Term
Firms use strategic management process by developing and learning how to implement a value-creating strategy.
a) True
b) False |
|
Definition
b) False.
...to achieve strategic competitiveness and earn above-average returns. (by developing and learning... a firm is achieving strategic competitiveness) |
|
|
Term
Above-average returns are:
a) lower returns than expected
b) excess of expected in other investments with different levels of risk
c) excess of expected in other investments with similar levels of risk
d) none |
|
Definition
| c) excess of expected in other investments with similar levels of risk |
|
|
Term
Above-average returns are the foundation a firm need to simultaneously satisfy all of its stakeholders
a) True
b) False |
|
Definition
|
|
Term
Primary factors that contribute to the turbulence of competitive landscape are:
a) chaotic environments
b) globalization of industries
c) significant technological changes
d) b and c |
|
Definition
|
|
Term
| The two major models to help a Firm form its vision and mission and to choose one or more strategies to pursue strategic competitiveness and above-average returns are: |
|
Definition
| The I/O model and the Resource-based model |
|
|
Term
I/O model is that the firm's unique resources, capabilities and core competencies should have more influence on selecting and using strategies
a) True
b) False |
|
Definition
b) False
This is the Resource-based model
The I/O says that firms should asses its external envrironment. |
|
|
Term
In the resource-based model, above-average returns are earned when firm uses its valuable, rare and...
a) costly-to-imitate and specific resources
b) specific resources and strategic capabilities
c) non-substitutable resources and strategic capabilities
d) costly-to-imitiate and non-substitutable resources |
|
Definition
d) costly-to-imitiate and non-substitutable resources
VRIO |
|
|
Term
Vision and mission provide direction to the firm and signal important descriptive information to stakeholders
a) True
b) False |
|
Definition
a) True
V = picture of what firm wants to be and ultimately achieve.
M = flow from vision and specifies business in which firm intends to compete and customers intended to serve |
|
|
Term
Examples stakeholders are:
a) shareholders, host communities, competitors
b) customers, suppliers, employees
c) shareholders, host communities, government
d) b and c |
|
Definition
d) b and c
Stakeholders are those who can affect or be affected by a firm's strategic outcomes. Having A-a returns a firm can simultaneously satisfy interests of all stakeholders. |
|
|
Term
Strategic leaders are people located in different parts of the firm using strategic management to help the firm reach vision and mission. However, the top-level executives are responsible for making certain the firms properly use the process.
a) true
b) false |
|
Definition
b) false
CEOs are the responsible
Grounding the process in ethical intentions and behaviors increase its effectiveness |
|
|
Term
The characteristics for all strategic leaders (especially the CEO) are to work hard, be honest and...
|_| analyse situation facing the firm
!_| ask right questions at right people/time
!_| lead people
|_| predict potential outcomes |
|
Definition
1 and 2..
they lead people during the process and predict potential outcomes of their strategic decisions by analyzing profit-pools linked to value chain activities, predicting potential outcomes |
|
|
Term
The resource-based model of above-average returns argues that the foundation for a firm’s competitive advantage is:
a. the structure of the industry in which the firm competes.
b. resources that are valuable, rare, costly to imitate, and non-substitutable.
c. all the resources and capabilities that the firm has at its disposal.
d. resources that are directly comparable with those of competing organizations. |
|
Definition
| b. resources that are valuable, rare, costly to imitate, and non-substitutable. |
|
|
Term
The global economy, globalization, rapid technological change, and the increasing importance of knowledge are creating the need to:
a. expand the strategic responsibilities to all organizational stakeholders.
b. delegate strategic responsibilities to employees "closer to the action."
c. re-centralize the responsibility for all strategic decision making to the CEO.
d. split strategic responsibilities between the CEO and the board of directors. |
|
Definition
| b. delegate strategic responsibilities to employees "closer to the action." |
|
|
Term
The organization's role as a taxpayer is most important to which group of stakeholders?
a. Unions
b. host communities
c. major suppliers of capital
d. shareholders |
|
Definition
|
|
Term
Disruptive technologies are defined as:
a. technologies that destroy the value of an existing technology and create new markets
b. technologies that change rapidly and enhance existing markets for that technology
c. replacement technologies that improve on existing technology but fulfill a similar function
d. technologies that enhance organizational communication and knowledge management |
|
Definition
| a. technologies that destroy the value of an existing technology and create new markets |
|
|
Term
The economic interdependence among countries as reflected in the free movement of goods, services, financial capital and knowledge across geographic borders is defined as:
a. strategic intensity.
b. boundaryless retailing.
c. globalization.
d. hypercompetition. |
|
Definition
|
|
Term
Research evidence suggests that employees perceive their CEOs as visionary where they:
a. focus on maximizing profits for shareholders above all other objectives of the organization
b. concentrate their decision making on the practical day-to-day aspects of the organization's operations.
c. work long hours and make excellent decisions about the strategic direction of the organization
d. work long hours and make ambiguous decisions about the strategic direction of the organization |
|
Definition
| d. work long hours and make ambiguous decisions about the strategic direction of the organization |
|
|
Term
Analysis of the industry's profit pool enables strategic managers to:
a. determine whether an industry will be viable in the long term.
b. estimate profit potential in each area of an industry's value chain.
c. predict growth in company sales over the medium to long range.
d. predict future revenue streams for the organization. |
|
Definition
| b. estimate profit potential in each area of an industry's value chain. |
|
|
Term
Capital market stakeholders include:
a. employees.
b. shareholders.
c. industry competitors.
d. government regulators. |
|
Definition
|
|
Term
The "liability of foreignness" is the:
a. inability of organizations to meet product needs in foreign cultures.
b. political disadvantage that domestic firms have when doing business abroad.
c. overall risk a domestic firm encounters when entering global competition.
d. preference for buying local, which disadvantages foreign firms in domestic markets |
|
Definition
| c. overall risk a domestic firm encounters when entering global competition. |
|
|
Term
Because of the external environment's effect on performance the firm must develop the skill required to identify its strengths and weaknesses existing in that environment
a) true
b) false |
|
Definition
b) false
EXTERNAL ENVIRONMENT: opportunities and threats |
|
|
Term
Which are the major parts of external environment:
a) general and industry environment
b) competitor environment
c) local and competitor environment
d) general, industry and competitor environment |
|
Definition
d) general, industry and competitor environment
in order: elements in broader society that affect industries, factors than influence a firm's actions/responses and profit potential (has a more direct effect on firm's strategic actions), firm analyses each major competitor's future objective, current strategies, etc. |
|
|
Term
Which are the four steps in external environmental analysis:
a) scan, monitor, forecast, implement
b) scan, monitor, implement, asses
c) scan, forecast, implement, asses
d) scan, monitor, forecast, asses |
|
Definition
d) scan, monitor, forecast, asses
Firms can identify opportunities and threats |
|
|
Term
The general environment has different segments: economic, political, technological, global, etc. For each, the firm wants to determine the strategic relevance of environmental changes and trends
a) true
b) false |
|
Definition
|
|
Term
| The 5-forces model of competition include... |
|
Definition
| threat of entry, power of suppliers, power of buyers, product substitutes, and intensity of rivalry among competitors. |
|
|
Term
A 5-forces analysis leads a firm to find a position in an industry influenced by the forces to achieve strategic competitiveness and earn average returns.
a) true
b) false |
|
Definition
b) false
to find a position where it can INFLUENCE the forces in its favour and buffer from the power of the forces to achieve competitiveness and ABOVE-average returns |
|
|
Term
A strategic group is a collection of firms following similar strategies along similar dimensions
a) true
b) false |
|
Definition
|
|
Term
A competitor analysis informs the firms about:
I. future objectives and major networks in which competitors participate
II. firm should also identify and carefully monitor mjor actions taken by firms
III. current strategies and assumptions of companies it directly competes
a) I
b) I and II
c) II and III
d) I, II, and III |
|
Definition
|
|
Term
Firms can use only legal and ethical practices to gather intelligence (set of data, information that allows firm to understand competitors, predict strategic and tactical actions)
a) true
b) false |
|
Definition
a) true
Furthermore, Internet enhances firms' capabilities to gather insights about competitors and their strategic intentions |
|
|
Term
| Which of Porter's five forces is powerful when no satisfactory substitutes are available, the selling industry is relatively more consolidated, and switching costs are high? a. Sellers or suppliers b. Threat of new entry c. Substitute products d. Power of buyers |
|
Definition
|
|
Term
Which of the following is not an entry barrier?
a.
High capital requirements
b.
Expected retaliation
c.
Brand loyalty
d.
Emotional attachment to the industry |
|
Definition
| d. Emotional attachment to the industry |
|
|
Term
An attractive industry would have all of the following characteristics except
a.
low barriers to entry.
b.
suppliers with low bargaining power.
c.
a moderate degree of rivalry.
d.
low threats from substitute products. |
|
Definition
| a. low barriers to entry. |
|
|
Term
Which of the following is not an activity used in the external environmental analysis process?
a.
