Lesson 5: Local and International Business of the Firm

• Local Business Environment

  The setting in which businesses operate within a specific area.
• What does International Business refer to?

  Trading goods and services in a worldwide market, also known as globalization of trade.
• What does Porter's Five Forces Model evaluate?

  It evaluates the competitive forces that affect an industry, including rivalry, new entrants, supplier power, customer power, and substitutes.
• What does the Competitive Rivals force in Porter's model assess?

  The intensity of competition among existing competitors.
• What does the Threat of New Entrants force examine?

  How easy or difficult it is for new competitors to enter the market.
• What does the Bargaining Power of Suppliers force analyze?

  How much power suppliers have over the prices and quality of materials.
• What does the Bargaining Power of Customers force look at?

  The power customers have to drive prices down or demand higher quality.
• What does the Threat of Substitute Products or Services force assess?

  The likelihood of customers finding a different way of doing what the firm does.
• What is Cultural Intelligence?


  • An individual’s ability to favorably receive and adjust to unfamiliar ways of doing things.
• What did Edward T. Hall note about cultural approaches to time?

  That the way people approach and deal with time varies across cultures.
• What characterizes a Monochronic Culture?


  A culture in which people tend to do one thing at a time.
• What characterizes a Polychronic Culture?


  A culture that is more flexible regarding time.
• What are the Cultural Dimensions identified in the study material?

  1. Power Distance
  2. Uncertainty Avoidance
  3. Individualism - Collectivism
  4. Masculinity - Femininity
  5. Time Orientation