In moving to alter a problem culture, management should do all of the following
EXCEPT:
A. identify which aspects of the present culture are supportive of good strategy
execution and which ones are not.
B. specify what new actions, behaviors, and work practices should be prominent in the
“new” culture.
C. talk openly about the problems of the present culture and how new behaviors will
improve performance.
D. employ visible, forceful actions-both substantive and symbolic-to ingrain a new set
of behaviors, practices, and cultural norms.
E. avoid cross-unit cooperation.
What is the rule for organizing the work effort to support good strategy execution?
A. Match the firm’s organizational structure to its unique strategy.
B. Decide on how much to spend on training managers and employees.
C. Choose an organization structure that is a tight fit with the corporate culture.
D. Ensure the firm hires a capable management team.
E. Learn how the collaborative partner does things.
In which of the following cases are late-mover advantages (or first-mover
disadvantages) NOT likely to arise?
A. When the costs of pioneering are much higher than being a follower and only
negligible learning/experience benefits accrue to the pioneer
B. When the marketplace is skeptical about the benefits of a new technology or product
being pioneered by a first-mover
C. When the pioneer’s products are somewhat primitive and are easily bested by late
movers
D. When opportunities exist for a blue-ocean strategy to invent a new industry or
distinctive market segment that creates altogether new demand
E. When technological change is rapid and fast-following rivals find it easy to leapfrog
the pioneer with next-generation products of their own
Which of the following is NOT one of the ways managers can enhance differentiation
based on value drivers?
A. Striving to create superior product features, design, and performance
B. Striving for innovation and technological advances
C. Pursuing continuous quality improvement
D. Increasing the intensity of marketing, brand building, and sales activities
E. Seeking out low-quality inputs
A European manufacturer that exports goods made at its European plants to the United
States:
A. is competitively disadvantaged when the euro declines in value against the U.S.
dollar.
B. is largely unaffected by fluctuating exchange rates between the euro and the U.S.
dollar. It would, however, be affected if its plants were in the U.S.
C. becomes more competitive in the U.S. market when the euro declines in value
against the U.S. dollar.
D. becomes more competitive in European markets when the euro declines in value
against the U.S. dollar.
E. has no interest in whether the euro grows stronger or weaker versus the U.S. dollar
unless its chief competitors are other companies located in countries whose currency is
also the euro.
A company’s resources and capabilities represent:
A. the firm’s net working capital and related determinants for measuring operating
performance and capabilities.
B. the firm’s competitive assets, which are considered determinants of its
competitiveness and ability to succeed in the marketplace.
C. whether the firm has the industry’s most efficient value chain.
D. the management’s source of funding of new strategic initiatives.
E. positive trends with relevant cultural factors related to buyers’ choices and product
modifications
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.
The businesses in a diversified company’s lineup exhibit good resource fit when:
A. the resource requirements of each business exactly match the resources the company
has available.
B. individual businesses have matching resource requirements at points along their
value chain and add to a company’s overall resource strengths and when solid parenting
capabilities exist without spreading itself too thin.
C. each business generates just enough cash flow annually to fund its own capital
requirements and thus does not require cash infusions from the corporate parent.
D. each business unit produces sufficient cash flows over and above what is needed to
build and maintain the business, thereby providing the parent company with enough
cash to pay shareholders a generous and steadily increasing dividend.
E. there are enough cash cow businesses to support the capital requirements of the cash
hog businesses.
The contention that since there are cross-country or cross-cultural differences in ethical
standards, it is appropriate to judge behavior as ethical/unethical in the light of local
customs and social mores should take precedence over a single set of ethical standards
or what may be applicable in a company’s home market:
A. defines what is meant by ethical relativism.
B. defines what is meant by ethical universalism.
C. is the foundation of a social contract.
D. is the basis for the theory of ethical variation.
E. is the guiding principle for religious and moral standards across countries and
cultures.
Without a strategic framework, managers lack the context in which to:
A. fix things that really matter to business-unit performance and competitive success.
B. carry out company-wide goals related to the dynamics of a single business model.
C. employ the company’s resources in the pursuit of sustainable competitive advantage.
D. communicate aspirations for the company.
E. analyze the emerging market opportunities more precisely.
A strategy of vertical integration can have substantial drawbacks, including:
A. whether horizontal integration can limit the performance of strategy-critical
activities in ways that increase cost, build expertise, protect proprietary know-how, or
increase differentiation.
B. raising the firm’s capital investment in the industry and increasing business risk, as
well as providing less flexibility in accommodating shifting buyer preferences by
locking the firm into relying on its own in-house activities.
