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Global Organization

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Organizations that operate and compete in more than on country

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Global Environment

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The set of global forces and conditions that operate beyond an organization's boundaries but affect a manager's ability to acquire and utilize resources.

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Task Environment

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The set of forces and conditions that originate with suppliers, distributors, customers, and competitors and affect an organization's ability to obtain inputs and dispose of its outputs because they influence managers on a daily basis.

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General Environment

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Wide-ranging global, economic, technological, sociocultural, demographic, political, and legal forces that affect the organizations and its task environment.

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Suppliers

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Individuals and organizations that provide an organization with the input resources that it needs to produce goods and services.

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Global Outsourcing

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Purchase of inputs from the overseas suppliers or the productions of inputs abroad to lower productions costs to improve product quality or design.

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Distributors

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Organizations that help other organizations sell their goods or services to customers.

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Customers

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Individuals and groups that buy the goods and services that an organization produces.

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Competitors

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Organizations that produce goods and services that are similar to a particular organization's goods and services.

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Barriers to Entry

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Factors that make it difficult and costly for the organization to enter a particular task environment or industry

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Economies of scale

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cost advantages associated with large operations.

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Brand loyalty

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Customers' preference for the products of organizations currently existing in the task environment.

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Economic Forces

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INTEREST RATES, INFLATION, UNEMPLOYMENT, ECONOMIC GROWTH, AND OTHERS FACTORS THAT AFFECT THE GENERAL HEALTH AND WELL- BEING OF A NATIONOR THE REGIONAL ECONOMY OF AN ORGANIZATION.

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Technological forces

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Outcomes of changes in the technology that managers use to design, produce, or distribute goods and services.

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Sociocultural forces

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Pressures emanating from the social structure of a country or society or from the national culture.

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Demographic forces

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Outcomes of changes in, or changing attitudes toward, the characteristics of a population, such as age, gender, ethnic origin, race, sexual orientation, and social class.

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Political and Legal forces

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Outcomes of changes in laws and regulations, such as the deregulation of industries, the prevatization of organizations, and the increased emphasis on enviromental protection.

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Globalization

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The set of specific and general forces that work together to integrate and connect economic, political, and social systems across countries, cultures, or geographical regions so that nations become increasingly interdependent and similar.

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Tariff

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A tax that government imposes on imported or, occasionally, exported goods.

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Free-trade doctrine

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idea that if each country specializes in the production of the goods and services that it can produce most efficiently, this will make the best use of global resources

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NAFTA

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Abolishes 99% of tariffs on goods traded between Mexico, Canada and the United States

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Values

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Ideas about what a society believes to be good, desirable, and beautiful.

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Individualism

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A worldview that values individual freedom and self-expression and adherence to the principle that people should be judged by their individual achievements rather than by their social background.

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Collectivism

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A worldview that values subordination of the individual to the goals of the group and adherence to the principle that people should be judged by their contribution to the group.

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Power distance

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The degree to which societies accept the idea that inequalities in the power and well-being of their citizens are due to differences in individuals' physical and intellectual capabilities and heritage.

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Achievement orientation

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A worldview that values assertiveness, performance, success, and competition.

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Nurturing orientation

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a world view that values the quality of life, warm personal friendships, and services and care for the weak.

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Uncertainty avoidance

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degree to which societies are willing to tolerate uncertainty and risk.

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Long-term orientation

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A worldview that values thrift and persistence in achieving goals.

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Short-term orientation

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A worldview that values personal stability or happiness and living for the present.

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Decision making

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The process by which managers respond to opportunities and threats by analyzing options, and making determinations about specific organizational goals and courses of action.

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Programmed decision

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Routine, virtually automatic decision making that follows established rules or guidelines.

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Non-programmed decision

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Nonroutine decision making that occurs in response to unusual, unpredictable opportunities and threats.

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Intution

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feelings, beliefs, and hunches that come readily to mind, require little effort and information gathering and result in on-the-spot decisions.

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Reasoned judgment

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decisions that take time and effort to make and result from careful information gathering, generation of alternatives, and evaluation of alternatives.

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Classical model of decision making

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A prescriptive model of decision making that assumes the decision maker can identify and evaluate all possible alternatives and their consequences and rationally choose the most appropriate course of action.

