Retrenching to a narrower diversification base can be attractive or advisable EXCEPT
when:
A. certain businesses have questionable long-term potential.
B. a diversified company has businesses that have little or no strategic or resource fits
with the “core” businesses that management wishes to concentrate on.
C. certain business units are weakly positioned and show poor prospects for providing a
good return on investment.
D. market conditions in a once-attractive business have badly deteriorated.
E. business units are cash cows with promising futures.
Answer:
The major drivers of unethical managerial behavior include:
A. lack of self-dealing and short termism on the part of top executives of a company.
B. heavy pressures on company managers to meet or beat performance targets, and
overzealous pursuit of personal gain.
C. widespread managerial belief in the ethical relativism school of thinking.
D. widespread managerial belief in the ethical universalism school of thinking.
E. adherence to a cosmetic code of ethics stemming from a desire to avoid the risk of
embarrassment.
Answer:
A company’s strategic plan:
A. details key objectives and the strategy for achieving them.
B. lays out its future direction and business purpose, performance targets and strategy.
C. identifies the company’s strategy and management’s specific, detailed plans for
implementation.
D. consists of a company’s strategic vision, strategic objectives, strategic intent, and
strategy.
E. summarizes the company’s strategic vision, a strategy, and a business model.
Answer:
Which of the following is NOT a typical host government requirement that affects the
operations of foreign companies?
A. Establishing local content requirement on goods made inside their borders by foreign
companies
B. Having rules and policies that protect local companies from foreign competition
C. Placing restrictions on exports to ensure adequate local supplies
D. Requiring foreign companies to use vertical integration to support operations of local
companies
E. Imposing burdensome tax structures and regulatory requirements upon foreign
companies doing business within their borders
Answer:
Driving-forces analysis has:
A. speculative value because it compels the firm to drive strategic intent and collective
choice into operating practices.
B. theoretical value because it allows managers to visualize the many different
dimensions of the preferred forces that allow for industry functionality.
C. practical value and is basic to the task of thinking strategically about where the
industry is headed and how to prepare for the changes ahead.
D. no real analytical value because the driving forces are already established in the
marketplace and it is too late to make astute and timely strategy adjustments.
E. perceived value and is associated with identifying the close and distant rivals within
an operating industry.
Answer:
A strategy that incorporates elements of both multidomestic and global strategies is
termed a “transnational” strategy, but sometimes it is referred to as a(n):
A. glocalization strategy.
B. international strategy.
C. think-local, act-global strategy.
D. cross-border integrated strategy.
E. standardized integrated strategy.
Answer:
The task of crafting a company’s overall corporate strategy for a diversified company
encompasses all of the following EXCEPT:
A. picking the new industries to enter and deciding on the means of entry.
B. initiating actions to boost the combined performance of the corporation’s collection
of businesses.
C. pursuing opportunities to leverage cross-business value chain relationships and
strategic fit into competitive advantage.
D. establishing investment priorities and steering corporate resources into the most
attractive business units.
E. divesting well-performing businesses.
Answer:
What is the best way to achieve the efficiency potential of a global strategy?
A. It demands managerial attention to be focused on objective-setting specifically
oriented toward production practices.
B. It requires that resources and best practices be shared, value chain activities be
integrated, and capabilities be transferred from one location to another as they are
developed.
C. It requires that the best identified resources and capabilities be centralized at
headquarters.
D. It requires value chain activities to be dispersed across many countries to elevate
cost control management as a primary focus in all countries.
E. It requires giving local managers considerable latitude for executing strategies for the
country markets they are responsible for.
Answer:
External threats may pose various degrees of adversity upon the company and can
surface from many sources and examples, EXCEPT for:
A. the advent of cheaper or better technologies.
B. the entry of lower-cost foreign competitors and restrictive foreign trade policies.
C. new burdensome regulations.
D. higher overall unit costs relative to those of key competitors.
E. rising prices on key inputs (such as energy costs).
Answer:
According to integrated social contracts theory, the ethical standards a company should
try to uphold:
A. are governed by the school of ethical universalism.
B. are governed both by a limited number of universal ethical principles and the
circumstances of local cultures, traditions, and shared values.
