An effective governance arrangement exists when the CEO is also the chair of the board
of directors.
If a company generates free cash flow, that money technically belongs to shareholders.
Flat structures can lead to information distortion when data are being sent either up or
down the hierarchy.
No matter how complex the task is, learning effects typically die out after a limited
period of time.
An example of an important complementary asset is a state-of-the-art manufacturing
facility.
When implementing an international strategy, many companies create global divisions
that they add to their existing divisional structures.
As a result of fierce competition in the shakeout stage, an industry becomes fragmented.
Governance mechanisms help align the incentives between principals and agents and
help monitor and control agents.
Ownership of an industry standard that is protected from imitation by patents and
copyrights is a weak organizational resource.
The profit growth of a company can be measured by the increase in its stock price over
time.
A product structure requires that support activities from a company’s value chain be
decentralized so that independent specialists in support activities exist within each
product group.
Research finds that leaders who exhibit a high degree of emotional intelligence tend to
be significantly less effective than those who do not.
Strategic groups within an industry compete amongst themselves even though their
business models may vary greatly.
The purpose of organizational structure is to provide managers with specific feedback
on how well an organization and its members are performing and building competitive
advantage.
Companies in a weak competitive position in the growth stage of the industry life cycle
can use a market concentration strategy to find a viable competitive position.
The four basic building blocks of competitive advantage are
A.low cost, quality, efficiency, and customer responsiveness.
B.differentiation, quality, innovation, and customer responsiveness.
C.quality, efficiency, differentiation, and customer responsiveness.
D.customer responsiveness, quality, efficiency, and human resources.
E.quality, customer responsiveness, innovation, and efficiency.
Which of the following statements is true?
A.Differentiation and cost structure decisions affect one another.
B.Differentiation and cost structure decisions do not affect one another.
C.Differentiation and cost structure decisions have little effect on a company’s
profitability.
D.Differentiation decisions do not affect a company’s profitability.
E.Cost structure decisions do not affect a company’s profitability.
What percentage of the world’s PCs adhere to the Wintel standard?
A.95%
B.50%
C.20%
D.75%
E.5%
John, a computer scientist, is willing to pay premium prices to be one of the first to
have new versions of software packages. John is in the ____ customer group.
A.laggard
B.early majority
C.early adopter
D.late majority
E.innovator
The takeover constraint
A.effectively limits the number of independent companies that a company can acquire.
B.limits the degree to which managers can pursue strategies that are at variance with
stockholder interests.
C.is a theoretical construct that can be ignored in practice.
D.limits the freedom that individual companies have to maximize their long-run return
on investment.
E.is imposed by corporate managers on errant business-level managers.
Which of the following statements is false?
A.Acquisitions are preferable to joint ventures when the new business is unrelated to
the existing business.
B.Acquisitions are preferable to new ventures when speed is important.
C.Joint ventures are generally preferable to acquisitions when entry barriers are high.
D.Acquisitions can be both a reason for corporate decline and part of a turnaround
strategy.
E.New ventures are preferable to acquisitions in the embryonic stage of the industry life
cycle.
In some situations, pricing strategies can be used to
A.deter entry by other companies.
B.create exit barriers.
C.create emotional attachment to a product.
D.all of these choices.
E.none of these choices.
Which of the following strategies is most likely to facilitate the transmission of a
company’s norms and values and, hence, the development of a global corporate culture?
A.Focus
B.Localization
C.International
D.Global standardization
E.Transnational
Strategic control systems utilized to ensure long-run profitability include
A.personal control.
B.output control.
C.behavior control.
D.all of these.
E.none of these.
Mathematica 1.0 was one of the most distinctive applications for the short-lived NeXT
Computer. It still sets the standard for symbolic math and visualization on Windows,
Mac, Linux, and Unix. Mathematica 1.0 can be described as a(n) _____ application.
A.obsolete
B.high-tech
C.hardware
D.strategic
E.killer
Which of the following is not a general organizational competency?
A.Entrepreneurial capabilities
B.Capabilities in organizational design
C.Superior strategic capabilities
D.Product bundling
E.All of these
Using the value chain model, which of the following primary activities is performed
last, as inputs are transformed into outputs?
A.Research and development
B.Marketing and sales
C.After-sales service and support
D.Production
E.Human resources
Ray is a doctor who treats individuals with heart conditions. Ben is one of Ray’s
patients. Which function of the value chain is in operation when Ray checks Ben’s
blood pressure?
A.Marketing
B.Development
C.Research
D.Production
E.Sales