Alliance management is considered an organizational capability and:
A. develops over time, out of effort and learning.
B. decreases a company’s knowledge assets.
C. creates successful strategic alliances.
D. decreases a company’s knowledge capabilities.
E. rapidly transfers assets into the strategic alliance.
Answer:
The most powerful and widely used tool for diagnosing the principle competitive
pressures in a market is:
A. the five forces framework.
B. PESTEL.
C. the driving forces model.
D. strategic group mapping.
E. competitor analysis.
Answer:
Which of the following does NOT qualify as potential driving forces capable of
inducing fundamental changes in industry and competitive conditions?
A. Changes in who buys the product and how they use it, and changes in the long-term
industry growth rate
B. Changes brought about by the entry or exit of major firms, product innovation, and
marketing innovation and cost efficiency
C. Changes in the economic power and bargaining leverage of customers and suppliers,
growing supplier-seller collaboration, and growing buyer-seller collaboration
D. Changes in buyer preferences for differentiated products instead of mostly
standardized or identical products
E. Changes in economies of scale and experience curve effects brought on by changes
in manufacturing technology and new Internet capabilities
Answer:
The advantages of using an acquisition strategy to pursue opportunities in foreign
markets include:
A. having a high level of control and speed as an entry strategy to overcome trade
barriers.
B. allowing a company to achieve scalable economies.
C. eliminating the costs and risks associated with establishing a foreign business
location.
D. achieving variable product quality and competitive product performance.
E. exporting goods at higher costs than rivals in those locations.
Answer:
Which of the following is NOT a common type of driving force?
A. Reductions in uncertainty and business risk
B. Changing societal concerns, attitudes, and lifestyles
C. Diffusion of technical know-how across companies and countries
D. Increasing efforts to collaborate closely with suppliers
E. Advances in technology and manufacturing process innovation
Answer:
Crafting a deliberate strategy involves developing strategy elements that:
A. imitate as much of the market leader’s strategy as possible so as not to end up at a
competitive disadvantage.
B. comprise a five-year strategic plan that is then fine-tuned during the remainder of the
plan period; big changes in strategy are thus made only once every five years.
C. consist of a blend of proactive new planned initiatives plus ongoing strategy
elements continued from prior periods.
D. deliberately eliminate the ongoing strategic elements and implement new planned
initiatives.
E. consist of adaptive change plans to new market situations along with abandoned
redundant ongoing elements.
Answer:
In trying to gain employees’ wholehearted commitment to good strategy execution and
operating excellence, managers are well advised to use all of the following incentives
EXCEPT:
A. providing attractive perks and fringe benefits.
B. giving awards and public recognition to high performers and showcasing company
successes.
C. creating a work atmosphere in which there is genuine caring and mutual respect
among workers and between management and employees.
D. relying on opportunities for promoting from within wherever possible.
E. .withholding information from employees about financial performance, strategy, and
competitors’ actions.
Answer:
Which of the following is NOT an option for remedying a cost disadvantage associated
with activities performed by forward channel allies (wholesale distributors and retail
dealers)?
A. Changing to a more economical distribution strategy such as putting more emphasis
on cheaper distribution channels (perhaps direct sales via the Internet) or perhaps
integrating forward into company-owned retail outlets
B. Enhancing differentiation through activities such as cooperative advertising at the
forward end of the value chain
C. Pressuring distributors/dealers and other forward-channel allies to reduce their costs
and markups
D. Insisting on across-the-board cost cuts in all value chain activitiesthose performed by
suppliers, those performed in-house, and those performed by distributors/dealers
E. Collaborating with forward channel allies to identify win”win opportunities to reduce
costs
Answer:
As a rule, the key indicators of industry attractiveness, for all the industries represented
in a diversified company’s business portfolio, should NOT be measured on such
attractiveness factors as:
A. market size and projected growth rate.
B. emerging opportunities and threats, and the intensity of competition.
C. resource requirements and the presence of cross-industry strategic fits.
D. seasonal and cyclical factors, industry profitability, and whether an industry has
significant social, political, regulatory, and environmental problems.
E. the utility of the products for consumers from all age-groups.
Answer:
The real payoff of driving forces is to help managers understand:
A. what strategy changes are needed to prepare for the impacts of the driving forces.
B. the overall strength of the five competitive forces.
C. whether the industry’s strategic group map will be static or dynamic.
D. what conditions exist in the economy at large.
E. the extent to which rivals have more than two competitively valuable competencies
or capabilities.
