Deck 11: International Strategy and Organization

Question 1

Core competencies develop over long periods of time and are easy to teach.

Answer 1

False

Question 2

A core competency is a company skill that competitors can easily imitate.

Answer 2

False

Question 3

To be the largest global company in each industry in which we compete is an example of a business-unit objective.

Answer 3

False

Question 4

The process of identifying and selecting an organization's objectives and deciding how the organization will achieve those objectives is called strategy.

Question 5

Strategy is the set of planned actions managers take to help a company meet its objectives.

Question 6

A market segment is a clearly identifiable group of potential buyers.

Question 7

Developing an effective strategy requires a company to undertake an analysis of its own capabilities and strengths.

Question 8

A core competency refers to multiple skills that are coordinated to form a single technological outcome.

Question 9

To increase market share by 5 percent in the next three years is an example of an objective at the highest level of the firm.

Question 10

A company's mission statement often guides decisions such as which industries to enter or exit and how to compete in chosen segments.

Question 11

The strategy formulation process involves both planning and strategy.

Question 12

A written statement of why a company exists and what it plans to accomplish is referred to as its core competencies.

Question 13

Objectives at the highest level in a company tend to be stated in the most general terms.

Question 14

An inappropriate strategy can lead managers to take actions that cause internal tensions and pull a company in opposite directions.

Question 15

An architect's ability to design an office building in the Victorian style is an example of a core competency.

Question 16

To mass-produce a zero-pollution emissions automobile by 2012 is an example of a business-unit objective.

Question 17

A well-defined strategy helps to coordinate a company's various divisions and departments so that it reaches its company-wide goals in the most effective and efficient manner possible.

Question 18

Many concerns facing managers when formulating a strategy are different for domestic as compared with international companies.

Question 19

A value chain analysis divides a company's activities into primary activities and support activities and identifies those that create customer value.

Question 20

All parties ranging from suppliers and employers to consumers who are affected by a company's activities are called its stockholders.

Question 21

A growth strategy is designed to increase the scale or scope of a corporation's activities.

Question 22

The main drawback of a multinational strategy is that it does not allow companies to exploit scale economies in product development, manufacturing, or marketing.

Question 23

The high degree of independence with which each unit operates when using a multinational strategy can reduce opportunities for sharing knowledge among units within a company.

Question 24

Value chain analysis divides a company's activities into forward activities and backward activities.

Question 25

Companies following a global strategy often take advantage of scale and location economies by producing entire inventories of products or components in a single, optimal location.

Question 26

A global strategy does not allow a company to modify its products except for the most superficial features.

Question 27

A multinational strategy is best suited to industries in which price competitiveness is a key success factor.

Question 28

Support activities in a value chain analysis include infrastructure, human resource management, customer service, marketing, and procurement.

Question 29

A multinational strategy is most appropriate for companies that do not have foreign direct investments but rather export their products to foreign markets.

Question 30

Multinational and global strategies are most appropriate for exporters given their foreign direct investments in other national markets.

Question 31

When analyzing primary activities, managers often look for areas in which the company can increase the value provided to customers.

Question 32

Companies involved in more than one line of business must first formulate a business-level strategy.

Question 33

Inbound and outbound logistics is an example of a primary activity.

Question 34

The main benefit of a global strategy is that it allows companies to closely monitor buyer preferences in each local market and respond quickly and effectively as new buyer preferences emerge.

Question 35

Companies engaged in international business can approach their market using either a multinational or global strategy.

Question 36

The external business environment consists of all the elements outside a company that can affect its performance.

Question 37

Human resource management is an example of a support activity.

Question 38

The main problem with a multinational strategy is that it may cause a company to overlook important differences in buyer preferences from one market to another.

Question 39

The four key approaches to corporate strategy are growth, retrenchment, stability, and combination.

Question 40

A multinational strategy entails having a separate strategy for each nation in which a company markets its products.

Question 41

The purpose of a combination strategy is to mix growth, retrenchment, and stability strategies across a corporation's business units.

Question 42

A differentiation strategy works best with mass-marketed products aimed at price-sensitive buyers.

Question 43

The most common self-managed teams in many manufacturing companies are downsizing teams.

Question 44

A global matrix structure is an organizational structure that divides worldwide operations according to a company's product areas.

Question 45

Decentralized decision making disperses decisions to lower organizational levels, such as to international subsidiaries.

Question 46

A differentiation strategy tends to force a company into a higher market share position because it generally involves the perception of exclusivity.

Question 47

Weaker competitors often resort to retrenchment when national business environments grow more competitive.

Question 48

Because the international division structure concentrates international expertise in one division, divisional managers become specialists in a wide variety of activities such as foreign exchange, export documentation, and host-government lobbying.