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Optimum decision

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The most appropriate decision in light of what managers believe to be the most desirable future consequences for the organization.

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Administrative model of decison making

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An approach to decision making that explains why decision making is inherently uncertain and risky and why managers usually make satisfactory rather than optimum decisions

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Bounded rationality

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cognitive limitations on a person's ability to interpret, process, and act on information.

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Risk

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The degree of probability that the possible outcomes of a particular course of action will occur.

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Uncertainty

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The probabilities of alternative outcomes cannot be determined and future outcomes are unknown.

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Ambiguous information

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Information that can be interpreted in multiple and often conflicting ways.

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Time contraints and information costs

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managers have neither the time nor money to search for all possible alternatives and evaluate potential consequences

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Satificing

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Searching for and choosing an acceptable, or satisfactory response to problems and opportunities, rather than trying to make the best decision.

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Groupthink

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A pattern of faulty and biased decision making that occurs in groups whose members strive for agreement among themselves at the expense of accurately assessing information relevant to a decision.

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Devil's advocacy

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Critical analysis of a preferred alternative, made in response to challenges raised by a group member who, playing the role of Devil's advocate, defends unpopular or opposing alternatives for the sake of argument.

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Organizational learning

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The process through which managers seek to improve a employee's desire and ability to understand and manage the organization and its task environment so as to raise effectiveness.

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creativity

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A decision maker's ability to discover original and novel ideas that lead to feasible alternative courses of action.

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Innovation

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The implementation of creative ideas in an organization.

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Brainstorming

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Managers meet face-to-face to generate and debate many alternatives.

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Production blocking

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a loss of productivity in brainstorming sessions due to the unstructured nature of brainstorming.

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Nominal group technique

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A decision-making technique in which group members write down ideas and solutions, read their suggestions to the whole group, and discuss and then rank the alternatives.

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Delphi technique

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A decision-making technique in which group members do not meet face-to-face but respond in writing to questions posed by the group leader.

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Entrepreneurs

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An individual who notices opportunities and decides how to mobilize the resources necessary to produce new and improved goods and services.

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Social entrepreneurs

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Individuals who pursue initiatives and opportunities to address social problems and needs in order to improve society and well-being.

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Intrapreneur

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A manager, scientist, or researcher who works inside an organization and notices opportunities to develop new or improved products and better ways to make them.

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Entrepreneurship

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Mobilization of resources to take advantage of an opportunity to provide customers with new and improved goods and services.

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Product champion

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A manager who takes "ownership" of a project and provides the leadership and vision that take a product from the idea stage to the final customer.

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Skunkworks

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A group of intrapreneurs who are deliberately separated from the normal operation of the organization to encourage them to devote all their attention to developing new products.

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Planning

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Identifying and selecting appropriate goals and courses of action for an organization.

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Strategy

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A cluster of decisions about what goals to pursue, what actions to take, and how to use resources to achieve goals.

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Mission statement

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A broad declaration of an organization's purpose that identifies the organization's products and customers and distinguishes the organization from its competitors.

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Corporate-level plan

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Top management's decisions pertaining to the organization's mission, overall strategy, and structure.

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Corporate-level strategy

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a plan that indicates in which industries and national markets an organization intends to compete.

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Business-level plan

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Divisional managers' decisions pertaining to divisions' long-term goals, overall strategy, and structure.

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Business-level strategy

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A plan that indicates how a division intends to compete against its rivals in an industry.

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Functional-level plan

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Functional managers' decisions pertaining to the goals that they propose to pursue to help the division attain its business-level goals.

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Functional strategy

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A plan that indicates how functional managers intend to increase the value of the organization's goods and services.

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Time horizon

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The intended duration of a plan.

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Standing plans

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Used in programmed decision situations.

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Single-use plans

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Developed for a one-time, non-programmed issue.

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Policies

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General guides to action.

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Rules

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Formal written specific guides to action.

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Standard operating procedures (SOP)

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Specify an exact series of actions to follow.

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Strategic leadership

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The ability of the CEO and top managers to convey a compelling vision of what they want the organization to achieve to their subordinates.

