487 exam 2
Which of the following is not part of a culture of entrepreneurship? -A select staff are assigned to be attuned to new opportunities to create business. -The search for venture opportunities permeates every part of the organization. -Every value chain activity is viewed as a source of entrepreneurial value creation. -Employees at every level are attuned to opportunities to help create new businesses.
A select staff are assigned to be attuned to new opportunities to create business.
Which one of the following is not a Western hemisphere trade bloc? -MERCOSUR -Latin American Integration Association -ASEAN -NAFTA (now known as USMCA)
ASEAN
The traditional approach to strategic control is sequential. Which of the following is not one of the steps in the sequence? -Strategies are implemented. -Performance is measured against the predetermined goal. -Action plans are submitted by lower level managers. -Strategies are formulated and top management sets goals.
Action plans are submitted by lower level managers.
Which of the following is an advantage of a divisional type of organizational structure? -uniformity in image and quality across divisions -high degree of emphasis on long-term performance -an enhanced ability to respond quickly to changes in the external environment -efficient use of managerial and technical talent
An enhanced ability to respond quickly to changes in the external environment
________ are private individuals who provide seed capital to young ventures. -Cash cows -Gazelles -Rising stars -Angels
Angels
In choosing sides concerning CEO duality, two schools of thought exist. Which of the following would not be a consideration for the Unity of Command school of thought? -CEO duality provides smoother strategic decision making. -CEO duality creates unity across the board of directors and managers of a company. -One person holding both roles will be able to act more efficiently and effectively. -CEO duality slows down decision making.
CEO duality slows down decision making
________ is the intense rivalry involving actions and responses among similar competitors vying for the same customers in a marketplace. -Resource similarity -Pioneering new entry -The threat of substitutes -Competitive dynamics
Competitive dynamics
As long as the benefits of ________ are enjoyed by all participants in a co-opetition system, the practice can aid companies in avoiding intense and damaging competition. -cooperating -competition -alliance -forbearance
Cooperating
Which of the following statements about simple organizational structures is false? -There is little specialization of tasks. -Small firms with a narrow product-market scope will adopt such a structure. -Creativity and individualism are rare. -Decision-making authority is highly centralized.
Creativity and individualism are rare.
Shareholders rely on CEOs to adopt policies and strategies that maximize the value of their shares. To motivate CEOs to maximize the value of their companies, boards of directors can consider all the following options except one. Which one is it? -Salaries can be structured to provide penalties for poor performance -Salaries, bonuses, and stock options can be structures to provide rewards for superior performance. -Boards can require that the CEOs become substantial owners of company stock. -Dismissal for poor performance is not an option.
Dismissal for poor performance is not an option.
Rule-based controls are least appropriate in organizations with which one of the following characteristics? -There is consistency in product and service. -The risk of malfeasance is extremely high. -Employees are highly skilled and independent. -Environments are stable and predictable.
Employees are highly skilled and independent.
In the integrity-based approach to ethics management, the objective is to -conform with externally imposed standards. -enable responsible conduct. -reduce discretion, training, controls, audits, and penalties. -prevent criminal misconduct.
Enable responsible conduct
In attracting the best talent and relentlessly looking to build their skills, the most successful managers regularly ________ the ________ and ________ capital around them. As their followers mimic this pattern of behavior, the firm is able to build a dynamic and sustainable business model. -expand; corporate; financial -expand; human; social -eliminate; talent; social -eliminate; corporate; financial
Expand; human; social
The form of entry strategy into international operations that offers the lowest level of control for the domestic corporation would be -franchising -licensing -joint venture -exporting.
Exporting
TJ Parker went through the process of opportunity recognition when he developed PillPack. This means he ________, ________, and ________ the potential opportunity that arose from customers finding it difficult to keep to their medication schedule. -identified; selected; developed -answered; analysed; rejected -selected; improved; altered -chose; altered; discounted
Identified; selected; developed
Related industries create the probability that new companies will enter the market. This ________ competition and forces existing firms to improve ________. -decreases; sales -decreases; efficiency -decreases; innovation -increases; efficiency
Increases; efficiency
________ involves building entrepreneurial businesses within existing corporations. -Entrepreneurship -On-shoring -Intrapreneurship -Insourcing
Intrapreneurship
Informational control systems are concerned with which of the following questions? -Is the environment of the organization a necessary and sufficient condition for success? -Is the organization doing things right? -Is the organization doing the right things? -Are rules and regulations being followed as information is processed?
Is the organization doing the right things?
One of the following is not a question that should be answered when evaluating the performance of corporate venturing efforts. Which is it? -Does the value proposition offered by the venture insulate it from competitive attack? -Does the venture add to the worth of the firm internally? -Is the venture considered to be a market success? -Is the venture attracting external venture funding?
Is the venture attracting external venture funding?
Which of the following is not one of the characteristics of a contemporary control system? -It is a key catalyst for an ongoing debate about underlying data, assumptions, and action plans. -It must focus on constantly changing information that is strategically important -it circumvents the need for face-to-face meetings among superiors, subordinates, and peers -It generates information that is important enough to demand regular and frequent attention.
It circumvents the need for face-to-face meetings among superiors, subordinates, and peers.
Which of the following is not a motivation for a company to pursue international expansion? -It wishes to increase the size of the potential markets for its products and services. -It wishes to take advantage of arbitrage opportunities in order to increase profit. -It wishes to optimize value-chain activities to enhance performance, reduce costs, and reduce risk. -It wishes to increase foreign market penetration by developing products for the home market.
It wishes to increase foreign market penetration by developing products for the home market.