Scanning
b.
Training
c.
Monitoring
d.
Assessing |
|
Definition
|
|
Term
The forces that create high buyer power are:
a.
High buyer switching costs.
b.
Small buyer purchasing volumes.
c.
Buyer is buying a commodity product.
d.
All of the above. |
|
Definition
| c. Buyer is buying a commodity product. |
|
|
Term
According to your text, a firm’s external environment is divided into three major areas:
a.
the general, industry, and competitor environments.
b.
the general, industry, and internal environments.
c.
the general, governmental, and global environments.
d.
the political, economic, and competitor environments.
e.
the internal, outer circle, and global environments. |
|
Definition
| a. the general, industry, and competitor environments. |
|
|
Term
Which of these is not a dimension of general environment?
a.
Demographic
b.
Economic
c.
Sociocultural
d.
Industry
e.
Technological |
|
Definition
|
|
Term
Which segment of the general environment is concerned with a population’s size, age structure, and ethnic mix?
a.
Sociocultural
b.
Economic
c.
Demographic
d.
Global
e.
Political/Legal |
|
Definition
|
|
Term
All of these are kinds of entry barriers in an industry except
a.
access to distribution channels.
b.
product similarities.
c.
economies of scale.
d.
government policy.
e.
capital requirements. |
|
Definition
|
|
Term
The more a company can influence its industry environment, the likelier it is that the firm will earn above-average returns.
a) true
b) false |
|
Definition
|
|
Term
MATCH
a. Competitive Advantage
b. Risk
c. Average returns
d. Strategic Management Process
1. equal to those expected by investor acknowledged similar risk
2. uncertainty from the investor about economic gains or losses after a particular investment
3. strategy which is too hard and costly to imitate
4. set of commitments, decisions and actions to achieve strategic competitiveness and earn above-average return |
|
Definition
|
|
Term
In market analysis, what does PESTLE stands for:
a) Political, Economical, Socio-cultural, Technological, leadership
b) Political, Economical, Society, Technological, leadership
c) Political, Environmental, Socio-cultural, Technological, Ecological
d) Political, Economical, Socio-cultural, Technological, Ecological |
|
Definition
| d) Political, Economical, Socio-cultural, Technological, Ecological |
|
|
Term
Industry analysis can be conducted by: strategic groups, global industry profiles, industry globalization drivers, 5 forces, Arthur D. Little's Strategic Condition Matrix, Ansoffs Matrix, GE Business Screen
a) True
b) False |
|
Definition
|
|
Term
Match:
a. GE Business Screen
b. Ansoff Matrix
c. Arthur D. Little's Strategic Condition Matrix
d. Bowman's Strategy Clock
1.According to price and utility of value a company's strategies can be defined as a low price, hybrid, differentiated, or for ultimate failure
2. according to competitive position and market attractiveness, a firm decides to invest, to earn or to harvest/divest
3. 4 types according to product/market (present/new): P/P market penetration, N/P product development, P/N market development, N/N diversification
4. Company's competitive position (Dominant, Strong, Favorable, Tenable, Weak) and Stages of Industry Maturity (embryonic, growth, maturity, aging) help map competitors position |
|
Definition
|
|
Term
Current Strategy, Future Objective, Assumptions, Capabilities are factors that have an impact on how firm's should response
a) true
b) false |
|
Definition
|
|
Term
A competitor array determines how to proceed when a weakness is found (either offensive or defensive) and Competitor profiling helps a company determine the ranking of its competitors
a) true
b) false |
|
Definition
b) false
is the other way around |
|
|
Term
Power SWOT includes: Personal Experience, Order SWOT, Weighting, Emphasize details, Rank & priorize to make a SWOT analyses more flexible
a) true
b) false |
|
Definition
|
|
Term
Internal resources can create a competitive advantage.
I. However, they cannot sustain it by themselves
II. hyper-competitive markets help sustaining it
III. need to be combined with complementary resources in the external environment
IV. Internal resources are less often a source of sustainability in hypercompetition
a) I and II
b) II and III
c) I and IV
d) III and IV |
|
Definition
|
|
Term
What leads a company to lock-ining effects to prevent them from seeing and using highly complementary assets?
a) focusing on core competences and the environment
b) strategic competitiveness build up
c) integrating internal and external resources
d) high costs |
|
Definition
a) focusing on core competences and the environment
integrating internal and external resources offers a way to avoid these limitation, the cost to inter-relate them is the limitation. These types of companies enjoy a-a returns and have build strategic competitiveness |
|
|
Term
__________ increases the range of resources of different origins that can be successfully employed for value creation.
a) close innovation
b) open innovation
c) strategic competitiveness
d) licensing |
|
Definition
b) open innovation
licensing is in deed a result of the openness that companies can achieve by this type of exercise |
|
|
Term
| An important source of external resources is _________ customers who provide ______ insights on how to ______ products. a) critical, loyal, improve b) frequent, critical, improve c) frequent, critical, improve d) loyal, critical, improve |
|
Definition
| d) loyal, critical, improve |
|
|
Term
An important source of innovation are:
a) creative individuals
b) loyal customers
c) communities
d) creative communities and individuals |
|
Definition
d) creative communities and individuals
they are also called lead users who experiment and help develop and improve existing products further. |
|
|
Term
Competitive advantage can be sustained by understanding:
I. external environment is resource rich
II. heterogeneous resources and capabilities lie outside organizational boundaries
III. competitors strategic actions
a) I
b) II
c) I and II
d) II and III |
|
Definition
c) I and II
The most needed strategic assets to leverage internal resources are often possessed by others. Capabilities enable successful strategy development and implementation. So innovatively bundling and leveraging resources and capabilities, and recruiting external resources, firms create value |
|
|
Term
Alliances, joint ventures are traditional approaches with a common core: expand organization's pool of resources by gaining access to external resources
a) true
b) false |
|
Definition
|
|
Term
Habits or the lack of right incentives can lead to: a. obstruction b. adaptive resistance to change c. maladaptation
d. a and b
c. b and c
e. a and c
f. all |
|
Definition
|
|
Term
The knowledge possessed by a firm's human capital is
a.
easily reproduced by competitor firms, which allows them to obtain a competitive advantage.
b.
a significant capability and may be the root of all competitive advantage.
c.
not a primary source of competitive advantage.
d.
centred in a firm's top management team. |
|
Definition
| b. a significant capability and may be the root of all competitive advantage. |
|
|
Term
Which of the following is a true statement about capabilities?
a.
Capabilities derive from the firm's capacity to deploy resources that have been integrated to achieve a desired end state.
b.
Capabilities emerge quickly when resources interact.
c.
Human capital cannot be a firm's capability.
d.
Capabilities become weaker and less valuable through repetition and practice. |
|
Definition
a.
Capabilities derive from the firm's capacity to deploy resources that have been integrated to achieve a desired end state. |
|
|
Term
When several resources are bundled together in a unique fashion a firm can create
a.
a competitive advantage.
b.
a core competence.
c.
a resource-based asset.
d.
all of the above |
|
Definition
a.
a competitive advantage. |
|
|
Term
_______ is defined as the evaluation of a firm by its stakeholders in terms of respect, knowledge or awareness, and emotions or affective regard.
a.
Value
b.
Reputation
c.
Tangible resource
d.
Core competency
e.
Value chain analysis |
|
Definition
|
|
Term
_______, in combination with product-market positions, is(are) the firm’s most important sources of competitive advantage.
a.
Judgment
b.
Strategies
c.
Core competencies
d.
Certainty
e.
