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425 #2
| Question | Answer |
|---|---|
| Cage Distance Framework | A decision framework based on relative distance between home and a foreign target country along four dimensions: Cultural distance, administrative and political distance, geographic distance, and economic distance |
| National Culture | The collective mental and emotional "programming of the mind" that differentiates human groups |
| Cultural Distance | Cultural disparity between an internationally expanding firm's home country and its targeted host country. |
| globalization hypothesis | Assumption that consumer needs and preferences throughout the world are converging and thus becoming increasingly homogenous. |
| local responsiveness | The need to tailor product and service offerings to fit local consumer preferences and host-country requirements |
| integration-responsiveness framework | Strategy framework that juxtaposes the pressures an MNE faces for cost reductions and local responsiveness to derive four different strategies to gain and sustain competitive advantage when competing globally |
| international strategy | Strategy that involves leveraging home-based core competencies by selling the same products or services in both domestic and foreign markets. |
| Globalization | The process of closer integration and exchange between different countries and peoples worldwide, made possible by falling trade and investment barriers, advances in telecommunications, and reductions in transportation costs. |
| multinational enterprise | A company that deploys resources and capabilities in the procurement, production, and distribution of goods and services in at least two countries. |
| global strategy | Part of a firm’s corporate strategy to gain and sustain a competitive advantage when competing against other foreign and domestic companies around the world. |
| foreign direct investment | A firm’s investments in value chain activities abroad. |
| location economies | Benefits from locating value chain activities in the world’s optimal geographies for a specific activity, wherever that may be. |
| liability of foreignness | Additional costs of doing business in an unfamiliar cultural and economic environment, and of coordinating across geographic distances |
| Multidomestic strategy: | Strategy pursued by MNEs that attempts to maximize local responsiveness, with the intent that local consumers will perceive them to be domestic companies |
| global-standardization strategy: | Strategy attempting to reap significant economies of scale and location economies by pursuing a global division of labor based on wherever best-of-class capabilities reside at the lowest cost. |
| transnational strategy | Strategy that attempts to combine the benefits of a localization strategy (high local responsiveness) with those of a global-standardization strategy (lowest-cost position attainable). |
| death-of-distance hypothesis | Assumption that geographic location alone should not lead to firm-level competitive advantage because firms are now, more than ever, able to source inputs globally. |
| national competitive advantage | World leadership in specific industries. |
| Build-Borrow-Or-Buy Framework | Conceptual model that aids firms in deciding whether to pursue internal development(build), enter a contractual arrangement or strategic alliance (borrow), or acquire new resources, capabilities, and competencies (buy). |
| Relational View of Competitive Advantage | Strategic management framework that proposes that critical resources and capabilities frequently are embedded in strategic alliances that span firm boundaries |
| Real Options | choices that afford managers the right but not the obligation to make further investments |
| Real-Options Perspective | Approach to strategic decision making that breaks down a larger investment decisions into a set of smaller decisions that are staged sequentially over time |
| Co-opetition | Cooperation by competitors to achieve a strategic objective |
| Learning Races | Situations in which both partners in a strategic alliance are motivated to form an alliance for learning, but the rate at which the firms learn may vary. |
| Non-equity Alliance | partnership based on contracts between firms |
| Explicit Knowledge | knowledge that can be codified; concerns knowing about a process or product |
| Equity Alliance | Partnership in which at least one partner takes partial ownership in the other |
| Tacit Knowledge | Knowledge that cannot be codified; concerns knowing how to do a certain task and can be acquired only through active participation in that task |
| Corporate Venture Capital | Equity investments by established firms in entrepreneurial ventures, falls under the broader rubric of equity alliances |
| Alliance Management Capability | A firm's ability to effectively manage three alliance-related task concurrently: partner selection and alliance formation, alliance design and governance, post-formation alliance management |
| Merger | The joining of two independent companies to form a combined entity |
| Acquisition | the purchase or takeover of one company by another; can be friendly or unfriendly |
| Hostile Takeover | Acquisition in which the target company does not wish to be acquired |
| Horizontal Integration | The process of merging with competitors, leading to industry consolidation |
| Managerial Hubris | A form of self-delusion in which managers convince themselves of their superior skills in the face of clear evidence of the contrary |
| Business-Level Strategy | The goal-directed actions managers take in their quest for competitive advantage when competing in a single product market |
| Strategic Trade-Offs | Choices between a cost or value position. Such choices are necessary because higher value creation tends to generate higher cost |
| Differentiation Strategy | Generic business strategy that seeks to create higher value for customers than the value that competitors create, while containing costs |
| Cost-Leadership Strategy | Generic business strategy that seeks to create the same or similar value for customers at a lower cost |
