Question 1

With the home replication strategy ________.

Accepted Answer

The home replication strategy involves a firm leveraging its domestic business strategies and core competencies as the main competitive advantage in international markets. This approach often means replicating what has proven successful in the home market in new, foreign markets.

Question 2

What strategic management challenges are faced by international businesses that have business units scattered around the world? How can a business strategy help improve a firm's ability to compete?

Accepted Answer

The answer of What strategic management challenges are faced by...

Question 3

With the transnational strategy ________.

Accepted Answer

The transnational strategy involves balancing the need for efficiency and flexibility by assigning tasks to the most capable units within the organization, allowing for both global integration and local responsiveness.

Question 4

Executives at Harper Industries are evaluating the firm's international strategy to determine if the current approach is effective. Harper has been using a multidomestic strategy for the last five years. Which of the following statements best supports Harper continuing to use the same strategy?

Accepted Answer

A multidomestic strategy is most effective when economies of scale are low, as it allows for local adaptation and responsiveness to specific market needs.

Question 5

Dixon Enterprises, an MNE, uses a global strategy, which means that the firm most likely has a ________ structure.

Accepted Answer

A global strategy typically involves centralizing operations to exploit scale economies and maintain consistent standards across all operations, which aligns with a centralized structure.

Question 6

IKEA attempts to capture global efficiencies while remaining responsive to local conditions. IKEA follows a ________.

Accepted Answer

IKEA's approach of capturing global efficiencies while being responsive to local market conditions aligns with a transnational strategy. This strategy seeks to balance global integration and local responsiveness, which is what IKEA aims to achieve by standardizing some of its operations and products worldwide, while also adapting to the tastes and preferences of different local markets.

Question 7

The primary goal of a(n) ________ is the creation of standardized goods and services that will address the needs of customers worldwide.

Accepted Answer

The primary goal of a global strategy is to create standardized goods and services that can be sold and used worldwide, leveraging the same product for a global market to achieve economies of scale and scope.

Question 8

When using a(n) ________, a firm utilizes the core competency or firm-specific advantage it developed in the domestic market as its main competitive weapon in the foreign markets it enters.

Accepted Answer

A home replication strategy involves a firm using its core competency or firm-specific advantage developed in its domestic market as its main competitive weapon in foreign markets. This strategy focuses on replicating the firm's home market-based advantages in new markets.

Question 9

Firms using a ________ are more likely to locate responsibility for one product line in one country and responsibility for a second product line in another.

Accepted Answer

A transnational strategy involves balancing global efficiency and local responsiveness, often leading firms to allocate responsibility for different product lines to different countries to leverage local advantages.

Question 10

Parker Sportswear is an MNE with retail stores around the world. Parker views itself as a collection of relatively independent operating subsidiaries, each of which focuses on a specific domestic market. Parker most likely uses a ________ strategy.

Accepted Answer

Parker Sportswear operates with a focus on adapting to local markets through its independent subsidiaries, which is characteristic of a multidomestic strategy. This approach emphasizes the need to be responsive to the specific needs and preferences of each market, rather than standardizing products or operations across global markets.

Question 11

Hanson Manufacturing, an MNE, has operations in India, Taiwan, China, and Argentina. Since Hanson focuses on the specific domestic market in each location, the firm allows its subsidiaries to customize products and develop marketing campaigns that will appeal to local customers. Hanson most likely uses a ________ strategy.

Accepted Answer

A multidomestic strategy involves customizing products and marketing strategies to specific national conditions, which is what Hanson Manufacturing is doing by allowing its subsidiaries to adapt products and campaigns for local markets.

Question 12

With the multidomestic strategy ________.

Accepted Answer

A multidomestic strategy involves a corporation treating each market in which it operates as distinct and independent, leading to a focus on adapting products and strategies to fit the specific needs and preferences of local markets. This approach contrasts with global or transnational strategies that emphasize standardization and integration across markets.

Question 13

With the global strategy ________.

Accepted Answer

A global strategy involves viewing the world as a single marketplace and focuses on creating standardized products and services to meet the needs of customers worldwide.

Question 14

Which approach is most appropriate when economies of scale for production, distribution, and marketing are low?

Accepted Answer

A multidomestic strategy is most appropriate when economies of scale for production, distribution, and marketing are low because it allows a company to tailor its products and marketing strategies to local markets, optimizing its operations and offerings for each specific region.

Question 15

What are the three sources of competitive advantage that are available to MNCs but unavailable to domestic firms? Identify the four strategic alternatives MNCs use to balance these three sources of competitive advantage.

Accepted Answer

The answer of What are the three sources of competitive...

Question 16

Firms using a ________ conduct business the same way anywhere in the world.

Accepted Answer

A global strategy involves conducting business the same way around the world, emphasizing uniformity in products and processes.

Question 17

Which strategy combines the benefits of global scale efficiencies and local responsiveness?

Accepted Answer

A transnational strategy seeks to achieve both global efficiency and local responsiveness. It combines elements of global scale efficiencies (like a global strategy) with adjustments to cater to local markets (similar to a multidomestic strategy).

Question 18

A firm following the ________ views the world as a single marketplace.

Accepted Answer

A firm that views the world as a single marketplace and thus adopts a standardized approach to markets and consumers across different countries follows a global strategy.

Question 19

What is international strategic management? How do international, corporate, business, and functional strategies differ?

Accepted Answer

The answer of What is international strategic management? How do...

Question 20

Mercedes-Benz relies on its brand name and reputation for well-engineered, luxurious cars to succeed in foreign markets. Mercedes-Benz is most likely using the ________ strategy.

Accepted Answer

Mercedes-Benz is using the home replication strategy, where a company uses the core brand and business model successful in its home country as a basis for international expansion, relying on its established reputation and brand identity.

Quiz 11: International Strategic Management