading opportunities within a safe environment with help of transnational and supranational organisations such as European Union

Question 8

Explain ‘technological’ being a driver of globalisation

Answer 8

Worldwide communication, information sharing and the operation and control of remote activities

Question 9

Explain ‘market’ being a driver of globalisation.

Answer 9

Growth of business in home country causes market saturation. International markets: continued expansion.

Question 10

Explain ‘cost’ being a driver of globalisation.

Answer 10

MNEs can take advantage of economies of scale: increased scale of operations and therefore lower production costs.

Question 11

Explain competition being a driver of globalisation.

Answer 11

International competition prompts improvements in quality, efficiency and productivity.

Question 12

Explain economic liberalisation being a driver of globalisation.

Answer 12

Deregulation, Privatisation, Removal of barriers to trading i.e Tariffs.

Question 13

Describe the different impacts of globalisation

Answer 13

internationalisation, international communication, economies of sale, de-industrialisation, labour demand.

Question 14

Explain internationalisation as an impact of globalisation

Answer 14

Internationalisation of markets. Development of global products * International production. Global production strategies i.e outsourcing and offshoring.

Question 15

Explain international communication as an impact of globalisation

Answer 15

Increase in international communication, data transmission, technology transfer

Question 16

Explain economies of sale as an impact of globalisation

Answer 16

Increasing opportunity for economies of scale Creates low costs and high efficiency.* Change occurs at the organisation rather than just production level

Question 17

Explain de-industrialisation as an impact of globalisation

Answer 17

De-Industrialisation: Manufacturing and employment declines in ‘industrialized’ countries.* Increase in Service industries.

Question 18

Explain labour demand as an impact of globalisation

Answer 18

Change in demand for labour. Increase in educated and skilled labour. Decrease for low-skilled labour.

Question 19

define internalisation

Answer 19

Expanding into a new country can bring benefits regarding Production and Markets: linked by Logistics

Question 20

why do companies internationalise

Answer 20

Financial incentive