International Business Management

Question 1

4 levels at which globalisation can be analysed.

Answer 1

1) global
2) country
3) industry
4) company

Question 2

What is the Trans-nationality index (TNI)?

Answer 2

% of a company’s assets, sales and employment abroad compared to domestic

Question 3

3 drivers of globalisation.

Answer 3

1) economy liberalisation (trade, finances, foreign direct investment - FDI)
2) technology development (info and comms, transport)
3) internationalisation of firms (offshoring)

Question 4

3 deterrents of globalisation.

Answer 4

1) Covid-19
2) geopolitical tensions (war in Ukraine)
3) negative perception (modern slavery, cultural changes, MNC gain power)

Question 5

What is United Nations Global Compact? 4 action areas.

Answer 5

Call for businesses to adopt CSR practices.
1) human rights
2) labour
3) environment
4) anti-corruption

Question 6

3 factors of firm internationalisation.

Answer 6

1) push (forces to leave home markets)
2) pull (attracts to foreign markets)
3) facilitating

Question 7

5 types of push factors.

Answer 7

1) legal hinders
2) growing costs
3) local economy
4) home market saturation
5) demogaphics

Question 8

4 types of pull factors.

Answer 8

1) markets (growth opportunities, per capita income, consumer preferences)
2) resources (raw materials, infrastructure low-cost & skilled labour)
3) strategic (innovations, diversification, competitors follow-up)
4) efficiency

Question 9

2 ways to select markets for expansion.

Answer 9

1) opportunistic
2) systematic

Question 10

5 types of entry modes.

Answer 10

1) exports (direct & indirect)
2) licences
3) joint ventures
4) acquisitions
5) green-fields

Question 11

4 types of licensing entry modes.

Answer 11

1) licensing (e.g. Batman was licensed to LEGO)
2) franchising (e.g. McDonalds)
3) turnkey operations (i.e. a more controlled franchise, e.g. Subway, who prepare the premises, manage marketing etc. and the owner just runs the store)
4) management contracts (e.g. Sol Melia hotels, that run the place but do not own the property)

Question 12

3 types of firm internalisation process.

Answer 12

1) sequential (Scandinavian / Uppsala model), where expansion is based on physical distance and market similarities
2) network, where expansion is based on contacts
2) born globals (IT companies etc.)

Question 13

5 conditions of the Porter’s diamond.

Answer 13

1) factors (resources, infrastructure, education)
2) demand (growth, saturation)
3) home market rivalry (innovation, competition)
4) related and supporting industries
5) government role

Question 14

3 types of strategic approaches.

Answer 14

1) global
2) multidomestic
3) transnational

Question 15

5 key characteristics of the Global strategy.

Answer 15

1) ethnocentric (parent country managers)
2) passive (dependent) subsidiaries
3) centralised, HR visits to central HQ
4) international or product org. structure
5) control via procedures, behaviour control

Question 16

5 key characteristics of the Multidomestic strategy.

Answer 16

1) polycentric (host country managers)
2) autonomous subsidiaries (independent)
3) decentralised
4) geographic org. structure
5) control via socialisation, results

Question 17

5 key characteristics of the Transnational strategy.

Answer 17

1) geocentric (managerial nationality does not matter)
2) interdependent subsidiaries
3) selective centralisation and decentralisation
4) hybrid or matrix org. structure
5) control via socialisation and informal relationships

Question 18

5 types of organisational structure.

Answer 18

1) functional
2) international
3) product
4) geographic
5) hybrid & matrix

Question 19

4 categories of Hofstede’s cultural framework.

Answer 19

1) power distance
2) uncertainty avoidance
3) masculinity / femininity
4) individualism / collectivism

Question 20

4 key points of high Power distance.

Answer 20

1) autocratic managers
2) formal titles and positions are important
3) vertical org. structure
4) wide salary differences

Question 21

3 key points of high Uncertainty avoidance.

Answer 21

1) loyalty to the employer
2) highly formalised management
3) preference for tradition

Question 22

4 key points of high Individualism.

Answer 22

1) commitment to oneself and closest kin
2) personal achievement and financial autonomy
3) hiring and promotion based on performance and skill
4) greater social mobility across occupations

Question 23

4 key points of high Masculinity.

Answer 23

1) live to work (emphasis on income, status)
2) managers expected to be decisive, firm, assertive
3) career ambitions are expected
4) focus on fast career growth

Question 24

4 steps of expatriation process.

Answer 24

1) recruitment and selection
2) training and career development
3) compensation
4) expatriation failure and repatriation

Question 25

3 types of MNC tendencies nowadays.

Answer 25

1) re-shoring and regionalisation
2) digitalisation
3) sustainability (CSR and stakeholders)

Question 26

Example of re-shoring.

Answer 26

“Mango” moved production from India, China and Bangladesh to Spain, Italy and Turkey