Structure |
|
Definition
|
|
Term
An integrated and coordinated set of commitments and action the firm uses to gain a competitive advantage by exploiting core competencies in specific product markets, is called:
a) corporate-level strategy
b) vertical integration
c) managerial strategy
d) business-level strategy |
|
Definition
d) business-level strategy
Furthermore, customers are the foundation of successful business-level strategies. A firm examines 3 issues: who, what and how |
|
|
Term
Which are business-level strategies:
I. cost leadership, differentiation, focused cost leadership
II. focused differentiation, unrelated constrained
III. differentiation, integrated cost leadership
IV. focused differentiation, integrated cost leadership/differentiation
a) I and II
b) II and III
c) I and IV
d) all |
|
Definition
|
|
Term
Increasing ____________ throughout the global economy creates opportunities for firms to identify more unique customer needs they can serve with one of the bl-strategies
a) competitive rivalry
b) segmentation of markets
c) globalization
d) horizontal integration |
|
Definition
| b) segmentation of markets |
|
|
Term
A cost leadership strategy:
I. produce standardized products for a typical customer
II. products must be offered with competitive levels of differentiation
III. firms should continuously emphasize that costs are lower than competitors
IV. firms must provide customers with products that have acceptable levels of differentiated features
a) I and II
b) II, III, and IV
c) I, II, and IV
d) I, II, III, and IV |
|
Definition
|
|
Term
Loss of competitive advantage to newer technologies, failure to detect changes in customer's needs, and the ability of competitors to imitate that competitive advantage are Competitive Risks associated with:
a) Differentiation
b) Cost leadership
c) Focused differentiation
d) Integrated cost leadership |
|
Definition
|
|
Term
Through this strategy, firms provide customers with products that have different and valued features, good must be sold at a cost customers believe competitive relative to the product's features as compared to the competitors. One of its risks is the ability of competitors to provide products that have similar features but at a lower cost
a) Differentiation
b) Cost leadership
c) Focused differentiation
d) Integrated cost leadership |
|
Definition
a) Differentiation
the less similarity to competitor's products, the more buffered a firm is from competition with its rivales |
|
|
Term
| Through the ________ and the ________ strategies, firms serve the need of a narrow competitive segment. It is successful when firms have the core competences required to provide value to a specialized market segment that exceeds the value available from firms serving customers on an industry-wide basis a) Differentiation and Cost leadership b) Focused differentiation and Cost leadership c) Focused Cost leadership and Focused differentiation |
|
Definition
| c) Focused Cost leadership and Focused differentiation |
|
|
Term
Firms using the ____________ strategy strive to provide customers with relatively low-cost products that also have valued differentiated features. Flexibility is required to learn how to use primary and support activities that allow firms to produce differentiated products at relatively low costs. Primary risk is that a firm might produce products that do not offer sufficient value, getting "stuck in the middle"
a) Differentiation
b) Cost leadership
c) Focused differentiation
d) Integrated cost leadership/differentiation |
|
Definition
| d) Integrated cost leadership/differentiation |
|
|
Term
The value of creating constellation in which market players cooperate or develop complementary products or simultaneously compete is called:
a) Cooperation
b) Coopetition
c) Market segmentation
d) Market penetration |
|
Definition
|
|
Term
The main difference between closed innovation system and open innovation system is that in the first there are no sufficient resources to develop new ideas and in the second a broader market can be achieved by taking advantage of the investment in R&D and the usage of both internal/external resources
a) true
b) false |
|
Definition
|
|
Term
Classify (C for Closed innovation and O for Open innovation principles) the following believes:
__.- not all smart people work for us so we must tap into expertise of bright individuals outside
__.- to profit from R&D we must discover, develop, produce and sip it ourselves
__.-if we discover it ourselves we will get it to market first
__.- we don't have to generate the research in order to profit from it
__.- if we make the best use of internal/external ideas we will win
__.- we should control our Intellectual Property so that competitor do not profit from our ideas |
|
Definition
O.- not all smart people work for us so we must tap into expertise of bright individuals outside
C.- to profit from R&D we must discover, develop, produce and sip it ourselves
C.-if we discover it ourselves we will get it to market first
O.- we don't have to generate the research in order to profit from it
O.- if we make the best use of internal/external ideas we will win
C.- we should control our Intellectual Property so that competitor do not profit from our ideas |
|
|
Term
To identify critical external resource firms should be able to:
I. ability to learn
II. assimilate
III. transform and organizational change
a) I
b) II
c) III
d) all |
|
Definition
d) all
Ability to learn: ability to value the new external knowledge,
Assimilation: placing new knowledge within the existing frame
Transforming: disruptive innovations make transforming the frame of organization
Organization change: adapting structures, processes, and methods and cognition. |
|
|
Term
The purchasing of companies that sit either up or down stream that can supply raw materials or provide an outlet to sell products
a) horizontal integration
b) vertical integration
c) related constrained
d) none |
|
Definition
|
|
Term
A firm has achieved ________ when it successfully formulates and implements a value-creating strategy.
a. substantial returns
b. a permanently sustainable competitive advantage
c. strategic competitiveness
d. nirvana |
|
Definition
| c. strategic competitiveness |
|
|
Term
When resources and capabilities serve as a source of competitive advantage for a firm, the firm has created a(n):
a. core competence.
b. strategic differentiator.
c. normal market niche.
d. sustainable market niche. |
|
Definition
|
|
Term
________ is a capacity for a set of resources to perform a task or an activity in an integrative manner.
a. A hyper-resource
b. A core competence
c. A capability
d. Organizational knowledge |
|
Definition
|
|
Term
1. A general environmental analysis can be expected to produce all of the following EXCEPT:
a) identification of organizational threats.
b) recognition of environmental trends.
c) objective answers about the environment.
d) identification of organizational opportunities. |
|
Definition
| c) objective answers about the environment. |
|
|
Term
2. The political/legal segment of an environment represents how organizations try to influence governments and understand the influence of governments on them.
a) True
b) False |
|
Definition
|
|
Term
3. The likelihood of entry of new competitors is affected by ________ and ________.
a) the efficiency of the industry; the market share of its leading firm
b) the profitability of the industry; the market share of its leading firm
c) barriers to entry; expected retaliation of current industry organizations
d) the demand for the product; the profitability of the competitors |
|
Definition
| c) barriers to entry; expected retaliation of current industry organizations |
|
|
Term
4. Firms within strategic groups:
a) exist almost exclusively in the manufacturing sector.
b) follow dissimilar strategies across all dimensions.
c) follow similar strategies across certain dimensions.
d) typically engage in more intergroup rivalry than intragroup rivalry. |
|
Definition
| c) follow similar strategies across certain dimensions. |
|
|
Term
5. The existence of high exit barriers such as ownership of specialized assets (e.g., large aircraft) in the airline industry leads to:
a) firms leaving the industry quickly when return on capital becomes low or negative.
b) firms remaining in the industry when return on capital is high.
c) firms leaving the industry quickly when return on capital is high.
d) firms remaining in the industry when return on capital becomes low or negative. |
|
Definition
| d) firms remaining in the industry when return on capital becomes low or negative. |
|
|
Term
6. Which of the following would NOT be an ethical way to obtain information about competitors?:
a) obtaining and analysing the annual reports of competitors.
b) searching job sites and agencies to find competitor's advertisements for new staff members.
c) gathering information about competitors from trade shows.
d) using website addresses similar to competitors and receiving emails intended for them |
|
Definition
| d) using website addresses similar to competitors and receiving emails intended for them |
|
|
Term
7. Competitor intelligence is:
a) legally or illegally-gained data about competitors' internal strategic processes, capabilities and competitive decisions.
b) strategic information gathered by competitors of an organization, which the organization has tried to keep confidential
c) strategic information gained from competitors key employees about international strategic actions
d) strategic information gained from industrial espionage targeting international competitors of the organization. |
|
Definition
| d) strategic information gained from industrial espionage targeting international competitors of the organization. |
|
|
Term
8. Environmental scanning would be most important for which of the following organizations?
a) A provider of hospice services for the terminally ill.
b) A national manufacturer of household linens.
c) A web design company servicing small businesses.
d) A neighborhood sewer and water utility. |
|
Definition
| c) A web design company servicing small businesses. |
|
|
Term
9. An analysis of the economic segment of the external environment would include all of the following EXCEPT:
a) interest rates.
b) population structure.
c) international trade.
d) exchange rate analysis. |
|
Definition
|
|
Term
10. The observation that in mid-2009, the global automobile industry had the capacity to build 94 million vehicles per year, 34 million more than actually needed, is an aspect of the ________ segment of the general environment.
a) Technological
b) Demographic
c) Physical
d) Global |
|
Definition
|
|
Term
1. Which of the following is an example of a capability that is based in the functional area of distribution?
a) Effective use of logistics management techniques
b) Effective promotion of brand-name products
c) Motivating, empowering and retaining employees
d) Development and production skills yielding reliable products |
|
Definition
| a) Effective use of logistics management techniques |
|
|
Term
2. By emphasizing core competencies when formulating strategies, companies learn to compete primarily on the basis of:
a) firm-specific differences.
b) efficiency of production.
c) their primary activities.
d) intangible resources. |
|
Definition
| a) firm-specific differences. |
|
|
Term
3. Capabilities that other firms cannot easily develop are classified as:
a) nonsubstitutable.
b) valuable.
c) costly to imitate.
d) rare. |
|
Definition
c) costly to imitate.
e.g. Southwest Airlines has a complex interrelationship between its culture and staff that adds value in ways that other airlines cannot (such as jokes on flights or the cooperation between gate personnel and pilots). |
|
|
Term
4. According to preliminary evidence, which of the following represents the proportion of organizational decisions that fail?