Most organizations with strong cultures and a sound system of rewards and incentives can eventually internalize boundaries rather than use explicit rules and regulations. Which of the following is not a technique for moving in that direction? -Minimize training and indoctrination. -Align reward systems with organizational goals and objectives. -Develop managerial role models. -Hire people who identify with the dominant values of the organization.
Minimize training and indoctrination.
According to the textbook, globalization involves international exchange. Included in this exchange is trade in goods and services as well as the exchange of ________, ________, and ________ across countries. -money; ideas; information -habits; values; ideas -statistics; personnel; purchasing power -traditions; legal systems; history
Money; ideas; information
According to s's 2018 semiannual "Country Risk Rating" (shown in Exhibit 7.2), which of these countries would have the lowest political risks for a new entrant? -Hong Kong -China -Norway -Argentina
Norway
________ occurs when a firm decides to utilize other firms to perform value-creating activities that were previously performed in-house. -Offshoring -A global strategy -Outsourcing -A transnational strategy
Outsourcing
One of the disadvantages of divisional structure design is that they divide ________, ________, and knowledge. They insulate divisional managers from other divisional managers thus inhibiting their ability to coordinate activities, share resources, and learn from each other.
People; resources
Successful organizations create ________ boundaries among the ________ activities as well as between the organization and its external customers, suppliers, and alliance partners -impermeable; external -impermeable; internal -permeable; external -permeable; internal
Permeable; internal
When a company chooses to maintain low-price dominance, it is using which tactical action? -increased marketing efforts -price cutting -changing production capacity -product and service enhancements
Price cutting
Which of the following dimensions of entrepreneurial orientation is described as a forward-looking perspective characteristic of a marketplace leader that has the foresight to seize opportunities? -competitive aggressiveness -risk taking -autonomy -proactiveness
Proactiveness
________ refers to efforts to create designs and applications of technology to develop new products, while ________ refers to efforts to improve the efficiency of organizational systems such as manufacturing and operations. -Breakthrough innovation; instrumental innovation -Product innovation; service innovation -Radical innovation; incremental innovation -Product innovation; process innovation
Product innovation; process innovation
Telecommunication equipment providers, Huawei and Nokia, have a high degree of ________ because they have patent rights to similar technologies, high-quality engineering staffs, and global sales forces. -dynamic capabilities -resource similarity -market commonality -equity funding
Resource similarity
Community hospitals in Mississippi can video conference with the specialists at the University of Mississippi Medical Center thus lowering health care delivery costs and increasing the quality of medical care. This system mirrors that of the Indian health care delivery system for reaching rural areas. This is an example of -reverse innovation -arbitrage -forward innovation -vertical innovation.
Reverse Innovation
________ are fees that a multinational receives from a foreign licensee in return for its use of intellectual property (trademark, patent, trade secret, technology). -Transfer prices -Dividends -Intra-corporate inflows -Royalties
Royalties
Which of the below best describes the competitive tendencies of small firms? -Small firms are more nimble and can respond quickly to competitive attacks. -Small firms are more nimble and cannot respond quickly to competitive attacks. -Small firms typically have more resources available as they undertake competitive attacks than do large firms. -Small firms tend to signal their competitive actions long before they launch those actions because they lack legitimacy in the marketplace.
Small firms are more nimble and can respond quickly to competitive attacks.
Ritz-Carlton hotels employees meet each day for 15 minutes to share stories about how they went the extra yard to meet customer needs. What is the intended outcome of these activities? -Stories help build a customer-centric culture. -Storytime demonstrates to employees the importance of articulating explicit goals and objectives. -Storytime gives employees an opportunity to vent their frustrations. -Storytime gives management more control over employees.
Stories help build a customer-centric culture.
________ provide(s) a key avenue for growth for many young and small firms through partnering to obtain resources and to expand into new markets. -strategic alliances -Bootstrappers -Lone wolf entrepreneurs -Research & development
Strategic alliances
A firm is considering a large price cut on its leading product to gain market share. One executive strongly disagrees with the price cut. He observes that they are in the same marketplace as their rivals and do not have any competitive advantages in their cost structure. If they cut prices, their competitors will likely do the same. The result is that everyone will make less money. These arguments are an example of a -strategy of co-opetition. -strategy of forbearance -hardball strategy -weakness strategy
Strategy of forbearance
Rivalry is intense in nations with conditions of ________ consumer demand, ________ supplier bases, and ________ new entrant potential from related industries. -weak; weak; low -strong; strong; high -strong; strong; low -weak; weak; high
Strong; strong; high
________ are obstacles in which the design of organization structure, information processing, and reporting relationships, impede the proper flow and evaluation of information. -Behavioral barriers -Barriers to entry -Systemic barriers -Political barriers
Systemic barriers
A small firm may be unable to mount a serious attack due to lack of resources. As a result, it is more likely to react to ________ actions, such as incentive pricing or enhanced service offerings, because they are less costly to attack than large-scale strategic actions. -strategic -tactical -forbearance -co-opetition
Tactical
As a manager, when faced with ethical crises you should -focus on issues most relevant to stockholders. -wait for the other party to make the first move. -take the initiative to address the problem. -cover up as much as possible.
Take the initiative to address the problem
The Lending Club removed CEO Renaud Laplanche in 2016. Hans Morris, the company executive chairman, lauded him, saying his entrepreneurial spirit was critical to the success of the firm. But he also signaled the board was removing Mr. Laplanche because he had failed to build a strong control system and culture, stating that as a public company that provides a financial service, Lending Club must meet the industry high standards of transparency and disclosure. This kind of dismissal signals what message to the public? -The board of directors needed a scapegoat to cover up their ineffectiveness. -Mr. Laplanche was dishonest. -Mr. Laplanche was not a creative entrepreneur. -The board of directors is active and engaged.