C. are governed by each country’s Code of Required Ethical Conduct, which sets forth
that each individual/group/business/organization has a “social contract” to observe the
ethical and moral standards that the country has adopted.
D. should be determined by the company’s moral managers.
E. should be absolute and avoid wiggle room according to the circumstances of the
situation.
Answer:
A company’s values or core values concern:
A. whether and to what extent it intends to operate in an ethical and socially responsible
manner.
B. how aggressively it will seek to maximize profits and enforce high ethical standards.
C. the beliefs and operating principles built into the company’s “balanced scorecard” for
measuring performance.
D. the beliefs, traits, and behavioral norms that company personnel are expected to
display in conducting the company’s business and pursuing its strategic vision and
mission.
E. the beliefs, principles, and ethical standards that are incorporated into the company’s
strategic intent and business model.
Answer:
Each of the following exemplifies the impact of the macro-environment on a company’s
strategic opportunities EXCEPT:
A. sales of Smirnoff dwindle on account of new laws regulating the sale of liquor.
B. consumer confidence in GM rises as its stock price soars.
C. Nike considers Adidas its most potent rival in the industry.
D. footfalls at the outlets of Pizza Express increase following its drive to go vegan.
E. sales of Smooth Fitness Treadmills surge on account of a new feature that monitors
users’ blood pressure.
Answer:
Which of the following is NOT an example of a company that uses blue-ocean market
strategy?
A. eBay’s online auction industry
B. NetJets’ fractional jet ownership
C. Drybar’s hair blowouts
D. Cirque de Soleil’s live entertainment
E. Walmart’s logistics and distribution
Answer:
Which of the following does NOT exemplify a policy or procedure that facilitates
strategy execution?
A. A nonprofit agency that addresses only specific societal problems through public
services
B. A toy manufacturing company that plans on reaching three different segments of the
market
C. A fast food joint that has an onsite kindergarten and provides afterschool programs
for its employees’ children
D. A sporting goods seller that monitors consumers’ preferences for gear and
accessories on its blog
E. A bedding linen manufacturing company that recycles its water to cool the machines
in the factory
Answer:
Which of the following does NOT accurately characterize the differences between a
localized multidomestic strategy and a global strategy?
A. A global strategy entails extensive strategy coordination across countries and a
multidomestic strategy entails little or no strategy coordination across countries.
B. A global strategy often entails use of the best suppliers from anywhere in the world,
whereas a multidomestic strategy may entail fairly extensive use of local suppliers
(especially where use of local sources is required by host governments).
C. A global strategy tends to involve use of similar distribution and marketing
approaches worldwide, whereas a multidomestic strategy often entails adapting
distribution and marketing to local customs and the culture of each country.
D. A global strategy involves striving to be the global low-cost provider by
economically producing and marketing a mostly standardized product worldwide,
whereas a multidomestic strategy entails pursuing broad differentiation and striving to
strongly differentiate its products in one country from the products it sells in other
countries.
E. A global strategy relies upon the same technologies, competencies, and capabilities
worldwide, whereas a multidomestic strategy often entails the use of somewhat
different technologies, competencies, and capabilities as may be needed to
accommodate local buyer tastes, cultural traditions, and market conditions.
Answer:
Which of the following is NOT a factor analyzed and relied on by firms when
developing competitive strength in a foreign market?
A. The relative size of the market, its growth potential, and the nature of domestic
buyers’ needs and wants
B. The availability, quality, and cost of raw materials and other inputs that firms will
require to produce their products and services
C. The development of different styles of management, organization, and strategy
D. The degree of collaboration with key suppliers and the greater the knowledge
sharing throughout the related-industry cluster
E. The level of industry-related support activities to foster customization of products
and services
Answer:
A search engine giant specializes in all types of search items; provides a free translation
feature for 80 different languages; allows users to view ads on previously made related
searches; provides suggestive search items to assist the user; allows users to view a
collation of related web pages users might want to visit; and provides a faster load time
and more accurate hits than its rivals. Which of the following is a profit formula used
by the company?