a) About two-thirds
b) About a quarter
c) About half
d) About a third |
|
Definition
|
|
Term
5. Which of the following can be viewed as key to the capacity to take action?
a) Human capital
b) Core competencies
c) Strategic assets
d) Functional capabilities |
|
Definition
|
|
Term
6. Which of the following is measured by a product's performance characteristics and its attributes for which customers are willing to pay?
a) Profit potential
b) Competitive advantage
c) Contribution
d) Value |
|
Definition
|
|
Term
7. Which of the following is NOT required for a firm to achieve strategic competitiveness and earn above-average returns from its core competencies?
a) Core competencies must be bundled.
b) Core competencies must be leveraged.
c) Core competencies must be internationalized.
d) Core competencies must be acquired. |
|
Definition
| c) Core competencies must be internationalized. |
|
|
Term
8. A major reason outsourcing can be effective is that:
a) it permits the organization unlimited access to capital resources.
b) it increases the innovative potential of the organization in all areas.
c) few firms possess superior capability in all primary and support activities.
d) competitor organizations do not have access to the same external sources. |
|
Definition
| c) few firms possess superior capability in all primary and support activities. |
|
|
Term
| 9. Which of the following are reputational resources in an organization? A. knowledge B. brand names. C. scientific capability D. capacity to innovate |
|
Definition
|
|
Term
1. Which of the following statements is true?
a) External resources are always create a strategic threat to an organization and are disadvantageous
b) Firms who can use external resources to support strategy can create strategic advantage
c) External resources are resources external to the organization which can never be used to its advantage
d) Firms who can use internal resources to support strategy will always reduce the threat of external resources |
|
Definition
| b) Firms who can use external resources to support strategy can create strategic advantage |
|
|
Term
2. Which of the following best defines customer ethnography?
a) a capability that leads to awareness of weak signals, opportunities or new knowledge
b) feedback from external sources that helps the organization to generate new ideas
c) a research approach that seeks to understand consumers and their behavior
d) customer feedback that is gathered and analyzed through fieldwork methodologies |
|
Definition
| c) a research approach that seeks to understand consumers and their behavior |
|
|
Term
3. Which of the following do ‘core rigidities’ indicate?
a) a firm is too reliant on internal resources
b) a firm is too reliant on external resources
c) that the firm is not reliant on internal resources
d) that external threats are changing more slowly than internal resources |
|
Definition
| a) a firm is too reliant on internal resources |
|
|
Term
4. Which of the following best describes resource integration?
a) the effective control of resources internal to the organization
b) the effective control of resources external to the organization
c) the mutually beneficial combination of import and export activities
d) the mutually beneficial combination of external and internal resources |
|
Definition
| d) the mutually beneficial combination of external and internal resources |
|
|
Term
5. Coopetition exists where:
a) market players cooperate or develop complementary products and simultaneously compete
b) competing market players work together in order to develop a single marketable product
c) market players bundle several of their own products together to create a new marketable product
d) competitors co-operate to gain competitive advantage over another organization selling in the same markets |
|
Definition
| a) market players cooperate or develop complementary products and simultaneously compete |
|
|
Term
6. Which of the following is a principle of open innovation?
a) an organization must prevent competitors from benefiting from its research
b) the first organization to commercialize an innovation will win
c) an organization does not need to originate the research to benefit from it
d) if an organization discovers something, they will be first to market |
|
Definition
| c) an organization does not need to originate the research to benefit from it |
|
|
Term
7. Which of the following are required to ensure successful assimilation of new knowledge?
a) new knowledge must be radically different
b) flexibility, energy and limited novelty
c) alliances with other organizations
d) transformation of the frame of reference |
|
Definition
| b) flexibility, energy and limited novelty |
|
|
Term
8. Which of the following describes modular integration?
a) organizations select and internalize resources without trying to change the new combination
b) a dynamic process that results in a solution which is less structural than most organizational innovation
c) purposeful selection of externally sourced resources to substitute elements of the value chain
d) a structural solution that integrates new external resources with existing internal resources |
|
Definition
| c) purposeful selection of externally sourced resources to substitute elements of the value chain |
|
|
Term
9. Which of the following is most likely to help an organization gain competitive advantage?
a) an understanding that the external environment is resource rich
b) a belief that internal resources and innovations are the only key to success
c) an exclusive focus on internal core competencies of the organization
d) an exclusive focus on overcoming external threats to the organization |
|
Definition
| a) an understanding that the external environment is resource rich |
|
|
Term
The ‘NIH syndrome’ refers to:
A. being closed to new ideas
B. being open to new ideas
C. a source of new ideas
D. an approach to innovation |
|
Definition
| A. being closed to new ideas |
|
|
Term
1. When a product's unique attributes provide value to customers, the firm is implementing:
a) an integrated cost leadership/differentiation strategy.
b) a differentiation strategy.
c) a single-product strategy.
d) a cost leadership strategy. |
|
Definition
| b) a differentiation strategy. |
|
|
Term
2. The ________ dimension of relationships with customers is particularly important for social networking sites such as Facebook and MySpace.
a) richness
b) reach
c) social
d) affiliation |
|
Definition
|
|
Term
3. A differentiation strategy can be effective in controlling the power of substitutes in an industry because:
a) customers have low switching costs.
b) a differentiating firm can always lower prices.
c) customers develop brand loyalty.
d) substitute products are lower quality. |
|
Definition
| c) customers develop brand loyalty. |
|
|
Term
4. A company pursuing the differentiation or focused differentiation strategy would tend to:
a) invest in easy-to-use manufacturing technologies.
b) have strong capabilities in basic research.
c) have efficient systems linking products with processes.
d) make effective use of economies of scale. |
|
Definition
| b) have strong capabilities in basic research. |
|
|
Term
5. TQM is most helpful to firms following the ________ business strategy.
a) integrated cost-leadership/differentiation
b) cost-leadership
c) focused differentiation
d) focused cost-leadership |
|
Definition
| a) integrated cost-leadership/differentiation |
|
|
Term
6. The term "stuck in the middle":
a) indicates that the customers of an organization are willing to pay only a mid-range price for the product whatever the organization do to enhance the product.
b) indicates an organization that consistently adheres to a middle of the road strategy in the face of negative outcomes.
c) reflects the fact that the customers of the firm have only moderate expectations regarding product quality.
d) means that the cost structure is not low enough to allow it to attractively price products and that products are not differentiated enough for its target customer. |
|
Definition
| d) means that the cost structure is not low enough to allow it to attractively price products and that products are not differentiated enough for its target customer. |
|
|
Term
7. The use of a differentiation strategy would be expected to be LEAST effective in which of the following markets?
a) motion pictures
b) petrol
c) writing instruments
d) popular music |
|
Definition
|
|
Term
8. The three dimensions of a firm's relationships with customers include all the following EXCEPT:
a) richness.
b) exclusiveness.
c) affiliation.
d) reach. |
|
Definition
|
|
Term
9. Business-level strategies detail commitments and actions taken to provide value to customers and gain competitive advantage by exploiting core competencies in:
a) specific product markets.
b) primary value chain activities.
c) particular geographic locations.
d) the selection of industries in which the firm will compete. |
|
Definition
| a) specific product markets. |
|
|
Term
10. By linking companies with their suppliers, distributors, and customers, ________ provide a company with flexibility.
a) flexible manufacturing systems
b) flexible capabilities
c) information networks
d) total quality management systems |
|
Definition
|
|
Term
1. On the whole there are more competitive responses to
a) buyer pressures than to supplier pressures.
b) tactical actions than to strategic actions.
c) demands of top management than industry structural pressures.
d) strategic actions than to tactical actions. |
|
Definition
| b) tactical actions than to strategic actions. |
|
|
Term
2. Firms with few competitive resources are more likely to
a) respond quickly to competitive actions.
b) not respond to competitive actions.
c) respond to strategic actions, but not to tactical actions.
d) delay responding to competitive actions. |
|
Definition
| d) delay responding to competitive actions. |
|
|
Term
3. Which of the following statements is FALSE?
a) First movers tend to have more organizational slack than later movers.
b) First movers tend to have significantly higher revenues than second movers.
c) First movers have lower survival rates than second and late movers.
d) First movers tend to take higher risks than second and later movers. |
|
Definition
| c) First movers have lower survival rates than second and late movers. |
|
|
Term
4. A second mover
a) attempts to provide a product with greater customer value than the first mover’s product.
b) typically has a higher survival rate than the first movers who typically take greater risks.
c) is typically ineffective in its response to the first mover and can never compete with a similar product.
d) usually incurs higher expenses than the first mover since it must engage in reverse engineering. |
|
Definition
| a) attempts to provide a product with greater customer value than the first mover’s product. |
|
|
Term
5. Everything that Hotel Chocolat does is based around chocoalate. This is an example of
a) market commonality.
b) market dependence.
c) economies of scale.
d) standard-cycle markets. |
|
Definition
|
|
Term
6. Multimarket competition occurs when firms
a) simultaneously enter into an attack strategy.
