Deck 10: International Competitive Strategy

Question 1

An analysis of the forces controlled by the firm will include a situational analysis and control analysis.

Answer 1

False

Question 2

Value chain analysis is an assessment conducted on the chain of interlinked activities of an organization or set of interconnected organizations,intended to determine where and to what extent value is added to the final product or service.

Answer 2

True

Question 3

International strategy involves decisions that deal with a single area,such as marketing or production.

Answer 3

False

Question 4

The ultimate managers of strategic planning and strategy making are the executive board of a corporation.

Question 5

Value chain analysis focuses primarily on the question,"What value does the company want to deliver to these customers?"

Question 6

International strategy helps firms to make choices about how to deploy scarce resources in order to achieve their international objectives.

Question 7

Although strategic planning is not a widely used management tool among global executives,according to a Bain and Company's survey there is a high level of satisfaction among those executives who do utilize strategic planning.

Question 8

After setting corporate objectives,the company management must define the company's vision and mission.

Question 9

To create a sustainable competitive advantage,an international company should try to develop competencies that are valuable,rare,difficult to imitate,and readily substitutable.

Question 10

Companies have the potential to achieve competitive advantages through leveraging their organizational knowledge across national boundaries.

Question 11

According to a study by McKinsey & Company,most executives worldwide agree that environmental,social,and business trends are less critical to company strategy than was the case five years ago.

Question 12

Competencies are skills or abilities required in order to adequately complete a task.

Question 13

The goal of international strategy is to achieve and maintain a unique and valuable competitive position both within a nation and globally,a position that has been termed comparative advantage.

Question 14

The first step in the process of strategic planning is to define the company's business and mission.

Question 15

The basic concept behind strategic planning is to help ensure that managers have a sound understanding of the business,the strategy,the assumptions behind the strategy,the external business environment pressures,and the company's strengths and weaknesses.

Question 16

Global strategic plans help to ensure that decision makers have a common understanding of the business and to think through the impact of their decisions and actions firm-wide.

Question 17

Knowledge that an individual has but that is difficult to express clearly in words,pictures,or formulae,and therefore difficult to transmit to others,is called explicit knowledge.

Question 18

A broad statement that defines the organization's scope is the mission statement.

Question 19

Value chain linkages must be examined not merely across activities within the company but also in terms of managing relationships with external entities such as suppliers,alliance partners,distributors,or customers within and across nations.

Question 20

Objectives direct the firm's course of action,maintain it within the boundaries of the stated mission,and ensure its continuing existence.

Question 21

Scenario analysis can help managers to break away from their existing view of the world and envision alternatives that might lie outside their traditional frame of reference.

Question 22

Scenarios are a particularly useful approach for international companies that face high levels of change and uncertainty,because they allow management to anticipate and prepare for opportunities and threats by predicting and controlling for these developments.

Question 23

The planning process that begins at the highest level in the organization and continues downward is top-down planning.

Question 24

Sales forecasts are both a control and planning technique.

Question 25

Policies are broad guidelines issued by upper management for the purpose of assisting lower-level managers in handling recurring problems.

Question 26

Scenarios are multiple,plausible stories for probable futures.

Question 27

Two prominent features of the strategic plan are sales forecasts and the mission statement.

Question 28

Procedures are broad guidelines issued by upper management for the purpose of assisting lower-level managers in handling non-recurring problems.

Question 29

Because of the rapidity of changes in the uncontrollable variables,many managers have turned to contingency plans,which are multiple,plausible stories for probable futures.

Question 30

A benefit of global strategies is their ability to adjust quickly and effectively to changes in customer needs across national or regional markets.

Question 31

Historically,more aspects of marketing have been standardized and coordinated worldwide by companies than has been the case for other value chain activities such as research and development and manufacturing.

Question 32

Objectives must be quantified in order to be useful.

Question 33

A multidomestic strategy tends to be used when a company simultaneously confronts pressures for cost effectiveness and local adaptation.

Question 34

Companies pursuing a home replication strategy typically centralize product development functions in their home country and then transfer innovations to foreign markets in order to capture additional value.

Question 35

measures of the effectiveness of the company's personnel,within and across the firm's international network of operations,in performing their assigned jobs.

Question 36

With a multidomestic strategy,the cost and complexity of coordinating a range of different strategies and product offerings across national and regional markets can be substantial.

Question 37

Contingency plans are developed in some firms for the best and worst case scenarios and for critical events.

Question 38

Tactical/operational plans are more detailed than strategic plans.

Question 39

When developing and assessing strategic alternatives,it is important to remember that companies competing in international markets confront two opposing forces: reduction of costs and adaptation to local markets.

Question 40

A global strategy tends to be used when a company faces strong pressures for reducing costs and limited pressure to adapt products for local markets.

Question 41

Strategic planning processes are something that only the company's most senior executives are involved with.