A. Providing a free translation feature for 80 different languages
B. Allowing users to view ads on previously made related searches
C. Allowing users to view a collation of related web pages users might want to visit
D. Providing a faster load time and more accurate hits than its rivals
E. Providing suggestive search items based on history of sites visited
Answer:
What is the advantage of acquiring capabilities through merger and acquisition?
A. Speed, since developing new capabilities internally can take many years of effort
B. Empowerment, since you can capture the essence of the capability and refocus the
firm
C. Price, as it is always cheaper to buy a whole company and pull out the capabilities
individually
D. Assets, as it the basis of the sale
E. Investment, since resources and capabilities are considerable stronger
Answer:
Which of the following is NOT pertinent in identifying a company’s present strategy?
A. The key functional strategies (R&D, supply chain management, production, sales
and marketing, HR, and finance) a company is employing
B. Management’s planned, proactive moves to outcompete rivals (via better product
design, improved quality or service, wider product lines, and so on)
C. The company’s mission, strategic objectives, and financial objectives
D. Moves to respond and react to changing conditions in the macro-environment and in
industry and competitive conditions
E. The strategic role of its collaborative partnerships and strategic alliances with others
Answer:
Firms generally leverage the expertise of their talent pool in building capabilities by:
A. updating existing capabilities.
B. establishing a new arsenal of resource capabilities by phasing out existing
capabilities.
C. refreshing existing capabilities.
D. augmenting or recombining well-established capabilities with existing resources.
E. building resource capabilities from scratch so it is easy and less time-consuming.
Answer:
Which of the following statements about the ethical relativism school of thinking is
FALSE?
A. In a multinational company, application of ethical relativism equates to multiple sets
of ethical standards.
B. There are few absolutes when it comes to business ethics and thus few ethical
absolutes for consistently judging a company’s conduct in various countries and
markets.
C. When there are cross-country or cross-cultural differences in ethical standards, it is
appropriate for ethical standards in a company’s home market to take precedence over
what the local ethical standards may be.
D. A company that adopts the principle of ethical relativism and holds company
personnel to local ethical standards necessarily assumes that what prevails as local
morality is an adequate guide to ethical behavior.
E. According to the ethical relativism school of thinking, a “one-size-fits-all” template
for judging the ethical appropriateness of business actions and the behaviors of
company personnel does not exist.
Answer:
Changing a problem culture:
A. is never a short-term exercise.
B. is always a short-term exercise.
C. requires a determined effort by a limited number of employees.
D. is usually easier than it is to instill a strategy-supportive culture from scratch.
E. can be achieved by an overnight transformation.
Answer:
A competitive strategy predicated on low-cost leadership tends to work best when:
A. there are widely varying needs and preferences among the various buyers of the
product or service.
B. there are many market segments and market niches, such that it is feasible for a
low-cost leader to dominate the niche where buyers want a budget-priced product.
C. price competition among rivals is especially vigorous and the offerings of rival firms
are essentially identical, standardized, commodity-like products.
D. buyers prefer that the products/services of competing sellers have widely varying
attributes and prices.
E. buyers have high switching costs and there is considerable diversity in how buyers
use the product.
Answer:
The road to competitive advantage begins with management’s efforts to:
A. build organizational expertise in performing certain competitively important value
chain activities.
B. understand the value chain activities providing opportunity for growth.
C. build value-creating activities all along the value chain.
D. ensure superiority over rivals in performing even unimportant tasks and activities
extremely well.
E. maintain the existing chain of activities to lower costs.
Answer:
The big problem a franchisor faces is:
A. allowing franchisees to achieve scale economies.
B. maintaining quality control due to a lack of commitment to consistency and
standardization.
C. eliminating the costs and risks associated with establishing a foreign business
location.
