MGMT LS 8
(T?F) a plan that is updated and amended every year to take account of changing conditions in the external environment is a one time plan
F ; rolling plan
one way to overcome the loss of control problems associated with exporting , licensing and franchising is to expand by means of
a strategic alliance
expanding a company's operations into an industry that produces inputs for its products is
backward vertical integration
why might managers decide to pursue unrelated diversification ?
because they believe they can purchase a failing company and use their skills to turn it around so it performs better and adds value
a plan to gain a competitive advantage in a particular market or industry is a
business level strategy
one reason that few risks are associated with exporting is
companies do not have to build manufacturing companies abroad
when a company reinvests its profits to strengthen its competitive position in its current industry , it is utilizing a(n)
concentration on a single industry strategy
level of management planning
corporate : CEO and top management team responsible for planning and strategy making for the organization as a whole business : the different divisions of the company that compete in distinct industries planning and strategy for their particular business division or unit functions : departments , such as manufacturing , marketing planning necessary to increase the efficiency and effectiveness of their particular department
top management is responsible for creating the _____ which takes into account decisions involving the corporation's overall structure , strategy , goals , and mission
corporate level plan
a plan that indicates in which industries and national markets an organization intends to compete is a
corporate level strategy
an advantage of a multi domestic strategy is
customization of product offerings and marketing approaches
when companies decide to expand into a new industry in order to provide a good and/org service that is different from and , in addition to , what they are already providing
diversification
a time horizon is the intended ____ of a plan
duration
a major advantage of scenario planning is its ability to
educate managers to think strategically anticipate the challenges of an uncertain future
the corporate level strategy of related diversification means companies enter an industry that creates a competitive advantage for an organization's
existing division or business
continuity in planning occurs when managers view planning as an ongoing process in which plans at all levels are refined and modified so all of the company's plans
fit together into one broad framework
entering into a new industry that uses , distributes , and sells company products
forward vertical integration
in licensing , a company allows foreign organizations to take charge of both manufacturing and distribution , but ____ sells rights to use brand names that are trademarked
franchising
the goals that the managers of each function will pursue to help their division attain its business level goals and allow the entire company to achieve its corporate goals are
functional level plans
a plan of action to improve the ability of each of an organization's functions to perform its task specific activities in ways that add value to an organization's goods and services is a
functional level strategy
companies concentrate on a single industry to
gain entry into an industry
the risks associated with licensing are that the company granting the license
has to give access to its technological know how risks losing control of its secrets
lack of a plan will result in
hesitations and false steps
time horizons of one to five years make up ____ term plans , and time horizons of one year or less make up ___ term plans
intermediate ; short
when two or more companies form a strategic alliance to jointly establish and share the ownership of a new business , it is a(n)
joint venture
the advantage of licensing associated with opening up in a foreign country is
licenser does not have to bear the development costs
when companies utilize a global strategy for international expansion , they will undertake ____ of their products to suit the specific needs of customers in different countries
little , if any , customization
typically , corporate and business level goals and strategies require ____ plans ; functional level goals and strategies require ____ plans
long and intermediate term ; intermediate and short term
the business level plan details both
long term divisional goals and division level strategy
disadvantages of diversification include
losing control of the core business reduction of value
when a company customizes its products and marketing to fit specific national conditions , it is following a
multi domestic strategy
one of the key managerial roles is to choose appropriate goals and courses of action that will help organizations achieve these goals , this is process is called
planning
example of a single use plan is a
project
what represents vertical integration along a company's value chain ?
raw materials , intermediate manufacturing , assembly , distribution
one characteristic of a joint venture is that risk is ____
reduced
using valuable skills among cooperating divisions to add value results from ____ diversification ; using current strengths to turn around poorly performing companies in other industries can result from ____ diversification
related ; unrelated
a major disadvantage of the vertical integration strategy is that it reduces the organization's flexibility to
respond to change
because the future is unpredictable , managers should engage in
scenario planning
the generation of multiple forecasts of future conditions followed by an analysis of how to respond effectively to each of those conditions is
scenario planning
when the same situation occurs repeatedly , ____ plans are used
standing
fayol emphasized that managers must not be bound to a
static plan
an agreement in which managers share their organization's resources knowledge , and skills with a foreign company is a(n)
strategic alliance
to achieve organizational goals , managers use ____ to launch courses of actions that will move them towards their goals
strategies
the advantage to franchising is
the franchiser does not have to bear the development costs
managers of any organization that needs to sell its products abroad should ask
to what extent should the organization customize its products to different national conditions ?
synergy is created when
two divisions cooperate
in order to ensure that all information is accurate in the planning process , managers must recognize that
uncertainty exists
quality of an effective plan
unity : having only one guiding plan continuity : build and refine previous plans on an ongoing basis accuracy : collect and use all available information flexibility : alter or change plans when necessary
single use plans are designed to handle ____ situations
unusual and one of a kind
principal corporate level strategies include
vertical integration concentration on a single industry diversification international expansion
there are two important goals of a mission statement ; they are to describe their products for employees by pointing out ____ and ____
what is unique or important about it ; what differentiate its products
a manager of medical durable equipment company decides to establish an operation in a foreign company country independent of any local direct involvement . this manager is creating
wholly owned foreign subsidiary