b) compete against each other in several geographic or product markets.
c) sell different products to the same customer.
d) have a high level of awareness of their competitors’ strategic intent. |
|
Definition
| b) compete against each other in several geographic or product markets. |
|
|
Term
7. Which industry can be LEAST described as a slow cycle market?
a) Pharmaceuticals
b) Cell phone provider
c) Private ownership of highways and bridges
d) Freight railroads |
|
Definition
|
|
Term
8. Which of the following markets are often described as volatile and innovative?
a) Standard-cycle
b) Fast-cycle
c) Sheltered
d) Slow-cycle |
|
Definition
|
|
Term
9. All competitive advantages do not accrue to large-sized firms. A major advantage of smaller firms is that they
a) are more likely to have organizational slack.
b) can wait for larger firms to make mistakes in introducing products.
c) can launch competitive actions more quickly.
d) have more loyal and diverse workforces. |
|
Definition
| c) can launch competitive actions more quickly. |
|
|
Term
10. Which PC maker has historically benefited the most from its reputation?
a) IBM
b) Compaq
c) HP
d) Dell |
|
Definition
|
|
Term
1. Certain regulatory changes (such as antitrust regulation and tax laws) create incentives or disincentives for diversification that ________.
a) are managerial motives to diversify
b) are value-neutral
c) create value
d) reduce value |
|
Definition
|
|
Term
2. The term "conglomerates" refers to firms using the ________ diversification strategy.
a) global
b) related linked
c) related constrained
d) unrelated |
|
Definition
|
|
Term
3. Which of the following is NOT a drawback to transferring competencies by moving key people into new management positions?
a) the managers who have these skills are expensive.
b) top-level managers may resist having key people transferred.
c) the people involved may not want to move.
d) managerial competencies are not easily transferable to different organizational cultures. |
|
Definition
| d) managerial competencies are not easily transferable to different organizational cultures. |
|
|
Term
4. Which of the following represents the lowest level of diversification?
a) dominant business
b) single business
c) related constrained
d) unrelated |
|
Definition
|
|
Term
5. One method of facilitating the transfer of corporate-level core competencies between firms is to:
a) virtually integrate the two firms.
b) transfer key people into new management positions.
c) restructure the weaker firm to mirror the more successful firm.
d) share support activities, such as purchasing practices. |
|
Definition
| b) transfer key people into new management positions. |
|
|
Term
6. The more "constrained" the relatedness of diversification:
a) the fewer the linkages between the businesses owned by an organization.
b) the more links there are among the businesses owned by an organization.
c) the lower the proportion of total revenue from the dominant-business.
d) the wider the variation in the portfolio of businesses owned by the firm. |
|
Definition
| b) the more links there are among the businesses owned by an organization. |
|
|
Term
7. When a firm simultaneously practices operational relatedness and corporate relatedness:
a) the firm is likely to be overvalued by investors.
b) they will suffer from diseconomies of scope which outweigh cost savings
c) it is difficult for investors to observe the value created by the firm.
d) the firm is seeking to create value through financial economies. |
|
Definition
| c) it is difficult for investors to observe the value created by the firm. |
|
|
Term
8. Among the value-neutral incentives to diversify, some come from the firm's external environment while others are internal to the firm. External incentives to diversify include:
a) other firms in an industry are diversifying.
b) pressure from stockholders who demand that the firm diversify.
c) the low performance of a firm.
d) changes in antitrust regulations and tax laws. |
|
Definition
| d) changes in antitrust regulations and tax laws. |
|
|
Term
9. The purchasing of firms in the same industry is called:
a) horizontal acquisition.
b) networking the organization.
c) vertical integration.
d) unrelated diversification. |
|
Definition
| a) horizontal acquisition. |
|
|
Term
10. Which of the following reasons for diversification is most likely to increase the firm's value?
a) conforming to antitrust regulation
b) reducing costs through business restructuring
c) taking advantage of changes in tax laws
d) increasing managerial compensation |
|
Definition
| b) reducing costs through business restructuring |
|
|
Term
Merger and acquisition strategies have _______, even after financial crisis as a path to firm growth and earning of strategic competitiveness.
a) increased substantially
b) remained popular
c) remained the same
d) decreased |
|
Definition
|
|
Term
Firms use acquisition strategies to increase market power, overcome entry barriers, avoid cost of developing new products and speed up entries, and...
a) reduce risk of entering new business
b) cross-border acceptation
c) become more diversified
d) all
e) a and c |
|
Definition
|
|
Term
| Which of the following are characteristics of effective acquisitions: I. acquiring and target firms have complementary resources for developing new capabilities II. acquisition is friendly III. facilitates integration IV. the target firm is selected and purchased based on due diligence a) I, II and III b) I, II, and IV c) I, III, and IV d) all |
|
Definition
|
|
Term
| ___________ is used to improve a firm's performance by correcting problems created by ineffective management. a) Cooperation b) Competition c) Restructuring d) Reorganizing |
|
Definition
| c) Restructuring Downsize = reduce # employees and hierarchical levels Downscope = reduce level of diversification, focus core business Leverage Buy Out (LBO) = become private entity by purchaising through debt |
|
|
Term
The primary goal of restructuring is gaining or re-establishing:
a) core competences
b) effective strategic control of the firm
c) competitive advantage
d) effective managerial control of the firm |
|
Definition
b) effective strategic control of the firm
e.g. Downscoping the most aligned with using strategic controls |
|
|
Term
The aim of Corporate Level Strategy is to:
I. increase core competences
II. create additional value
III. become more diversified
IV. integrate vertically
a) I and IV
b) I and II
c) II and III
d) III and IV |
|
Definition
|
|
Term
The purpose of market penetration is to increase market share
a) true
b) false |
|
Definition
|
|
Term
In ______ the organization gains control of its outputs by becoming its own distributor
a) backward integration
b) vertical integration
c) forward vertical integration
d) backward vertical integration |
|
Definition
c) forward vertical integration
When Pepsi purchased KFC to replace Coke products is an example of Vertical Integration |
|
|
Term
When a company wants to combine with other organizations in different but associated industries, the strategy is know as:
a) related diversification
b) horizontal acquisition
c) unrelated diversification
d) multipoint competition |
|
Definition
| a) related diversification |
|
|
Term
| Multipoint compeittion is when 2+ diversified firms simltaneously compete in different geographic markets a) true b) false |
|
Definition
| b) false they compete in SAME product areas/demographic markets |
|
|
Term
When 2 companies share same primary inputs and are likely to share distribution channels and sales networks due to the similarity of their products/services, the relatedness is called:
a) related linked diversification
b) operational relatedness
c) conglomerate diversification
d) horizontal relatedness |
|
Definition
| b) operational relatedness |
|
|
Term
1. Which of the following is NOT true of cross-border acquisitions?
a) global M&A activity declined in the first half of 2009.
b) they remain popular as a viable path to growth and strategic competitiveness.
c) global M&A activity grew in the first half of 2009.
d) there was a significant increase in cross-border activity during the 1990s. |
|
Definition
| c) global M&A activity grew in the first half of 2009. |
|
|
Term
2. Which of the following is NOT an attribute of a successful acquisition?
a) Investments in advertising and image building are made quickly.
b) The acquiring firm has a large amount of financial slack.
c) Innovation and R&D investments continue as part of the firm's strategy.
d) The acquired and acquiring firms have complementary assets and/or resources. |
|
Definition
| a) Investments in advertising and image building are made quickly. |
|
|
Term
3. Which of the following statements is FALSE?
a) Private synergy is when the combination of two firms yields competencies and capabilities that could not be achieved by combining with any other firm.
b) Private synergy is more likely when the two firms in an acquisition have complementary assets.
c) Synergy resulting from an acquisition generates gains in shareholder wealth beyond what they could achieve through diversification of their own portfolios.
d) Private synergy is easy for the organization’s competitors to understand and imitate. |
|
Definition
| d) Private synergy is easy for the organization’s competitors to understand and imitate. |
|
|
Term
4. Which of the following can counteract the over-involvement of an organization in acquisitions?
a) making sure that there is no disagreement in the boardroom
b) allowing top executives to make all decisions about acquisitions
c) completing effective due-diligence processes around acquisitions
d) learning from mistakes and not having too much agreement in the boardroom |
|
Definition
| d) learning from mistakes and not having too much agreement in the boardroom |
|
|
Term
5. Which term describes the situation where the target firm does not solicit the acquiring firm’s bid?
a) a stealth raid.
b) a hostile takeover.
c) a leveraged buyout.
d) an adversarial acquisition. |
|
Definition
|
|
Term
| 6. A friendly acquisition a) raises the price that has to be paid for a firm. b) allows joint ventures to be developed. c) enhances the complementarity of the two firms’ assets. d) facilitates the integration of the acquired and acquiring firms. |
|
Definition
| d) facilitates the integration of the acquired and acquiring firms. |
|
|
Term
7. Private synergy
a) is assessed by managers during the due diligence process.