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SWOT analysis

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identifying internal strengths (S) and weaknesses (W) and also examining external opportunities (O) and threats (T)

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Low-cost strategy

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Driving the organization's costs down below the costs of its rivals

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Differentiation

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Distinguishing an organization's products from the products of competitors on dimensions such as product design, quality, or after-sales service.

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Concentration on a single industry

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Reinvesting a company's profits to strengthen its competitive position in its current industry.

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Vertical integration

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Expanding a company's operations either backward into an industry that produces inputs for its products or forward into an industry that uses, distributes, or sells its products.

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Diversification

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Expanding a company's business operations into a new industry in order to produce new kinds of valuable goods or services

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Related diversification

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Entering a new business or industry to create a competitive advantage in one or more of an organization's existing divisions or businesses.

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Unrelated diversification

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Entering a new industry or buying a company in a new industry that is not related in any way to an organization's current businesses or industries.

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Global strategy

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selling the same standardized product and using the same basic marketing approach in each national market

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Multi-domestic strategy

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customizing products and marketing strategies to specific national conditions

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Licensing

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allowing a foreign organization to take charge of manufacturing and distributing a product in its country or world region in return for a negotiated fee.

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Franchising

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Selling to a foreign organization the rights to use a brand name and operating know-how in return for a lump-sum payment and a share of the profits

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Strategic alliance

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Managers pool resources with those of a foreign company

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Joint venture

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Strategic alliance among companies that agree to jointly establish and share the ownership of a new business

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Wholly owned foreign subsidiary

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Managers invest in establishing production operations in a foreign country independent of any local direct involvement

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Organizing

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The process by which managers establish the structure of working relationships among employees to achieve goals

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Organizational structure

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A formal system of task and reporting relationships that coordinates and motivates organizational members so that they work together to achieve organizational goals.

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Organizational design

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The process by which manageers make specific organizing choices that result in a particular kind of organizational structure.

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Job design

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The process by which managers decide how to divide tasks into specific jobs

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Job simplification

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The process of reducing the number of tasks that each worker performs.

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Job enlargement

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increasing the number of different tasks in a given job by changing the division of labor

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Job enrichment

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Increasing the degree of responsibility a worker has over his or her job.

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Functional structure

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An organizational structure composed of all the departments that an organization requires to produce its goods or services.

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Divisional structure

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An organizational structure composed of separate business units within which are the functions that work together to produce a specific product for a specific customer.

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Product structure

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Each product line or business is handled by a self-contained division

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Global product structure

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Each product division, not the country or regional managers, takes responsibility for deciding where to manufacture its products and how to market them in foreign countries.

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Geographic structure

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Each region of a country or area of the world is served by a self-contained division

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Global geographic structure

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Managers locate different divisions in each of the world regions where the organization operates

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Market structure

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Each kind of customer is served by a self-contained division

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Matrix structure

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An organizational structure that simultaneously groups people and resources by function and by product.

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Product team structure

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An organizational structure in which employees are permanently assigned to a cross-functional team and report only to the product team manager or to one of his subordinates

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Cross-functional team

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Group of managers brough together from different departments to perform organizational tasks

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Hybrid structure

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The structure of a large organization that has many divisions and simultaneously uses many different organizational structures.

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Authority

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The power to hold people accountable for their actions and to make decisions concerning the use of organizational resources

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Hierarchy of authority

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An organization's chain of command, specifying the relative authority of each manager

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Span of control

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The number of subordinates who report directly to a manger

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Line manager

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Someone in the direct line or chain of command who has formal authority over people and resources at lower levels.

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Staff manager

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Someone responsible for managing a specialist function, such as finance or marketing.

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Integrated mechanisms

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Organizing tools that managers can use to increase communication and coordination among functions and divisions

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Network structure

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A series of strategic alliances that an organization creates with suppliers, manufacturers, and distributors to produce and market a product

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Boundaryless organization

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An organization whose members are linked by computers, faxes, computer-aided design systems, and video teleconferencing and who rarely, if ever, see one another face-to-face.

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Knowledge management system

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A company-specific virtual information system that allows workers to share their knowledge and expertise and find others to help solve problems

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Business to Business network

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A group of organizations that join together and use IT to link themselves to potential global suppliers to increase efficiency and effectiveness.

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Business to Business network

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A group of organizations that join together and use IT to link themselves to potential global suppliers to increase efficiency and effectiveness.

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