By exploiting a positive feedback loop, Dolby Laboratories, became the standard for
sound quality.
XYZ Technologies Inc. was one of the first companies to utilize inter-office e-mail. In
1995, before many other companies, managers at XYZ Technologies Inc. saw that
e-mail could be used to communicate with employees. Managers at XYZ Technologies
Inc. belong to the early majority group.
Nene works in a factory where she picks crab meat from crabs. She is paid per day
based upon the number of pounds of crab meat that she picks. Nene’s daily number of
pounds of crab meat can be referred to as her productivity.
Companies that successfully pursue a cost leadership strategy generally have a
distinctive competency in research and development.
Both the way a product is differentiated from other products of its type and the price of
the product determine which product a customer chooses to satisfy his or her needs.
A major impact of information technology (IT) on strategic implementation has been its
effects on a company’s ability to pursue strategic outsourcing to strengthen its business
model.
Factors that help a company to build and sustain competitive advantage include which
of the following?
A.Superior efficiency
B.Product quality
C.Innovation
D.Customer responsiveness
E.All of these
A key to making a strategic alliance work is
A.having one partner handle daily operations.
B.selecting the right partner.
C.sharing all knowledge.
D.enforcing one culture for both partners.
E.reducing investment in the alliance to a minimum.
Marginal cost refers to the cost of
A.switching to a new technology.
B.buying stock with loaned funds.
C.producing one extra unit of product.
D.realizing a profit.
E.motivating other firms to produce complements.
The extent of rivalry among established companies is lowest when
A.the industry’s product is a commodity.
B.demand is growing rapidly.
C.exit barriers are substantial.
D.the industry is entering a decline stage.
E.the industry is dominated by a small number of large companies.
Recently, the U.S. Food and Drug Administration began to require more descriptive
labeling of food products. This is an example of standards developed
A.in the public domain.
B.with a dominant design.
C.through industry cooperation.
D.by government mandate.
E.through market demand.
Ownership of the company created by a joint venture
A.is split 50/50 between the two joint-venturing companies.
B.is usually a matter to be negotiated between the companies engaged in the venture.
C.automatically goes to the largest company engaged in the venture.
D.automatically goes to the smallest company engaged in the venture.
E.none of these.
Economies of scale are
A.unit cost reductions associated with learning effects.
B.unit cost reductions associated with superior customer responsiveness.
C.realized when output is as large as possible.
D.realized when the point of maximum efficient scale is reached.
E.unit cost reductions associated with a large-scale output.
Companies that base their diversification strategy on transferring competencies tend to
acquire new businesses that are ____ to their existing business activities.
A.unrelated
B.not comparable
C.opposed
D.related
E.identical
What advice would you give to a firm that wants to exploit network effects?
A.Price your products high in the early stages of the market’s development.
B.Be a first mover and thus establish the technical standard.
C.Create incentives for other firms to develop complementary products.
D.Develop more killer applications than do competitors.
E.Ask customers to bear the switching costs.
In which stage of the industry life cycle do both cost leaders and differentiators adopt a
hold-and-maintain strategy to defend their business models and ward off threats from
focused companies that might be appearing?
A.Late majority
B.Growth
C.Shakeout
D.Mature
E.Decline
The Achilles heel of international strategy is that
A.market demand inevitably dries up.
B.costs cannot be sufficiently controlled over long periods of time.
C.competitors inevitably emerge.
D.prices eventually tumble drastically.
E.all of these choices.
Which of the following distinctive competencies typically has the lowest barrier to
imitation?
A.Efficient scale manufacturing facilities
B.Technological know-how
C.Marketing know-how
D.Organizational capabilities
E.Brand name
The resources and capabilities that lead to the formation of distinctive competencies are
mostly created at which level of the organization?
A.Business
B.Functional
C.Corporate
D.Global
E.Industry
Flexible manufacturing technologies allow companies to
A.mass-produce a standardized output at a low delivered cost.
B.avoid plant-level diseconomies of scale.
C.produce small batches of high-quality customized products at a high cost.
D.ride down the experience curve more rapidly than competitors.
E.produce small batches of customized products at a relatively low cost.
Intel’s invention of the microprocessor in the early 1970s, Cisco’s development of the
router for routing data over the Internet in the mid-1980s, and Apple’s development of
the iPod, iPhone, and iPad in the 2000s can be referred to as _____ innovations.
A.process
B.product
C.customer
D.sector
E.absorptive
In a multidivisional structure, which form of control is used to compare the relative
performances of different divisions?
A.Output control
B.Financial control
C.Control through culture
D.Bureaucratic control
E.Adaptive control
The greater the number of business units in a company’s portfolio, the ____ it is for
corporate managers to remain informed about the complexities of each business.
A.easier
B.more difficult
C.less important
D.less expensive
E.more simplistic
Natalie and Shay are both employees at XYZ Company. Natalie, the marketing
manager, often meets with Shay, the production manager in order to solve specific
mutual problems. This is an example of which of the following?
A.A team
B.Liaison roles
C.Direct contract
D.Diverging mechanisms
E.Strategic control system