Deck 8: Strategy Formulation and Implementation

Question 1

While selecting a geographic location to operate in,manufacturers often set up operations in urban areas.

Answer 1

False
Explanation: Manufacturers often set up operations in rural areas, commonly called "greenfield locations," which are much less expensive and do not have the problems of urban areas.

Question 2

To a growing extent,the customers of multinational corporations have heterogeneous tastes,and this has helped to spread international consumerism.

Answer 2

False
Explanation: To a growing extent, the customers of multinational corporations have homogenized tastes, and this has helped to spread international consumerism. For example, throughout North America, the EU, and Japan, there has been a growing acceptance of standardized, yet increasingly personally, customized goods such as automobiles and computers.

Question 3

The primary thrust of internal resource analysis is to match internal opportunities with external capabilities.

Answer 3

False
Explanation: Internal resource analysis helps a firm to evaluate its current managerial, technical, material, and financial resources and capabilities to better assess its strengths and weaknesses. The primary thrust of this analysis is to match internal opportunities with external capabilities.

Question 4

Multinational corporations generally need higher profitability from their overseas operations than they do from their domestic operations.

Question 5

When the home office interferes with a subsidiary in another country,profitability suffers.

Question 6

National responsiveness relates to the need to adapt tools and techniques for managing the local workforce.

Question 7

The more successful a firm is domestically,the less difficult it is to increase market share without strong competitive response.

Question 8

Citibank is an example of a company that finds operating in China to be too risky.

Question 9

Statistics reveal that foreign direct investment (FDI)has grown ten times faster than trade and twice as fast as world gross domestic product.

Question 10

International strategies are characterized by increased international standardization of products and services.

Question 11

Emerging economies pose exceptional risks due to their political and economic volatility and their relatively underdeveloped institutional systems.

Question 12

The implementation of strategy from a marketing perspective must be determined on a country-by-country basis.

Question 13

In a multi-domestic strategy,niche companies adapt products to satisfy the high demands of differentiation.

Question 14

Total quality management techniques range from traditional inspection and statistical quality control to cutting-edge human resource management techniques.

Question 15

Frontier markets are less correlated to the ups and downs of the global economy.

Question 16

An economic imperative dominates the strategic plans of computer manufacturers.

Question 17

There is definitive evidence that strategic planning in the international arena always results in higher profitability.

Question 18

Although strategic planning usually seems to pay off,as with most other aspects of international management,the specifics of the situation will dictate the success of the process.

Question 19

Strategic management is required to keep track of increasingly diversified operations in a continuously changing international environment.

Question 20

The economic imperative dominates the strategic plans of industries such as insurance and consumer packaged goods.

Question 21

Total quality management techniques range from traditional inspection and statistical quality control to cutting-edge human resource management techniques,such as:

A) market share and profitability
B) customer service and quality control
C) self-managing teams and empowerment
D) imports and exports

Question 22

Multinational corporations using the _____ approach to strategic planning are country-responsive; their approach is designed to protect local market niches.

A) administrative coordination
B) economic imperative
C) quality imperative
D) political imperative

Question 23

Which of the following statements is true of strategic management?

A) Middle management is responsible for setting the strategy in most organizations.
B) All levels of management are imperative to the strategic implementation process.
C) Formulating an organization's vision statement is the core motive of strategic management.
D) As companies go international, the need for strategic management decreases.

Question 24

When the need for national responsiveness is high and the need for global integration is also high,the most appropriate strategy is a(n)_____ strategy.

A) transnational
B) global
C) international
D) multi-domestic

Question 25

A(n)_____ approach to strategy formulation and implementation is one in which a multinational corporation makes strategic decisions based on the merits of the individual situation rather than using a predetermined economic or political strategy.

A) administrative coordination
B) bureaucratic coordination
C) value-added
D) functional

Question 26

The quality strategy is formulated at the _____ management level and is diffused throughout the _____.

A) top; middle-level management
B) top; organization
C) lowest; organization
D) middle; low-level management

Question 27

The approach to strategic formulation and implementation utilizing strategies of total quality management to meet or exceed customers' expectations and continuously improve products and/or services is referred to as the:

A) value-added imperative.
B) quality imperative.
C) political imperative.
D) economic imperative.

Question 28

Who among the following are the key to stimulating profit growth within a company?

A) Sales personnel
B) Middle managers
C) First-line managers
D) Top managers

Question 29

The _____ approach to strategic planning is used by multinational corporations that need a country-centered or multi-domestic strategy.

A) quality imperative
B) administrative coordination
C) political imperative
D) economic imperative

Question 30

When using the _____ approach to strategic planning,the products sold by multinational corporations often have a large portion of their value added in the downstream activities of the value chain.