C. the environmental costs of coordinating operations across vertical chain activities.
D. loss of technological know-how.
E. the difficulties faced in entering outside vertical and horizontal markets.
Which of the following is NOT something a company should consider in crafting an
environmental sustainability strategy?
A. Actions to protect the environment that will guard against the ultimate endangerment
of the planet
B. Actions to maintain ecological support systems for future generations
C. Actions to provide for the longevity of natural resources
D. Actions to couple environmental degradation and economic growth
E. Actions to contain the adverse effects of greenhouse gases
Which of the following is part of strategy-supportive resources and capabilities?
A. Recruiting and retaining talented employees
B. Instituting organizational arrangements
C. Establishing lines of authority
D. Creating reporting relationships
E. Deciding how much authority to delegate
Acquisition of an existing business is an attractive strategy option for entering a
promising new industry because it:
A. is an effective way to hurdle entry barriers, is usually quicker than trying to launch a
brand-new startup operation, and allows the acquirer to move directly to the task of
building a strong position in the target industry.
B. is less expensive than launching a new startup operation, thus passing the
cost-of-entry test.
C. offers a challenging opportunity to train new resources and revive a sagging business
even if does not offer great prospects for growth, profitability, or return on investment.
D. is more likely to result in passing the shareholder value test, the profitability test, and
the better-off test.
E. offers the prospect of gaining an immediate competitive advantage in the new
industry and thus helps ensure that the diversification move will pass the competitive
advantage test for building shareholder value.
An offensive to yield good results can be short if:
A. buyers respond immediately (to a dramatic cost-based price cut or imaginative ad
campaign).
B. competition creates an appealing new product.
C. the technology needs debugging.
D. new production capacity needs to be installed.
E. consumer acceptance of an innovative product takes time.
The competitive power of a company resource strength or competitive capability hinges
on all of the following EXCEPT:
A. how hard it is for competitors to copy.
B. whether it is rare and something rivals lack.
C. whether it is really competitively valuable and has the potential to contribute to a
competitive advantage.
D. whether it is nonsubstitutable
E. whether it available in plenty.
A competitive environment where there is weak to moderate rivalry among sellers, high
entry barriers, weak competition from substitute products, and little bargaining leverage
on the part of both suppliers and customers:
A. lacks powerful driving forces.
B. gives each industry competitor the best potential for building sustainable competitive
advantage over rival firms.
C. makes it challenging for industry members to compete successfully unless they can
strongly differentiate their products.
D. is conducive to industry members earning attractive profits.
E. requires that industry members have low costs in order to be competitively
successful.
Competitive pressures associated with the threat of entry are greater in all of the
following situations, EXCEPT when:
A. incumbent firms are willing to strongly contest the entry of newcomers with moves
designed to make entry unprofitable.
B. a large pool of potential entrants exists, some of which have the capabilities to
overcome high entry barriers.
C. entry barriers are relatively low and buyer demand for the product is growing
rapidly, and newcomers can expect to earn attractive profits without inviting a strong
reaction from incumbents.
D. existing industry members are looking to expand their market reach by entering
product segments or geographic areas where they currently do not have a presence.E.
customers have low brand preferences and low degrees of loyalty to seller.
Quantitative measures of a company’s competitive strength:
A. signal which competitor has the most distinctive competencies and which competitor
has the fewest.
B. provide useful indicators of how a company compares against key rivals, factor by
factor and capability by capability-thus indicating whether the company has a net
overall competitive advantage or disadvantage against each rival.
C. reveal which competitors are in the best and worst strategic groups.
D. show which industry rival has the best overall market opportunities and which
competitor has the poorest market opportunities.
E. pinpoint which industry rival is subject to the least amount of competitive pressures
from the five competitive forces.
Identify four factors that affect whether an industry does or does not present a company
with a good business opportunity.
What is strategy and why is it important?
When is a global strategy ‘superior” to a multidomestic strategy?
What are the distinctive features of a best-cost provider strategy? Under what
circumstances is a best-cost provider strategy appealing?
What are the strategic advantages of a backward vertical integration strategy?
What does a company racing to stake out a strong position in an industry of the future
need strategic alliances for?
Carefully explain the difference between and the rationale for selecting a strategy of
related diversification and/or a strategy of unrelated diversification
What market conditions and circumstances make a low-cost provider strategy
attractive? What are the pitfalls in pursuing a low-cost provider strategy? What can go
wrong?
Good strategy + good strategy execution = good management. True or false? Justify and
explain your answer.