64.
Vehmo Inc. is an automobile company whose core competency lies in manufacturing
petrol- and diesel-based cars. The company realizes that more of its potential customers
are switching to electric cars. The R&D department of the company acquires
competencies in developing electric cars and launches its first hybrid car. In this scenario,
Vehmo is primarily
65.
Coca-Cola was primarily known for its core competencies in marketing, bottling, and
distributing aerated drinks. However, with the success of Gatorade, Coca-Cola developed
competencies in the development and marketing of its own sports drink, Powerade. Which
of the following is true of Coca-Cola?
66.
In 2007, Salesforce.com recognized an emerging market for platform as a service (PaaS)
offerings and developed a new competency in delivering software development and
deployment tools. This allowed its customers to either extend their existing CRM offering
or build completely new types of software. This is an example of
67.
Diversification premium is a situation in which
68.
Which of the following firms is most prone to experiencing a diversification discount?
69.
Win Goods Inc. is a large multinational conglomerate. As a single business unit, the
company’s stock price is estimated to be $200. However, by adding the actual market
stock prices of each of its individual business units, the stock price of the company as one
unit would be $300. What is Win Goods experiencing in this scenario?
70.
ESB Group is the parent company of many related businesses under its banner. Each
share of the parent company is quoted at $220. However, if this had to be assessed by
adding the stock prices of each of its strategic business units, the value would only be
$200 per share. In this scenario, what has ESB Group created?
71.
Companies that pursue related diversification are able to create a diversification premium
because they
72.
_____ is best described as the process of reorganizing and divesting business units and
activities to refocus a company in order to leverage its core competencies more fully.
73.
WJ Group Inc., a large multinational conglomerate, had begun to experience declining
revenues over the years. The top management at the headquarters of the company
decided that it was important for the company to avoid deviating from its core
competencies. Thus, a few of the company’s key businesses like energy,
telecommunications, and automobiles were centralized, giving the top management more
control over them. Also, relatively newer businesses like beverages and food processing
were divested. In this scenario, WJ Group is involved in
74.
The Boston Consulting Group (BCG) growth-share matrix locates a firm’s individual
strategic business units (SBUs) in which two dimensions?
75.
In the Boston Consulting Group (BCG) growth-share matrix, strategic business units
categorized under dogs
76.
In the context of the Boston Consulting Group (BCG) growth-share matrix, if one of the
strategic business units of a conglomerate is categorized under dogs, the management
should
77.
ElectraSync Inc., a large consumer electronics company, has divided each product in its
portfolio into a separate strategic business unit (SBU). The desktop SBU has been
experiencing drastic decline in its cash flow, and its market share has also reduced to an
insignificant 10 percent. This has been attributed to the low growth in the desktop market
after the arrival of tablet computers and laptops. In the context of the Boston Consulting
Group (BCG) growth-share matrix, the desktop SBU will be categorized under
78.
_____ are strategic business units that compete in a low-growth market but hold
considerable market share.
79.
PrimoDisk Inc. holds the highest market share in the low-growth compact disk industry.
With the introduction of flash drives, the market for compact disks has reduced. However,
PrimoDisk has been able to generate sufficient revenues for the parent company by selling
its products in less developed countries. In the Boston Consulting Group (BCG) growth–
share matrix, PrimoDisk will be categorized under
80.
If a strategic business unit is recognized as a cash cow, it is advisable to
81.
Real Goods Inc. is a large conglomerate. The company’s beverages strategic business unit
(SBU) has been recognized as a cash cow, and its tobacco SBU has been categorized as a
dog. Which of the following can be inferred from this scenario?
82.
A corporation’s star SBUs will
83.
The smartphone division of the large consumer electronics company, True Electra Inc., has
a significant market share in the fast-growing cell phone market. If the company invests
further into this division, it will be able to reap increased cash flows. In the Boston
Consulting Group (BCG) growth-share matrix, the smartphone division of True Electra will
be categorized under
84.
BestDrive Inc. is a large automobile company. The company’s petrol cars strategic
business unit (SBU) has been recognized as a cash cow, and its hybrid electric cars SBU
has been categorized under stars. Which of the following can be inferred from this
scenario?
85.
Strategic business units that have a relatively low market share but have the potential to
grow are best categorized under _____ in the Boston Consulting Group (BCG) growth–
share matrix.