b) is not easy for competitors to understand and imitate.
c) occurs in most related acquisitions resulting in increased returns.
d) is frequently achieved in conglomerates. |
|
Definition
| b) is not easy for competitors to understand and imitate. |
|
|
Term
8. Internal product development is often perceived by managers as:
a) the only reliable method of generating new products for the firm.
b) critical to the success of biotech and pharmaceutical firms.
c) a quicker method of product launch than acquisition of another firm.
d) carrying a high risk of failure. |
|
Definition
| d) carrying a high risk of failure. |
|
|
Term
9. A leveraged buyout refers to
a) a restructuring action whereby a party buys all of the assets of a business, financed largely with debt, to take the firm private.
b) an action where the management of the firm and/or an external party buy all of the assets of a business financed largely with equity.
c) a firm pursuing its core competencies by seeking to build a top management team that comes from a similar background.
d) a firm restructuring itself by selling off unrelated units of the company’s portfolio. |
|
Definition
| a) a restructuring action whereby a party buys all of the assets of a business, financed largely with debt, to take the firm private. |
|
|
Term
10. Evidence suggests that firms using acquisitions as a substitute for internally developed innovations:
a) extend their time-to-market for new product launches.
b) leverage their core competencies across a broader range of products.
c) will eventually encounter performance problems.
d) offset the loss of research and development by competencies in other areas. |
|
Definition
| c) will eventually encounter performance problems. |
|
|
Term
The use of international strategies is _______. Traditional motives include ______ the products life cycle, securing key resources, and having access to ________ labour.
a) increasing, extending, cost-less
b) decreasing, extending, low-cost
c) increasing, shortening, efficient
d) increasing, extending, low -cost |
|
Definition
d) increasing, extending, low -cost
Emerging motives: internet, mobile telecommunications |
|
|
Term
Firms do not experience increased pressure for global integration as the demand for commodities becomes borderless.
a) true
b) false |
|
Definition
b) false
they DO experience increased pressure |
|
|
Term
An international strategy is commonly designed primarily to capitalize on four benefits: increased market size, earning a return on large investments, economies of scale and learning, and:
a) competitive advantage
b) advantages of locations
c) risk-free situations
d) market profitability |
|
Definition
| b) advantages of locations |
|
|
Term
Match the three types of international corporate-level strategies:
a. Multidomestic strategy
b. Global strategy
c. Transnational strategy
1. Assumes more standardization of products; strategy is controlled by home office
2. Focuses on competition within each country; strategy is decentralized to the business units operating in each country
3. Emphasize both local responsiveness and global integration and coordination; difficult to implement, requires an integrated network and individual commitment |
|
Definition
|
|
Term
____________ are causing many multinational firms to consider the need for both global efficiency and local responsiveness.
a) Globalization
b) Environmental trends
c) Excessive rivalry
d) External incentives |
|
Definition
b) Environmental trends
Liability of foreignness is more difficult to overcome than once thought, though |
|
|
Term
Exporting, licensing, strategic alliances, acquisition, establishing new wholly owned subsidiaries (greenfield ventures), are examples of:
a) types of acquisitions
b) international strategies
c) market entry strategies
d) international diversification |
|
Definition
c) market entry strategies
Exporting/Licensing have lower risks and costs
Greenfield ventures are the most expensive and risky but the one with greatest returns |
|
|
Term
International diversification facilitates innovation in a firm, it provides a larger market to gain more and faster returns from investments in innovation. However, it does not generate resources necessary to sustain large-scale R&D programs
a) true
b) false |
|
Definition
b) false
it DOES generate resources for large-scale R&D programs
In general, international diversification is related to a-a returns when well implemented and managed, providing greater economies of scope and learning |
|
|
Term
Which of the following is NOT a factor of production in Porter's model of international competitive advantage?:
a. capital
b. labour
c. technology
d. infrastructure |
|
Definition
|
|
Term
A licensing agreement:
a. is the least costly way to manage currency exchange rate fluctuations when exporting goods.
b. results in two organizations agreeing to share the risks and the resources of a new venture.
c. is the best way to protect proprietary technology from future competitors in other countries.
d. allows a foreign firm to purchase the rights to manufacture and sell a firm's products within a host country. |
|
Definition
| d. allows a foreign firm to purchase the rights to manufacture and sell a firm's products within a host country. |
|
|
Term
When a firm INITIALLY becomes internationally diversified, its returns:
a. become more variable.
b. decrease.
c. increase.
d. remain stable. |
|
Definition
|
|
Term
Firms in with emerging economies may want to form strategic alliances with firms from developing countries because:
a. it gains access to the foreign firm's sophisticated technology.
b. assets from the investing foreign company can be nationalized later.
c. disruption to the host-country's economy will be minimal.
d. there will be less cultural conflict than in licensing arrangements. |
|
Definition
| a. it gains access to the foreign firm's sophisticated technology. |
|
|
Term
Which pair of industries would NOT be considered as "related and supporting" under Porter's diamond model?
a. U.S. computers and software
b. Italian leather-processing and shoes
c. Japanese cameras and copiers
d. Highway systems and the supply of debt capital |
|
Definition
| d. Highway systems and the supply of debt capital |
|
|
Term
Moving into international markets is a particularly attractive strategy to firms whose domestic markets:
a. demand a differentiation strategy for success.
b. have developed unfriendly business attitudes toward the industry.
c. have too much regulation.
d. are limited in opportunities for growth. |
|
Definition
| d. are limited in opportunities for growth. |
|
|
Term
A global strategy:
a. lacks responsiveness to local markets.
b. achieves efficient operations without sharing resources.
c. increases risk because decision-making is centralized.
d. is easy to manage because of common operating decisions. |
|
Definition
| a. lacks responsiveness to local markets. |
|
|
Term
A nation's competitiveness depends, in part, on the capacity of its industry to ________ and thereby maintain its competitive advantage.
a. innovate
b. access critical resources
c. diversify internationally
d. protect proprietary capabilities |
|
Definition
|
|
Term
Which of the following is NOT a disadvantage associated with exporting?
a. tariffs imposed by local governments
b. high transportation costs
c. potential loss of proprietary technologies
d. loss of control over distribution activities |
|
Definition
| c. potential loss of proprietary technologies |
|
|
Term
1. Which of the following best reflects the nature of cross-border alliances compared to domestic alliances, especially in emerging markets
a. Highly leveraged and tightly monitored
b. Flexible and trust-based
c. Complex and risky
d. Uncertainty reducing and diversifying |
|
Definition
|
|
Term
2. In the franchising strategy, the most important competitive advantage for the franchisee in the franchisor’s:
a. Brand name
b. Capital resources
c. Geographic locations
d. Access to a consolidated market |
|
Definition
|
|
Term
| 3. One disadvantage of developing effective monitoring systems to manage a strategic alliance is that: a. Firms will have to accept greater risks b. Trust will be eroded c. Responses to opportunities can be prevented from noticing (precluded) d. Power coalitions will still develop |
|
Definition
| c. Responses to opportunities can be precluded |
|
|
Term
4. A nonequity strategic alliance exists when:
a. The partners agree to sell bonds instead of stock in order to finance a new venture
b. Two or more firms have a contractual relationship to share resources and capabilities
c. Two firms join together to create a new company
d. Two partners in an alliance own unequal shares in the combined entity |
|
Definition
| b. Two or more firms have a contractual relationship to share resources and capabilities |
|
|
Term
5. Which of the following is a competitive advantage that is developed through a cooperative strategy?
a. A relational advantage
b. A collusive advantage
c. A economic advantage
d. An Alliance advantage |
|
Definition
| a. A relational advantage |
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Term
6. In free market economies, who must decide how rivals can collaborate with their competitors without violating established regulations?
a. The business community
b. Consumers
c. The government
d. The invisible hand |
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Definition
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Term
7. On which strategy do McDonald’s, Hilton International, and Subway all heavily rely?
a. Cross-border alliances
b. Transnational
c. Network cooperative
d. Franchising cooperative |
|
Definition
| d. Franchising cooperative |
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Term
8. Why are alliances in the airline industry unstable?
a. The industry is declining and profits are not sufficient to divide among partners
b. The potential for firms to take opportunistic actions is too widespread
c. Alliance require cooperation among firms that must also compete
d. Unstable industries make for unstable alliances |
|
Definition
| c. Alliance require cooperation among firms that must also compete |
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Term
9. In which markets do firms cooperate to pool resources and gain market power
a. Fast-cycle
b. Standard-cycle
c. Hyper-cycle
d. Slow-cycle |
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Definition
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Term
10. A manufacturer of specially jams and jellies has decided to ally with an orchard and vineyard growing rare strains of fruit. Which of the following describes this strategy?
