Y13 Models 2/2 Flashcards
(85 cards)
What is Hofstede’s model and why is it useful in international business?
A framework identifying six cultural dimensions (e.g. individualism, power distance, uncertainty avoidance) that shape workplace values and behaviours. It helps global firms adapt leadership, communication, and marketing styles to local norms.
What are the business implications of Hofstede’s dimensions: Individualism vs Collectivism, Masculinity vs Femininity, and Power Distance?
Individualism vs Collectivism:
- Individualist: Value autonomy, personal rewards, and self-motivation.
- Collectivist: Emphasize teamwork, group loyalty, and shared success.
Masculinity vs Femininity:
- Masculine: Driven by competition, ambition, and success.
- Feminine: Prioritize work-life balance, cooperation, and wellbeing.
Power Distance:
- High PDI: Accept hierarchy, prefer directive leadership.
- Low PDI: Expect equality, value participative management.
How do Uncertainty Avoidance, Long-term Orientation, and Indulgence vs Restraint affect business behavior across cultures?
Uncertainty Avoidance:
- High: Need clear rules, structured roles, low risk tolerance.
- Low: Embrace flexibility, creativity, and innovation.
Long-term vs Short-term Orientation:
- Long-term: Focus on relationship-building, future goals, and sustainable growth.
- Short-term: Value quick results, tradition, and short-term planning.
Indulgence vs Restraint:
- Indulgent: Favor freedom, leisure, lifestyle branding.
- Restrained: Prefer control, discipline, and practical messaging.
What are limitations of Hofstede’s model in strategic decision-making?
Based on national averages — ignores regional or generational variation. Cultures evolve, and globalisation blurs boundaries. Risk of stereotyping.
Hofstede’s dimension of ______ vs collectivism reflects the degree to which a society values individual achievement over group loyalty.
Individualism
What are the four types of integration and their strategic purposes?
Horizontal: Merge with competitors to increase market share
Vertical Backward: Take over suppliers (control supply chain)
Vertical Forward: Take over distributors/retailers
Conglomerate: Diversify into unrelated markets to spread risk
What are advantages and risks of going international via licensing, franchising, or joint ventures?
✅ Lower initial cost, brand exposure, local expertise
❌ Lower control, potential brand damage, cultural misalignment
How does economies of scale support internal growth strategies?
Spreading fixed costs across increased output reduces unit costs. Enables price competitiveness or higher margins — essential in global markets.
______ integration can help a manufacturer secure raw materials and reduce supplier dependence.
Backward vertical
What is synergy and how can it justify business integration or growth?
When combined firms generate more value than separately — via cost savings, knowledge sharing, or expanded customer base. E.g. Disney + Pixar = creative synergy.
What is overtrading and when does it typically occur?
Rapid expansion without sufficient working capital. Common in startups or firms scaling too fast — leads to cash flow problems despite rising sales.
Explain two diseconomies of scale that can undermine growth.
Communication breakdowns in large structures
Demotivated staff due to reduced responsibility or alienation
Both raise costs and reduce efficiency.
Overtrading is a financial risk where a firm’s growth outpaces its available ______.
Liquidity (or working capital)
What is CSR and how can it support long-term business success?
Corporate Social Responsibility (CSR) refers to a business’s commitment to ethical practices, environmental sustainability, and positive social impact. Builds trust, strengthens brand loyalty, and can attract investment.
What is greenwashing and why is it harmful?
When firms present an environmentally responsible image without genuine actions. Misleads stakeholders, risks reputational damage, and may lead to regulatory scrutiny — undermines trust (e.g. Volkswagen emissions scandal).
Evaluate the strategic value of CSR for large businesses.
✅ Competitive advantage through ethical differentiation
✅ Attracts talent and investors
❌ Expensive short-term; ROI not guaranteed
❌ Stakeholders may question motives if poorly communicated
CSR must be embedded into ______ strategy to be credible, not just used as a marketing tool.
Core (or corporate)
How can ethical decision-making cause conflict between different stakeholders?
Ethical sourcing may please customers but raise costs for shareholders. Cutting ties with unethical suppliers may disrupt operations. Balancing interests is difficult when ethics reduce short-term profitability
What is stakeholder theory and how does it contrast with shareholder primacy?
Stakeholder theory prioritises all affected groups (employees, customers, environment), not just shareholders. Shareholder primacy focuses on maximising profit and dividends — often at odds with ethical aims.
Why is ethical behaviour sometimes difficult to sustain in competitive markets?
Pressure to reduce costs or compete on price may lead to cutting ethical corners (e.g. labour standards, sustainability). May lose ground to unethical rivals if customers aren’t willing to pay more.
Ethical decisions often involve trade-offs between ______ interests and ______ values.
Financial; social (or moral)
How does leadership style influence organisational structure?
Autocratic leaders favour centralised, tall structures for tight control. Democratic leaders support flatter, decentralised structures that encourage delegation and innovation.
Compare centralised and decentralised decision-making structures.
Centralised: Quick decisions, consistency, control — but low responsiveness
Decentralised: Empowers local teams, boosts flexibility — but risks inconsistency
How can a shift from tall to flat structure affect communication and motivation?
Improves speed and transparency of communication, empowers staff, boosts motivation via autonomy — but may cause role confusion or overload without clear accountability.
