Which of the following is NOT a contributing reason for businesses with strategic fit in
R&D or technology activities to perform better together?
A. The ability to continue using existing processes
B. Cost savings in research and development areas
C. Shorter times in getting new products to market
D. Increased sales in both the parent company and the diversified businesses
E. A greater number of innovative products or processes
The three components of building a capable organization are:
A. making periodic changes in the firm’s internal organization to keep people from
getting into a comfortable rut, instituting a decentralized approach to decision making,
and developing the appropriate competencies and capabilities.
B. hiring a capable top management team, empowering employees, and establishing a
strategy-supportive corporate culture.
C. putting a centralized decision-making structure in place, determining who should
have responsibility for each value chain activity, and aligning the corporate culture with
key policies, procedures, and operating practices.
D. staffing the organization, acquiring, developing, and strengthening key resources and
competitive capabilities, and structuring the organization and work effort.
E. optimizing the number of core competencies and competitive capabilities, making
sure that all managers and employees are empowered, and maximizing internal
operating efficiency.
A “best practice” refers to:
A. a policy or procedure that is unusually effective.
B. a method of performing an activity or business process that consistently delivers
superior results compared to other approaches and that at least one company has
demonstrated works particularly well in terms of delivering operating excellence.
C. a strategy-critical activity that results in sustainable competitive advantage.
D. a value chain activity that is a company’s distinctive competence.E. a particular
value chain activity that management has given top priority to performing in
world-class fashion.
Which of the following topics would least likely be contained in a company’s code of
ethics?
A. Prohibiting giving or accepting bribes, kickbacks, or gifts
B. Expecting all company personnel to display honesty and integrity in their actions and
avoid conflicts of interest
C. Barring dealing with suppliers that employ child labor or engage in other unsavory
practices
D. Committing to a no-layoff policy and to adequate funding of employee retirement
programs
E. Avoiding use of company assets, resources, and property for personal or other
inappropriate purposes
The advantages of using a franchising strategy to pursue opportunities in foreign
markets include:
A. having franchisees bear most of the costs and risks of establishing foreign locations
and requiring the franchisor to expend only the resources to recruit, train, and support
and monitor franchisees.
B. being particularly well-suited to the global expansion efforts of companies with
multidomestic strategies.
C. allowing a company to achieve scale economies.
D. being well suited to companies who employ cross-border transfer strategies.
E. being well suited to the global expansion efforts of manufacturers.
A creative and distinctive strategy that sets a company apart from rivals and that gives it
a sustainable competitive advantage:
A. is a reliable indicator that the company has a socially responsible business model.
B. is achievable in emerging but not mature industries.
C. is a company’s most reliable ticket to above-average profitability.
D. signals that the company has a bold, ambitious strategic intent that places the
achievement of strategic objectives ahead of the achievement of financial objectives.
E. is the best indicator that the company’s strategy and business model are well-matched
and properly synchronized.
Apple decides to reallocate resources by curtailing online ad budgets and investing
heavily in scratch-resistant Sapphire, the material that differentiates iPhone from
competitive brands. What is MOST LIKELY the reason for reallocation of resources?
A. Making critical value chain activities less effective
B. Supporting the new strategic initiative of the brand
C. Signalling commitment to online sales of the brand
D. Signalling commitment to offline sales of the brand
E. Impeding the efforts of rivals to hoard Sapphire
The target market of a best-cost provider is:
A. value-conscious buyers.
B. brand-conscious buyers.
C. price-sensitive buyers.
D. middle-income buyers.
E. young adults (in the 18’“35 age group).
The three tests for judging whether a particular diversification move can create value
for shareholders are:
A. the attractiveness test, the profitability test, and the shareholder value test.
B. the strategic fit test, the competitive advantage test, and the return-on-investment
test.
C. the resource fit test, the profitability test, and the shareholder value test.
D. the attractiveness test, the cost-of-entry test, and the better-off test.
E. the shareholder value test, the cost-of-entry test, and the profitability test.
Leading the drive for good strategy execution and operating excellence calls upon
senior executives to:
A. be very personable, effective communicators, and skilled in the empowerment of
company personnel.
B. personally lead the implementation process and drive the pace of progress.
C. delegate little to subordinates and, instead, personally exert a strong, highly visible
influence on the company’s approaches to strategy execution.
D. be creative in establishing policies and procedures that will instill high standards of
operating excellence.E. be charismatic, decisive decision-makers, and make inspiring
speeches at company events.
An organic foods manufacturer insists on portraying the cleanliness of its farms in its
advertisements, charges a higher price for its products, and sells its products only
through reputable distributors. What strategy is the manufacturer using to deliver
superior value to customers?
A. Signaling the value of the company’s product offering to buyers
B. Incorporating intangible features
C. Incorporating tangible features
D. Lowering the buyer’s overall cost
E. Lowering the overall bargaining power from suppliers
Which of the following is one of the first steps to take in launching the strategy
execution process?
A. Ensure all requirements of the value chain are fulfilled.
B. Form a mission statement as a basis for managers to achieve organizational
objectives.
C. Go on the offensive by employing moves to make its product offering more
distinctive and appealing to buyers.
D. Put together a talented management team with the right mix of experiences, skills,
and abilities to get things done.E. Strive to be more profitable than rivals and aim for a
competitive edge based on bigger profit margins.
The organizing challenge of a decentralized structure that stresses employee
empowerment is:
A. how to keep empowered employees from making lots of stupid decisions.
B. establishing a collegial, collaborative culture so that decisions can be made by
gaining a quick consensus on what to do and when to do it.
C. how to avoid de-motivating employees (because empowered employees are expected
to take responsibility for their actions and decisions).
D. how to exercise control over the actions and decisions of empowered employees so
that the business is not put at risk while trying to capture the benefits of empowerment.
E. how to convince lower-level managers and employees that they are empowered.
A company needs financial objectives to:
A. spur company personnel to help the company overtake key competitors on such
important measures as net profit margins and return on investment.
B. communicate management’s targets for financial performance and achieve strategic
objectives.
C. indicate to employees whether the emphasis should be on earnings per share, return
on investment, return on assets, or positive cash flow.
D. convince shareholders that top management is acting in their interests.
E. counterbalance its pursuit of strategic objectives and have a balanced scorecard for
judging the caliber of its overall performance.
A company that fails to manage its strategic alliance probably has:
A. incorporated contractual safeguards.
B. made opportunities for learning a routine management process.
C. created a system to manage alliances in a systematic fashion.
D. established strong interpersonal relationships and established trust.
E. refrained from making commitments to its partners and ensured they do the same.
How does a transnational strategy differ from a multidomestic or a global strategy?
What three principles underlie the statistical thinking of Six Sigma quality control
programs?
What does a company racing for global market leadership need strategic alliances for?
Identify and briefly describe the strategic options for tailoring a company’s strategy to
compete in emerging country markets.
A decentralized organizational structure is more likely to further the cause of good
strategy execution than is a centralized organization structure. True or false? Justify
your answer.
A company with strong competition in a saturated market decides to wipe out all its
products and introduce a fresh line of products in reaction to its falling shares during
recession. Would this type of a reactive strategy revive its position? Why or why not?
Identify and briefly discuss the key reasons why a company may consider expanding
outside its domestic market.