New ventures face common problems whose solutions involve identifying new
opportunities and developing organizational resources and capabilities.
Industry concentration affects the intensity of competition in an industry.
Firms do not typically incur significant additional costs when diversifying their
business operations around the globe.
When a firm’s condition is critical, the plan is usually drastic and complex.
Costs may decline at some ranges of production but increase at others.
Vision statements tend to be very general, while arenas are identified very specifically.
Corporate new ventures are more likely to succeed when they are based on radically
different products and services.
Chinese public firms are controlled by state-owned or state-controlled shareholders.
The greater the cost in capital and time, the more synergies managers need to create
from the acquisition.
Costs in both the automobile and airframe-manufacturing industries are such that they
do not favor globalization.
Economic logic influences strategic positioning choices.
The presence of strong complementors typically works to decrease industry
profitability.
McDonalds’ intangible real estate gives it a competitive advantage.
When a publicly traded firm is acquired by another firm, the purchase price is almost
always less than the target firm’s market value.
Turnkey projects are examples of equity entry modes.
A diversified firm can broker relationships among its portfolio businesses.
An alliance may be strategic to one firm and only tactical to the other.
Competitive interactions are composed of the interactions between incumbents and the
interactions of new entrants and incumbents.
To successfully pursue the integrated position, managers must make tradeoffs for one
position over another.
In investor/holding company transactions, independent investors or holding companies
purchase existing firms.
A series of presentations in which top management promotes an IPO to interested
investors and analysts is referred to as a(n) ________.
A) S-1 statement
B) prospectus
C) road show
D) bootstrap
Historically, the value added through the practice of arbitrage was high in all but which
of the following commodities?
A)spices
B)tea
C)coffee
D)silk
Michael Porter’s generic strategy model is useful to help select a ________.
A)low competition business for a firm to enter
B)starting strategic business position
C)new CEO
D)product development team
Some experts suggest that firms should not even own resources that do not meet the
VRINE criteria. Which of the following is not a rationale for this argument?
A)Owning these resources may put the firm at a competitive disadvantage.
B)The capital tied up in these resources could be redistributed to shareholders.
C)These resources are usually more expensive to acquire.
D)The capital invested in these resources could be reinvested in other resources.
According to the ________ approach, a firm’s appropriate strategy, key assets, and
requisite skills are dictated by industry characteristics.
A)P/L
B)Q/A
C)I/O
D)P/R
The financial organization that has become the de facto payment standard on the
biggest locus of small business in the world is ________.
A)eBay
B)PayPal
C)Mastercard
D)Visa
The challenge posed by a strategic purpose is to close the gap between the firm’s
aspirations and its current ________.
A)capabilities and market positions
B)productivity level
C)personnel numbers
D)return on invested capital (ROIC)
When professional managers, rather than the owners of a firm, run the firm’s operations,
situations can arise in which there may be ________.
A) unethical behavior
B) personality disharmonies
C) informational disconnections
D) conflicts of interest
If a firm outsources its marketing or distribution function, it may lose access to the
knowledge of customer ________ that inspired its early product breakthroughs.
A)education
B)socioeconomics
C)demographics
D)preferences
The strategically most important markets to a firm will be those that feature all except
________.
A)intrinsic market attractiveness
B)the opportunity to learn
C)the opportunity to innovate
D)the opportunity to compete
A corporation consisting of many companies in different businesses or industries is
called a ________.
A)monopoly
B)conglomerate
C)portfolio
D)multinational
_____ is a condition in which a resource is considered valuable, rare, and inimitable
because it is difficult to identify and understand.
A)environmental uncertainty
B)distinctive competence
C)dynamic improbability
D)causal ambiguity
The ________ strategy assumes considerable risk.
A)neutralization
B)absorption
C)annulment
D)shaping
Social stakeholders include all of the following except ________.
A)unions
B)venture capitalists
C)governments.
D)activist groups
When unrelated diversification is taken to the extreme and there are many unrelated
businesses, the firm is referred to as a ________.
A)monopoly
B)conglomerate
C)oligopoly
D)cartel
All of the following are popular means of organizing firm structure except ________.
A) functional
B) multidivisional
C) network
D) array
Codes of governance target all of the following areas except ________.
A) shareholder equality
B) board accountability
C) financial disclosure
D) accountability by the board
Southwest Airline’s use of only one type of jet gives it all but which of the following?
A)faster turnarounds
B)more reliable maintenance by ground crews
C)higher luggage handling capacity
D)greater flexibility with pilots
Products and services that, when bundled together, create greater value than when
acquired separately are known as ________.
A)substitutes
B)complementors
C)co-opetors
D)new entrants
All of the following are well-known companies pursuing the differentiation strategy
except ________.
A)Coca-Cola
B)Pepsi
C)Mercedes Benz
D)Jet Blue
Alliances formed during the 1980s emphasized ________.
A)product and service performance
B)the building and reinforcing of market position
C)complex benefits, such as organizational learning
D)informal relationships
Explain the concept of tradeoff protection and the connection to competitive advantage.
List the five areas in which organizations can increase the probability of alliance
success.
According to Porter, what are the two key factors affecting the economic logic of
competitive advantage?
What is the difference between a public and private firm?
How does Pacific Cycle compete in the bicycle industry?