IB Final

a planned set of actions that managers employ to make the best use of the firm’s resources and core competencies to gain competitive advantage.

a quality of senior management that provides superior strategic guidance for managing efficiency, flexibility, and learning.

the pattern of shared values, behavioral norms, systems, policies, and procedures that employees learn and adopt.

managerial routines, behaviors, and mechanisms that allow the firm to function as intended.

an internationally distributed group of employees charged with a specific problem-solving or best-practice mandate that affects the entire organization.

and industry in which competition takes place on a country-by-country basis.

an industry in which competition is on a regional or worldwide scale.

coordination of the firm’s value-chain activities across countries to achieve worldwide efficiency, synergy, and cross-fertilization in order to take maximum advantage of similarities between countries.

management of the firm’s value-chain activities on a country-by-country basis to address diverse opportunities and risks.

an approach in which the firm views international business as separate from, and secondary to, its domestic business.

an approach to firm internationalization in which headquarters delegates considerable autonomy to each country manager, allowing him or her to operate independently and pursue local responsiveness.

a coordinated approach to internationalization in which the firm strives to be relatively responsive to local needs while retaining sufficient central control of operations to ensure efficiency and learning.

reporting relationships inside the firm that specify the links between people, functions, and processes.

a unit within the firm charged with managing the firm’s export operations. 

an organization design in which all international activities are centralized within one division in the firm, separate from domestic units.

an organizational design in which management and control are decentralized to the level of individual geographic regions.

an arrangement in which management of international operations is organized by major product line.

an arrangement in which management of the firm’s international operations is organized by functional activity, such as production and marketing.

an arrangement that blends the geographic area, product, and functional structures to leverage the benefits of a purely global strategy while keeping the firm responsive to local needs.

Favorable combination of circumstances, locations, and timing that offers prospects for exporting, investing, sourcing, or partnering in foreign markets.  

an estimate of the likely sales for all firms in a particular industry over a specific period.

arrangement in which the owner of intellectual property grants a firm the right to use that property for a specified period of time in exchange for royalties or other compensation. 

arrangement in which the firm allows another the right to use an entire business system in exchange for fees, royalties, or other forms of compensation.

cross-border business alliance whereby partnering firms pool their resources and share costs and risks to undertake a  new business venture; also referred to as an “international partnership” or an “international strategic alliance”.

an estimate of the share of annual industry sales that a firm expects to generate in a particular target market.

the procurement of products or services from independent suppliers or company-owned subsidiaries located abroad for consumption in the home country or a third country.

the strategy of producing products or services in one country (often the producer’s home country), and selling and distributing them to customers located in other countries.

an international business transaction where all or partial payments are made in kind, rather than cash.

exporting that is accomplished by contracting with intermediaries located in the firm’s home market.

exporting that is accomplished by contracting with intermediaries located in the foreign market.

a representative office of the local firm that handles marketing, physical distribution, promotion, and customer service activities in the foreign market.

official forms and other paperwork required in export transactions for shipping and customs procedures.

universally accepted terms of sale that specify how the buyer and the seller share the cast of freight and insurance in an international transaction and at which point the buyer takes the title to the goods.

contrast between the banks of a buyer and a seller that ensures payment from the buyer to the seller upon receipt of an export shipment.

international financial institutions owned by multiple governments within world regions or other groups.

a type of countertrade in which goods are directly exchanged without the transfer of any money.

a type of countertrade in which payment is both goods and cash.

a type of countertrade with two distinct contracts. In the first, the seller agrees to a set price for goods and receives cash from the buyer. This first deal is contingent on a second wherein the seller agrees to purchase the goods from the buyer for the same amount as in the first contract or a set percentage of same.

a type of countertrade in which the seller agrees to supply technology or equipment to construct a facility and receives payment in te form of goods produced by the facility.

an internationalization strategy in which the firm establishes a physical presence abroad though acquisition of productive assets such as capital, technology, labor, land, plant, and equipment.

cross-border business alliance whereby partnering firms pool their resources and share costs and risks to undertake a new business venture; also referred to as an “international partnership” or an “international strategic alliance”.

a form of collaboration between two or more firms to create a new, jointly owned enterprise.

passive ownership of foreign securities such as stocks and bonds for the purpose of generating financial returns.

direct investment to build a new manufacturing, marketing, or administrative facility, as opposed to acquiring existing facilities.

direct investment to purchase an existing company or facility.

a special type of acquisition in which two firms join to form a new, larger firm.

acquisition of partial ownership in an existing firm.

a foreign direct investment in which the investor fully owns the foreign assets.