The board of directors is active and engaged
Which of the following is not an advantage of a strategic business unit (SBU) type of organizational structure? -Planning and control by the corporate office is more manageable. -Divisions with similar products, markets, or technologies are formed into homogeneous groups that can achieve synergies. -The corporate office is more removed from the individual divisions. -Divisional executives can respond quickly to market changes and opportunities.
The corporate office is more removed from the individual divisions.
Which of the following is not a characteristic of effective reward and incentive systems? -The compensation system is perceived as fair and equitable. -Objectives are well understood, and broadly accepted. -Performance measures are clear and highly visible. -The structure is fixed to assure employees of consistency.
The structure is fixed to assure employees of consistency.
Which of the following is not a benefit of outsider dominance on boards of directors? -There is less information that the board receives about the operations of the firm because it is filtered through the CEO. -There is independent oversight of the CEO, as well as the strategy of the firm. -There is a larger number of candidates for outsider-only board committees. -There is broader access to knowledge and resources in the broader business community.
There is less information that the board receives about the operations of the firm because it is filtered through the CEO.
Which of the following is the primary drawback of traditional strategic control systems? -They are only appropriate when the environment is stable and simple. -Goals and objectives cannot be measured with a high level of certainty. -They lead to complacency. -They lack the flexibility needed to adjust to changes in the environment.
They lack the flexibility needed to adjust to changes in the environment.
Which of the following is the primary drawback of traditional strategic control systems? -They lead to complacency. -They are only appropriate when the environment is stable and simple. -Goals and objectives cannot be measured with a high level of certainty. -They lack the flexibility needed to adjust to changes in the environment.
They lack the flexibility needed to adjust to changes in the environment.
Which of the following is not one of the characteristics of reward and incentive systems? -They represent an effective control mechanism. -They focus efforts on high priority tasks. -They represent a poor means of influencing the culture of an organization. -They motivate high levels of individual and collective task performance.
They represent a poor means of influencing the culture of an organization.
________ are groups of countries that agree to increase trade among them by lowering trade barriers. -Trading blocs -Exchange partners -Open zones -Black zones
Trading blocs
Dispersed approaches to corporate entrepreneurship are often found in organizations with a strong spirit of entrepreneurship. true or false
True
Sales quotas, operating budgets, and production schedules are examples of traditional controls. True or false
True
Which of the following statements about venture capital is false? -Entrepreneurs raise venture capital by selling shares of ownership in their business. -Venture capital groups can often provide helpful management advice. -Venture capital is a form of public equity financing. -Venture capital is used to finance rapid growth or large capital expenditures.
Venture capital is a form of public equity financing.
________ are most appropriate when a firm already has the appropriate knowledge and capabilities that it can leverage rather easily through multiple locations in many countries. -Strategic alliances -Wholly owned subsidiaries -Joint ventures -Licensing agreements
Wholly owned subsidiaries
In order to minimize the temptation for managers to act in their own self-interest, governance mechanisms exist for implementation consideration. Which of the following is not a primary means for monitoring managerial behavior? -managerial incentives to align management interests with those of the stockholders -a board of directors that acts in the best interests of shareholders to create long-term value -shareholder activism in which owners view themselves as shareowners -a board of directors that acts in the best interests of shareholders to create short-term value
a board of directors that acts in the best interests of shareholders to create short-term value ???
Green tea Oreos in China, chocolate and peanut butter Oreos in Indonesia, and banana dulce de leche Oreos in Argentina are examples of Kraft using ________ strategy.
a multidomestic
Many situations that a firm faces have regular, identifiable patterns. Leaders tend to handle such routines by establishing ________ or ________ to be followed that can be applied ________ to each occurrence. -documents; credos; uniquely -a policy; a procedure; uniformly -rules; regulations; individually -policies; regulations; uniformly
a policy; a procedure; uniformly
In Fortune's annual list of the 500 biggest companies in the world, 156 firms were from emerging markets in 2015 compared to 18 in 1995, owing to -a rapid rise in global capitalism. -traditional purchasing habits. -the lower living standards throughout the world. -a divergence in world living standards.
a rapid rise in global capitalism.
According to the text, for an entrepreneurial start-up to be successful, three ingredients are critical. What are they? -an opportunity, a marketing plan, and office space -a viable opportunity, available resources, and a qualified and motivated founding team -management, marketing, and money -good ideas, a team of investors, and a business plan
a viable opportunity, available resources, and a qualified and motivated founding team
Tom Monahan, a business creativity coach, says that every new idea is merely a spin of an old idea. A company that enters the market by offering a product or service that is somewhat new and sufficiently different in order to create value for customers by capitalizing on current trends is using which new entry strategy? -adaptive -differentiated -pioneering -imitative
adaptive
Which of the following is not one of the characteristics of an entrepreneurial opportunity? -attractive -affordable -achievable -value creating
affordable
Chesapeake Energy set a goal to improve workplace safety. To reinforce this, one year it gave out over 8 million USD in safety bonuses to over 6,000 employees for following safe work practices. This served to create -a new mission statement for the company. -an effective incentive program because employees worked harder. -an effective reward and incentive program because it reinforced commitment to goals. -happy employees because they got more free time.
an effective reward and incentive program because it reinforced commitment to goals.
Which of the following social skills do many executives find challenging to acquire? -having a large network in place -being a good listener -having empathy for subordinates -being a good motivator
being a good listener
The innovation dilemma known as "seeds versus weeds" refers to -choosing to pursue radical rather than incremental innovations. -promoting organizational stars onto innovation teams rather than involving all employees in innovation efforts. -choosing to pursue product rather than process innovations. -choosing to pursue investment in one innovative idea over another.
choosing to pursue investment in one innovative idea over another.
