Encyclopedia of business in today's world

2077 Pages·2009·33.87 MB·English

by  Charles Wankel

encyclopedia of
BUSINESS
IN TODAY’S WOR LD

encyclopedia of
BUSINESS
IN TODAY’S WOR LD
Charles Wankel
St. John’s University
General Editor
Copyright © 2009 by SAGE Publications, Inc.
All rights reserved. No part of this book may be reproduced or utilized in any form or by any means, electronic or mechani-
cal, including photocopying, recording, or by any information storage and retrieval system, without permission in writing
from the publisher.
For information
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Library of Congress Cataloging-in-Publication Data
Encyclopedia of business in today’s world / Charles Wankel, general editor.
p. cm.
Includes bibliographical references and index.
ISBN 978-1-4129-6427-2 (cloth)
1. Business--Encyclopedias. 2. Commerce--Encyclopedias. 3. Management--Encyclopedias. 4. International trade--
Encyclopedias. 5. International business enterprises--Encyclopedias. I. Wankel, Charles.
HF1001.E4665 2009
650.03--dc22 2009002541
This book is printed on acid-free paper.
09 10 11 12 13 10 9 8 7 6 5 4 3 2 1
GOLSON MEDIA SAGE REFERENCE
President and Editor J. Geoffrey Golson Vice President and Publisher Rolf A. Janke
Managing Editor Susan Moskowitz Senior Editor Jim Brace-Thompson
Layout Editors Oona Patrick, Mary Jo Scibetta Project Editor Tracy Buyan
Copyeditors Joyce Li, Barbara Paris Cover Production Gail Buschman
Proofreader Julie Grady Marketing Manager Amberlyn McKay
Indexer J S Editorial Editorial Assistant Michele Thompson
Reference Systems Manager Leticia Gutierrez
Photo credits are on page 2010. Reference Systems Coordinator Laura Notton
Contents
About the General Editor vi
Introduction vii
Reader’s Guide xi
List of Articles xxiii
List of Contributors xxxv
Chronology of Business xlv
Articles A to Z 1–1738
Glossary 1739
Resource Guide 1783
Appendix: World Trade Statistics 1787
Index 1927
About the General Editor
Charles Wankel, Associate Professor of Management at St. John’s University,
New York, holds a doctorate from New York University. His authored and edited
books include 21st Century Management: A Reference Handbook, Reinventing
Management Education for the 21st Century, Innovative Approaches to Global
Sustainability, The Cutting Edge of International Management Education, Alle-
viating Poverty through Business Strategy, Global Sustainability Initiatives: New
Models and New Approaches, University and Corporate Innovations in Lifetime
Learning, Educating Managers with Tomorrow’s Technologies, Educating Manag-
ers through Real World Projects, New Visions of Graduate Management Educa-
tion, Innovative Approaches to Reducing Global Poverty, Being and Becoming a
Management Education Scholar, and the bestselling Management.
He is the founder and leader of eight scholarly virtual communities for man-
agement professors with 8,000 members in 90 nations. He is internationally
prominent and has been a Fulbright Scholar and was sponsored by the United Nations Development Program
and the Soros Open Society Fund in Lithuania. He has been a visiting professor lecturing around the world
including at the Chiba University of Commerce in Japan, and was the 2004 Keynote Speaker at the Nippon
Academy of Management Education; Distinguished Speaker at the Education without Borders Conference in
Abu Dhabi, United Arab Emirates; and Keynote Speaker at the Association of MBAs Latin America Conference
for Deans and Directors.
Dr. Wankel was awarded the Outstanding Service in Management Education and Development Award at the
Academy of Management’s 2004 meeting. Columbia University’s American Assembly identified him as one of
the nation’s top experts on Total Quality Management. His Fortune 50 consulting clients include McDonald’s
Corporation and IBM.
Editorial Advisory Board
David M. Brock, Ph.D.
Ben-Gurion University and Yeshiva University
Sabine Hoffman, Ph.D.
American University of the Middle East
Janice M. Traflet, Ph.D.
