Managerial jobs with strategy-making responsibility:
A. extend throughout the managerial ranks and exist in every part of a
company-business units, operating divisions, functional departments, manufacturing
plants, and sales districts.
B. are primarily located in the strategic planning departments of large corporations.
C. are relatively rare because most strategy-making is done by the members of a
company’s board of directors.
D. seldom exist within a functional department (e.g., marketing and sales) or in an
operating unit (a plant or a district office) because these levels of the organization
structure are well below the level where strategic decisions are typically made.E. are
found only at the vice-president level and above in most companies.
Which of the following signals would NOT warn challengers that strong retaliation is
likely?
A. Publicly announcing management’s commitment to maintain market share
B. Publicly committing to a company policy of matching competitors’ terms or pricing
C. Maintaining a war chest of cash and marketable securities
D. Making a strong counter-response to the moves of weak competitors
E. Announcing strong quarterly earnings potential to financial analysts
Which of the following is NOT one of the pitfalls of a low-cost provider strategy?
A. Overly aggressive price-cutting
B. Setting the industry’s price ceiling to capture volume gains and achieve economies of
scale
C. Relying on an approach to reduce costs that can be easily copied
D. Becoming too fixated on cost reduction
E. Having the basis for the firm’s cost advantage undermined by cost-saving
technological breakthroughs that can be readily adopted by rival firms
In which of the following market circumstances is a broad differentiation strategy
generally NOT well-suited?
A. When buyer needs and preferences are too diverse to be fully satisfied by a
standardized product
B. When few rivals are pursuing a similar differentiation approach
C. When the products of rivals are weakly differentiated
D. When there are many ways to differentiate a product or a service and many buyers
perceive these differences valuable
E. When technological change is fast-paced and competition revolves around rapidly
evolving product features
Sharing and transferring resources and capabilities across borders may also contribute
to the development of broader or deeper competencies and capabilities, thereby helping
a company achieve:
A. control over its resource capabilities.
B. dominating depth in some competitively valuable area
C. intensity of resource diversification.
D. precision and compliance in resource agility and responsiveness
E. direct investments in foreign countries.
Costs and price differences among competing companies can have origins in activities
performed by:
A. the company’s internally performed activities (its own value chain) compared to the
cost structure of the internally performed activities of rival companies.
B. value chains of the company’s suppliers.
C. value chains of a company’s distributors and retail dealers and forward channel
allies.
D. the company’s internally performed activities (its own value chain), but also on costs
in the value chain of its suppliers and distribution channel allies.
E. whether the company has a longer or shorter value chain than its close rivals.
Which of the following questions is NOT pertinent to company managers in thinking
strategically about what directional path should be taken by the company and about
developing a strategic vision?
A. Is the outlook for the company promising if it continues with its present product
offerings?
B. Are changing market and competitive conditions acting to enhance or weaken the
company’s prospects?
C. What business approaches and operating practices should we consider in trying to
implement and execute our business model?
D. What strategic course offers attractive opportunity for growth and profitability?
E. What, if any, new customer groups and/or geographic markets should the company
get in position to serve?
Which of the following is NOT a strategic disadvantage of vertical integration?
A. Vertical integration boosts a firm’s capital investment in the industry, thus increasing
business risk if the industry becomes unattractive later.
B. Vertical integration backward into parts and components manufacturing can impair a
company’s operating flexibility when it comes to changing out the use of certain parts
and components.
C. Vertical integration reduces the opportunity for achieving greater product
differentiation.
D. Forward or backward integration often calls for radically different skills and
business capabilities than the firm possesses.
E. Vertical integration poses all kinds of capacity-matching problems.
Which of the following is NOT a reason why a company decides to enter foreign
markets?
A. To spread business risk across a wider geographic market base
B. To capitalize on company competencies and capabilities
C. To achieve lower costs through economies of scale, experience, and increased
purchasing power
D. To impart technical knowledge to high-cost human resources in developing nations
E. To gain access to more buyers for the company’s products/services
Which of the following is LIKELY to have the biggest strategy-shaping impact on
mobile service providers?
A. Coca-Cola launches mobile campaigns for community-connect and awareness.
B. Discovery Channel launches a mobile game to promote its Gold Rush TV show.
C. T-Mobile US signs a pact with Nokia Networks for greater spectrum support.
D. Hugo Boss announces the launch of its fall/winter collection via mobile.E. Apple
enters into a pact with PayPal to market its mobile wallet application.
Competitive pressures stemming from buyer bargaining power tend to be weaker in
which of the following circumstances?
A. Most consumers vary the brands they choose for their cookware and kitchen gadgets.
B. There is a global decline in the demand for CD players.
C. The investment banking industry offers highly differentiated products.
D. The Internet offers a huge amount of information on a variety of products.
E. Heinz owns a metal-can manufacturing subsidiary to cut back on supplier costs.
The transaction costs of completing a business agreement or deal of some sort, over and
above the price of the deal, can include all of the following EXCEPT:
A. the costs of searching for an attractive target.
B. the costs of evaluating its worth.
C. bargaining costs.
D. the costs of completing the transaction.
E. the premium cost.
Approaches to enhancing differentiation through changes in the value chain do NOT
include:
A. coordinating with retailers to enhance the buying experience and building a
company’s image.
B. coordinating with suppliers to speed up new product development cycles.
C. coordinating with distributors or shippers to lower shipping costs.
D. collaborating with suppliers to improve many dimensions affecting product features
and quality.
E. coordinating with employees to create a greater incentive systems to encourage
worker productivity
Which of the following exemplifies good strategy execution?
A. The policy document of Dominos ensures consistency in service behavior patterns
across outlets.
B. The policy document of Pizza Today allows for differences in product range and
quality across outlets.
C. The policy document of Boston Pizza leaves ample scope for each member of the
staff to act independently.
D. The policy document of Little Caesars discusses strategy but not the routines for
running the outlets.
E. The policy document of Pizza Inn is averse to standardization of the way activities
are performed.
Which of the following activities by a company does NOT conform to the norms of
corporate social responsibility?
A. Conducting vocational programs inside the company’s premises for the
underprivileged
B. Encouraging employees to use all means possible to exceed targets and providing
heavy compensation to employees who generate profits
C. Providing work-from-home options to working mothers residing in distant locations
D. Involving company personnel in cleaning and restoring state parks
E. Manufacturing energy-saving bulbs
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
An umbrella brand:
A. is a generalized resource that can be leveraged in unrelated diversification.
B. is a brand name that can steer a narrow assortment of business types.
C. represents a public disclosure spotlighting the corporate image.
D. represents an overall corporate marker covering its overriding image of
sustainability and responsibility.
E. is a specialized resource designed to influence profit growth.
Explain how the marketing emphasis of a low-cost provider differs from the marketing
emphasis of a best-cost provider.
What are the keys to sustaining a focused low-cost strategy?
A pizza maker manufactures thin-crust pizzas and offers free soft drinks with a pack of
four pan pizzas. What can you say about its Value-Price-Cost Framework?
What are the advantages of outsourcing non-critical and sometimes even critical value
chain activities?
What are the five competitive forces that comprise the five forces model of
competition?
Instead of entering into an alliance or partnership, Smith Limited opts to merge with
Design Limited. What are the reasons for preferring a merger to an alliance or
partnership? Explain the other organizational mechanisms that are also preferable to
alliances.