a. Networking
b. Vertical complementary
c. Horizontal complementary
d. Uncertainty reduction |
|
Definition
| b. Vertical complementary |
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Term
A firm use a corporate level cooperative strategy to grow and improve its performance in individual product markets
a) true
b) false |
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Definition
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Term
A horizontal complementary strategic alliance is an alliance in which firms share same of their resources and capabilities from different stages of the value chain to create a competitive advantage
c) true
d) false |
|
Definition
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|
Term
A strategic Alliance is a cooperative strategy in which firms combine some of their resources and capabilities to create a competitive advantage
e) true
f) false |
|
Definition
|
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Term
Firms in fast-cycle markets often use strategic alliances to enter restricted markets or to establish franchises in new markets
g) true
h) false |
|
Definition
|
|
Term
Complementary strategic Alliance is a type of business-level cooperative strategy
i) true
j) false |
|
Definition
|
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Term
A strategic ______ is a cooperative strategy in which firms combine some of their resources and capabilities to create a competitive advantage.
a) competence
b) advantage
c) alliance
d) acquisition |
|
Definition
|
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Term
A corporate-level cooperative strategy in which a firm (the franchisor) uses a franchise as a contractual relationship to describe and control the sharing of its resources and capabilities with partners
a) acquisition
b) franchising
c) exporting
d) greenventure |
|
Definition
|
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Term
_____ -reducing strategy: some firms use business-level strategic alliances to hedge against risk
a) uncertainty
b) vertical
c) relatedness
d) corporative |
|
Definition
|
|
Term
| A corporate level cooperative strategy in which firms share some of their resources and capabilitites to create economies of scope a) diversifying b) network c) synergistic d) acquisition |
|
Definition
|
|
Term
| A corporate level cooperative strategy in which firms share some of their resources and capabilitities to diversify into new product or market areas a) diversifying b) network c) synergistic d) acquisition |
|
Definition
|
|
Term
| A cooperative strategy where in several firms agree to form multiple partnerships to achieve shared objectives a) diversifying b) network c) synergistic d) acquisition |
|
Definition
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|
Term
In this complementary strategic alliance, firms share their resouces and capabilities from different stages of the value chain to create a competitive advantage
a) uncertainty
b) horizontal
c) vertical
d) none |
|
Definition
|
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Term
Effective strategic leadership is a prerequisite to successfully using the Strategic Management Process. It is also the ability to:
a) create strategic change and analyze supply chain activities
b) anticipate events, maintain flexibility and empower others
c) successfully delegate activities and predict customers future behavior |
|
Definition
b) anticipate events, maintain flexibility and empower others
Top level managers are an important resource for firms to develop and exploit competitive advantages. When themselves and their work is VRIO proof, strategic leaders are also a source of competitive advantage |
|
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Term
Top management team's characteristics, a firm's strategies and its performance are all ________.
a) interrelated
b) not related
c) managerial factors
d) none |
|
Definition
a) interrelated
e.g. a top management team with significant marketing and R&D knowledge positively contributes to the firm's use of a growth strategy. Performance improves when board of directors is involved in shaping the strategic direction. CEOs may have a great deal of power in decision making |
|
|
Term
The __________ market is used to select the CEO, but the number of _________ chosen is increasing.
a) external, insiders
b) competitive, outsiders
c) internal, outsiders
d) competitive, insiders |
|
Definition
c) internal, outsiders
Outsiders are often selected to initiate major changes in strategy |
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Term
Determining firm's strategic direction, managing firm's resource portfolio, sustaining an effective organizational culture, emphasizing ethical practices and establishing balanced organizational control are the 5 major components of:
a) effective corporate-level strategies
b) effective strategic leadership
c) complex business-level strategies
d) global strategies |
|
Definition
b) effective strategic leadership
Strategic Leaders must develop firm's strategic direction |
|
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Term
The ____________ specifies the image and character the firm want to develop over time. To form it, strategic leaders evaluate conditions expected over the next 3-5 years
a) strategic goals
b) strategic acquisitions
c) strategic direction
d) strategic leadership |
|
Definition
c) strategic direction
Strategic Leaders must ensure that core competencies are being exploited |
|
|
Term
Strategic leaders must develop a firm's human capital. However they are not responsible for training current and future strategic leaders.
a) true
b) false |
|
Definition
b) false
In fact, they develop programs to train current and future strategic leaders to build the skills needed to nurture the rest of the firm's human capital which should be maximized |
|
|
Term
The ____________ is a tool that measure the effectiveness of the firm's strategic and financial controls. An effective balance allows flexible use of core competencies but within the parameters of the firm's financial position.
a) GE matrix
b) Balance Score Card
c) Balanced Strategic Controls
d) none |
|
Definition
|
|
Term
1. Which of the following is NOT a factor that determines the amount of a manager’s decision-making discretion?
A. the external environmental
B. characteristics of the organization
C. characteristics of the manager
D. cohesiveness of the board of directors |
|
Definition
| D. cohesiveness of the board of directors |
|
|
Term
2. Which of the following is a criterion for reevaluating learning and growth using the balanced scorecard?
A. improvements in employee morale.
B. asset utilization improvements.
C. changes in turnover rates.
D. improvements in innovation ability. |
|
Definition
| D. improvements in innovation ability. |
|
|
Term
3. Which of the following will increase the probability that a lower-level manager will become a successful strategic leader?
A. training and development programs.
B. increasing the homogeneity of the top management team.
C. increasing the firm’s sales.
D. appointing many outside board members. |
|
Definition
| A. training and development programs. |
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Term
4. The ability to attract and manage ____ may be the most important skill a strategic leader must have.
A. human capital
B. investment strategies
C. financial resources
D. responses to competitors’ actions |
|
Definition
|
|
Term
5. Which of the following is NOT associated with heterogeneous top management teams?
A. innovation and strategic change
B. better strategic decisions
C. higher firm performance
D. diminished debate among top managers |
|
Definition
| D. diminished debate among top managers |
|
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Term
6. Which key strategic leadership action plays a key role in influencing how the firm conducts its business and regulates and controls employees’ behavior?
A. Determining Strategic Direction.
B. Sustaining an Effective Organizational Culture.
C. Regulating and Controlling Employees.
D. Effectively Managing the Firm’s Resource Portfolio. |
|
Definition
| B. Sustaining an Effective Organizational Culture. |
|
|
Term
7. Four perspectives are integrated to form the balanced scorecard framework. The financial perspective focuses on the view of the firm by the
A. shareholder.
B. general society.
C. employee.
D. customer. |
|
Definition
|
|
Term
8. ____ capital increases cooperation among individuals inside and outside the firm.
A. Visionary
B. Cultural
C. Social
D. Human |
|
Definition
|
|
Term
9. To successfully implement a firm’s strategy, the workforce must be viewed as
A. depreciating asset.
B. variable cost.
C. resource to be maximized.
D. renewable asset. |
|
Definition
| C. resource to be maximized. |
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Term
10. The effective development and management of the firm’s ____ may be its only sustainable competitive advantage.
A. human capital
B. organizational culture
C. technology
D. capital base |
|
Definition
|
|
Term
_______ is a relationship among stakeholders that is used to determine a firm's direction and control its performance
a) Ownership
b) Strategic relationship
c) Corporate governance |
|
Definition
c) Corporate governance
Effective governance aligns managers' decisions with shareholders' interest to produce a competitive advantage |
|
|
Term
_____ is a mechanism in modern corporation where principals hire managers (agents) to make decisions that maximize the firm's value diversifying their risk by investing in multiple corporations with different risk profiles.
a) ownership
b) board of directors
c) executive compensation |
|
Definition
a) ownership
furthermore, it is separated from control in the modern corporation; however separating control and ownership creates an agency problem when agent pursues goals that conflicts with principal's |
|
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Term
_____ is a governance mechanism in modern corporation that is expected to represent the interests of all stakeholders affected by the firm.
a) ownership
b) board of directors
c) executive compensation |
|
Definition
b) board of directors
it is composed of insiders, related outsiders, and outsiders; being the lasts the group that exceeds in percentage |
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Term
_____ is a governance mechanism in modern corporation that uses salary, bonuses and long-term incentives to strengthen the alignment between managers' and shareholders' interests. An effective system elicits managerial decisions that are in the shareholders' best interests
a) ownership
b) board of directors
c) executive compensation |
|
Definition
c) executive compensation
...it is an often criticized mechanism |
|
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Term
Short-term strategic success results when firms are governed in ways that permit at least minimal satisfaction of capital market shareholder, whether or not the interests of the rest stakeholders are served. This describes how effective governance mechanisms should be.
a) true
b) false |
|
Definition
b) false
LONG TERM
Ensure that interests of ALL stakeholders are served not just the shareholders |
|
|
Term
1. Generally, a board member who is a source of information about a firm's day-to-day activities is classified as ________ director.
