To successfully empower employees to achieve organizational goals, leaders must
perform the tasks of resource allocation and power brokering.
Product innovations are commonly associated with a differentiation strategy.
Many acquisitions ultimately result in divestiture.
Smell-O-Vision created an invention that would pump odors into movie theatres. It did
not make it to market. This was an attempt to be an adaptive entry strategy.
Risk taking can lead to competitive advantage, but it needs to be managed carefully.
Business risk taking refers to the risk associated with entering untested markets or
committing to unproven technologies.
One potential pitfall of a differentiation strategy is that identification of the brand in the
marketplace may become diluted through excessive product line extensions.
PepsiCo successfully captured the Indian market by using a joint venture strategy.
Informational control is primarily concerned with whether or not the organization is
doing the right things.
Rewards systems that reinforce the core values of the organization and contribute to
organizational cohesiveness are the least effective type.
Organizational learning works best when an organization leader gathers information
and teaches it to employees who are like their students.
The term strategic envelope refers to the scope of innovation efforts of a firm.
Financial risk taking involves the risk an executive assumes in taking a stand in favor of
a strategic course of action.
Leverage ratios provide measures of the capacity of a firm to meet its long-term
financial obligations.
While working to prioritize and fulfill their responsibilities, members of the board of
directors of an organization should:
A. represent their own interests
B. represent the interests of the shareholders
C. direct all actions of the CEO
D. emphasize the importance of short-term goals
Exit barriers do not arise from ________.
A. specialized assets with no alternative use
B. governmental and social pressures
C. strategic interrelationships with other business units within the same company
D. flexible costs of exit
Which of the following lists consists of support activities?
A. human resource management, technology development, customer service, and
procurement
B. human resource management, customer service, marketing and sales, and operations
C. customer service, information systems, technology development, and procurement
D. human resource management, technology development, procurement, and firm
infrastructure
The risks of vertical integration include all of the following EXCEPT:
A. costs and expenses associated with increased overhead and capital expenditures.
B. problems associated with unbalanced capacities along the value chain.
C. lack of control over valuable assets.
D. additional administrative costs associated with managing a more complex set of
activities.
In managing the corporate portfolio, the BCG matrix would suggest that __________.
A. Dogs should be invested in to increase market share and become Cash Cows
B. Stars are in low growth markets and can provide excess cash to fund other
opportunities
C. Cash Cows require substantial cash outlays to maintain market share
D. Question Marks can represent future Stars if their market share is increased
Product champions _____________.
A. are typically senior executives
B. are usually inventors of some sort
C. scavenge for resources and encourage others to back promising new ideas
D. are strong supporters of the status quo
Which of the following is not a reason for the possible erosion of company competitive
advantage?
A. rapid change in technology
B. globalization
C. actions by rivals from within and outside of the industry
D. company commitment to innovation
The value net is a game-theoretic approach that _____________.
A. extends the value chain analysis
B. is a way to analyze all the players in a game and analyze how their interactions affect
the ability of a firm to generate and appropriate value
C. helps us to understand the evolution of the five forces over time
D. uses network analysis to understand the relationships among different companies
Strategic groups consist of ________________.
A. a group of top executives that makes strategies for a company
B. a group of firms within an industry that follows similar strategies
C. a group of executives drawn from different companies within an industry that makes
decisions on industry standards
D. a group of firms within an industry that decides to collude rather than compete with
each other so that they can increase their profits
In order to take advantage of investment in human capital, a firm should ___________.
A. rotate workers through functions in the company as quickly as possible
B. refrain from training individual employees
C. establish practices that will enhance employee retention
D. keep employees in the same position forever
For businesses facing complex and turbulent business environments, which of the
following is true?
A. Goals and objectives that are uncertain prevent opportunism.
B. Traditional strategic controls are usually inappropriate.
C. Complacency about predetermined milestones can prevent adaptability.
D. Detailed plans are needed to maintain order.
The phrase that best defines a virtual organization is _____________.
A. a dot-com company
B. a type of modular structure
C. an organization that uses information technology to integrate different functions
D. a continually evolving network of independent companies
Summarize the most important benefits and risks associated with diversification into
global markets.
What are some of the primary benefits and risks of transnational strategies?
Why is it important to have a balance among the three behavioral controls (culture,
rewards, and boundaries)? Is there a danger associated with emphasizing one behavioral
approach more than another?
What are some of the most important implications of using the “balanced scorecard”
approach?
Compare and contrast the three most common new venture entry strategies: pioneering,
imitative, and adaptive.
The Internet and digital technologies offer opportunities and pitfalls to companies using
overall cost leadership, differentiation, and focus strategies. Discuss the statement and
provide examples that support your argument.
Briefly explain the advantages and disadvantages of vertical integration.
Address some of the limitations and potential downsides of the balanced scorecard.
Describe the virtual organizational form. How and why are organizations choosing to
implement this approach to organizing? Provide examples of organizations that have
used a virtual organizational structure.
What are the characteristics of short-term objectives? Provide examples of practical
applications of these characteristics by organizations.