Question 49

Stability is a relatively common strategy among today's corporations.

Question 50

Organic growth refers to a corporate strategy relying on mergers and acquisitions.

Question 51

A negative aspect of the low-cost leadership strategy is low customer loyalty.

Question 52

Corporate combination strategies are quite uncommon because international corporations generally follow identical strategies in each of their business units.

Question 53

Scale refers to the kinds of activities a firm performs and scope to the size of activities.

Question 54

A main goal of the matrix structure is to bring together geographic and product area managers in joint decision making.

Question 55

Corporations reduce the scope of their activities by selling unprofitable business units or those no longer directly related to their overall aims.

Question 56

The key to developing an effective business-level strategy is deciding on a general competitive strategy in the marketplace.

Question 57

Centralized decision making is beneficial when fast-changing national business environments put a premium on local responsiveness.

Question 58

A focus strategy is one in which a company focuses on serving the need of a narrowly defined market segment by being the low-cost leader, by differentiating its product, or both.

Question 59

Firms pursuing a low-cost leadership strategy can ignore other competitive factors such as product quality and customer service to focus completely on price.

Question 60

Decentralization can help foster participative management practices.

Question 61

All parties affected by a company's activities are called ________.

A) stakeholders
B) suppliers
C) stockholders
D) employees

Question 62

Which of these divides a company's activities into primary and support activities central to creating customer value?

A) Mission statement analysis
B) Location analysis
C) Multinational analysis
D) Value chain analysis

Question 63

To be the largest global company in each industry in which we compete is an example of an objective at the ________.

A) individual department level
B) business-unit level
C) consumer level
D) corporate level

Question 64

The objective to mass-produce a zero-pollution emissions automobile by 2012 would most likely belong to a(n) ________.

A) individual business unit
B) individual department
C) regional headquarters
D) global headquarters

Question 65

A mission statement ________.

A) provides information to companies about highly specific operational plans
B) is a written statement of why a company exists and what it plans to accomplish
C) typically avoids identifying how corporate goals will affect stakeholders
D) is designed to inform suppliers of their responsibilities in meeting the company's goals

Question 66

________ is the set of planned actions taken by managers to help a company meet its objectives.

A) Mission formulation
B) Planning
C) Value chain analysis
D) Strategy

Question 67

Which of these is a special company ability that competitors find extremely difficult to equal?

A) Value chain
B) Core competency
C) Growth strategy
D) Location economics

Question 68

All the following are true regarding core competencies EXCEPT that they are ________.

A) special abilities that competitors find extremely difficult or impossible to equal
B) easy to teach to new employees
C) multiple skills coordinated to form a single technological outcome
D) learned through on-the-job training and personal experience

Question 69

Which of these is a primary activity in a company's value chain?

A) Infrastructure
B) Marketing and sales
C) Procurement
D) Human resource management

Question 70

A well-defined strategy ________.

A) helps a company compete effectively in increasingly competitive international markets
B) serves to coordinate a company's various divisions and departments so it reaches its company-wide goals in the most effective manner possible
C) focuses a company on the activities it performs best
D) all of the above

Question 71

A company's stakeholders include all of the following EXCEPT ________.

A) suppliers
B) employees
C) consumers
D) competitors

Question 72

At which level in a company do objectives usually become more precise and almost always contain numerical targets of performance?

A) Individual department level
B) Business-unit level
C) Consumer level
D) Corporate level

Question 73

During the second stage of the strategy formulation process, a company does all of the following EXCEPT analyze ________.

A) the firm's primary activities
B) competitors unique abilities
C) national and international business environments
D) the firm's support activities

Question 74

Which of these refers to a written statement of why a company exists and what it plans to accomplish?

A) Strategy statement
B) Mission statement
C) Value chain statement
D) Core competency statement

Question 75

Which of these is the first stage of the strategy formulation process?

A) Formulate strategies
B) Implement strategies
C) Identify company mission and goals
D) Identify core competency and value creating activities

Question 76

An architect's ability to design an office building in the Victorian style is an example of a(n) ________.

A) core competency
B) skill
C) ability
D) capability

Question 77

All of the following are part of stage three of the strategy formulation process EXCEPT ________.

A) selecting multinational or global strategy
B) formulating departmental-level strategy
C) analyzing business-level environment
D) formulating corporate-level strategy

Question 78

The strategy formulation process involves both ________.

A) planning and strategy
B) strategy and structure
C) planning and marketing
D) strategy and production

Question 79

A cross-functional team is one composed of employees who work at similar levels in different functional departments.

Question 80

Which of these is the process of identifying and selecting an organization's objectives and deciding how the organization will achieve those objectives?

A) Mission formulation
B) Planning
C) Value chain analysis
D) Strategy development