Management Study Guide Test 2

False

Milestones are formal review points that tend to lengthen the innovation process.

Hiring workers based on market expectations Allowing retailers to promote cultural values

Which of the following are examples of local adaptation?

Testing products with diverse consumer groups Asking for market input in product design

Which of the following are examples of local adaptation?

Synergistic

Which of the following is NOT one of the characteristics of S.M.A.R.T. goals?

Making goals public

Which of the following is a commonly used method for increasing goal commitment?

Gain diverse perspectives.

Which of the following is a method of learning how to earn consumer trust in new markets?

It encourages people to work harder for extended periods.

Which of the following is an advantage of planning?

Self-interest

Which of the following is one of the sources of resistance to change?

Coercion

Which of the following methods for managing resistance to change should only be used as a last resort or under crisis conditions?

MERCOSUR

Which of the following trade agreements is held between Argentina, Brazil, Paraguay, and Uruguay?

Subsidy

Which trade barrier is created when a government financially supports national industries against foreign competitors?

Character of the rivalry

____ is a measure of the intensity of competitive behavior among companies in an industry.

Direct foreign investment

____ is a method of investment in which a company builds a new business or buys an existing business in a foreign country.

A-type conflict

____ is the emotional reaction that can occur when disagreements become personal rather than professional.

Discontinuous change

____ is the phase of a technology cycle characterized by technological substitution and design competition.

Organizational development

_______ is defined as a philosophy and collection of planned change interventions designed to improve an organization's long-term health and performance.

lives and works outside of his or her own country

An expatriate is someone who ____.

five consistent dimensions of cultural differences across countries

Hofstede's research has shown that there are _______.

Cooperation

How does a company minimize country risk by leveraging strategic business alliances?

Workforce quality

How should a company determine if it will be able to access required technical skills for business operations?

Exporting

If a company transports its products to a foreign market for sale, which type of global business is being conducted?

core capabilities

In any organization, _____ are the less visible, internal decision-making routines, problem-solving processes, and organizational cultures that determine how efficiently inputs can be turned into outputs.

dissolution

In the _____ stage of organizational decline, a new CEO may be brought in to oversee the closing of stores, offices, and manufacturing facilities, the final layoff of managers and employees, and the sale of assets.

faulty action

In the ______ stage of organizational decline, managers typically assume that if they just run a tighter ship, company performance will return to previous levels.

Stars

In the context of BCG matrix, _____ are companies that have a large share of a fast-growing market.

Resistance

In the context of managing change, _______ forces support the status quo.

rare resources

In the context of sustainable competitive advantage, _____ are those resources that are not controlled or possessed by many competing firms.

True

Innovation streams are patterns of innovation over time that can create sustainable competitive advantage.

political uncertainty and policy uncertainty

What are the two types of political risk that affect companies conducting global business?

Show visible support for the change, explaining how it would help Honest Tea serve its customers.

When Honest Tea announced that it was being bought by Coca-Cola, some employees probably felt that Honest Tea had "sold out" and resisted the change. What was the best way for Seth Goldman to overcome this resistance?

National culture

_________ is the set of shared values and beliefs that affects the perceptions, decisions, and behavior of the people from a particular country.

grand strategy

A _____ is a broad corporate-level strategic plan used to achieve strategic goals and guide the strategic alternatives that managers of individual businesses or subunits may use.

situational analysis

A _____ is an assessment of the strengths and weaknesses in an organization's internal environment and the opportunities and threats in its external environment.

joint venture

A _________ is a strategic alliance in which two existing companies collaborate to form a third, independent company.

Political uncertainty

A company wants to understand the risks associated with changes in government leadership. What should it consider?

Purchasing power

A cosmetics company that is considering entering the South American market would be especially interested in the discretionary income within that region. In this context, which of the following is a determining factor in its global strategy?

a firm's competitors cannot duplicate the value offered by the firm to its customers.

A sustainable competitive advantage is achieved when:

it solves a practical problem.

A technology can become a dominant design if:

cooperative contract

A(n) ____ is an agreement in which a foreign business owner pays a company a fee for the right to conduct that business in his or her country.

franchise

A(n) ________ is arranged when a company sells its business model and operations to a local owner in a foreign market for a fee.

False

According to Kurt Lewin, managing organizational change is a simple process that requires organizational dialogue, change intervention, and reformatting.

the bargaining power of suppliers

According to Porter's industry forces, _____ is a measure of the influence that suppliers of parts, materials, and services to firms in an industry have on the prices of these inputs.

cultural simulations

After learning specific critical cultural differences, expatriate trainees can participate in _________, in which they practice adapting these differences.

S-curve

Nearly all technology cycles follow the typical ____ pattern of innovation.

Managers will want to look for a country that offers tax advantages to their company. Managers will want to find a country that is politically stable. Managers will need to find a country that has a growing market for the company's products.

Because Black Diamond manufactures and sells its outdoor sports products outside the United States, what should the company do to find attractive business climates for additional locations? Check all that apply.

stability strategy

Companies following a _____ would most likely try to improve the way in which they sell the same goods or services to the same customers.

stability

Companies often choose a ______ strategy when their external environment doesn't change much or after they have struggled with periods of explosive growth.

True

Companies that want to sustain a competitive advantage must understand and protect themselves from the strategic threats of innovation.

organizational innovation

Creativity was needed to improve efficiency without raising costs at one automobile maker. Over the last few years, the company has successfully implemented a creative engineering program that allows its plants to produce more than one type of car from the same assembly line. This successful change to a flexible manufacturing system is an example of ____.

True

Direct foreign investment is an increasingly important and common method of conducting global business.

"How should we compete against a particular company?"

Firm-level strategies answer the question:

Exporting

Fran Wilson Creative Cosmetics is a medium-sized U.S. company that sells 1.5 million tubes of lipstick annually in Japan. It has no physical presence in Japan beyond the fact that its products are sold there. Which of the following technique does the company adopt to reach the Japanese market?

True

Global business is defined as the buying and selling of goods and services by people from different countries.

True

Historically, companies have generally followed the phase model of globalization.

workforce quality

It is important for a company to assess the qualitative factor of ________ when considering a location.

The USDA releases a report about the potential link between chocolate and cancer. Unlike other chocolate brands, Theo sources their cacao beans directly from farmers in Peru and the Democratic Republic of Congo, incurring greater costs than competitors who purchase from suppliers.

When formulating strategy, Theo Chocolate's managers scan the business environment for factors that will or could impact the company's competitive advantage. Which of the following would pose a threat to Theo? Check all that apply.

Control

Which approach is used when a company minimizes country risk by lobbying foreign governments?

Purchasing power

Which factor should a company evaluate to determine if consumers will purchase its goods?

A response

______ is a countermove, prompted by a rival's attack, that is designed to defend or improve a company's market share or profit.

market commonality

Resource similarity and _____ are factors that determine the extent to which firms will be in direct competition with each other.

False

Nearly all technology cycles follow a bell-shaped pattern of innovation.

protectionism

The Candinia government continues to impose high tariffs on rice to make sure local farmers can earn a living. The tariff on rice is an example of ________.

Strategic alliance

What agreement is created when a company combines resources with a foreign partner to enter a specific market?

focus

MCRS Toys manufactures learning toys and games exclusively for children in the age group of one to six years. The company is using a(n) _______ strategy.

change agent

Mark was the person who was in charge of the plan to reinvent Supernova Automobiles. He played a major role in making a shift to building solar-powered automobiles from making regular fuel-powered cars. Mark was a(n) __________.

General Agreement on Tariffs and Trade

The acronym GATT stands for the _________.

Differentiation strategy

Theo Chocolate produces organic, fair trade chocolate and other candies for not only foodies and green consumers, but also anyone who wants a milk chocolate bar. This indicates that Theo has a:

entry

There are eight general steps for organizational development intervention. The first step is __________.

cultures

Thomas Hodel helps Black Diamond because he brings a European perspective to the U.S.-based business. When Thomas says, "It takes a long time to really figure out the differences in Europe," he is speaking of the difficulties managers can face in understanding the __________ of different countries.

Control, avoidance, and cooperation strategies

What are the strategies that can be used to minimize or adapt to the political risk inherent in global business?

Gaining economies of scale by standardization Using a home country distributor across markets

Which of the following are examples of global consistency?

Core firms

_____ are the central companies in a strategic group.

at the midpoint of the cycle

In the typical S-curve pattern of innovation, small amounts of effort will result in significant increases in performance _______.