Which of the following is not one of the three characteristics of entrepreneurial leadership mentioned by the text? -clarifying job responsibilities -dedication and drive -commitment to excellence -vision
clarifying job responsibilities
Houston-based Baylor College of Medicine has a ________ that instructs all employees to follow the Baylor Mission Statement, Compliance Program and Conflict of Interest policy. -corporate reward -code of ethics -corporate motto -system of evaluation
code of ethics
If a firm outsources some parts of its value chain in order to reduce costs and increase quality and at the same time engages in multiple alliances to penetrate new markets, this is an example of a firm using a ________ of organizational types. -combination -barrier-free collection -bounded consortium -boundaryless consortium
combination
Walmart has an aggressive pricing structure that has forced smaller, local retailers out of business in many markets. Local cities responded with regulations that make it difficult for Walmart to move into or expand operations in these areas. This is an example of -competitive aggressiveness always leading to competitive advantages. -community regulations not leading to competitive advantages. -competitive aggressiveness leading to negative stakeholder reactions. -community regulations diminishing small business choices.
competitive aggressiveness leading to negative stakeholder reactions.
If a company dramatically lowers prices to take market share from rival firms, this is an example of -proactiveness. -innovativeness. -autonomy. -competitive aggressiveness.
competitive aggressiveness.
External governance control mechanisms include all the following except -media. -analysts. -competitors. -auditors.
competitors.
In principal-principal conflicts (conflicts between controlling shareholders and minority shareholders), the ownership (of equity) is -concentrated. -widely dispersed. -controlled almost completely by management. -often held by employee stock ownership programs.
concentrated.
Statistics indicate that over half of the world's output now comes from emerging markets. This is leading to a(n) ________ of living standards across the globe and is changing the face of business. -divergence -expansion -convergence -contraction
convergence
Which of the following is not a guideline an organization can use to promote the challenging of the status quo? -establishing a culture of dissent -creating a results-based reward system -fostering a culture that encourages risk taking -forcefully creating a sense of urgency
creating a results-based reward system
For years O.R.T. Technologies resisted moving any operations outside Israel. However, when faced with a sharp rise in the value of the shekel, the maker of specialized software for managing gas stations froze all local hiring and decided to transfer some developmental work to Eastern Europe. This is an example of ________ risk. -management -political -currency -economic
currency
Walmart began offering low-priced extended warranties on home electronics after learning that its rivals such as Best Buy derived most of their profits from extended warranties. According to the Stalk and Lachenauer book, this is an example of the strategy to -deceive the competition. -devastate rivals' profit sanctuaries. -plagiarize with pride. -unleash massive and overwhelming force.
devastate rivals' profit sanctuaries.
The innovation dilemma known as "building capabilities versus collaborating" refers to -building innovative products in-house versus outsourcing. -building credibility by launching products ahead of potential collaboration partners. -incrementally launching a product. -developing innovation skills internally versus partnering with qualified outsiders.
developing innovation skills internally versus partnering with qualified outsiders.
Shakespeare & Co. was reimagined in 2015 to meet the current needs of the market when Dan Neller purchased the NY bookstore. He provided a place to find the hottest books, the ability to print more obscure titles, and a rare level of service that made the store feel like a destination. He used which generic strategy to achieve competitive advantages? -focus -overall cost leadership -low cost leadership -differentiation
differentiation
Generally speaking the opportunity recognition process consists of two phases of activity. They are ________ and ________. -discovery; evaluation -global search; valuation -value creation; affordability -global search; recycling profits
discovery; evaluation
Strategic business unit (SBU) and holding company structures result from extensive -diversification. -international expansion. -organizational flattening. -vertical integration.
diversification.
A strategy of related diversification requires most firms to organize around geographical areas or product lines. This type of organizational growth leads to a(n) ________ structure. -matrix -international -divisional -functional
divisional
The sale of Boeing commercial aircrafts and Microsoft operating systems in many countries enables these companies to benefit from -higher prices in their domestic markets. -optimizing the location for many activities in their value chain. -economies of scale. -reducing their exposure to currency risks.
economies of scale.
Which component of emotional intelligence (EI) enables a manager to have a deep understanding of the existence and importance of cultural and ethnic differences? -self-regulation -social skills -empathy -awareness
empathy
A drawback of EI is that a leader can find it easy to over-identify with others and confuse ________ with ________. -intelligence; empathy -empathy; sympathy -motivation; empathy -motivation; intelligence
empathy; sympathy
When considering the best entry mode for effectively leveraging its technologies in new markets, firms will consider all of the following choices except -enter the market by licensing the technology to someone already in the market. -enter the market through a strategic alliance with a partner. -enter the market on its own. -enter the market by licensing the technology to a newcomer to the market.
enter the market by licensing the technology to a newcomer to the market.
Which of the following does not explain why organizations are prone to inertia and slow to change? -political barriers -vested interests in the status quo -entry barriers -personal time constraints
entry barriers
Which of the following statements about ethics is false? -Business ethics is the application of ethical standards to commercial enterprises. -Ethics may be defined as a system of right and wrong. -Ethics assists individuals in deciding when an act is moral or immoral. -Ethics can be assessed by the legality of an action.
ethics can be assessed by the legality of an action.
