BSAD 114

Lars Perner, Instructor

Global Marketing

Winter, 2002

INCREDIBLY BEAUTIFUL MIDTERM

Version 1b

Exam #: _____________

PLEASE DO NOT PUT YOUR NAME ON THIS EXAM, but indicate your exam number on the sheet which will be circulating.

Part I: Short Answers (Please answer ANY 6 of the following 8 questions. If you answer more than six, only the first six questions will count toward your grade. If you start on an answer and decide to abandon it, please make sure that your answer is crossed out). [20 points per question for a total of 6*20=120 points. Suggested time allocation: 7 minutes per question for a total of 42 minutes for Part I].

1. Back in the late 1970s and early 1980s, Japanese auto manufacturers were able to rapidly increase their market shares in the U.S. market in part because of a large labor cost advantage associated with Japanese manufacturing techniques, allowing them to sell the cars at much lower prices than American cars. Now, however, Japanese cars typically sell for considerably more than comparable American models—and not all this money goes to higher profits for the Japanese. What has happened?

2. A Brazilian manufacturer of small commercial aircraft has a cost structure that allows it to sell at prices much lower than those for comparable aircraft made in the U.S., Europe, or Japan, so the manufacturer is really not worried about tariffs. Currently, neither the U.S. nor Japan has put quotas on Brazilian planes. Are there other forms of potential protectionism in the U.S. and Japanese markets that this firm should worry about?

3. According to the text, how do factual and interpretive knowledge differ, and what are the significance and implications of this difference?

4. Rap singer Questionable Q has heard that there is a large market for rap music in Japan, but neither she nor her agent knows much more than that. What kind of advice can you give them on market research?

5. Maytag would like to increase its share of the Kuwaiti market for household appliances and is planning to do market research to assess possibilities. What kinds of problems would you advice the research team to expect?

6. Traitor Joe sells Libyan figs, Iraqi dates, and Cuban cigars in his U.S. stores and in return sells encryption software and enriched uranium to the governments of those countries. The Central Intelligence Agency has hired you as an undercover agent posing as a business culture consultant, hoping that you would be able mislead Joe so that he would end up making a negative impression on his foreign business clients, increasing chances that his deals would fail. Please suggest potential strategies for your choice of one of the three countries above.

7. According to the text how does resistance to change vary between countries? In which ways does change vary?

8. The text suggests that cultural similarities may be "an illusion." Please discuss.

PLEASE BE SURE THAT YOU HAVE EITHER COMPLETELY SKIPPED OR CROSSED OUT ANSWERS TO YOUR TWO LEAST PREFERRED SHORT ANSWER QUESTIONS!

Part II. “Issue spotter” case (80 points=40%. Suggested time allocation: 32 minutes). Please apply course concepts to one of the two cases below. You must (1) identify which course issues are relevant and important to the firm and then (2) apply those concepts to the specific situation of the firm. Grading will be based on:

· the significance to the firm of the issues that you identify (you must decide which issues are applicable and are genuinely important for the specific firm);

· how well you relate the ideas to the specific situation of the firm in question (merely regurgitating class notes in the abstract will yield no credit);

· the extent to which in-depth knowledge of the ideas applied is expressed (note that your reasoning must be evident and explicit); and

· the extent to which the answer is well organized.

PLEASE BE SURE THAT YOU RELATE YOUR ANSWERS TO THE SPECIFICS OF THE FIRM—GENERAL ANSWERS ARE NOT OF INTEREST!

There will be no credit for:

· “No brainer” observations, such as the need for the firm to take culture into consideration (you must discuss likely cultural influences in context of the firm situation) or the need to do research (you must justify the issues and methods that you explicitly indicate);

· Outside knowledge (what you happen to know about this particular firm, beyond what was covered in class, readings, or in the case);

· Ideas which are too vague to be meaningful;

· Ideas not related to issues discussed in this course (e.g., issues not of international significance);

· “Buzz” words whose meaning is not discussed; or

· General ideas not tailored to the needs of the specific firm.

A. Vermont Gaming Consoles (VGC) is a small American manufacturer of home video game equipment. VGC’s emphasis is on low cost since the units run on lower speeds and have less advanced graphics capabilities than those manufactured by big name competitors such Microsoft, Sony, and Sega. However, because these units are easier to assemble and can be made mostly from “off-the-shelf” components available from many suppliers, VGC’s management hopes to be appeal to growing gaming markets in Eastern Europe and Latin America where affordability is a significant issue. A number of low cost VGC game cartridges are already available, and because the system is relatively simple, it is much easier to make new games for these units than it is for the competitors’ more advanced ones. The management consists mostly of American engineers who do not have experience doing business abroad.

B. Wal-Mart now holds a large share of the American discount retail market and is expanding aggressively in Europe. The U.S. and European markets are, however, relatively mature, and although Wal-Mart is able to take share away from existing competitors, this is the only significant source of growth potential. Some managers are therefore intrigued with China. Although average incomes there are still very low, the Chinese economy and incomes are growing rapidly, and there are few established national retail chains.