Answer:
Which of the following managerial practices is NOT used to lead the effort to foster a
results-oriented, high-performance culture?
A. Using empowerment to help create a fully engaged workforce
B. Making champions out of the people who spearhead new ideas and/or turn in
winning performances
C. Celebrating individual, group, and company successes
D. Treating employees as valued partners in the drive for operating excellence and good
business performance
E. Placing a premium on not making mistakes, prompting managers to lean toward safe,
conservative options intended to maintain the status quo
Answer:
What is it called when a company sells its goods in foreign markets at prices that are
below the prices at which it normally sells in its home market or well below its full
costs per unit?
A. Dumping practices
B. Price-clearing system
C. Clearance sale
D. Discounting practices
E. Competitive advantage
Answer:
In which of the following instances is being a first-mover NOT particularly
advantageous?
A. When moving first with a preemptive strike makes imitation difficult or unlikely
B. When first-time buyers remain strongly loyal to pioneering firms in making repeat
purchases
C. When early commitments to new technologies, types of components, or emerging
distribution channels produce an absolute cost advantage over rivals
D. When markets are slow to accept the innovative product offering of a first-mover,
and fast followers possess sufficient resources and marketing muscle to overtake a first
mover
E. When being a pioneer helps build a firm’s image and reputation with buyers
Answer:
Studies done on the correlation of between good corporate behavior and good financial
performance have generally found:
A. no correlation
B. a small positive correlation
C. a small negative correlation
D. a large positive correlation
E. a large negative correlation
Answer:
Excellent execution of an excellent strategy is:
A. the best test of managerial excellence and the best recipe for making a company a
standout performer.
B. a solid indication that managers are maximizing profits and looking out for the best
interests of shareholders.
C. the best test of whether a company is a “true” industry leader.
D. the best evidence that managers have a emerging business model.
E. the best test of whether a company enjoys sustainable competitive advantage.
Answer:
A middle-class customer (target) base in a region is most concerned with quality and
price of products. Which of the following would be considered a best value proposition
for the customers?
A. A company that identifies unique features of its products without comparing it with a
rival’s products
B. A company that offers copycat products at low cost but an average quality compared
to rivals
C. A company that offers the same quality of products as rivals but at a high cost based
on greater market share and higher brand value
D. A company that provides same quality of products at a much lower price than rivals,
but leaves the final assembly of product pieces to customers with an easy assembly
guide
E. A company that sells an average quality product compared to rivals with a meager
difference in price.
Answer:
Which of the following is generally NOT considered a barrier to entry?
A. Restrictive regulatory policies
B. High capital requirements
C. Strong brand preferences
D. Many industry patents in place
E. Weak “network effects” in customer demand
Answer:
Although exposing children to hazardous work and long work hours is unquestionably
deplorable, which of the following, if true, leads to a moral dilemma?
A. Use of adults leads to higher labor costs.
B. Children are not as efficient as adults in doing physically demanding work.
C. Many child laborers come from poverty-stricken families.
D. Banning child labor increases school attendance.
E. Working children learn independence.
Answer:
Viable strategic options companies should consider in tailoring their strategy to fit
circumstances of emerging country markets include all of the following, EXCEPT:
A. trying to change the local market to better match the way the company does business
elsewhere.
B. being prepared to modify aspects of the company’s business model to accommodate
local circumstances.
C. preparing to compete on the basis of low price.
D. staying away from those emerging markets where it is impractical to modify the
company’s business model to accommodate local circumstances.
E. focusing on local markets whose circumstances will be most challenging to the
company’s business model.
Answer:
Giving customers more value for the money by satisfying their expectations on key
quality features, performance, and/or service attributes while beating their price
expectations is a:
A. best-cost provider strategy.
B. focused low-cost strategy.
C. focused differentiation strategy.
D. broad differentiation strategy.
E. low-cost provider strategy.
Answer:
Brands create customer loyalty, which in turn:
A. increases the perceived cost of switching to another product.
B. strengthens the product’s quality.
C. validates the motivation for alternate products.
D. provides monetary incentive for using the product.
E. allows a company to operate facilities at full capacity.
Answer:
Checking a diversified company’s business portfolio for the competitive advantage
potential of cross-business strategic fits does NOT involve ascertaining the extent to
which sister business units:
A. have value chain match-ups that offer opportunities to combine the performance of
related value chain activities and reduce costs.
