Chapter 7 MGMT
A weakness of the single-product strategy is that the ____.
firm using it will suffer if its product is replaced by a new one
How can managers use information provided by the GE Business Screen to manage their various business opportunities more effectively?
to determine asset allocation
Why is it critical for an organization to understand that eventually a product will go into the decline stage?
to stay in business
Which is an international strategy in which a company attempts to combine the benefits of global scale efficiencies with the benefits and advantages of local responsiveness?
transnational
A(n) ____ strategy is a pattern of action that develops over time in an organization in the absence of missions and goals, or despite missions and goals.
emergent
Which type of strategy is based on a pattern of action that develops over time in an organization, in the absence of mission and goals or despite mission and goals?
emergent
When a firm identifies a weakness within its organization, what can it do to address that weakness?
It can modify its mission.
Yahoo! has a business strategy that creates revenue by selling ads. Yahoo! uses a(n) ____ strategy.
deliberate
Jones International is a large organization with holdings in the United States, Europe, and Southeast Asia. The corporation's mix of strategic business units (SBUs) allows the company to exploit its strengths and capabilities in more than one line of business and to exploit synergies across business lines. One of the disadvantages of Jones International's strategy is that it ____.
increases management complexity
Which of the following is used to show how sales volume of a product can change over time?
product life cycle
Ugar has relocated a production firm to a country that has lower production costs, and is closer to his customers. What type of advantage does this offer Ugar's firm?
production efficiencies
3M is a highly innovative firm that is constantly seeking new markets and is oriented toward growth and taking risks. It uses a(n) ____ strategy.
prospector
Which of the strategy types in the Miles and Snow model avoids long-term commitment to any single technology, is highly decentralized, and has a propensity to take risk?
prospector
An organization that implements a defender strategy focuses on ____.
protecting its market from new competitors
For years, the Tabasco Company used a(n) ____ strategy and manufactured only its famous hot sauce.
single-product
What does the BCG matrix use to evaluate an organization's set of businesses?
stable performance over time
What is the advantage to those organizations who use unrelated diversification?
stable performance over time
Extra funds should be channeled to the ____, which is a product with a high share of a fast-growing market.
star
Sabine is focusing on the processes to use to achieve her strategies and goals for the year. What is Sabine working on?
strategy implementation
What is the method by which processes are operationalized or executed within the organization?
strategy implementation
Many companies make bead jewelry, but Chamilia is the only one with a licensing agreement with Disney to make beads that include Disney characters. The agreement is a(n) ____ for Chamilia.
strength
Which framework is useful for managers as they plot how sales volume changes over the life of products?
the product life cycle
Organizational opportunities are ____.
areas in the environment that may generate higher performance
When are global efficiencies most easily obtained?
When a single unit has worldwide responsibility
When is a multidomestic strategy particularly effective for international firms?
When there are clear differences among markets.
What is a strategy?
A comprehensive plan for accomplishing an organization's goals.
What is the advantage of setting business-level strategies?
Ability to focus efforts in a targeted manner.
How can encouraging creativity and flexibility help an organization that is pursuing a prospector strategy?
Opportunities can be created and it can quickly change to take advantage of them.
Which of the following is an advantage of unrelated diversification?
Organizations can allocate capital to maximize corporate performance.
Why would one organization want to purchase an SBU that has been classified as a "dog"?
Possible synergistic effects on the buying organization.
How is an organizational threat different from an organizational weakness?
Threats are uncovered by analyzing the organization's environment, while weaknesses are internal to the organization
In which way can managers use information from the product life cycle?
To determine which strategies for products need to evolve
The starting point in formulating strategies is usually ____.
a SWOT analysis
Abercrombie & Fitch uses its ability to manage its supply chain more effectively than most of its competitors to create ____.
a distinctive competence
Strategy formulation is ____.
a set of processes involving the organization's strategies
The aircraft engine division of General Electric has its own mission and a strategy that often differs considerably from other parts of the corporation. What is a division such as this called?
a strategic business unit
Google is a highly successful search engine site. It maintained that expertise and tried to expand app development to maintain its current business while innovating in new markets. It used a(n) ____ strategy.
