MGT302 Final Exam Study Guide S10

MGT302 Final Exam Study Guide S10 - MGT302 Final Exam Study...

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MGT302 Final Exam Study Guide Tacit Knowledge – Information that is intuitive and difficult to articulate or codify in writing; Ex. swimming or riding a bike (you would want to show a person v. just tell them if they’ve never done these things before) Can be gained through personal experience or interaction Shared knowledge might be dispersed throughout the company Codified Knowledge – Information that can be easily captured in the form of text, tables, or diagrams; Ex. Jamba Juice recipes, procedures, etc. on how to make smoothies Product specifications, scientific formulas and computer programs are examples of codified knowledge First Mover Advantages versus Pioneering Costs First Mover Advantages: this is the advantage gained by the first business/company to enter into a new market, can achieve huge market potential and growth as a result Pioneering Costs: costs the firm has to bear that a later entrant can avoid; can arise when the business system in a foreign country is so different from that in a firms home market that the enterprise has to devote considerable time efforts and expense to learning the rules of the game.) Externalities knowledge ‘spillovers’- general knowledge related to a specific industry or idea; comes from sheer concentration of intellectual talent, and a network of informal contacts that allows firms to benefit from each other’s knowledge generation. Basic Entry Decisions: Which foreign markets – Choose markets close to home and easily moved to Timing the entry – First mover advantage for new entrants can lead to brand becoming synonymous with the solution of a problem; Ex. Apple iPod is synonymous with mp3 players/portable music problem in the mind of the consumers o Switching costs for customers implemented by first mover can further solidify customer use/base o First mover mistakes can end up benefiting later entrants Scale of entry – Do we want to enter a foreign market on a very large scale? (Show up and make a large statement) Or should we show up slowly? Resources may determine this for you Strategic Commitments Decision that has a long-term impact and is difficult to reverse such as entering a foreign market on a large scale; can have important influence on the nature of competition in a market; limits a company’s strategic flexibility. Exporting – The sale of products produced in one country to residents of another country Direct exporting – Company conducts all phases of the sale and transfer of the merchandise to a buyer Indirect exporting – Firm hires the expertise of someone else to facilitate the exchange
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for a fee; Advantage of knowledge/expertise in foreign market; Disadvantages: o Limits access to local information o Lack of control over intermediaries Advantages: Avoids the costs of establishing manufacturing operations in the host country Minimizes risk and investment Rapid speed of entry May realize experience curve and location economies
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MGT302 Final Exam Study Guide S10 - MGT302 Final Exam Study...

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