B. have value chain match-ups that offer opportunities to transfer skills or technology or
intellectual capital from one business to another.
C. have opportunities to share use of a well-respected brand name.
D. have value chain match-ups that offer opportunities to create new competitive
capabilities or to leverage existing resources.
E. are cash cows and which ones are cash hogs.
Answer:
Managerial actions to develop core competencies and competitive capabilities internally
generally take one of two forms. What are they?
A. Either strengthening the company’s base of skills, knowledge, and experience or
coordinating and integrating the efforts of various work groups and departments
B. Either putting in high incentive bonuses to reward individual employees who train
hard to develop the desired capability or launching an extensive training effort to
develop the capability quickly with newly hired employees
C. Either using benchmarking and the adoption of best practices to imitate a capability
that rivals have already developed or empowering a team of employees to develop the
capability however they best see fit
D. Either using developed dynamic capabilities or acquiring the capability from outside
sources
E. Either by enforcing close cross-business collaboration or by centralizing the
performance of functions requiring close coordination at the corporate level
Answer:
Experience indicates that strategic alliances:
A. are generally successful.
B. work well in cooperatively developing new technologies and new products but
seldom work well in promoting greater supply chain efficiency.
C. work best when they are aimed at achieving a mutually beneficial competitive
advantage for the allies.
D. can suffer culture clash and integration problems due to different management styles
and business practices.
E. are rarely useful in helping a company win the race for global industry leadership.
Answer:
Which of the following does NOT describe the standard type of structural form of
organization?
A. A functional structure where function is a major step in the firm’s value chain
B. A simple structure where all major decisions and oversight are a duty of the central
executive
C. A multidivisional structure where each division of the firm is an independent profit
center
D. A matrix structure where there are two or more divisions organized to enhance
cross-communication
E. A network structure where independent organizations are involved in a common
undertaking
Answer:
Superior strategy execution capabilities are:
A. easy for rivals to copy.
B. socially simple..
C. develop quickly.
D. easy to achieve.
E. hard to imitate.
Answer:
The business case for CSR and environmentally sustainable business practices suggests
such actions could lead to all of the following EXCEPT:
A. increased buyer patronage.
B. shorter supply chain.
C. lower costs and enhanced employee recruiting and workforce retention.
D. opportunities for revenue enhancement and best long-term profits for shareholders.
E. reduced risk of reputation-damaging incidents.
Answer:
Which one of the following is NOT among the chief duties/responsibilities of a
company’s board of directors insofar as the strategy-making, strategy-executing process
is concerned?
A. Hiring and firing senior-level executives and working with the company’s chief
strategic planning officer to improve the company’s strategy when performance comes
up short of expectations
B. Being inquiring critics and exercising strong oversight over the company’s direction,
strategy, and business approaches
C. Evaluating the caliber of senior executives’ strategy-making/strategy-executing skills
D. Instituting a compensation plan for top executives that rewards them for actions and
results that serve stakeholders’ interests, most especially those of shareholders
E. Overseeing the company’s financial accounting and financial reporting practices
Answer:
Tangible resources include:
A. human assets and intellectual capital, which can include the talent of the work force
and the creativity and innovativeness of certain personnel.
B. reputational assets, which can include the company’s reputation for quality, service,
and reliability as well as their reputation for fair dealings with suppliers.
C. relationships such as alliances that provide access to technologies, specialized
know-how, or geographic markets.
D. technological assets such as patents, copyrights, and innovation technologies.
E. company culture and incentive system, which includes the norms of behavior and
business principles.
Answer:
Sometimes it makes sense for a company to go on the offensive to improve its market
position and business performance. The best offensives tend to incorporate the
following EXCEPT:
A. focusing relentlessly on building a competitive advantage.
B. applying resources where rivals are least able to defend themselves.
C. using a strategic offense to allow the company to leverage its weaknesses to
strengthen operating vulnerabilities.
D. employing the elements of surprise as opposed to doing what rivals expect and are
prepared for.
E. displaying a strong bias for swift, decisive, and overwhelming actions to overpower
rivals.
Answer: