The industry environment directly influences the firm and its competitive actions and
responses.
a. True
b. False
The selection of an organizational structure for an internationally diversified firm
should consider the international corporate-level strategy the firm is using.
a. True
b. False
Top managers typically become overly focused on acquisitions because only they can
perform most of the tasks involved, such as performing due diligence on the target firm.
a. True
b. False
The growing number of global competitors heightens the requirements to keep costs
down and there is the desire for more specialized products to meet customer needs.
These two pressures make transnational strategies increasingly necessary.
a. True
b. False
Rapid-Built Homes specializes in low-cost prefabricated, modular homes that can be
erected in a matter of days anywhere in the country. Rapid-Built focuses on entire
subdivisions of homes developed by real estate speculators. ModernModular Homes
(ModMod) specializes in modular homes designed by architects, which can be built
anywhere in the country. The buyers usually build the home themselves from kits on
their own lots. ModMod sells fewer than 100 house kits per year. ModMod is run by
two professors of architecture as a sideline business. According to the “Framework of
Competitive Analysis,” we can say that Rapid-Built and ModMod
a. are direct mutually acknowledged competitors.
b. have high resource similarity.
c. have high market commonality.
d. are probably not engaged in intense competitive rivalry.
The need for quality products and services is so high that quality alone can assure a
firm that it will achieve strategic competitiveness and earn above-average returns.
a. True
b. False
Christina is evaluating Maximum Brands as an investment opportunity. She is very
concerned about future financial performance by Maximum Brands. Christina does not
believe that the CEO can act as a steward. Christina will probably be most concerned if
a. there is CEO duality.
b. many of the members of the board of directors are outsiders.
c. the positions of chairman of the board and CEO are held by different persons.
d. there is an independent board leadership structure.
The steps for identifying the profit pools in an industry include all of the following
EXCEPT
a. defining the boundaries of the pool.
b. estimating the overall size of the pool.
c. defining the competitors in the pool.
d. estimating the size of the value-chain activity in the pool.
A decision that results in failure
a. is a career-ending event because it is so unusual.
b. often results from lack of accountability.
c. fosters organizational inertia.
d. allows for learning.
Some experts consider the ______ structure to be one of the 20th century’s most
significant organizational innovations because of its value to diversified firms.
a. network
b. cooperative
c. multidivisional
d. functional
The more heterogeneous the top management team, the
a. more difficult it will be for the team to implement strategies.
b. more likely it is that the team will be cohesive.
c. less innovative the team’s decisions will tend to be.
d. less diverse the team membership will be.
The location advantages associated with locating facilities in other countries can
include all of the following
EXCEPT
a. low-cost labor.
b. access to critical supplies.
c. access to customers.
d. evasion of host country governmental regulations.
What is the similarity between high-technology firms and service-based firms that
makes them risky as restructuring candidates?
a. They are human-resource dependent.
b. They have few tangible assets.
c. Both types of firm rely on financial economies.
d. The demand for their products is highly sensitive to economic downturns.
Thomas is an upper-middle level manager for a firm that has been actively involved in
acquisitions over the last 10 years. The firm has grown much larger as a result. Thomas
has been dismayed to find that recently the managerial culture of the firm has been
turning more and more to controls.
a. bureaucratic
b. strategic
c. tactical
d. organic
CaseScenario1:TheBoyandGirlClubs.
The Boys and Girls Clubs (BGC) is a national non-profit organization geared toward
providing America’s youth with the tools and skills they need to become healthy adults,
responsible citizens, and effective leaders. By bringing parents, neighbors, educators,
and civic leaders together with our youth, BGC believes it can instill these crucial life
lessons at an age when they’re most needed. The national organization is headquartered
in Atlanta, GA, and serves as a service hub for over 3,700 club locations around the
United States. Each local club is directed by a volunteer board of directors and staffed
by professional youth development workers (usually including an executive director, a
program director, and an arts director) and many volunteers who just enjoy working
with young people and want to make a difference in their lives. While affiliated with the
national center, each local BGC is locally funded.
How might BGC respond to threats to its donations at both local and national levels?
Discuss the differences between autonomous strategic behavior and induced strategic
behavior.
Identify the four types of business-level cooperative strategies and the advantages and
disadvantages of each.
CaseScenario2:B.B.Mangler.
B.B. Mangler is a top U.S. business-to-business distributor of maintenance, repair, and
service equipment, components, and supplies such as compressors, motors, signs,
lighting and welding equipment, and hand and power tools. Its industry is typically
referred to as MRO, an acronym for maintenance, repair, and supplies. MRO products
are typically small and fairly inexpensive (such as light bulbs and washers), but often
needed on short notice. Mangler states its strategy as having the “capacity to offer an
unmatched breadth of lowest-total-cost MRO solutions to business.” Mangler’s GoMRO
sourcing center for indirect spot buys locates products through its database of 8,000
suppliers and 5 million products. Mangler has 388 physical branches in the United
States, including Puerto Rico (90 percent of sales), 184 in Canada, and 5 in Mexico.
Customers include contractors, service and maintenance shops, manufacturers, hotels,
governments, and health care and educational facilities. Mangler also provides
materials-management consulting services.
How should Mangler respond to the threat of new Internet-based entrants?
Describe the seven problems in achieving a successful acquisition.