D. sharing foreign facilities and marketing strategies with local businesses.
E. achieving higher product quality and better product performance than with an export
strategy.
Answer:
A company’s strategic plan:
A. maps out the company’s history.
B. links the company’s financial targets to control mechanisms.
C. outlines the competitive moves and approaches to be used in achieving the desired
business results.
D. focuses on offering a more appealing product than rivals.
E. lists methods of making money in its chosen business.
Answer:
When high ethical principles are deeply ingrained in the corporate culture of a
company, culture can function as a powerful mechanism for all of the following
EXCEPT:
A. communicating ethical behavioral norms.
B. gaining employee buy-in to the company’s moral standards.
C. gaining employee buy-in to the company’s business principles.
D. gaining employee buy-in to the company’s corporate values.
E. boosting short-termism.
Answer:
A company’s competitive strength scores pinpoint its strengths and weaknesses against
rivals and:
A. suggest the company use its strengths to exploit its own competitive liabilities.
B. point directly to the kinds of offensive/defensive actions it can use to exploit its
competitive strengths and reduce its competitive liabilities.
C. point directly to the company to use its weaknesses as offensive moves to challenge
rivals’ weaknesses.
D. suggest receptivity for astute companies to drive their operating practices if the
strength scores are very low.
E. point directly to accepting the competitive strength scores on face value.
Answer:
Rivalry among competing sellers is generally more intense when:
A. there are relatively few industry key success factors.
B. the industry’s driving forces are strong and rivals have strongly differentiated
products.
C. barriers to entry are moderately high and the pool of likely entry candidates is small.
D. rivals are active in making fresh moves to lower prices, introduce new products,
increase promotional efforts and advertising, and otherwise gain sales and market share.
E. barriers to entry are high and buyer switching costs are high.
Answer:
A company’s biggest vulnerability in employing a best-cost provider strategy is:
A. relying too heavily on outsourcing.
B. getting squeezed between the strategies of firms employing low-cost provider
strategies and high-end differentiation strategies.
C. getting trapped in a price war with low-cost leaders.
D. being timid in cutting its prices far enough below high-end differentiators to win
away many of their customers.
E. not having a sustainable distinctive competence in cost reduction.
Answer:
A company’s “macro-environment” refers to:
A. the industry and the competitive arena in which the company operates.
B. general economic conditions plus the factors driving change in the markets where a
company operates.
C. the strategically relevant factors outside a company’s industry boundarieseconomic
conditions, political factors, sociocultural forces, technological factors, environmental
factors, and legal/regulatory conditions.
D. the competitive market environment that exists between a company and its
competitors.
E. the dominant economic features of a company’s industry.
Answer:
Explain the meaning and significance of each of the following and their relationship to
one another.
a. driving forces
b. strategic group mapping
c. key success factors
Answer:
The marketing emphasis of a company pursuing a broad differentiation strategy usually
is to:
A. under-price rival brands with comparable features.
B. tout differentiating features and charge a premium price that more than covers the
extra costs of differentiating features.
C. out-advertise rivals and make frequent use of discount coupons.
D. emphasize selling directly to end-users and promoting personalized customer
service.
E. communicate the product’s ability to serve the customer’s every need.
Answer:
Which of the following makes use of Six Sigma programs to improve quality and
strategy execution?
A. Memphis & Company applies advanced statistical methods to identify and remove
the causes of defects.
B. Milwaukee Hospital relocates its pathological lab to reach out to consumers in
suburbs.
C. LG Electronics reengineers its value chain activities by creating cross-functional
teams.
D. La Tagliata Boutiques offers a different range of products at different outlets across
London.
E. Duke Energy replaces work depots by mobile repair vans reducing operational costs
by 40 percent.
Answer:
Sourcing a supply from a small, women-owned business is an example of a corporate
social responsibility action to:
A. enhance employee well-being.
B. support philanthropy.
C. protect and sustain the environment.
D. ensure honorable and ethical action.
E. promote workforce diversity.
Answer: