Final Strategic management

d) threaten to lay off employees if they do not achieve targets.

A company that is using extrinsic motivation as an output control mechanism will most likely a) organize training sessions for employees. b) cut budgets during recessions. c) implement a peer review system. d) threaten to lay off employees if they do not achieve targets.

c) localization

When a firm is facing high pressure for local responsiveness and low pressure for cost-reductions, the firm is likely to adopt a(n) ________ strategy according to the integration-responsiveness framework. a) transnational b) global standardization c) localization d) international

a) conflicts that arise in corporations should be addressed in the legal realm.

According to the agency theory, a) conflicts that arise in corporations should be addressed in the legal realm. b) corporations are more than a set of contracts between parties. c) companies should focus on generating profits for stockholders. d) principals and agents have interchangeable roles.

c) Link the CEO's pay to her performance but avoid high-powered incentives that may cause reckless behavior.

Aperture Science is a publicly traded manufacturer of home electronics. Based on what you have read, which of these actions would be wisest for Aperture Science's board of directors to take to be sure that the company's new CEO is as motivated as possible? a) Encourage the CEO to take all of her compensations in stock options, which will motivate her to keep the stock price high. b) Offer the largest bonus possible to prevent the CEO from leaving to go a rival firm. c) Link the CEO's pay to her performance but avoid high-powered incentives that may cause reckless behavior. d) Encourage her to emulate Warren Buffett and to take a lower salary than she might command elsewhere.

d) functional structure.

Bill Lewis is the CEO of Nordic Technologies Inc., a firm that offers a limited line of standard products that competes in a similar manner with a narrow, local market focus and whose competitive advantage is a focus on low cost derived from gaining economies of scale. Bill should use a a) group of strategic business units that each have a geographic focus. b) matrix structure that combines functional departments with geographic divisions. c) simple structure. d) functional structure.

c) global-standardization strategy

Blue Cat Inc., a manufacturer of high-technology medical devices, has its product development centers located in the United States and South Korea. The manufacturing units are located in China and the Philippines to benefit from low labor costs and access to original equipment manufacturers. This allows the company to competitively price its devices. Also, the various phone models sold by the company are uniform in all the foreign markets it operates in. In this scenario, which of the following strategies does Blue Cat most likely pursue? a) international strategy b) multidomestic strategy c) global-standardization strategy d) transnational strategy

a) Request and review a copy of the firm's risk assessment plan, if such a plan exists.

Carla recently became a board member of a firm that has a history of reckless actions by senior employees. Which task would be appropriate for Carla to undertake to help safeguard the company's financial health? a) Request and review a copy of the firm's risk assessment plan, if such a plan exists. b) Take part in the annual reviews of employees in the financial department. c) Draft and circulate a statement that the firm's board members serve at the pleasure of the CEO. d) Determine how to postpone or evade the firm's compliance with local, regional, and national regulations.

c. acquisition

Gregarious Simulation Systems Inc. wants to globally expand its market. It intends to ensure that its mode of foreign entry allows it to have strong control over its operations and protect its intellectual property, though that may mean investing a significant amount of capital and other resources. In this scenario, which of the following foreign-entry modes would best suit Gregarious Simulation Systems? a) exporting b) franchise agreement c) acquisition d) licensing

b) local responsiveness

Hooper's Corn Inc. produces an inexpensive microwave popcorn that is well tailored for the tastes of U.S. consumers. However, it has failed to satisfy the consumer preferences of its host country, Japan. Which of the following categories has Hooper's Corn performed poorly in? a) cost-reduction b) local responsiveness c) global standardization d) transnational strategy

d) an international strategy

Hooper's Store, a luxury motorcycle company, sells the same motorcycles and offers the same superior services in both its home country and foreign markets. The market it operates in faces low pressures for both local responsiveness and cost-reductions. Which of the following strategies within the integration-responsiveness framework does Hooper's Store most likely pursue? a) multidomestic strategy b) a transnational strategy c) a global-standardization strategy d) an international strategy

b) tall structure

Jared works as a front-line employee for a nationwide retail store. He reports to a floor manager, who reports to a departmental manager, who reports to a regional supervisor, who reports to a vice president, who reports to the CEO. Which of the following best describes this retail store? a) flat structure b) tall structure c) centralized structure d) decentralize structure

b) greenfield operations strategy.

Lucy wishes to have more control with her international strategy and is willing to increase her firms' investments in this foreign market. She considers creating a subsidiary but also wishes to build a manufacturing plant from the ground up. Lucy is most likely interested in pursuing a(n) a) franchising agreement. b) greenfield operations strategy. c) exporting and importing strategy. d) equity alliance.

c) political distance

Macmillan Toys Inc. is located in the nation of Ruffino near the nation of East Fenwick. Macmillan Toys is considering expanding into Rusalka. Both countries have similar consumer incomes and knowledge bases and share a common language. Also, the transportation networks between the countries are strong. Even so, the two nations have a long-standing dispute concerning the control of an area of land along their common border. Currently, Ruffino rules this land. Which of the following would most likely prevent Macmillan Toys from expanding into Rusalka? a) geographic distance b) economic distance c) political distance d)cultural distance

a) Yes. It is unethical to trade stocks based on insider information, irrespective of the final outcome.

Paul is a manager at Macmillan Toys Inc. and is friends with the company's CEO. This privilege gives Paul the information that Macmillan Toys is in the midst of talks to take over a leading rival. Paul buys stocks of Macmillan Toys with the expectation that its stocks will appreciate. But the deal falls through, and the stocks of Macmillan Toys depreciate in the following months. Are Paul's actions unethical? Why or why not? a) Yes. It is unethical to trade stocks based on insider information, irrespective of the final outcome. b) Yes. It is illegal and unethical for Paul to possess any kind of insider information. c) No. Paul did not ask the CEO to disclose such information to him. d) No. Paul did not make any profits from trading stocks using this information.

d) functional; mechanistic

Paul runs an organization that implements a cost-leadership strategy. This business-level strategy supports both a ________ and ________ structure. a) matrix; organic b) M-form; vertical c) simple; organic d) functional; mechanistic

c. multidivisional

PolyCon's, a large and successful retail chain on the East Coast, decides to expand its operations across the United States. Which of the following organizational structures should PolyCon's use? a)basic b)simple c)multidivisional d) functional

a) is a world leader in the pharmaceutical industry.

Sirius Cybernetics Inc. has a national competitive advantage in the pharmaceutical industry. This means that the country a) is a world leader in the pharmaceutical industry. b) has nationalized the pharmaceutical industry. c) has low levels of competition, providing other multinational companies with an opportunity to take over the pharmaceutical industry. d) is a potential foreign market for multinational pharmaceutical companies to sell their products.

a) a slower decision-making process

Susan works for a firm that has high degrees of formalization in their organizational structure. She understands that one of the main drawbacks of working in a firm with such high levels of formalization can often result in which of the following? a) a slower decision-making process b) increased organizational inertia c) less co-opetition d) increased vertical integration

c) The increased span of control for remaining managers may lead to higher levels of stress and possible burnout.

The Estelle Leonard Talent Agency recently underwent a reorganization. Based on customer feedback, the company eliminated many of its middle management positions and implemented a flatter structure. Which of the following is a possible drawback of this decision? a) Employees will have less power and autonomy, resulting in a loss of morale. b) Internal communications and decision-making processes will be slower. c) The increased span of control for remaining managers may lead to higher levels of stress and possible burnout. d) Employees will be forced to take on more specialized roles and may become bored by repetitive tasks.

a) industry-specific forces

There are some industries that are more competitive in some countries than others. In order to fully understand why this occurs, we need to examine Porter's Diamond framework. Which of the following below is NOT one of the four factors in this framework? a) industry-specific forces b) factor conditions c) competitive intensity in the focal industry d) demand conditions

c) Pug Tech will protect its intellectual property with patents and trade secrets.

Two leading home appliance companies, Globex Inc. and Pug Tech, are in competition for market share. In their quest for exciting new products, Globex employs an open innovation model, while Pug Tech pursues a closed innovation model. Which of the following statements is most likely true? a) Globex has a greater chance of capturing market share. b) Pug Tech has a superior absorptive capacity. c) Pug Tech will protect its intellectual property with patents and trade secrets. d) Globex is most concerned with securing first-mover advantages.

a) The new owner sells the company in pieces.

Which of the following is a common result of a hostile takeover of a company? a) The new owner sells the company in pieces. b) The new owner keeps the company intact. c) The new owner keeps the board of directors of the company the same. d) The new owner enhances the reputations of the company's management.

b) McDonald's use of standard operating procedures across the world

Which of the following real-world scenarios best exemplifies formalization? a) Zappos' focus on allowing its customer service employees to use their own approach rather than depend on scripts b) McDonald's use of standard operating procedures across the world c) W. L. Gore's associates organizing themselves in project-based teams that are led by sponsors, not bosses d) Yahoo's decision to fire its CEO after incurring huge losses

c) Wealthy countries engage in relatively more cross-border trade than poorer ones.

Which of the following statements is true with regard to international trade between countries? a) Greater cultural distance between the home and host countries decreases the liability of foreignness to multinational companies. b) Colony-colonizer relationships have a strong negative effect on bilateral trade between countries. c) Wealthy countries engage in relatively more cross-border trade than poorer ones. d) Political integrations decrease the expected trade intensity between two countries.

b) Yubaba Inc. has a flat organizational structure.

Yubaba Inc., a fidget spinner manufacturing company, encourages its employees to enjoy their work by taking on additional responsibilities or switching jobs with each other. It allows its employees immense flexibility in charting their own career path within the organization. Bill has worked at Yubaba for eight years, but has never had a boss or supervised an employee. Which of the following is most likely true in this scenario? a) Yubaba Inc. is a mechanistic organization. b) Yubaba Inc. has a flat organizational structure. c) Yubaba Inc. has a high degree of centralization. d) Yubaba's organizational culture is governed by codified rules.