The PlantBottle is a potentially technological discontinuity; grape juice-sweetened drinks are an incremental change.

One change that Seth mentions is the PlantBottle. Another is using grape juice instead of sugar to sweeten drinks. What is true about these changes?

organizational innovation

Parkline is a popular brand of formal wear. The company decided on a new marketing strategy that actually involved its target audience participating in the campaign. This included an online virtual reality game that was highly popular among the audience, bringing the brand mass attention. Following this, their sales skyrocketed. This is an example of _________.

Delphi technique

The ________ is a decision-making method in which a panel of experts responds to questions and to each other until an agreement is reached on how a specific issue should be handled.

Unrelated diversification

Seattle, home to Theo Chocolate, experiences around 155 days of rain per year. CEO of Theo, Joe Whinney, recently purchased a umbrella company which will produce umbrellas in various colors and sizes. This is an example of:

Give employees challenging work so that they have a more creative work environment. Allow employees to test prototypes and use the results of their tests to create new products. Help employees overcome conflict and power struggles.

Seth Goldman makes clear that innovation is essential for a small company to break into the packaged beverage market. In what ways can a company foster innovation? Check all that apply.

licensing

Sodima is a French cooperative that owns the name, the trade secrets, and the patents of Yoplait yogurt. General Mills pays Sodima for the right to sell Yoplait yogurt in the United States. This is an example of __________.

discontinuous change

Stellar Mobiles was a popular mobile phone brand. However, when its competitors began switching to smartphones, Stellar realized that it too needed to change in order to survive in the market, and it quickly started developing smartphones. In other words, Stellar Mobiles entered the ________ stage of the technology.

True

The criteria for choosing an office/manufacturing location are different from the criteria for entering a foreign market.

relative

The customers of a restaurant are requested to rate the service of the waiters on a sheet of paper. The rate of each waiter is then compared to the rates of the all the other waiters. This is the method of _______ comparisons.

encouraging workers' participation in goal setting

The most popular approach to increasing goal commitment is ____.

decreasing a-type conflict

The nominal group technique improves group decision making by ____.

True

The three kinds of standing plans are policies, procedures, and rules and regulations.

True

The three strategies used to minimize or adapt to the political risk inherent in global business are avoidance, control, and cooperation.

Related diversification

Theo Chocolate is considering opening a cooking school which will teach students techniques for working with chocolate and recipes that feature Theo chocolate as an ingredient. This would be an example of:

Threat of substitute products

Theo Chocolate is just one of many high-end chocolate manufacturers today. They compete against brands such as Scharffen Berger, Valrhona, and Godiva. This means that it is easy for customers to choose a different chocolate, passing up the opportunity to buy a Theo Chocolate confection. This problem illustrates which of Porter's five industry forces?

True

Two factors that help companies determine the growth potential of foreign markets are the purchasing power of the consumers and types of foreign competitors already in the market.

Train employees on Coca-Cola's payroll and expense reimbursement systems since Honest tea uses them. Survey Honest Tea employees to identify sources of anxiety and conflict related to the acquisition. Conduct team-building exercises to help groups of employees from Coca-Cola and Honest Tea communicate effectively and address conflict.

When Coca-Cola purchased first a part and then all of Honest Tea, what would have been appropriate ways to help this change be successful?

defender

WindWings is a company that manufactures and markets flutes, a product with a steady demand rate. It is so successful at what it does that the company controls 85 percent of the world's flute industry. In terms of the adaptive strategies, WindWings would most likely be categorized as a(n) __________.

related diversification

Wisher Technologies became a large software development company through a merger with Ringus Tech., a growing software solutions firm. Since both the companies had similar core capabilities, this would be classified as an example of _________.

Cost leadership

_____ means producing a product or service of acceptable quality at consistently lower production costs than competitors so that the firm can offer the product or service at the lowest price in the industry.

Prospectors

_____ means producing a product or service of acceptable quality at consistently lower production costs than competitors so that the firm can offer the product or service at the lowest price in the industry.

Options-based

_____ planning allows companies to maintain flexibility by making small simultaneous investments in many alternative plans.

Portfolio

_______ strategy is a corporate-level strategy that minimizes risk by diversifying investment among various businesses or product lines.