978-0134728391 Chapter 4 Part 2

Learning Catalytics is a “bring your own device” student engagement, assessment,

and classroom intelligence system. It allows instructors to engage students in class

with realtime diagnostics. Students can use any modern, web-enabled device

(smartphone, tablet, or laptop) to access it. For more information on using

Learning Catalytics in your course, contact your Pearson Representative.

IN-CLASS ACTIVITIES

In-Class Activity 1: Ice-Breaker: Shoes in the Global Marketplace

Activity Overview:

This activity asks students to think about why certain countries produce more labor-intensive

products than others in the global marketplace.

Time Limit: 20 minutes

What to Do:

1. Ask students to remove their shoe and note the country in which it was made. Go around the

class and keep a tally of country of origin. Most students will have shoes from China. (5

minutes)

2. Ask students why they think shoes are often made in China. Possible answers will include

low wages and a workforce willing to perform this type of work. (5 minutes)

3. Examine how other countries on the list are similar to China. Point out that shoes are labor

intensive and cost savings can be significant. (10 minutes)

In-Class Activity 2: Class Discussion: Assessing Your Own Culture

Activity Overview:

Students often think of how different other cultures are to the U.S. culture. This discussion helps

students recognize how foreign the U.S. culture is to business managers from other countries.

Time Limit: 20 minutes

What to Do:

1. Ask students to form groups.

Don’t Forget:

How many of your students have had experience with foreign business managers? What about

their families?

Wrap-Up:

Bring the discussion to a close by asking students for suggestions as to how to acclimate business

managers to different cultures.

ANSWERS FOR END OF CHAPTER ACTIVITIES

QUESTIONS FOR REVIEW

4-1. What are the advantages and disadvantages of globalization?

Governments and businesses are more aware of the benefits of globalization to businesses and

shareholders. These benefits include the potential for higher standards of living and improved

4-2. What are the three possible levels of involvement in international business? Give examples

of each.

4-3. What are the elements of national competitive advantage? Give a current, real-world

example of each condition.

The elements of national competitive advantage are factor conditions, demand conditions,

4-4. Describe the five international organizational structures.

Students should focus on the levels of involvement and organizational structures discussed in

QUESTIONS FOR ANALYSIS

4-5. Make a list of five things you own, such as an item of furniture, a vehicle, electronics,

and other consumer goods, making sure that each one was made in a different country.

Develop a hypothesis about why each product was made in that particular country.

Answers will vary, but students may indicate that many electronics items, for example, are

4-6. Describe the United States in terms of the five cultural orientations.

When discussing the first dimension of social orientation, students should note the United

States emphasis on individualism with the interests of the individual taking precedence. On the

4-7. Research and identify a protectionist tariff imposed by the United States. Do you support

that tariff? If so, why?

Answers will vary, but students should identify a specific product from a specific country,

such as clothing from Mexico, and estimate the amount of tariff and hypothesize what might

4-8. Do you think that a firm operating internationally is better advised to adopt a single standard

of ethical conduct or to adapt to local conditions? What are the advantages and disadvantages

of adapting to local conditions?

APPLICATION EXERCISES

4-9. The World Bank uses per-capita income to make distinctions among countries. Use Web or

database research to identify at least three countries in the following categories for last year:

high-income countries, upper–middle-income countries, lower–middle-income countries, and

lower-income countries. In addition, identify the source of the data that you used to draw

these conclusions.

4-10. China is one of the fastest-growing markets in the world. Use Web or database research to

uncover how to best describe China according to the five cultural dimensions. Cite the

sources for your information.

BUILDING A BUSINESS: CONTINUING TEAM EXERCISE 4-11 TO 4-13

(Learning Objective 2 – AACSB – analytical thinking, application of knowledge)

Answers will vary depending on the type of business venture. With e-commerce, many students

may source products internationally. With e-commerce, they also may very well identify export

opportunities. The product or service will determine whether market adaptation is needed and

whether social, cultural, economic, legal or political differences may affect its success.

TEAM EXERCISE: WEIGHING THE TRADE-OFFS 4-14 TO 4-17

(Learning Objective 3 – AACSB – application of knowledge, interpersonal relations and

teamwork, ethical understanding and reasoning)

This exercise should generate a lively discussion with passionate arguments since many students

may have experienced outsourcing first hand or know someone who has been outsourced.

Students may have a tendency to look at this issue as either “black or white” but need to be

encouraged to explore all aspects of this situation.

Outsourcing offers advantages of helping firms focus on their core activities and avoid getting

sidetracked on secondary activities and reducing costs by locating certain business functions in

EXERCISING YOUR ETHICS: PAYING HEED TO FOREIGN PRACTICES

(Learning Objective 4 – AACSB – application of knowledge, ethical understanding and

reasoning)

4-18. What are the key ethical issues in this situation?

4-19. What do you think most managers would do in this situation?

4-20. What would you do?

CASES:

THE DOOR OPENS

(Learning Objectives 2, 3, 4 and 5 – AACSB – application of knowledge, ethical

understanding and reasoning)

4-21. How has opening Cuba to international travel affected the travel industry in the United

States and other countries? What are the potential benefits of virtually open travel to Cuba to

Cuban citizens as well as the Cuban government?