| Scope of Competition | The size (narrow or broad) of the market in which a firm chooses to compete |
| Focused Cost-Leadership Strategy | Same as cost-leadership strategy except with a narrow focus on a niche market |
| Focused Differentiation Strategy | Same as differentiation strategy except with a narrow focus on a niche market |
| Economies of Scope | Savings that come from producing two (or more) outputs at less cost than producing each output individually, despite using the same resources and technology |
| Economies of Scale | Decreases in cost per unit as output increases |
| Minimum Efficient Scale | Output range needed to bring down the cost per unit as much as possible, allowing a firm to stake out the lowest-cost position that is achievable through economies of scale |
| Diseconomies of Scale | Increases in cost per unit when output increases |
| Blue Ocean Strategy | Business-level strategy that successfully combines differentiation and cost-leadership activities using value innovation to reconcile the inherent trade-offs |
| Value Innovation | The simultaneous pursuit of differentiation and low cost in a way that creates a leap in value for both the firm and the consumers; considered a cornerstone of a blue ocean strategy |
| Value Curve | Horizontal connection of the points of each value on the strategy canvas that helps strategic leaders diagnose and determine courses of action |
| Strategy Canvas | Graphical depiction of a company's relative performance vis-a-vis its competitors across the industry's key success factors |
| Long Tail | A business model in which companies can obtain a large part of their revenues by selling a small number of units from among almost unlimited choice |
| Invention | The transformation of an idea into new products or process, or the modification and recombination of existing ones |
| Patent | A form of intellectual property that gives the inventor exclusive rights to benefit from commercializing a technology for a specified time period in exchange for public disclosure of the underlying idea. |
| Trade Secrets | Valuable proprietary information that is not in the public domain and where the firm makes every effort to maintain its secrecy |
| Innovation | The commercialization of any new product or process, or the modification and recombination of existing ones |
| First-Mover Advantages | Competitive benefits that accrue to the successful innovator |
| Entrepreneurship | The process by which people undertake economic risk to innovate-to create new products, processes, and sometimes new organizations |
| Entrepreneurs | The agents that introduce change into the competitive system |
| Strategic Entrepreneurship | The pursuit of innovation using tools and concepts from strategic management |
| Social Entrepreneurship | the pursuit of social goals while creating a profitable business |
| Industry Life Cycle | The five different stages-introduction, growth, shakeout, maturity, and decline- that occur in the evolution of an industry over time |
| Network Effects | The positive effect (externality) that one user of a product or service has one the value of that product for other users |
| Standard | An agreed-upon solution about a common set of engineering features and design choices |
| Product Innovation | New or recombined knowledge embodied in new products |
| Process Innovation | New ways to produce existing products or deliver existing services |
| Crossing-the-Chasm Framework | Conceptual model that shows how each stage of the industry life cycle is dominated by a different customer group |
| Technology Enthusiasts | A customer segment in Introductory stage of the industry life cycle. Often have an engineering mind-set and pursue new technology proactively, frequently seeking out new products before that are officially introduced to the market |
| Early Adopters | Customers entering the market in the growth stage of the industry life cycle that are eager to buy early into a new technology or product concept. |
| Early Majority | Customers coming into the market in the shakeout stage of the industry life cycle. |
| Late Majority | Customers entering the market in the maturity stage of the industry life cycle that are less confident about their ability to master new technology. |
| Laggards | Customers entering the market in the declining stage of the industry life cycle. Will adopt a new product only if absolutely necessary, generally don’t want new technology, and are generally not a customer |
| Markets-and-Technology Framework | A conceptual model to categorize innovations along the market (existing/new) and technology (existing/new) dimensions |
| Incremental Innovation | An innovation that squarely builds on an established knowledge base and steadily improves an existing product or service |
| Radical Innovation | Innovation that uses new technology to reach new consumers |
| Winner-Take-All Markets | Markets where the market leader captures almost all of the market share and is able to extract a significant amount of value created |
| Innovation Ecosystem | A firm’s embeddedness in a complex network of suppliers, buyers, and complementors, which requires interdependent strategic decision making |
| architectural innovation | new products or services use existing technology to create new markets and/or new consumers that did not purchase that item before |
| reverse innovation | An innovation that was developed for emerging economies before being introduced in developed economies. Sometimes also called frugal innovation. |
| disruptive innovation | when firms introduce offerings that are so unique and superior that they threaten to replace traditional approaches |
| platform business | An enterprise that creates value by matching external producers and consumers in a way that creates value for all participants, and that depends on the infrastructure or platform that the enterprise manages. |
| platform ecosystem | The market environment in which all players participate relative to the platform. |
Created by:
eunsolochos
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