analyzer
The local party store developed a busy lunch business by offering slices of pizza and deli sandwiches to go. They also offered a wide selection of soft drinks in their coolers. Recently a fast food restaurant opened down the street, and offers salads and bottled water. To compete, the party store did the same, and expanded its other menu offerings. Which type of business strategy did this store use?
analyzer
When a new line of organic salad dressing was launched, it was very successful. Competitors soon began to produce a similar product. What should the organization do to keep its competitive advantage?
develop strategies to slow the entry of competitors
Mercedes-Benz sells high quality automobiles at high prices. It uses a(n) ____ strategy to distinguish their product from other automotive companies.
differentiation
Which strategy would Pepsi use to promote its Aquafina brand on the basis of its purity?
differentiation
Which component of strategy that indicates what the organization does exceptionally well?
distinctive competence
As the plant manager, Eli is concerned with having enough employees to meet production needs and managing cash flow for a specific product. Which stage of the product life cycle is Eli likely managing?
introduction
Using the Boston Consulting Group matrix, SBUs are classified on the basis of ____.
market share and market growth rate
Which of the following is(are) used to promote products or services and the overall public image of the organization?
marketing and sales
Why is it important to identify weaknesses in a SWOT analysis?
to correct them
Ramkumar works in an organization's European office, and Atmir works in the Asian-Pacific office. Even though they both work for the same firm, both offices operate differently, based on the unique needs in each country. Which of the following contributes to that?
worldwide learning
Where is power and authority held in a multidomestic corporation?
with the managers of subsidiaries in host countries
In the growth stage of the product life cycle, the ____.
sales of the product increase
Which strategy in the Miles and Snow model represent a middle-of-the-road approach to business strategy?
analyzer
Unlike multidomestic firms, global corporations ____.
assume that customers are the same regardless of nationality
A company that stops buying supplies from other companies and begins to provide its own has diversified through ____.
backward vertical integration
In a SWOT analysis, how will the identification of strengths help to accomplish an organization's mission?
by allowing the exploitation of skills and capabilities
A(n) ____ strategy is a pattern of action that develops over time in an organization in the absence of missions and goals, or despite missions and goals
emergent
What does the GE Business Screen use to determine the attractiveness of an organization?
competitive position
Scott works for a firm that specializes in oil and gas products. During the last recession, one of the business units lost considerable income, but other parts of the business were healthy enough to offset that loss. Which type of corporate strategy was Scott's company using?
competitive support
A small retail shop in the local community offers a wide variety of women's clothing at low prices. In order to be competitive with larger chains found at the mall, the store owner frequently works alone, and she has adjusted store hours to capitalize on busy days. What should this retail shop owner be pursuing as part of her general business-level strategy?
concentrating on reducing operating costs
GE competes in industries ranging from medical devices, to financial services, to turbine engines. GE's mixed strategy is an example of ____ strategy.
corporate-level
Most grocery stores carry a wide variety of national brands in addition to their own private label brands. The private label brands are often made by the same national brands they are competing with. Which type of strategy is a firm using when it creates a lower-priced private label brand in addition to its other, higher-priced brands?
cost leadership
The local dollar store sells a variety of products, all at $1 each. These items are no different than the products of other retail chains, but sizes are slightly smaller. In addition, the store is a little out of the way for most shoppers, but shoppers find the value is worth the trip. In which way does the local dollar store compete with nearby retailers?
cost leadership
Which of the following helps an organization perceive, or even generate, new opportunities in its environment?
creativity
Mrs. Fields was the first high quality, high priced cookie. Its success attracted competition. Mrs. Field's slowed growth to focus on making current operations more profitable. This is an example of a ____ strategy.
defender
A(n) ____ strategy is a plan chosen and implemented to support specific goals, such as an increase of market share by 5 percent.
deliberate
Wounded Warrior Project (WWP) spends a lot of money telling the stories of wounded veterans. There are many nonprofits helping veterans, but WWP is the most well-known, with celebrity involvement and advertising. WWP is using a ____ strategy.
differentiation
Chaparral Steel is so efficient in its steel production and casting processes that it is the only U.S. steel producer that regularly exports its products to Japan. This is an example of Chaparral Steel's ____.