Question 42

In analyzing the corporate controllable variables,management must address the question:

A)who are the company's target customers?
B)what will be the costs that the company will incur in delivering value to its target customers?
C)how much will the company be able to charge for the value it creates for its target customers?
D)who are the company's direct investors?

Question 43

International strategy:

A)needs to be consistent among the various functions,products,and regional units of the company.
B)needs to be consistent with the demands of the international competitive environment.
C)is concerned with the way firms make fundamental choices about developing and deploying scarce resources internationally.
D)has a goal of achieving and maintaining competitive advantage.
E)has to achieve and maintain competitive advantage.It also needs to be consistent among various functions,products,regional units of the company,and with the demands of international competitive environment.

Question 44

Top management of companies generally accept the fact that,to be effective,strategic planning processes should permit ideas to surface from anywhere in the organization and at any time.

Question 45

According to the text,value chain analysis focuses primarily on what question(s)?

A)Who are the company's target customers?
B)What does the customer value and how much is the customer willing to pay for this value?
C)How will this customer value be created?
D)Who are the company's foreign direct investors?
E)How will the company double its profits?

Question 46

There is a growing tendency for firms to use strategic planners to devise the corporate plan,which is then handed to operations people for execution.

Question 47

Managers of international companies that are attempting to develop a competitive advantage face a formidable challenge because:

A)resources are always scarce.
B)there are not many equally attractive alternative ways to use the company's scarce resources.C.managers are forced to make choices regarding what to do and what not to do.
C) Managers of international companies attempting to develop a competitive advantage face challenges because resources are always scarce,there are many alternative ways to use the company's scarce resources and are forced to make choices.
C)resources are always scarce,there are not many equally alternative ways to use the company's scarce resources and are forced to make choices.
D)Two of A,B and

Question 48

To fully understand why,how,and where they intend to do business,now and over time,managers must have:

A)a clear understanding of the company's mission.
B)a vision for how they intend to achieve the company's mission.
C)an understanding of how the company plans to compete with other companies.
D)a clear understanding of the company's mission,a vision on how to achieve the mission and how the company plans to compete.

Question 49

According to the text,the strategic planning process provides a formal structure in which managers will:

A)analyze the company's external and internal environments.
B)define the company's business and mission.
C)formulate scenarios.
D)will make tactical plans but quantify goals.
E)analyze the company's external and internal environments and define the company's business and mission.

Question 50

To create a competitive advantage that is sustainable over time,the international company should try to develop competencies that:

A)create value for customers and for which they are willing to pay.
B)are easy to imitate or substitute for.
C)are expensive to develop and maintain.
D)create value for manufactures and for which they are willing to pay.
E)require only man power.

Question 51

According to a survey by Bain & Company,the most commonly used management tool among global executives is:

A)value chain analysis.
B)industry and competitor analysis.
C)strategic planning.
D)environmental analysis.
E)environmental planning.

Question 52

According to the text,the strategic planning process provides a formal structure in which managers will:

A)set corporate objectives.
B)implement strategies.
C)manage relationships with government and society.
D)improve and promote cultural ties.
E)plan the corporate controllable variables to be implemented.

Question 53

Repetition of the bottom-up or top-down planning process until all differences are reconciled is sequential planning.

Question 54

According to the text,the firm's ultimate manager of strategic planning is the:

A)vice president for planning.
B)chief operating officer.
C)firm's chief executive officer.
D)director of strategic planning department.
E)chief strategic planning officer.

Question 55

An assessment conducted on the chain of interlinked activities of an organization or set of interconnected organizations,intended to determine where and to what extent value is added to the final product or service is known as:

A)economic value added.
B)internal analysis.
C)value chain analysis.
D)SWOT analysis.
E)internal SWOT analysis.

Question 56

International firms have found it necessary to institute formal global planning:

A)to eliminate the practice of informal planning.
B)to provide top management with a means to identify threats and opportunities worldwide.
C)to provide consistency of action among the firm's managers.
D)to provide top management with a means to identify threats and opportunities worldwide and to provide consistency of action among the firm's managers.
E)to provide consistency of decision among the firm's stockholders.

Question 57

An advantage of bottom-up planning is that the people responsible for attaining the goals are formulating them.

Question 58

Due to developments such as a rapid rise in the level of uncertainty in many areas of international business,many firms have moved toward more structured strategic planning formats and longer planning documents.

Question 59

According to the text,competencies:

A)are skills or abilities required in order to achieve competitive advantage.
B)refer to the ability of a company to have higher rates of profits than its competitors.
C)create value for customers and for which customers are willing to pay.
D)create value for manufactures and for which customers are willing to pay.
E)refer to the ability of a company to have higher rates of FDI.

Question 60

According to Frederick W.Gluck,formal strategic planning teams must assume a more explicit strategic decision making role in strategic planning,including dedicating a large amount of time to deciding how things ought to be instead of listening to analyses of how they are.