A) political imperative
B) cost imperative
C) quality imperative
D) economic imperative

Question 31

Honda and General Motors have both built plants in Thailand to take advantage of:

A) demand and low delivery costs.
B) strategic pricing.
C) new technologies and low wages.
D) tax incentives and demand.

Question 32

When focusing on the _____ approach to strategic planning,companies typically sell products for which a large portion of value is added in the upstream activities of the industry's value chain.

A) quality imperative
B) political imperative
C) economic imperative
D) administrative coordination

Question 33

When the need for national responsiveness is high and the need for global integration is low,a(n)_____ strategy is appropriate.

A) transnational
B) multi-domestic
C) international
D) global

Question 34

When the need for national responsiveness is low and the need for global integration is also low,which of the following strategies would be appropriate?

A) Globalization strategy
B) Transnational strategy
C) International strategy
D) Multi-domestic strategy

Question 35

A worldwide strategy based on cost leadership,differentiation,and segmentation is referred to as the _____ strategy.

A) economic imperative
B) political imperative
C) quality imperative
D) administrative coordination

Question 36

Which of the following is not one of the steps in strategic planning?

A) Transferring the successful process used in a developed country to an emerging economy
B) Scanning the external environment for opportunities and threats
C) Conducting an internal resource analysis of company strengths and weaknesses
D) Formulating goals in light of the external scanning and internal analysis

Question 37

The process of determining an organization's basic mission and long-term objectives and then implementing a plan of action for attaining these objectives is called:

A) strategic management.
B) tactical management.
C) contingency management.
D) functional management.

Question 38

Which of the following strategies is appropriate when the need for national responsiveness is low and the need for global integration is high?

A) International strategy
B) Multi-domestic strategy
C) Global strategy
D) Transnational strategy

Question 39

A(n)_____ strategy is most likely to be used when a product is regarded as a generic good and therefore does not have to be sold based on name brand or support service.

A) economic imperative
B) political imperative
C) quality imperative
D) administrative coordination

Question 40

The production and distribution of products and services of a homogeneous type and quality on a worldwide basis is called _____.

A) global integration
B) administrative coordination
C) horizontal specialization
D) market standardization

Question 41

Why do multinational corporations often invest in advanced industrialized countries?

A) They offer the largest markets for goods and services.
B) The control of operations is in the hands of local partners in these countries.
C) They do not have any legal restrictions related to imports.
D) The cost of doing business in these countries is significantly less.

Question 42

A multinational corporation's choice of a specific locale is affected by all of the following factors except:

A) desirability of the location for employees coming in from the outside.
B) the structure of the organization.
C) proximity to competitors.
D) the nature of the workforce.

Question 43

The process of providing goods and services in accord with a plan of action is called:

A) strategy implementation.
B) strategy formulation.
C) strategy control.
D) strategy contingency.

Question 44

In choosing a location,a primary consideration for a multinational corporation investing in a foreign country would be a decision based on:

A) corporate culture.
B) business ethics.
C) specific locale.
D) operating norms.

Question 45

When market liberalization is delayed,_____.

A) first movers possess a significant advantage over later entrants.
B) first movers possess clear, significant advantages in transitional markets.
C) later entrants possess a significant advantage over first movers.
D) substantial risks to premature entry are removed.

Question 46

If a company is going to export goods to a foreign market,the production process traditionally has been handled through:

A) domestic operations.
B) home-country operations.
C) third-party operations.
D) fourth-party operations.

Question 47

International management must consider three general areas in strategy implementation.First,the multinational corporation must:

A) implement functional strategies in areas such as marketing.
B) develop alliances with the most attractive local partner.
C) carry out entry and ownership strategies.
D) decide where to locate operations.

Question 48

For products like computers,Japanese firms:

A) move from their home market directly into fully developed countries and then on to newly developing nations.
B) move from their home market directly into developing nations and then on to developed countries.
C) go only to developed countries to market products.
D) go only to developing countries to market products.

Question 49

Once strategic goals are set,a multinational corporation will develop specific _____ goals and controls,usually through a two-way process at the subsidiary or affiliate level.

A) bureaucratic
B) operational
C) tactical
D) contingency

Question 50

The implementation of a marketing strategy in international areas is built around the well-known "four Ps" of marketing.These are:

A) place of origin, price, productive life, and product.
B) promotion, price, production method, and productive life.
C) product, price, promotion, and place.
D) place of origin, production method, price, and people.

Question 51

If a firm operates production plants in different countries but makes no attempt to integrate its overall operations,the company is known as a(n)_____ firm.

A) multi-domestic
B) global
C) transnational
D) international

Question 52

A key success factor is a factor that is necessary for a firm to compete effectively in a(n):

A) international market.
B) highly restricted market.
C) market niche.
D) broad market domain.

Question 53

Many large multinational corporations work to combine the _____ approaches to strategic planning.