Bucknell University
Andrew J. Waskey, Ph.D.
Dalton State College
Introduction
Business in today’s world is one of increasing diver- volume provides the opportunity for understanding
sity. Undertaking commerce even by an individual the landmarks and their interrelationships in the wide
can mean working globally through a welter of new domain of business. These volumes indeed enable a
media with opportunities of all sorts rapidly appear- person to come to understand what the key issues
ing. The boundaries, scope, content, structures, and of a business topic are, and then examine associated
processes of a business activity can morph into com- topics to emerge with an expanding understanding
pletely different ones in the course of a project. Con- of any of many areas of business. Thus, users of this
temporary businesses and certainly future businesses encyclopedia may use it as a GPS to navigate them
find it incumbent upon them to fit with the require- into the language and ideas of the main conceptual
ments of environmental and economic sustainability terrain of business.
of the others who inhabit our world. Of course the This encyclopedia is designed to include a vast
practices, technologies, and tools of business are cur- range of different types of entries, including key com-
rently utilized by professional managers in govern- panies, business policies, regions, countries, dimen-
ment, education, arts organizations, not-for-profit sions of globalization, economic factors, international
organizations, political organizations, social service agreements, financial instruments, accounting regu-
organizations, etc. That is, rather than having an lations and approaches, theories, legislation, man-
opera company run by a former singer who charms agement practices and approaches, ethical and social
its patrons, what is expected is a former singer who is responsibility issues, legal and contractual structures,
a professional manager who is adept at grappling with professional organizations, technologies, market-
the issues, requirements, and expectations associated ing and advertising topics, research and develop-
with responsible business. ment practices, operations management, and logis-
With about 1,000 entries written for this volume tics terms, with a global perspective. The wealth of
by experts from an incredible diversity of fields, this topics included here reflects an integrated vision by
vii
viii Introduction
the editor of a welter of functions, technologies, and In the post-Enron, post-Bhopal, post–Three Mile
environmental factors. In the past century most busi- Island, post–Exxon Valdez, and post-9/11 environ-
ness topics were free-standing and mostly of inter- ment, business and society issues and topics refract
est to narrow specialists in related departments and off each other with new meanings. For example, what
organizations. However, the 21st century is one of in the past might have just been a climate of corrup-
cross-boundary actions. For example, Amazon incor- tion, bribery, ineptness, and lack of accountability,
porates the knowledge of prosumers’ book and other now in this or that far-flung place today might have
product reviews as part of its service to customers. global implications. So, the editor of this volume was
Wal-Mart has suppliers who are alerted by data fed to engaged by Columbia University to teach cutting-
them by the scanning of RFID tags when the product edge human resource management (HRM) topics in
levels of a particular shelf in a particular Wal-Mart a Russian oil company in Nizhny Vartovsk, Siberia,
store or in Wal-Mart stores of a particular region or where just as in U.S. oil companies, the sharing of cut-
country indicate that it is time to initiate the produc- ting-edge management technologies and approaches
tion packaging and shipping of their products to Wal- was proceeding at a rapid rate. Notions such as whis-
Mart. These vendors actually might better understand tle-blowing, managing stakeholders, alleviating pov-
parts of Wal-Mart’s inventory sales, promotions, and erty through business strategy, and microfinance are
requirements better than Wal-Mart managers. increasingly important for those interested in under-
Such new types of partnering create new terms and standing business to know.
topics that those wishing to successfully engage and Management information systems are a new uni-
utilize must understand. Increasingly used structural verse of technologies, and the terms and topics that
approaches such as outsourcing and offshoring tran- encompass them, from just 15 years ago. New appli-
scend the still important and now classic conceptu- cations and functions have proliferated, including
alization of international business through an under- e-commerce, the blogosphere, social networking
standing of intercultural issues, the political and (including Facebook and LinkedIn), digital dash-
economic environment of key countries around the boards, e-learning, executive support systems, inter-
world, home country and host country issues, joint net, intranets, extranets, identity theft, moblogs,
ventures, multinational corporations, international privacy, spam, transaction processing systems, virtu-
negotiations. alization, virtual companies, VoIP, business process
Globalization is a by-word of the current business reengineering, data warehouses, and customer rela-
epoch. Today it is normal for a business in a developed tionship management (CRM).
