GMS 522 Final Correct Questions and Answers(RATED A)

GMS 522 Final Correct Questions and Answers( nternationalization - ANSWER -defined as the process by which firms become more engaged in international markets. -the process involves varying degrees of financial and other resource commitments to foreign markets and of course, various degrees of risk Mode of Entry - ANSWER central to the process of internationalization is the selection of an entry mode. These range from low commitment modes such as exporting high commitment modes such as foreign direct investment Motivation - ANSWER the motivation for internationalization may either be proactive (firm wants to) or reactive (firm has little choice) Uppsala or U model - ANSWER the firm first expands to a psychically close market and having become familiar with that market, will target slightly more distant markets. experiential knowledge is the major driver of its pattern of internationalization. The Uppsala model has been criticized for its linear approach to the internationalization process Dunnings OLI framework - ANSWER firms expand abroad to capitalize on ownership, location and internalization advantages Advantages of Dunnings OLI framework - ANSWER -ownership of foreign assets will confer on the firm a competitive advantage in the foreign market which is not enjoyed by competing firms that do not own such assets -location confers advantages in terms of tax or other investment incentives offered by the gov't of the host country or a more favorable industrial relations climate for the firm's operations -internalization of firm-specific advantages such as proprietary technology confers benefits to the firm over alternatives such as licensing Springboard or latecomer perspective - ANSWER emerging market firms internationalize in order to overcome limitations inherent in their home-country environment, such as small market size, institutional immaturity or a relatively unsophisticated consumer base. To accomplish this firms aggressively acquire strategic assets from MNCs in developed countries Systematic four-step process - ANSWER 1)Macro segmentation 2)Preliminary screening 3)Secondary screening 4)Final security selection Macro Segmentation - ANSWER -develop segmentation criteria -apply to group countries Preliminary screening - ANSWER -develop additional criteria -apply to reduce the # of candidate countries Secondary screening - ANSWER -firm assesses its own capabilities relative to the market Final security selection - ANSWER -conduct site visit Selecting Foreign Markets - ANSWER the end result of the process is the selection of one country from the universe of potential candidates by a process of elimination International consumer segmentation - ANSWER consumers in cross-national segments may have more in common with their counterparts in other countries than they do with citizen of their own countries. If this is the case a two-stage model may be appropriate in which segmentation is undertaken at both the country and consumer levels Country Level Screening - ANSWER macro-segmentation based on overall market attractiveness Consumer level screening - ANSWER micro-segmentation based on personal and societal values Types of Entry modes - ANSWER -export -intermediate -hierarchical Export Modes - ANSWER low risk-low return modes which provide limited control for the exporting firm Intermediate Modes - ANSWER modes which provide for the sharing of the risks and rewards of market entry commensurate with the share of ownership of each partner Hierarchical Modes - ANSWER modes in which firm has complete control of the operation but also exposure to a higher level of risk Exporting - ANSWER involves the manufacture of a product in one country and its sale in one or more foreign countries Two forms of exporting - ANSWER -direct -indirect RATED A)