Chapter 4 Flashcards
Benchmarking
Examining whether a firm has resources and capabilities to perform a particular activity in a manner superior to competitors.
Business process outsourcing (BPO)
Outsourcing business processes to third-party providers.
Capability
The tangible and intangible assets a firm uses to choose and implement its strategies.
Captive sourcing
Setting up subsidiaries abroad so that the work done is inhouse but the location is foreign. Also known as foreign direct investment (FDI).
Causal ambiguity
The difficulty of identifying the actual cause of a firm’s successful performance.
Commoditization
A process of market competition through which unique products that command high prices and high margins gradually lose their ability to do so, thus becoming commodities.
Complementary asset
The combination of numerous resources and assets that enable a firm to gain a competitive advantage.
Intangible resource and capability
Assets that are hard to observe and difficult (if not impossible) to quantify.
Offshoring
Outsourcing to an international or foreign firm.
Onshoring
Outsourcing to a domestic firm.
Original brand manufacturer (OBM)
Firm that designs, manufactures, and markets branded products.
Original design manufacturer (ODM)
Firm that both designs and manufactures products.
Original equipment manufacturer (OEM)
Firm that executes design blueprints provided by Western firms and manufactures such products.
Outsourcing
Turning over an activity to an outside supplier that will perform it on behalf of the focal firm.
Reshoring
Moving formerly offshored activities back to the home country of the focal firm.