A. a lead independent
B. an encumbered
C. a related
D. an inside |
|
Definition
|
|
Term
2. Research suggests that firms with ________ perform better, especially when collaboration among top management team members is important.
A. benchmarking used for top executive pay
B. smaller pay gap between the CEO and other top executives
C. larger proportion of insiders on the board of directors
D. greater emphasis on stock options |
|
Definition
| B. smaller pay gap between the CEO and other top executives |
|
|
Term
3. Ownership concentration is determined by both:
A. the number of outside directors and total percentage of shares they own.
B. the number of stockholders and total percentage of shares they own.
C. the number of outside directors and the parties they represent.
D. the number of stockholders and the parties they represent. |
|
Definition
| B. the number of stockholders and total percentage of shares they own. |
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Term
4. As ownership of the corporation is diffused, shareholders' ability to monitor managerial decisions:
A. increases.
B. decreases.
C. remains constant.
D. is eliminated. |
|
Definition
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|
Term
5. A takeover defence wherein preferred stock in the merged firm is offered to shareholders at a highly attractive rate of exchange is called:
A. a standstill agreement.
B. greenmail.
C. a poison pill.
D. crossing the palm with silver. |
|
Definition
|
|
Term
6. Japanese keiretsu are:
A. company unions, which are a type of governance system.
B. the banks owing the largest shares of stock in the firm.
C. a group of firms tied together by cross-shareholdings.
D. management structures related to total quality management systems. |
|
Definition
| C. a group of firms tied together by cross-shareholdings. |
|
|
Term
agency relationship exists when one party delegates:
A. financial responsibility to employees.
B. decision making responsibility to a second party.
C. ownership of a company to a second party.
D. strategy implementation actions to functional managers. |
|
Definition
| B. decision making responsibility to a second party. |
|
|
Term
8. Boards of directors are now becoming more involved in:
A. governmental relations.
B. the firm's tax issues.
C. selecting new CEOs.
D. the strategic decision making process. |
|
Definition
| D. the strategic decision making process. |
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|
Term
9. Which of the following reasons would NOT explain the difficulty of determining appropriate executive compensation?
A. A number of factors intervene between top-level management decisions and firm performance (e.g., unpredictable economic, social, or legal changes).
B. The decisions made by top-level managers are typically complex and non-routine.
C. An executive's decisions often affect firm performance only over the long run.
D. The compensation committee may not have comprehensive firm performance data. |
|
Definition
| D. The compensation committee may not have comprehensive firm performance data. |
|
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Term
10. In Japan, the principal source of the active monitoring of large companies comes from:
A. the government.
B. stock brokerage companies.
C. banks.
D. boards of directors. |
|
Definition
|
|
Term
Match the differences in global Corporate Governance Structures:
a. Maximize share holder value
b. Employees, as a stakeholder group, take more prominent role in governance
c. Shareholders played virtually no role in monitoring until recently. Now firms are being challenged by "activist" shareholders (banks are principal source of monitoring)
d. Is the youngest and mirror those in the US, but the central government still plays a major role
1. China
2. US
3. Japan
4. Germany |
|
Definition
a2
b4
c3
d1
Systems are becoming increasingly similar internationally. |
|
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Term
Organizational ________ details the work to be done in a firm and how that work is to be accomplished (formal reporting relationships, procedures). On the other hand, Organizational _________ guide the use of strategy, indicate how to compare actual and expected results.
a) Controls, Structure
b) Structure, Controls
c) Activities, Mechanisms
d) Mechanisms, Activities |
|
Definition
b) Structure, Controls
A proper match between strategy and structure can lead to a competitive advantage. Strategy has a stronger influence on structure |
|
|
Term
Strategic controls are a largely objective criteria, while financial controls are the opposite (a largely subjective criteria).
a) true
b) false |
|
Definition
b) false
Is the other way around
Strategic - subjective, Financial - objective
The two types are used to implement a strategy. |
|
|
Term
Research indicates that firms tend to change ________ when declining performance forces them to do so.
a) strategy
b) control mechanisms
c) structure
d) none |
|
Definition
c) structure
Effective managers anticipate the need for changes and quickly modify structure to better accommodate firm's strategy when evidence calls for that action. |
|
|
Term
The functional structure is used to implement ________ strategies. The ________ strategy requires a centralized functional structure while the ________ strategy's functional structure decentralizes implementation-related decisions
a) business-level, differentiation, cost-leadership
b) corporate-level, cost-leadership, differentiation
c) business-level, cost-leaderhip, differentiation
d) corporate-level, differentiation, cost-leadership |
|
Definition
| c) business-level, cost-leaderhip, differentiation |
|
|
Term
Focus strategies (often used by small firms) require a functional structure until such time that the firm diversifies in terms of products/markets.
a) true
b) false |
|
Definition
b) false
a SIMPLE structure |
|
|
Term
Unique combinations of different forms of the multidivisional structure are matched with the corporate level diversification strategies. Some examples include: SBU M-form, Cooperative M-form, Competitive M-form, among others.
a) true
b) false |
|
Definition
|
|
Term
Match International Strategy types of structures:
a. Multidomestic Strategy
b. Translational Strategy
1. Firms seek the local responsiveness and the global efficiency of the global strategy (combination structure)
2. Implemented through the worldwide geographic area structure, emphasizes decentralization and locates all functional activities in the host country. |
|
Definition
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|
Term
_________ strategies are implemented through organizational structures in which the Strategic Centre firms play a critical role. ___________ strategies often employ in vertical/horizontal alliance networks. _________ strategies are used to pursue prodcut and market diversification, one type could be Franchising. In _________ strategies distributed networks are often used.
a) cooperative, bussines-level, corporate-level cooperative, international cooperative
b) bussines-level, cooperative, corporate-level cooperative, international cooperative
c) corporate-level cooperative, bussines-level, cooperative, international cooperative
d) international cooperative, corporate-level cooperative, bussines-level, cooperative |
|
Definition
| a) cooperative, bussines-level, corporate-level cooperative, international cooperative |
|
|
Term
1. Which of the following is true?
A. for a firm to be most effective, structure and controls need to be matched with strategy
B. the structure and controls in an organization are not affected by the organizational strategy
C. organizational structures do not have an impact on the work of management in an organization
D. having the right structure and controls is important for managers but don’t impact on strategy. |
|
Definition
| A. for a firm to be most effective, structure and controls need to be matched with strategy |
|
|
Term
2. Which of the following best describes strategic controls?
A. they guide the use of strategy for the organization
B. they verify the firm is using appropriate strategies
C. they maintain control over the finances of the organization
D. they maintain control over production processes |
|
Definition
| B. they verify the firm is using appropriate strategies |
|
|
Term
3. In a simple structure, all major decisions are made by:
A. the staff
B. the staff or the owner/manager
C. the staff and the owner/manager
D. the owner/manager |
|
Definition
|
|
Term
4. A functional structure is organized around__________
A. different organizational areas
B. multiple operating divisions
C. the day to day operations
D. the most effective managers |
|
Definition
| A. different organizational areas |
|
|
Term
5. Which of the following is not a variation of the multidivisional structure?
A. cooperative form
B. strategic business unit
C. functional form
D. competitive form |
|
Definition
|
|
Term
6. Which of the following is true of the work of individuals in a functional structure for implementing a cost leadership strategy?
A. they will be allowed to make autonomous decisions
B. their work will be self-managed
C. it will be controlled by highly formalized rules and procedures
D. there will be few formalized rules and procedures |
|
Definition
| C. it will be controlled by highly formalized rules and procedures |
|
|
Term
7. Which of the following is NOT one of the levels of the strategic business unit form?
A. corporate headquarters
B. divisional headquarters
C. strategic business units
D. strategic business divisions |
|
Definition
| B. divisional headquarters |
|
|
Term
8. What is the relationship between the divisions of SBUs?
A. there is no relationship between divisions
B. they share products only
C. they are related in terms of shared products or markets
D. they are different only in their geographical location |
|
Definition
| C. they are related in terms of shared products or markets |
|
|
Term
9. In the competitive form of the multidivisional structure, divisions are:
A. dependent on one another
B. cost centres
C. profit centres
D. completely independent |
|
Definition
| D. completely independent |
|
|
Term
10. Which of the following is true of a worldwide geographic area structure?
A. it emphasizes national interests and supports firm’s attempts to satisfy local differences
B. it emphasizes domestic interests and products are the same across borders
C. it recognizes that there is difference locally but that it cannot meet these differences
D. it is structures around markets that have some synergy with the domestic market of the organization |
|
Definition
| A. it emphasizes national interests and supports firm’s attempts to satisfy local differences |
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