Chapter 6
The most long-lasting strategic alliances aim at teaming up with world-class suppliers or else companies with world-class know-how in product innovation. are those whose purpose is helping a company master a new technology. are those formed to enable the partners to be consistent first movers or fast followers. (1) involve collaboration with suppliers or distribution allies, or (2) conclude that continued collaboration is in their mutual interest, perhaps because new opportunities for learning are emerging. aim at insulating the partners against the impacts of the five competitive forces and industry driving forces.
(1) involve collaboration with suppliers or distribution allies, or (2) conclude that continued collaboration is in their mutual interest, perhaps because new opportunities for learning are emerging.
In which of the following situations is being first to initiate a particular move not likely to result in a positive payoff? A. when potential buyers are skeptical about the benefits of a new technology or product being pioneered by a first mover B. when pioneering helps build up a firm's image and reputation with buyers C. when first-time buyers remain strongly loyal to a pioneering firm in making repeat purchases D. when moving first can constitute a preemptive strike, making imitation extra hard or unlikely E. when moving first can result in a cost advantage over rivals
A. when potential buyers are skeptical about the benefits of a new technology or product being pioneered by a first mover
Being first to initiate a particular move can have a high payoff when pioneering helps build up a firm's image and reputation with buyers. early commitments to new technologies, new-style components, new or emerging distribution channels, and so on can produce an absolute cost advantage over rivals. first-time customers remain strongly loyal to pioneering firms in making repeat purchases. moving first constitutes a preemptive strike, making imitation extra hard or unlikely. All of these choices are correct.
All of these choices are correct.
Companies are often motivated to enter into strategic alliances or cooperative arrangements in order to expedite the development of promising new technologies or products. overcome any deficits in their own technical and manufacturing expertise. bring together the personnel and expertise needed to create desirable new skill sets and capabilities. acquire or improve market access. All of these choices are correct.
All of these choices are correct.
Which of the following is not a typical reason that many alliances do not live up to expectations? A. inability of partners to work well together B. emergence of more attractive technological paths C. changing conditions make the purpose of the alliance obsolete D. disagreement over how to divide the added market share and profits gained from joint collaboration E. diverging objectives and priorities
D. disagreement over how to divide the added market share and profits gained from joint collaboration
Strategic alliances A. are the cheapest means of developing new technologies and getting new products to market quickly. B. are a proven means of reducing the costs of performing value chain activities. C. are best used to insulate a company from the impact of the five competitive forces. D. help insulate a firm from the adverse impacts of industry driving forces. E. are formal agreements between two or more companies to work cooperatively toward some common objective.
E. are formal agreements between two or more companies to work cooperatively toward some common objective.
Which of the following questions should companies ask before seeking a first-mover advantage? Are the costs of pioneering much higher than being a follower, and will only negligible buyer loyalty or cost savings accrue to the pioneer? Is new infrastructure needed before market demand can surge? Are our skills, know-how, and products easily copied, or could they even be bested by fast-followers and late movers? How rapid is technological change, and will follow-on rivals find it easy to derail us with next-generation products of their own? Two answers are correct: Is new infrastructure needed before market demand can surge? and How rapid is technological change, and will follow-on rivals find it easy to derail us with next-generation products of their own?
How rapid is technological change, and will follow-on rivals find it easy to derail us with next-generation products of their own?
Which of the following is not a strategic disadvantage of vertical integration? It greatly reduces the opportunity for capturing maximum scale economies and achieving the lowest possible operating costs. Vertical integration increases a firm's capital investment in the industry. Integrating into more industry value chain segments increases business risk if industry growth and profitability sour. Vertically integrated companies are often slow to embrace technological advances or more efficient production methods when they are saddled with older technology or facilities. Integrating backward potentially results in less flexibility in accommodating shifting buyer preferences when a new product design doesn't include parts and components that the company makes in-house.
It greatly reduces the opportunity for capturing maximum scale economies and achieving the lowest possible operating costs.
Architects of mergers and acquisition strategies typically set sights on which of the following objectives? revamping a company's value chain facilitating the employment of both offensive and defensive strategies creating a more cost-efficient operation, expanding a company's geographic coverage, and extending a company's business into new product categories gaining quick access to new technologies or other resources and competitive capabilities, and leading the convergence of industries whose boundaries are being blurred by changing technologies and new market opportunities Two answers are correct: creating a more cost-efficient operation, expanding a company's geographic coverage, and extending a company's business into new product categories, and gaining quick access to new technologies or other resources and competitive capabilities, and leading the convergence of industries whose boundaries are being blurred by changing technologies and new market opportunities
Two answers are correct: creating a more cost-efficient operation, expanding a company's geographic coverage, and extending a company's business into new product categories, and gaining quick access to new technologies or other resources and competitive capabilities, and leading the convergence of industries whose boundaries are being blurred by changing technologies and new market opportunities
Which of the following is not an advantage of outsourcing the performance of certain value chain activities to outsiders? being able to reduce distribution costs by eliminating the use of wholesale distributors and retail dealers and, instead, selling direct to end-users at the company's website allowing a company to reduce costs if the activity is not crucial to the firm's ability to achieve sustainable competitive advantage and won't hollow out its capabilities, core competencies, or technical know-how improving organizational flexibility and speeding time to market allowing a company to concentrate on its core business, leverage its key resources and core competencies, and do even better what it already does best being able to reduce the company's risk exposure to changing technology and/or buyer preferences
being able to reduce distribution costs by eliminating the use of wholesale distributors and retail dealers and, instead, selling direct to end-users at the company's website
Which of the following is not one of the principal offensive strategy options? adopting and improving on the good ideas of other companies launching preemptive strikes blocking the avenues open to challengers attacking competitors' weaknesses offering an equal or better product at a lower price
blocking the avenues open to challengers
Experience indicates that strategic alliances have a high "divorce rate." are generally successful. work well in cooperatively developing new technologies and new products but seldom work well in promoting greater supply chain efficiency. work best when they are aimed at achieving a mutually beneficial competitive advantage for the allies. are rarely useful in helping a company win the race for global industry leadership and establish positions in industries of the future.
have a high "divorce rate."
Which of the following is not a potential advantage of backward vertical integration? adds to a company's differentiation capabilities and perhaps achieves a differentiation-based competitive advantage lessens a company's vulnerability to powerful suppliers inclined to raise prices at every opportunity spares a company the uncertainty of being dependent on suppliers for crucial components or support services offers enhanced R&D capability, better opportunity to establish a core competence in supply chain management, more flexibility in incorporating state-of-the-art parts and components, and better overall product quality contributes to a better-quality product/service offering
offers enhanced R&D capability, better opportunity to establish a core competence in supply chain management, more flexibility in incorporating state-of-the-art parts and components, and better overall product quality
Which one of the following is not a strategic choice that a company must make to complement and supplement its choice of one of the five generic competitive strategies? whether and when to go on the offensive and initiate aggressive strategic moves to improve the company's market position, or to go on the defensive which value chain activities, if any, should be outsourced whether to employ a low-cost strategy, a differentiation strategy, or a hybrid strategy whether to integrate forward or backward into more stages of the industry value chain whether to enter into strategic alliances or collaborative partnerships
whether and when to go on the offensive and initiate aggressive strategic moves to improve the company's market position, or to go on the defensive