Students will have differing answers based on their perceptions of the ethics of the embargo.

The travel industry in the United States will be the industry to see the most potential benefits,

4-22. How have changes in the structure of the global economy affected the U.S. embargo,

which has been in effect for around 50 years? More specifically, how can U.S. companies deal

with changing environmental challenges—economic, political and legal, and cultural—in

their relations not only with Cuba but also with other countries in Latin America?

Again, answers will vary but it is obvious that the embargo is much less effective than 50

4-23. How might U.S. businesses best prepare themselves for a possible elimination of the

embargo?

NOT MY CUP OF TEA

(Learning Objective 4 – AACSB – analytical thinking, application of knowledge)

4-24. What motivates companies like Starbucks to expand into international markets with little

perceived interest for their product?

4-25. How has Starbucks adapted to Chinese culture?

4-26. How will expansion in the ready-to–drink market help or hinder sales in China’s Starbucks

stores?

4-27. China has a collectivist culture. How do you believe that this will affect managers in a

Starbucks store?

4-28. Would you describe Starbucks’ model as multinational or global? Why? How would you

differentiate the two different approaches to marketing?

Starbucks is considered to be operating as a multinational firm. It designs, produces, and

markets products in many countries. Products are adapted for different countries and cultures.

CRAFTING A BUSINESS PLAN

PART 1: THE CONTEMPORARY BUSINESS ENVIRONMENT

You will already have seen that a central part of the experiential learning approach of Business

Essentials is the Business Planning Project. Now is the ideal time to introduce the project and

assign Part 1 to students to complete as homework.

The business plan project for Business Essentials is divided into six parts, corresponding to the

book’s six parts. The first part of the project is found here. Refer to the Business Plan portion of

this Instructor’s Manual for all remaining parts.

For a Sample Syllabus Business Plan Project Outline, see the instructor resource guide in the

Business Plan Project document (located within this Instructor’s Manual).

In addition to giving a general overview of the business planning project, you should copy and

distribute the following documents to students:

 Student FAQs for the Business Plan Project

 Student Business Plan Project Template Part 1: The Contemporary Business

Environment

PART 1 THE CONTEMPORARY BUSINESS ENVIRONMENT

This part of the business plan asks students to come up with a “great idea” for a business,

creating an identity and forming a concrete notion of what the business will do. The first part of

The first part of the plan should take approximately 1 to 3 hours. However, completion times will

vary greatly based on what the individual student brings to the class. Students who already have

a “big idea” will have a head start on those who do not.

HOMEWORK DELIVERABLE FROM STUDENTS

Each business plan is a unique document, so some variance in response lengths should be

expected. As a result, you may not wish to designate a minimum number of pages for the

assignment. Keep in mind that students who display a grasp of the concepts and demonstrate

higher–level thinking may write 20 to 26 pages during the project. For Part 1, expect an

approximate range of 2 to 4 pages.

STUDENT FAQs FOR THE BUSINESS PLAN PROJECT

1. Where do I begin?

2. What should my business plan look like?

There are six parts to the business plan. Your instructor will provide you with the “Business

Plan Project Student Template” file; you’ll need to complete each part. Answer the questions

that make up each part in the order that they are shown. Note that the template includes hints

explained in the Business Plan portion of this Instructor’s Manual.

3. After I finish each part of the plan, what do I do with my assignment?

Your instructor will give you instructions as to how he or she would like you to submit each

your hard drive.

4. How will I know if I’m doing the plan correctly?

Your instructor will provide feedback to you about your plan. Students who successfully

complete the plan have these two qualities in common:

you, check in your textbook or ask your instructor for an explanation.

5. How many pages are needed for a good grade?

between 12 to 15 pages. This sounds like a lot, but most sections will average 2 to 3 pages.

STUDENT BUSINESS PLAN PROJECT TEMPLATE

PART 1: THE CONTEMPORARY BUSINESS ENVIRONMENT

BUSINESS NAME

What is the name of your business?

Hint: When you think of the name of your business, make sure it captures the spirit of the

DESCRIPTION OF BUSINESS

What will your business do?

FORM OF BUSINESS OWNERSHIP

What form of business ownership (sole proprietorship, partnership, or corporation) will

your business take? Why did you choose this form?

IDEAL CUSTOMER

Briefly describe your ideal customer. What are they like in terms of age, income level, and

so on?

OUR ADVANTAGES

Why will customers choose to buy from your business, instead of your competition?

ETHICAL ISSUES

All businesses have to deal with ethical issues. One way to address these issues is to create a

code of ethics. List three core (unchanging) principles that your business will follow.

SOCIAL RESPONSIBILITY

A business shows social responsibility by respecting all its stakeholders. What steps will

you take to create a socially responsible business?

responsibility in Chapter 2. What steps can you take to be a good citizen in the community?

Consider also how you may need to be socially responsible toward your customers and, if

applicable, investors, employees, and suppliers.

GLOBAL ISSUES

Do you think that you’ll sell your product in another country? If so, what countries would

you choose, and why? What challenges will you face?