country to employ clerks, technicians, salespeople, Operations management is a field of business that
customer relations agents, and increasingly profes- is undergoing many structural and technological
sionals such as managers, engineers, and researchers changes. The quality management revolution start-
in emerging market nations such as India, China, and ing in Japan and developing in the mid-80s in the
Vietnam. Increasingly, corporate teams work virtually United States and Europe has been overtaken by new
with team members distributed around the world. issues of global supply chain procurement and distri-
New technologies provide interfaces that are coming bution. New approaches to designing services take
to replicate and in some ways even improve on the on more import in a service economy. Service blue-
kind of exchanges that traditionally were only avail- printing, front office and back office activities, and
able in face-to-face situations. servicescapes are among the new by-words. Location
So, for example, it has been predicted that most analysis, hybrid layout design, and process product
people in companies will do part of their work by 2012 and fixed position layouts are increasingly structured
using three-dimensional augmented reality interfaces in their deployment. Enterprise resource planning
such as that provided by virtual worlds such as Second (ERP) is increasingly sophisticated with new connec-
Life. The need for people in organizations to under- tivity and integration issues.
stand associated newly arising terms and topics such Management strategy has been redefined in the
as crowdsourcing, avatars, and teleporting, therefore, United States by agency theory, the resource-based
is significant. view of the firm, and such important accounting
Introduction ix
legislation as the Sarbanes-Oxley Act. New types of subliminal or covert messages. Internet advertising
financial instruments and their deployment through is arising in many new varieties. Marketing has gone
a wider than traditional spectrum of organizational from international marketing to global marketing,
types resulted from deregulation. The looseness where marketing decisions are made to apply across
and oversight of this new environment resulted in a multiple countries.
looseness in financial dealings. Financial institutions This encyclopedia is current and packed with
worldwide have been shaken by the great mortgage essential and up-to-date information on the state of
crisis of 2008. This followed the bailing out of Bear, business in our world. Not only does it reflect where
Stearns, & Co. Inc., a leading global investment bank- business is, but also conveys the trajectory of busi-
ing and securities trading firm, by the American fed- ness further into the 21st century. The current status
eral government. The world economy is increasingly of English as the new Esperanto is having a big impact
integrated. The European Union (EU) and NAFTA on business around the world. Many business schools
are just two of many such international structures in all parts of the world are now offering courses and
that foster freer trade. The high price of oil in 2008 programs in English. This is creating a need for a ref-
reflects the ongoing power of OPEC. erence that will explain English language topics and
Marketing is no longer just a department in a terms, in university, business, and public libraries.
company; rather it entails the collaboration of many Coverage of the global has not been at the expense
departments, vendors, and even customers working of the local. This encyclopedia provides insight into
together to market products and services. Today we the development and current business situation in a
find companies such as Dunkin’ Donuts focusing on wide spectrum of nations through articles on many
the quick provision of inexpensive cups of coffee to go individual countries.
and at the same time other companies such as Star- Our hundreds of article authors, with their knowl-
bucks going beyond that to market an entire experi- edge of a wide range of literatures, provide biblio-
ence, lifestyle, variety of flavors, and even music to graphic recommendations for those seeking more
their target market. specific information. Sometimes as in the case of
We see lateral and vertical marketing, yet the the article on Austria, this might include a link to a
classic mix of the 4Ps of product, price, place, and Web site that might offer the ongoing updates of the
promotion still frame marketing decisions. Pricing nation’s statistical data. The editor hopes that the
decisions can spring from such varied strategies and Encyclopedia of Business in Today’s World will pro-
focuses as penetration, competition’s price, bun- vide clear overviews of the important business topics
dling, differential product line pricing across dif- of our time.
ferent price-points, psychological selection of price
amounts, and premium pricing to exclusive target Charles Wankel
markets. Advertising nowadays at times includes General Editor