Deck 9: Network-Level Strategies

Question 1

Motivations for entering into a cooperative venture, or strategic alliance, include:

A) Risk reduction
B) Economies of scale
C) Knowledge access
D) All of the above

Answer 1

D

Question 2

Strategic alliance agreements can also be classified as:

A) Formal or informal
B) Joint ventures, collaborations, management contracts, franchising
C) Equity based or non-equity based
D) All of the above

Answer 2

D

Question 3

Which of the following is true regarding franchising?

A) Franchising involves enterprises run by the franchisee operating under the trade name and business format of a franchisor
B) There is only one form of franchising
C) The franchisee is not obliged to pay the franchisor a fee if their business is not profitable
D) The franchisee is free to change the specifics dictated by the franchisor

Answer 3

A

Question 4

Which statement is true regarding joint ventures?

A) You might also need to consider the market image, reputation and the customer association of your partner
B) In selecting partners, companies must pay attention to the cultural compatibility
C) Without market knowledge, joint venture partnership with a local partner can be a viable option to establish a presence
D) All of the above

Question 5

What type of factor influences the increase of franchising in foreign markets due to increased educational levels of the local population, technological advancement that facilitate travel overseas, the ability of the younger generation to try new, foreign products, rapid development of rural areas and concentration of population in urban and industrial areas.

A) Increased travel and tourism for business and pleasure
B) Technological advancement
C) Demographic trends
D) Expanded market

Question 6

Under a management contract who is responsible for hiring, training, and retaining staff and management?

A) The owner(s)
B) The operator
C) Both the owner and operator
D) An outside payroll company

Question 7

What defines a H&T organization as a good candidate for expansion by management contract?

A) A strong financial position
B) An established reputation for being an excellent manager
C) Decreased profit margins
D) None of the above

Question 8

Which of the following steps should occur before selecting from potential candidates for a strategic alliance?

A) Formulating firm's strategy;
B) Eliminating and selecting promising business sectors
C) Developing partnership benchmark;
D) All of the above

Question 9

The saturated, dynamic, and competitive global environment of today motivates organisations to join forces and benefit from financial and non-financial pooling of resources.

Question 10

Strategic alliances are often defined as agreements between only two partners to share both tangible and intangible resources, risks, and profits.

Question 11

Because strategic alliances foster the learning of new skills and core competencies, there are no significant drawbacks to this growth strategy.

Question 12

A joint venture can be defined as the participation of two or more companies in an enterprise in which each party contributes assets, and shares ownership as well as risk in the entity.

Question 13

Franchising emerged as a powerful way of facilitating the growth of H&T organizations.

Question 14

A wholly owned subsidiary involves the ownership and management an enterprise by setting up a business either from scratch or by developing resources and competences by taking over another organization.

Question 15

International strategy is appropriate in those markets where there is a need for local responsiveness but it is not urgent.

Question 16

Under a management contract the owner(s) must commit to not interfering in the management of the business, since the provider of the management services has the expertise and responsibility to perform this task.

Question 17

An international strategic alliance partner should be selected based on their expertise in operations; if the desired expertise exists a poor cultural fit is not terribly important.

Question 18

What are the motives for forming strategic alliances?

Question 19

What are the pros and cons of franchising?

Question 20

What are the motives for joint venture?

Question 21

What does management contract refer to?

Question 22

What are the advantages of management contracts for hotel operators?

Question 23

What are the motives for management contracts?