Amazon is an example of a company that used the differentiation strategy to enter the market. The differentiation features included -minimal customer service -traditional back office logistics -exceptional customer service -traditional delivery logistics
exceptional customer service
Founders Larry Page and Sergey Brin provide time and resources for Google employees to experiment. Some, such as the Android cell phone platform, have been big winners. Others, such as the Orkut and Buzz social networking systems, have failed. But Google will continue to experiment with new products and services. This is an example of which innovator DNA trait? -associating -experimenting -networking -observing
experimenting
Entrepreneurial firms that pursue a low-cost leadership strategy use all the following to achieve lower costs except -simple organizational structures. -cost-saving technology. -extensive investment in order to achieve economies of scale. -rapid decision making.
extensive investment in order to achieve economies of scale.
Companies that cultivate cultures of experimentation and curiosity make sure that ________ is not to be avoided at all costs. -authority -failure -experimentation -risk taking
failure
The failure of many auditing firms to raise red flags about accounting irregularities in companies such as Enron and WorldCom is generally attributed to all the following factors except the
failure of U.S. audit firms to hire technically qualified professionals.
A strategy of related diversification requires a need to reorganize only around functional lines. This leads to a divisional structure. true or false
false
In a barrier-free organization, differences in skills, authority, and talent disappear. True or false
false
Informational controls involve the balance and alignment of the culture, rewards, and boundaries of a firm. True or false
false
There is no value to flattening organizational structures. True or false
false
The board of directors is a group that has a _______ duty to ensure that the company is run consistently with _______ interests of the owners, or shareholders of a corporation and that acts as an _______ between the shareholders and management. -sworn; long-term; advisor -legal; short-term; intermediary -fiduciary; long-term; intermediary -formal; short-term; adviso
fiduciary; long-term; intermediary
Which kind of risk taking requires that a company borrow heavily or commit a large portion of its resources in order to grow? -business risk taking -financial risk taking -personal risk taking -technological risk taking
financial risk taking
Consolidating the European aerospace industry was a strategic decision to compete against Boeing because Boeing had a ________ advantage. -licensing -transnational -multidomestic -first mover
first mover
In 2016, John Stumpf, CEO of Wells Fargo, was forced to resign after both stakeholder and government scrutiny of the practices of the firm. Firm management had instituted very aggressive sales goals for employees, leading employees to create sham accounts using the names and money of the real customers of the bank. This is an example of _______ corporate governance. -sound -controlled -guided -flawed
flawed
When an industry is mature, a(n) ________ strategy is considered one of the most effective approaches for a new entrant. -overall low-cost -small business -differentiation -focus
focus
When an organization with a simple structure increases its sales revenue and volume of outputs, it is most likely to develop a ________ structure. -functional -divisional -geographic -product-market
functional
Which of the following is not a common source of new business opportunities? -current or past work experiences -future work -suggestions by family or friends -chance event
future work
Virtual organizations ________ whereas modular organizations ________. -pursue collective strategies; forfeit strategic control -accept interdependent destinies; pursue collective strategies -give up part of their strategic control; retain full strategic control -are usually permanent; are usually temporary
give up part of their strategic control; retain full strategic control
Precision Hawk, a company using drones to do aerial data analysis reached out to Hahn Estate Winery to understand their needs in analyzing crop health. Precision Hawk was conversing with Hahn Estate Winery in order to -develop a focus strategy. -get into wine production. -identify an opportunity. -offer to build a new winery.
identify an opportunity.
Square provides a means for small businesses to process credit and debit card sales without signing up for a traditional credit card arrangement of monthly fees and minimum charges. When its business grew rapidly, Apple, Google, and PayPal responded with ________ actions. -imitative -pioneering -adaptive -differentiated
imitative
What advantages does outsourcing not provide an organization? -accessing best in class goods and services -focusing scarce resources on core competencies -enabling rapid expansion with relatively low capital investment -improved buyer positioning
improved buyer positioning
When differentiating products and services to local markets, strategies and tactics are likely to ________ company costs. -decrease -increase -obliterate -decentralize
increase
Which of the following is a reason for the rise in regional expansion? -increasing local taxes and tariffs -increase in the number of trading blocs and free trade zones -increasing national trade restrictions -decrease in the number of trading blocs and free trade zones
increase in the number of trading blocs and free trade zones
Organizations that make it to the growth stage, design strategies to -leave exiting product-market domains. -increase the overall scope of operations. -reduce the tendency to increase operational scope. -reduce the commitment to new product-market domains.
increase the overall scope of operations.
The power of shareholders has intensified in recent years because of the -decreasing influence of large institutional investors. -decline in the number of interested institutional investors. -increasing influence of large institutional investors. -increasing influence of small individual investors.
increasing influence of large institutional investors.
Effective learning organizations must redistribute ________, ________, and ________ in order to assure that there is a common body of knowledge. -information; knowledge; rewards -knowledge; financial rewards; intangible rewards -rewards; training; handbooks -training; knowledge; pay raises
information; knowledge; rewards
Top managers at ABC Company meet every Friday to review daily operational reports and year to date data. This is an example of -behavioral control. -strategy formulation. -strategy implementation. -informational control.
informational control.
Proactive measures to prevent organizational ethics problems do not include -using leaders as role models of ethical behavior. -issuing statements describing organization commitment to certain standards of behavior. -instituting a reward system which considers outcomes as its primary criterion. -using organization information systems as a control system.
instituting a reward system which considers outcomes as its primary criterion.
Building production capacity in locations outside of Europe can threaten ________, an issue typically raised when investing in China. -European investment potential -European economic risk -balance of trade -intellectual property rights protection
intellectual property rights protection
Which would be the appropriate strategy for companies to use to compete in the global marketplace if both the pressures to lower costs and adapt locally are low? -global strategy -transnational strategy -international strategy -multidomestic strategy
international strategy
The U.S. Small Business Administration supports small business through all the following except -government contracting -underwriting loans -investing venture capital -training and counseling
investing venture capital.