a type of partnership in which a separate firm is created through the investment or pooling of assets by two or more parent firms that gain joint ownership of the new legal entity.

an arrangement whereby the firm owns, or seeks to own, multiple stages of a value-chain for producing, selling, and delivering a product or service.

an arrangement whereby the firm owns, or seeks to own, the activities performed in a single stage of its value-chain.

a collaboration in which the partners create a project with a relatively narrow scope and a well-defined timetable, without creating a new legal entity.

a project based, nonequity venture initiated by multiple partners to fulfill a large-scale project.

a type of project-based, nonequity venture where partners agree to access licensed technology developed by the other on preferential terms.

a plan of action for foreign markets that guides the firm in deciding how to position itself and its offerings, which customer segments to target, and the degree to which it should standardize or adapt its marketing program elements.

a group of customers who share common characteristics across many national markets.

firm’s efforts to modify one or more elements of its international marketing program to accommodate specific customer requirements in a particular market.

firm’s efforts to make its marketing program elements uniform, with a view to targeting entire regions, or even the global marketplace, with the same product or service.

a brand whose positioning, advertising strategy, look, and personality are standardized worldwide.

legal importation of genuine products into a country by intermediaries other than the authorized distributors (also known as parallel imports).

the problem of end-user prices reaching exorbitant levels in the export market, caused by multilayered distribution channels, intermediary margins, tariffs, and other international customer costs.

the practice of pricing intermediate or finished products exchanged among the subsidiaries and affiliates of the same corporate family located in different countries.

serving a key global customer in a consistent and standardized manner, regardless of where in the world it operates.

the issuance of shares of stock to raise capital from investors and the use of retained earnings to reinvest in the firm.

the borrowing of money from banks or other financial intermediaries, or the sale of corporate bonds to individuals or institutions, to raise capital.

the collective financial markets where firms and governments raise short-term financing.

the collective financial markets where firms and governments raise intermediate and long-term financing.

the worldwide market of funds for equity financing – stock exchanges around the world where investors and firms meet to buy and sell shares of stock.

US dollars held in the banks outside the United States, including foreign branches of US banks.

any currency deposited in a bank outside its country of origin.

a debt instrument that enables the issuer (borrower) to raise capital by promising to repay the principal along with interest on a specified date (maturity).

the international marketplace in which bonds are bought and sold, primarily through bond brokers.

a bond sold outside the issuer’s country and denominated in the currency of the country where issued.

a bond sold outside the issuer’s home country but denominated in its own country.

funds from sources inside the firm (both headquarters and subsidiaries) such as equity, loans, and trade credits.

a loan between the parent and its subsidiary, channeled through a large bank or other financial intermediary.

a country hospitable to business and inward investment because of its low corporate income taxes.

strategic reduction of cash transfers within the MNE family through the elimination of offsetting cash flows. 

the currency risk firms face when outstanding accounts receivable or payable are denominated in foreign currencies.

the currency risk that results when a firm translates financial statements denominated in a foreign currency into the functional currency of the parent firm, as a part of consolidating international financial results.

the process of combining and integrating the financial results of foreign subsidiaries into the financial statements of the parent firm.

the currency risk that results from exchange rate fluctuations affecting the pricing of products, the cost of inputs, and the value of foreign investments.

the exchange rate applied when the current exchange rate is used for immediate receipt of a currency.

the exchange rate applicable to the collection or delivery of a foreign currency at some future date.

the number of units of domestic currency needed to acquire one unit of foreign currency; also known as the normal quote.

the number of units of foreign currency obtained for one unit of domestic currency.

currency traders who seek to minimize their risk of exchange rate fluctuations, often by entering into forward contracts or similar financial instruments. 

currency traders who seek profits by investing in currencies with the expectation their value will change in the future. 

currency traders who buy and sell the same currency in two or more foreign-exchange markets to profit from differences in the currency’s exchange rate.

using financial instruments and other measures to reduce or eliminate exposure to currency risk by locking in guaranteed foreign exchange positions.

a contract to exchange two currencies at a specified exchange rate on a set future date.

an agreement to buy or sell a currency in exchange for another at a specified price on a specified date.

a contract that gives the purchaser the right to, but not the obligation, to buy a certain amount of foreign currency at a set exchange rate within a specified amount of time.

an agreement to exchange one currency for another, according to a specified schedule.

the degree to which companies regularly reveal substantial information about their financial condition and accounting practices.

translation of foreign currency balance sheet and income statements at the current exchange rate- the spot exchange rate in effect on the day or for the period when the statements are prepared.

translation of foreign currency balance sheet and income statements at an exchange rate that varies with the underlying method of valuation.