MANAGEMENT FINAL NOTES Below are some concepts and key terms to know for the Final Organizational culture is a system of shared beliefs and values guiding behavior When someone speaks of the way we do things here One firm now considered a benchmark for its special culture is zappos If you get the culture right most of the other stuff like brand and customer service will just happen Strong cultures clear well defined and widely shared among members Socialization the process through which new members learn the culture of an organization Observable culture is what you see in peoples behavior and hear in their conversations it is reflected in how people dress at work arrange their offices speak to and behave toward one another and talk and treat customers Core culture is found in the underlying values of the organization Core values beliefs and values shared by organization and members Example FedEx and Zynga Value based management actively develops communicates and enacts shares values Symbolic leader uses language and symbols and actions to establish and maintain a desired organizational culture Workplace spirituality involves practices that create meaning and shared community among organization members Innovation is the process of taking a new idea and putting it into practice Process innovation result in better ways of doing things southwest airlines Product innovations results in new or improved goods or services groupon put coupons on the web Business model innovations result in ways for firms to make money Netflix turned movie rental into a subscription business Green innovation sustainable innovation reduces the carbon footprint of an organization or its product Social innovation business innovation driven by a social conscience Social Entrepreneurship pursues innovation ways to solve pressing social problems Commercializing innovation process of turning new ideas into salable products Reverse innovation aka trickle up innovation the concept recognizes the potential for valuable innovations to be launched from lower organizational levels and diverse locations including emerging markets Skunkworks are special creative units set free from the normal structure for the purpose of innovation Incremental change bends and adjusts existing ways to improve performance Unfreezing the phase during which a situation is prepared for change Changing in the phase where a planned change actually takes place Refreezing the phase at which change is stabilized Force coercion strategy pursues change through formal authority and or the use of rewards or punishments Rational persuasion strategy pursues change through empirical data and rational argument Shared power strategy pursues change participation to assessing change needs values and goals Why people resist change Fear of the unknown Disrupting habits Loss of confidence Loss of control Poor timing Work overload Loss of face Lack of purpose Globalization and International Business Global economy resources markets and competition are worldwide in scope Globalization process of growing interdependence among elements of the global economy Insourcing creation of domestic jobs by foreign employers Outsourcing shifts local jobs to foreign locations to take advantage of lower wage labor in other countries International business conducts commercial transactions across national boundaries Why businesses go global Profits Customers Suppliers Capital Labor Risk Global Sourcing firms purchase materials or services around the world for local use o Exporting local products are sold abroad o Importing process of acquiring products abroad and selling them in o Licensing one firm pays a fee for rights to make or sell another company s o Franchising a firm pays a fee for rights to use another company s name and domestic markets products operating methods Joint venture operates in a foreign country through co ownership with local partners Global strategic alliance each partner hopes to achieve through cooperation things they couldn t do alone Foreign subsidiary is a local operation completely owned by a foreign firm Greenfield venture establishes a foreign subsidiary by building an entirely new operation in a foreign country World Trade Organization global institution established to promote free trade and open markets around the world Most Favored Nation Status gives a trading partners the most favorable treatment for imports and exports Tariffs taxes governments levy on imports from abroad Nontariff Barrier nontax policies that government enact to discourage imports such as quotes and import restrictions Protectionism is a call for tariffs and favorable treatments to protect domestic firms from foreign competition Global Corporation Multinational corporation has extensive international business dealings in many foreign countries Translation Corporation is an MNC that operates worldwide on a borderless basis Globalization gap involves large global firms gaining disproportionately from the global economic versus smaller firms and many countries Corruption involves illegal practices to further one s business interests Foreign Corrupt Practices Act makes it illegal for U S firms and their representatives to engage in corrupt Practices overseas Sweatshops employ workers at very low wages for long hours and in poor working conditions Child labor is a the full time employment of children for work otherwise done by adults Currency risk is possible loss because of fluctuating exchange rates Political risk possible loss because of instability and political changes in foreign countries Political risk analysis forecasts how political events may impact foreign investments Look at global area structure page 416 Global manger culturally aware and informed on international affairs Team and Teamwork Team is a collection of people who regularly interact to pursue common goals Team work is the process of people actively working together to accomplish common goals Synergy is the creation of a whole greater than the sum of its individual parts Why teams are good More resources for problem solving Improved creatively Improved quality Greater commitment Increased motivation Better control More satisfaction Social loafing is the tendency of some people to avoid responsibility by free riding in groups Formal team is officially recognized and supported by the organization Informal group is unofficial and emerges from relationship and shared interest among members Committee designated
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