In corporations with a strong entrepreneurial culture, the willingness and ability to change -often worries stakeholders such as suppliers and creditors. -is imposed from the top-down. -often leads to instability. -is considered a core capability.
is imposed from the top-down.
Continuous monitoring, in the contemporary approach, is beneficial because -it increases the time it takes to detect changes in the competitive environment. -organizational flexibility is reduced. -it reduces time lags. -organization response time is increased.
it reduces time lags.
Expert power is derived from -organizationally conferred decision-making authority. -referent power. -leader capability and knowledge in a particular field. -manager access, control, and distribution of information that is not freely available to everyone in an organization.
leader capability and knowledge in a particular field.
In organizations, ethical behavior must start with the ________ before the ________ can be expected to perform accordingly. -employees; shareholders -shareholders; leader -leader; shareholders -leader; employees
leader; employees
Multinational firms are constantly faced with the decision of choosing between ________ adaptation and ________ integration. -global; global -local; local -global; local -local; global
local; global
Proponents of flat leadership structures argue that they offer all of the following except ________ benefits -longer feedback -cost -flexibility -creativity
longer feedback
Which of the following is not a strategic risk of outsourcing? -loss of nonvital functions -loss of critical skills -loss of cross-functional skills -loss of control over a supplier
loss of nonvital functions
In emerging economies and continental Europe, firms often can be characterized by all the following except -concentrated ownership -low family ownership and control -business group structures -weak legal protection for minority shareholders.
low family ownership and control.
Effective leadership is like a three-legged stool. Which of the following is not represented by one of the stool legs? -setting a direction -nurturing a culture dedicated to excellence and ethical behavior -maintaining the status quo -designing the organization
maintaining the status quo
Greeks reacted negatively to Coca-Cola advertising using Coke bottles as pillars for the Parthenon. This is a form of ________ risk. -currency -management -environmental -economic
management
According to the textbook, ________ and ________ must accept personal responsibility for developing and strengthening ethical behavior throughout the organization. -bankers, employees -employees, external stakeholders -managers, top executives -managers, stockholders
managers, top executives
Aircraft makers Boeing and Airbus have a high degree of ________ because they make very similar products and have many buyers in common. -equity funding -dynamic capabilities -first mover advantages -market commonality
market commonality
Complicated working relationships, intense power struggles, and excessive reliance on group processes are disadvantages of which type of organizational structure? -functional -divisional -matrix -holding company
matrix
Which of the following is not a boundaryless organizational design? -barrier-free -modular -virtual -matrix
matrix
Effective boundaries and constraints -tend to inhibit efficiency and effectiveness -distract employees who are trying to focus on organizational priorities -minimize improper and unethical conduct -tend to limit organizational growth.
minimize improper and unethical conduct.
According to Michael Porter, firms that have experienced intense domestic competition are -unlikely to have the time or resources to compete abroad. -most likely to design strategies aimed primarily at the domestic market. -more likely to design strategies and structures that allow them to successfully compete abroad. -more likely to demand protection from their governments.
more likely to design strategies that will allow them to successfully compete abroad.
If a board of directors is to be effective, it needs to allocate its scarce time to the _______ issues to which its members can add _______. -hardest; time -most clear; capital -most critical; value -newest; information
most critical; value
High pressure for local adaptation combined with low pressure for lower costs would suggest what type of international strategy? -overall cost leadership strategy -transnational strategy -global strategy -multidomestic strategy
multidomestic strategy
Inspiring and motivating people with a mission or purpose is a ________ for developing an organization that can learn and adapt. -goal and a required precondition -goal but not a necessary condition -necessary but not sufficient condition -necessary and sufficient condition
necessary but not sufficient condition
Michael Lazaridis got the idea for a wireless email device that led him to found Research in Motion, now called BlackBerry, from a conference he attended. At the conference, a speaker was discussing a wireless system Coca-Cola was using that allowed vending machines to send a signal when they needed refilling. Lazaridis saw the opportunity to use the same concept with email communications, and the idea for the smartphone was hatched. Seeing this innovative idea while at a conference is an example of which innovator DNA trait? -observing -associating -networking -experimenting
networking
Which habit is most directly related to the innovative process that managers should acquire as they start to build the innovative DNA needed to be more successful innovators in the future? -writing down product goals regularly -never sleeping over five hours at a time -motivating the team to work longer hours -networking across functions and organizations
networking across functions and organizations
Innovation involves using ________ knowledge to ________ organizational processes or create commercially viable products and services.
new; transform
From watching his wife struggle to keep track of the family finances, Intuit founder Scott Cook identified the need for easy-to-use financial software that provided a single place for managing bills, bank accounts, and investments. This is an example of which innovator DNA trait? -experimenting -associating -observing -networking
observing
The best example of a tactical action that a company might use in response to a competitive attack is to -target the markets of the rival. -expand into new geographical areas. -acquire the competitor. -offer price discounts and rebates.
offer price discounts and rebates.
As illustrated in the opening case for Chapter 10, Boeing lost a lot of control and, therefore, incurred high operating costs for its build out of the 787 Dreamliner because it ________ design and manufacturing. -on-shored -internalized -outsourced -internationalized
outsourced
A report issued by the World Trade Organization described the production of a particular U.S. car. The study showed that 30 percent of the car value goes to Korea for assembly, 17.5 percent to Japan for components and advanced technology, 7.5 percent to Germany for design, 4 percent to Taiwan and Singapore for minor parts, 2.5 percent to U.K. for advertising and marketing services, and 1.5 percent to Ireland and Barbados for data processing. This is an example of -insourcing and offshoring. -outsourcing and on-shoring. -insourcing and outsourcing. -outsourcing and offshoring.
outsourcing and offshoring.