A) economic, environmental, political, and administrative
B) global, environmental, economic, and quality
C) political, administrative, regional, and environmental
D) economic, political, quality, and administrative

Question 54

To respond to risks in emerging markets,multinational corporations must do all of the following except:

A) limiting equity investments.
B) avoiding joint ventures.
C) collaborating with a local partner.
D) engaging in shared ownership structures.

Question 55

_____ attempts to provide management with accurate forecasts of trends that relate to external changes in geographic areas where the firm is currently doing business or considering setting up operations.

A) Environmental scanning
B) Functional scanning
C) Tactical scanning
D) Operational scanning

Question 56

In the context of strategy formulation,which of the following identifies the key factors for success that will dictate how well the firm is likely to do?

A) Regression analysis
B) Internal analysis
C) Competitive analysis
D) Power analysis

Question 57

_____ is the strategic planning process that helps a firm evaluate its current managerial,technical,material and financial strengths and weaknesses.

A) Environmental scanning
B) Administrative coordination
C) Internal resource analysis
D) Corporate governance

Question 58

_____ is central to discovering if a multinational corporation can survive in a particular region.

A) Horizontal integration
B) Administrative coordination
C) Environmental scanning
D) Internal resource analysis

Question 59

Which of the following statements about the Internet business is false?

A) It has removed certain entry barriers that have historically restricted quick market entry.
B) It provides one of the easiest and most efficient methods of becoming global quickly.
C) It provides a more diverse customer base than building-based businesses.
D) It experiences more problems than "bricks and mortar" business during times of financial crises.

Question 60

All of the following act as disincentives for multinational corporations except:

A) restrictions on profit repatriation.
B) controls on the transfer of technology.
C) export maximums for generating foreign currency.
D) limits on local market growth.

Question 61

Which of the following is not one of the factors that made international management activities of entrepreneurial and new-venture firms possible?

A) Customized, old access channels
B) Advances in telecommunication
C) Greater efficiencies and lower costs in shipping
D) Advances in Internet technologies

Question 62

Identify the four basic strategies that multinational corporations use and the situations in which they are used.

Question 63

Is there a growing need for strategic management among multinational corporations? If so,why?

Question 64

Which of the following statements is true of the technological learning gained from varied international environments?

A) It is enhanced by efforts to integrate knowledge throughout a firm.
B) It results in a deterioration of growth and return on equity.
C) It leads to minimal diversity of national environments.
D) It has no effect on cross-functional teams.

Question 65

All of the following are challenges firms could face in the implementation of the base of the pyramid (BOP)strategy except:

A) offering affordable goods.
B) generating awareness regarding a product.
C) nonexistent distribution channels.
D) coordinating administrative functions.

Question 66

Firms that internationalize after being domestically established have to overcome all of the following barriers except:

A) their domestic orientation.
B) their internal domestic political ties.
C) their domestic decision-making inertia.
D) their anti-risk seeking behavior.

Question 67

The significant economies associated with early-entry positioning include all of the following except:

A) capturing learning effects important for increasing market share.
B) achieving scale economies.
C) developing alliances with the most attractive local partner.
D) making technological advancements.

Question 68

_____ are firms that engage in significant international activity shortly after being established.

A) Greenfield ventures
B) Born globals
C) Sole proprietorships
D) Matrix organizations

Question 69

Which of the following groups make up the "base of the pyramid" in international management?

A) Front-line employees at the bottom of an organizational hierarchy
B) Young people at the bottom of the population pyramid
C) Emerging middle-class markets and other wealthiest consumers
D) Potential low-income customers at the bottom of the economic pyramid

Question 70

Which of the following is not a feature of born-global firms?

A) They export products to close markets.
B) They employ strategies like unique-products development.
C) They indulge in significant international activity shortly after being established.
D) They succeed depending on how developed the areas are that the companies are moving into.

Question 71

Which of the following findings regarding the base of the pyramid (BOP)strategy has significant implications for the globalization-national responsiveness framework?

A) Building relationships directly and at the local level contributes to the reputation and fosters the trust necessary to overcome the lack of formal institutions such as the rule of law.
B) The BOP may be an ideal environment for incubating new, leapfrog technologies.
C) Business models forged successfully at the base of the pyramid have the potential to travel profitably to higher-income markets.
D) The BOP strategy brings focus to those who are too poor to be viable customers for multinational companies.

Question 72

Which of the following is likely to be the most effective strategic approach for the "base of the pyramid"?

A) Incremental adaptation of existing technologies and products
B) Establishing partnerships with central governments of emerging economies
C) Leapfrog technologies, including disruptive technologies
D) Large-scale strategies

Question 73

Describe the difference between global integration and national responsiveness.What is the principle advantage of each strategy?

Question 74

What is the purpose of internal resource analysis? In the context of internal resource analysis,what is a "key success factor"?

Question 75

What is the base of the pyramid (BOP),and why is this strategy challenging to implement?