Important information about strategic management questions

1. ________ exists when the combined benefits of a firm's activities in two or more arenas are more than the simple sum of those benefits alone.
a. Synergy
b. Competitive Advantage
c. Diversification
d. Corporate Strategy

2. A _______ is a business that has a weak competitive position and is in a slow-growth industry.
a. Cash Cow
b. Dog
c. Star
d. Question mark

3. The practice of mapping diversified businesses or products based on their relative strengths and market attractiveness is called _________.
a. Strategic mapping
b. Related diversification
c. Portfolio planning
d. Strategic planning

4. Economies of scope is one of the two key factors in determining whether a corporate strategy is adding value through diversification. The other key factor is _______.
a. Vertical
b. Horizontal
c. Geographic diversification
d. Revenue-enhancement

5. Revenue-enhancement synergies arise from _______ and _______ opportunities.
a. Bundling; joint selling
b. Bundling; separate selling
c. Separating; joint selling
d. Separating; separate selling

6. Investors can make reasonable estimates of a business unit's potential independent value by using _______ ratios.
a. Revenue to cost
b. Price to earnings
c. Human resource costs to price
d. Price to cost

7. The form of diversification in which the business units operated by a firm are highly related is called _________.
a. Related diversification
b. Unrelated diversification
c. Vertical diversification
d. Horizontal diversification

8. When strategists think about a proposed diversification move, they must assess the extent to which their firm's resources and capabilities match the _______.
a. Needs of potential subsidiaries
b. Needs of their own firm
c. Production schedule
d. Capabilities of potential subsidiaries

9. Increased horizontal scope is attractive to firms because it offers opportunities by reducing costs through exploiting possible economies of scope and by _________.
a. Increasing the customer base
b. Decreasing production costs
c. Decreasing competition between similar business units
d. Increasing revenues through synergies

10. The extent to which a firm participates in related market segments or industries outside its existing value-chain activities is called ________.
a. Vertical scope
b. Horizontal scope
c. Geographic scope
d. Vertical differentiation

11. The process by which a firm approaches its cross-border activities and those of competitors, and plans to approach them in the future, is called________.
a. Staging
b. International strategy
c. Competitive strategy
d. Cross-border configuration

12. What question must managers ask concerning the relationship between economic logic and international strategy?
a. What geographical areas will we enter?
b. How does our international strategy contribute to the economic logic of our business and corporate strategies?
c. How does being international make our products more attractive to our customers?
d. Which international market-entry strategies will we use?

13. The disadvantage a firm faces by not being a local player is referred to as liability of _______.
a. Newness
b. Governance
c. Foreignness
d. Coordination

14. With the help of a five-forces analysis and the value chain, managers can assess all of the following except ______.
a. The desirability of investment in one market versus another
b. The competitive consequences of foreign investment
c. The value-chain activities needed to locate in various regions
d. The predicted market reaction to a newly gained competitive advantage.

15. Multipoint competition refers to the situation where a firm competes against another firm in _______.
a. Multiple markets or businesses
b. Implementation of price discounts
c. A single domestic market
d. Developing new technologies

16. Dell Inc. uses a core distribution and sales engine known as the Dell ______ model to maintain its position as the world's second largest PC maker.
a. Innovative
b. Global
c. Competitive
d. Direct

17. The geographic-diversified firm must ensure that the benefits of being international outweigh the added costs of the _______ necessary to support its nondomestic operations.
a. Human resources
b. Infrastructure
c. Raw materials
d. Learning

18. A goal of locating a firm or a particular aspect of its operations in a part of the world where competition is the fiercest is to learn from leading-edge production practices and _______.
a. Compete in that location
b. Transfer that advanced knowledge back to the firm
c. Beat the competition in developing even more advanced technologies
d. Figure out how to neutralize the competition there

19. The CAGE framework is a tool that considers _______ dimensions to assess the distance created by global expansion.
a. Culture, association, geography, and expansion
b. Culture, administration, geography, and expansion
c. Culture, administration, geography, and economics
d. Culture, association, geography, and economics

20. A dimension of cultural differences that pertains to the extent to which individuals accept the existence of inequalities between subordinates and superiors within a hierarchical structure is called ________?
a. Power distance
b. Uncertainty avoidance
c. Masculinity or predominant values
d. Long or short term orientation

21. Patents and trademarks are examples of ______ property protection that are territorial and must be filed in each country where protection is sought.
a. Communal
b. Virtual
c. Real estate
d. Intellectual

22. A form of foreign direct investment in which a firm starts a new foreign business from the ground up is called ______.
a. Joint venture alliance
b. Entrepreneurism
c. Greenfield investment
d. 50/50 joint venture

23. A strategy by which a firm sacrifices local responsiveness for the lower costs associated with global efficiency is referred to as _______ vision.
a. Multinational
b. Transnational
c. International
d. Global

24. When mergers and acquisitions are undertaken in pursuit of synergy which of the following relationships describes the beliefs that guide managers. Let A and B represent the firms involved.
a. Value of A and B merged > value of A + value of B if the firms remain separate
b. Value of A and B merged = value of A + value of B if the firms remain separate
c. Value of A and B merged < value of A + value of B if the firms remain separate
d. Value of A minus B > value of A + value of B if the firms remain separate

25. To overcome a supplier's reluctance to making a large investment for the benefit of one buyer, the buyer may need to integrate vertically backward into the supply chain by _______.
a. Developing an internal division that becomes the supplier
b. Finding multiple similar suppliers
c. Partnering with another similar firm
d. Making an acquisition