distinctive competence
The number of different businesses that an organization runs, and the extent to which these businesses relate to one another, is represented by ____.
diversification
Fox News covers stories from what many believe to be a right-of-center political point of view. They use a(n) ____ strategy to differentiate their product from other news outlets.
focus
In which type of strategy does an organization concentrate on a specific regional market, product line, or group of buyers?
focus
Porter's generic strategies classify firms based on a specific regional market or product line. Which type of strategy is this?
focus
Franke, a Swiss manufacturer of sink and facet systems, sold accessories through retail stores and now sells directly to customers using the Internet. Franke used ____.
forward vertical integration
The primary concern of strategy implementation is ____.
how the strategy is operationalized and executed
Decentralizing power in the hands of a local subsidiary ____.
may make it difficult to transfer learning from one subsidiary to another
If two automotive suppliers are about the same size, and decide to join together as one company, they are using a diversification strategy referred to as a(n) ____.
merger
Curl Up and Dye is a local hair salon that has a steady clientele from the surrounding community. However, a new salon has just opened in the area, and some clients have mentioned that the new salon offers similar services at lower prices. Curl Up and Dye now needs to pursue a strategy that will ____.
neutralize the impending threat
In environmental SWOT analysis, the external organizational position is analyzed according to its ____.
opportunities and threats
The local coffee shop imports its coffee beans from a small, private farm in South America. The unique quality and taste of the beans, and the roasting process used, cannot be imitated, and brings consumers to the store from miles around. The coffee shop is now considering selling the beans online, creating ____.
organizational opportunity
The expiration of a pharmaceutical drug patent allows generic drug makers to introduce the same chemical compound under a different name and at lower prices. This is an example of ____ for the developer of the original drug.
organizational threat
If an organization has higher prices for a similar good or service, the prices are considered to be an organizational ____.
organizational weakness
ZeroBreeze Inc. is an outerwear manufacturer that caters to a large customer base. In addition to the high volume of coats and jackets that it manufactures, the company sells light jackets for low prices. Many customers buy ZeroBreeze jackets because they are durable and inexpensive. Which of the following strategies is illustrated in the scenario?
overall cost leadership
Based on differentiation strategy, why are customers willing to pay more for one product over a similar product?
perceived extra value
Which of the following is a major tool for managing diversification?
portfolio generation
Olesia is managing the diversification of divisions for her organization. She wants to monitor how to engage and manage subsidiaries to maximize corporate performance. What should Olesia use to track this information?
portfolio management techniques
Camille's Coffee Shop has a very small share of the market and has no plans for growth. According to the BCG matrix, this business is a ____.
portfolio tool
Adolph Coors Company heavily developed Zima brand beer that was targeted to Generation Xers, but Zima gained only a small share of a rapidly growing market. According to the BCG matrix, Zima is an example of a ____.
question mark
Companies should invest carefully and closely monitor a ____, which is a product that has a small share of a growing market.
question mark
Turner Broadcasting was looking for a source of movies to show on its various cable television stations. When Turner purchased a movie studio with its vault of old movies, it was an example of a(n) ____ diversification strategy.
related
When an airline uses profits from one region to lower prices in another region it is using ____.
resource deployment
Hewlett Packard contemplated selling its PC division, eliminating one of the markets it competes in. This is an example of change in ____.
scope
Southwest Airlines gained access to the Atlanta market when it purchased Air Tran. This is an example of a change in Southwest's ____.
scope
The Windows operating system is used in 90% of the world's PCs. Microsoft has an international ____.
strength
What is a potential downfall when using a SWOT analysis?
subjective assessment
Rumi has found that selling gluten-free products at her bakery has been an effective strategy and has allowed her to achieve some of her strategic goals for sales. Which of the following makes this an effective strategy for Rumi?
superior alignment with her environment
United Continental Holdings includes Continental Airlines, United Airline, Chelsea Food Services, and United Cruises, because it was thought that they could accomplish more joined together than they can operating as separate units. Which advantage of related diversification does this best represent?
synergy
What can exist when the economic value of companies joined together is greater than the value of the parts?
synergy
Business-level strategy focuses primarily on ____.
the areas in which the firm chooses to conduct business in a particular industry or market