A highly ethical organization must have all the following elements except -payment plans. -corporate credos. -codes of conduct. -role models.
payment plans.
The first personal computer revolutionized computing and how business is conducted. It was using a(n) ________ entry strategy. -creative -adaptive -imitative -pioneering
pioneering
In designing its smartphones, Samsung copied the look, feel, and technological attributes of the Apple iPhone. By copying Apple, Samsung was able to improve its market position. According to the Stalk and Lachenauer book, this is an example of strategy to -plagiarize with pride. -deceive the competition. -raise competitor costs. -unleash massive and overwhelming force.
plagiarize with pride.
Carefully developed ________ and ________ guide behavior so that all employees will be encouraged to behave in ________ manner. -policies; procedures; an ethical -role models; standards; a stagnant -corporate credos; codes of conduct; an unethical -codes of conduct; role models; a legal
policies; procedures; an ethical
Renault paid 1 billion USD to acquire a 25 percent ownership stake in the Russian automaker AvtoVAZ in 2008. Just one year later, Russian Prime Minister Vladimir Putin threatened to dilute the Renault ownership stake unless it contributed more money to prop up AvtoVAZ, which was then experiencing a significant slide in sales. This is an example of ________ risk. -currency -economic -political -management
political
Refusal to share information, conflicts over resources, conflicts between departments and divisions, and petty interpersonal differences are symptoms of which type of barrier to change? -political barriers -systemic barriers -behavioral barriers -entry barriers
political barriers
Coercive power is the -arises from manager access, control, and distribution of information that is not freely available to everyone in an organization. -power exercised by use of fear of punishment for errors of omission or commission by employees. -ability of the leader or manager to confer rewards for positive behaviors or outcomes. -power of persuasion exercised by a charismatic leader to get compliance from reluctant subordinates.
power exercised by use of fear of punishment for errors of omission or commission by employees.
In the compliance-based approach to ethics management, the objective is to -prevent criminal misconduct. -conform with externally imposed standards. -reduce discretion, training, controls, audits, and penalties. -enable responsible conduct.
prevent criminal misconduct.
According to the textbook, which of the following is not a common new entry strategy? -adaptive new entry -pioneering new entry -imitative new entry -proactive new entry
proactive new entry
Whereas ________ are often associated with a low-cost leader strategy, ________ are frequently an important aspect of a differentiation strategy. -marketing innovations; management innovations -product innovations; service innovations -process innovations; product innovations -radical innovations; instrumental innovations
process innovations; product innovations
In large organizations, a strategy of diversification requires a need to reorganize around ________ or ________. -product lines, geographic markets -product lines, competition -competitor lines, geographic markets -distribution lines, competitor markets
product lines; geographic markets
Which of the following is not a primary source of financing for entrepreneurial start-ups? -public equity -private investors -personal savings -investments by family and friends
public equity
The strong culture at General Electric prior to the change in leadership in 2018, helped the firm retain a common _______ and identity, but it ultimately led to poor stock value. -incentive -rigidity -engagement -purpose
purpose
After witnessing the emergence of eBay and Amazon, Marc Benioff questioned why computer software was still sold in boxes rather than leased with a subscription and downloaded through the Internet. This was the genesis of Salesforce.com, a firm with over 6.7 billion USD in sales in 2016. This is an example of which innovator DNA trait? -experimenting -associating -questioning -networking
questioning
Strategic reasons for undertaking a corporate venture do not include -reinforcing stakeholder commitment. -entering into new markets. -building the base of corporation resources. -expanding capabilities by acquiring new knowledge.
reinforcing stakeholder commitment.
Strategic business unit (SBU) structures are best suited for corporations pursuing ________, whereas holding company structures are best suited for companies with ________ strategies. -unrelated diversification; related diversification -product-market diversification; international -related diversification; unrelated diversification -international diversification; product-market
related diversification; unrelated diversification
Structures help to ensure that ________ are used effectively in accomplishing the mission of the organization. -resources -relationships -strategies -boundaries
resources
SC Johnson makes Windex, Ziploc bags, Glade Air Fresheners, and Saran Wrap. It decided to remove chlorine as an ingredient in Saran Wrap which reduced the effectiveness of the product to cling to containers. Which of the following does not exemplify Johnson's goal? -respecting the financial position of the company only -maintaining a strong ethical culture -developing an ethical organization culture -being environmentally responsible
respecting the financial position of the company only
Product champions -scavenge for resources and encourage others to back promising new ideas. -are usually inventors of some sort. -are strong supporters of the status quo. -are typically senior executives.
scavenge for resources and encourage others to back promising new ideas.
Common features of a dispersed approach to corporate entrepreneurship include all the following except -an entrepreneurial culture. -a top-down approach to supporting entrepreneurial behavior. -use of product champions. -semi-autonomous new venture groups.
semi-autonomous new venture groups.
CEO duality refers to a situation in which the CEO -formulates and implements strategies. -serves as both the CEO and the chair of the board of directors. -is responsible for acting as CEO and serving on the compensation committee. -is responsible for acting as CEO and Chief Operating Officer (COO).
serves as both the CEO and the chair of the board of directors.