Question 61

Knowledge that an individual has but that is difficult to express clearly in words,pictures,or formulae,and therefore difficult to transmit to others is known as:

A)explicit
B)implicit
C)tacit
D)intangible
E)valuable

Question 62

An itemized projection of revenues and expenses for a future time period is a:

A)sales forecast.
B)budget.
C)marketing plan.
D)strategic plan.
E)venture capital forecast.

Question 63

Action plans to enable organizations to reach their objectives are known as:

A)strategic plans.
B)competitive strategies.
C)policies.
D)procedures.
E)values statement.

Question 64

When a company faces strong pressures for both reducing costs and adapting products for local markets,it should tend to use a:

A)global strategy
B)multidomestic strategy
C)transnational strategy
D)differentiation strategy
E)home replication strategy

Question 65

When there is strong pressure for a company to adapt its products or services for local markets,it should tend to use a:

A)global strategy.
B)multidomestic strategy.
C)transnational strategy.
D)differentiation strategy.
E)home replication strategy.

Question 66

Plans for the best- or worst-case scenarios or for critical events that could have a severe impact on the firm are known as:

A)scenario plans.
B)strategic plans.
C)contingency plans.
D)emergency plans.
E)visionary plans.

Question 67

Scenarios:

A)has an objective of envisioning possible futures that might lie outside their traditional frame of reference.
B)is based on stories about possible futures that are presented to line managers by the strategic planners.
C)extrapolates from past data to make predictions.
D)is based on past stories that are presented to line managers by the strategic planners.
E)rarely used because future decisions are always contingency based.

Question 68

A description of the company's desired future position if it can acquire the necessary competencies and successfully implement its strategy is known as a:

A)strategic plan.
B)mission statement.
C)vision statement.
D)values statement.
E)strategic value statement.

Question 69

A broad statement that defines the organization's purpose and scope is known as a:

A)strategic plan.
B)mission statement.
C)vision statement.
D)values statement.
E)valued visionary statement.

Question 70

To set corporate objectives,management must first:

A)select a viable market segment.
B)quantify them.
C)define the firm's mission.
D)research the market.
E)talk to the head honchos.

Question 71

Historically,more aspects of _______ have been standardized and coordinated worldwide by companies than has been the case for other value chain activities such as _______.

A)research and development,manufacturing
B)marketing,manufacturing
C)manufacturing,marketing
D)marketing,research and development
E)hiring,research and development

Question 72

Scenarios assist managers:

A)in becoming aware of the critical elements of the external forces.
B)in brainstorming various "what-if" situations.
C)in preparing budgets.
D)in manufacturing,and marketing.
E)in becoming aware of the critical elements of the external forces and in brainstorming various "what-if" situations.

Question 73

Procedures:

A)prescribe how certain activities will be carried out.
B)are broad guidelines used to assist lower level managers to handle recurring problems.
C)assure that all budgets will be prepared using the same format.
D)are global guidelines used to assist lower level managers to handle recurring problems.
E)prescribe how certain activities will be carried out and assure that all budgets will be prepared using the same format.

Question 74

Tactical plans

A)are operational plans.
B)are broad,operational plans on which strategic plans are based.
C)are specific and short-term compared to strategic plans.
D)are specific and long-term compared to strategic plans.
E)are operational plans and are specific and short-term compared to strategic plans.

Question 75

A strategic plan:

A)will be prepared when the tactical plan is finalized.
B)describes how the firm's goals will be met.
C)contains sales forecasts and budgets.
D)gives time-based guidelines to handle recurring problems.
E)describes how the firm's goals will be met and contains sales forecasts and budgets.

Question 76

Most top managers:

A)prefer non-quantifiable,directional goals.
B)prefer non-quantifiable,but verifiable goals.
C)prefer verifiable objectives.
D)have no preference as to quantifiable and non-quantifiable goals.
E)prefer non-directional,but verifiable goals.

Question 77

Tactical plans

A)are fairly broad compared to strategic plans.
B)spell out in detail how objectives will be reached.
C)are broad guidelines to assist in handling recurring problems.
D)are less specific than strategic plans.
E)are time-based guidelines to handle recurring problems.

Question 78

When a company faces relatively weak pressures for local responsiveness and cost reductions,it should tend to use a:

A)global strategy.
B)multidomestic strategy.
C)transnational strategy.
D)differentiation strategy.
E)home replication strategy.

Question 79

Policies:

A)prescribe how certain activities will be carried out.
B)are broad guidelines used to assist lower level managers to handle recurring problems.
C)assure that all budgets will be prepared using the same format.
D)itemized projection of revenues and expenses for a future time period.
E)are broad guidelines used to assist top level managers to handle recurring problems.

Question 80

When a company faces strong pressures for reducing costs and limited pressure to adapt products for local markets,it should tend to use a:

A)global strategy
B)multidomestic strategy
C)transnational strategy
D)differentiation strategy
E)home replication strategy