26. Acquisitions have implications for the financial success of strategies, or in other words the realization of the anticipated ________ of the strategy.
a. Economic logic
b. Competitive advantage
c. Knowledge increase
d. Margins

27. Business-strategy alliances are fundamentally related to a firm's core business through _______.
a. Vertical relationships
b. Horizontal relationships
c. Complementary relationships
d. All of the above

28. ______ is a major factor in making mergers and acquisitions work.
a. Cost
b. Integration
c. Regulation
d. Internal Structure

29. In a ______ acquisition, the acquiring company expands its product line by purchasing another company.
a. Horizontal
b. Vertical
c. Product-extension
d. Market-extension

30. When using mergers and acquisitions as substitutes for research and development, the objectives include_____.
a. Short term innovation by buying it from small companies
b. Synergy of similar but expanded product lines or geographic markets
c. Eliminating capacity, gaining market share, and increasing efficiency
d. Anticipation of new industry emerging and culling resources from firms in multiple industries whose boundaries are eroding.

31. The purpose of a(n)_________ acquisition is to reduce the number of competitors in a mature industry in which capacity exceeds increasing demand.
a. Vertical
b. Overcapacity
c. Geographic roll-up
d. Market-expansion

32. _______ is deciding what to do and _______ is the process of executing what you planed to do.
a. Strategy formulation; strategy implementation
b. Strategy implementation; strategy formulation
c. Strategic thinking; strategy implementation
d. Strategy formulation; strategic execution

33. Some experts believe that many strategy implementation failures result from management's inability to ______.
a. Get employees on board with new ideas
b. Assess potential implementation obstacles
c. Successfully copy industry leaders' methods
d. Develop strategic plans

34. The mechanism with which a strategic leader can help to execute a firm's strategy is referred to as a(n)__________.
a. Organizational structure
b. Implementation lever
c. Organizational level
d. Implementation system

35. The _______ of an organization is the framework that management has devised to divide tasks, deploy resources, and coordinate departments.
a. Lever
b. System
c. Strategy
d. Structure

36. The more ______ a firm, the more the structure will have to be designed to accommodate coordination.
a. Focused
b. Diversified
c. Simple
d. Concentrated

37. The _______ tends to work best in smaller firms and those with few products or services.
a. Functional structure
b. Multidivisional structure
c. Network
d. Matrix

38. A form of organization in which divisions are organized around product or geographic markets is referred to as a ________.
a. Functional structure
b. Multidivisional structure
c. Network
d. Matrix

39. A(n) _______ structure is designed to capitalize on both functional specialization and divisional autonomy.
a. Functional structure
b. Multidivisional structure
c. Network
d. Matrix

40. Many firms find it difficult to implement the _______ structure because it calls for high levels of resource sharing across divisions.
a. Multidivisional
b. Matrix
c. Functional
d. Network

41. In the typical ________ structured organization, employees work in small teams and are encouraged to participate in direct one-on-one communications with other associates, customers, and suppliers.
a. Multidivisional
b. Matrix
c. Functional
d. Network

42. The structure that most enables a firm to grow rapidly is the ______ structure.
a. Multidivisional
b. Network
c. Partnership
d. Franchise

43. A performance-management system that can be used to gauge the success with which implementation levers are aligned with strategic objectives is called the balanced _______.
a. Scorecard
b. Metric
c. Matrix
d. Network

44. The strategy map states objectives in terms of _______.
a. Business processes
b. Cycle time
c. Productivity
d. All of the above

45. The ________ configuration uses a structure that is designed to achieve efficiency, local responsiveness, and innovation.
a. Multinational
b. International
c. Transnational
d. Global

46. Patching may involve which of the following activities?
a. Combining business units
b. Splitting business units
c. Adding new business units
d. All of the above

47. A partnership in which two or more firms combine resources and capabilities with the goal of creating mutual competitive advantage is referred to as a(n)_______.
a. Strategic alliance
b. Competitive alliance
c. Strategic partnering
d. Competitive co-marketing

48. An alliance in which two firms make equity investments in a third legal entity is referred to as a(n) ________.
a. Equity alliance
b. Joint venture
c. Strategic alliance
d. Consortium

49. An alliance that involves neither the assumption of equity interest nor the creation of separate organizations is referred to as a(n) ________.
a. Joint venture
b. Equity alliance
c. Non-equity alliance
d. Consortium

50. _________ refers to a situation in which firms are both competitors and cooperative partners.
a. Co-opt alliance
b. Consolidation
c. Cooperation
d. Co-opetition

51. The corporate strategy whereby a firm takes ownership of a downstream supply or upstream distribution is called ______ integration.
a. Complementary
b. diagonal
c. Vertical
d. Horizontal

52. The corporate strategy whereby a firm partners with firms in the same industry is called ________ integration.
a. Adjacent
b. Complementary
c. Vertical
d. Horizontal

53. Corporate strategy is largely concerned with determining the right mix of business in the corporate portfolio and ________.
a. Analyzing the industry conditions
b. Developing business-specific competitive plans
c. Determining the right mix of products and/or services
d. Ensuring that the corporate portfolio creates shareholder value

54. The use of alliances in a _______ web enables a firm to develop its specific dynamic capabilities in concert with the best resources and capabilities available.
a. Cooperation
b. Co-evolution
c. Vertical
d. Horizontal

55. The four key elements in establishing and maintaining interorganizational trust are ________.
a. Initial conditions, negotiation process, reciprocal experiences, and outside behavior
b. Beginning process, negotiation process, contract development, and joint experiences
c. Initial conditions, contract development, negotiation process, and outside behavior
d. Contract development, negotiation process, reciprocal experience, and outside behavior