CEOs who are ________ tend to have a wide circle of acquaintances as well as a knack for finding common ground and building rapport. -self-regulators -motivated -socially skilled -self-aware
socially skilled
Firms following a global strategy strive to offer ________ products and services as well as locate manufacturing, research and development, and marketing activities in a limited number of locations. -widely differentiated -internationally differentiated -standardized -more expensive local
standardized
An organization such as ConAgra that has dozens of different divisions with similar products will probably have the greatest success with which form of organization structure? -functional structure -holding company structure -strategic business unit structure -matrix structure
strategic business unit structure
In the contemporary approach to strategic control, adapting to and anticipating both internal and external environmental change is an integral part. The relationships between ________, ________, and ________ are highly interactive. -change; leadership; control -strategy formulation; leadership; control -strategy formulation; implementation; control -strategic information; organizational behavior; implementation
strategy formulation; implementation; control
Rivalry is intense in nations with conditions of ________ consumer demand, ________ supplier bases, and ________ new entrant potential from related industries. -strong; strong; low -strong; strong; high -weak; weak; high -weak; weak; low
strong; strong; high
Which of the following is not a key control lever of behavioral control? -boundaries -rewards -culture -structure
structure
Which of the following do corporate business incubators typically not provide? -physical space -funding -mentoring -student interns
student interns
An ethically sound organization, drawing on the concepts of stakeholder management, can also strengthen its bonds among its ________, ________, and ________. -policies; procedures; values -values; organizational design; employees -suppliers; customers; governmental agencies -current employees; potential employees; future employees
suppliers; customers; governmental agencies
In competitive dynamics, new entrants may be forced to change their strategies or develop new ones to ________ competitive challenges by ________. -survive; incumbents -survive; former rivals -overcome; other new rivals -succumb; potential rivals
survive; incumbents
Organizational structure refers to the formalized patterns of interactions that link company ________, ________, and ________. -tasks; technologies; people -processes; mechanisms; techniques -processes; people; mechanisms -tasks; mechanisms; techniques
tasks; technologies; people
Which of the factors below has not made the software services industry in India extremely competitive on a global scale? -large network of public and private educational institutions -tax and antitrust legislation that protects the dominant players in the industry -large pool of skilled workers -large, growing market and sophisticated customers
tax and antitrust legislation that protects the dominant players in the industry
Poor organizational design by leaders can result in all the following except -inadequate or inappropriate budgeting and control systems. -reward systems that do not motivate individuals toward desired organizational goals. -teams, systems, and organizational processes that facilitate implementation. -lack of understanding of responsibility and accountability among managers.
teams, systems, and organizational processes that facilitate implementation.
As in the case of Siebel Systems (now part of Oracle), elements of a global strategy may facilitate the competitive advantage of differentiation by -increased freedom of individual business units to adapt to local tastes -the creation of a worldwide network to achieve consistent service regardless of location -flexibility in applying Research and Development to meet country-specific needs -tailoring products to meet country-specific needs
the creation of a worldwide network to achieve consistent service regardless of location.
Competitive actions can take many forms. Which is not likely to be one of them? -the exit of a successful business from the market -the launch of a breakthrough innovation that disrupts the industry structure -the entry of a start-up into a market for the first time -an attack by a lower-ranked incumbent on an industry leader
the exit of a successful business from the market
As firms expand into foreign markets, they generally follow a pattern of change in structure that parallels the changes in their strategies. Which one of the following is not a major contingency that influences the structure they choose? -the type of strategy that is driving the company foreign operations -the research and development budget commitment -product diversity -the extent of the company dependence on foreign sales
the research and development budget commitment
When Mario Cotta Zincometal Group, an Italian firm, had developed an innovative machine for cutting paper tissue, they sent three managers to Drupa, a printing and cutting technology trade show in Germany. Why? -to reduce uncertainty in the marketplace for their company success -to help the managers overcome their fear of marketplace rejection -to assure their employees that the company was not planning to declare insolvency -to scour conference booths to identify cutting product segments in which they could apply their technology
to scour conference booths to identify cutting product segments in which they could apply their technology
As firms grow, owner managers often need to hire functional specialists to handle the increased information-processing burden. true or false
true
Business incubators are designed to support fledgling entrepreneurial ventures until they can operate as stand-alone businesses. True or false
true
Cutting prices or increasing marketing efforts are examples of tactical competitive actions. True or false
true
Firms are more likely to effectively leverage their technologies in new markets if they redefine the technology or competency in general terms. True or false
true
If similar competitors vie for the same customers in a marketplace, they are likely to escalate their competitive strategy through a reactive series of actions and responses. True or false
true
In order to succeed in being creative and agile, innovative firm teams must hold the team accountable. True or false
true
Increasing international exchange in goods and services can run into the difficulty of how to address the needs of customers at differing income levels. True or false
true
Many international firms are increasing their efforts to market their products and services to countries such as India and China as the ranks of their middle class continue to increase. True or false
true
Product innovations are commonly associated with a differentiation strategy. True or false
true
Small businesses create the majority of new jobs in the U.S. economy. True or false
true
Strategic control systems, both informational and behavioral, are used to correct the performance and ultimate strategy of a firm. True or false
true
The central key to empowerment is effective leadership. Leading-edge organizations recognize the need for ________, ________, and ________ at all levels instead of the extensive and cumbersome rules and regulations inherent in hierarchical control. -respect; finances; trust -control, order, finances -training; finances; expertise -trust; cultural control; expertise
trust; cultural control; expertise
The two vital elements that managers must concern themselves with, when creating boundaryless organizations, are -type of structure and the mechanisms, processes, and techniques for enhancing permeability. -financial returns and marketplace value. -market share and shareholder value. -product marketability and capital structure.
type of structure and the mechanisms, processes, and techniques for enhancing permeability.
Unilever has taken a dominant position (65 percent market share) in the Vietnamese laundry detergent market by employing an investment and marketing campaign that decimated the market position of the local, incumbent competitors. According to the Stalk and Lachenauer book, this is an example of ________ strategy. -unleash massive and overwhelming force -deceive the competition -raise competitors' costs -plagiarize with pride
unleash massive and overwhelming force
Which of the following is not an aspect of culture that effective learning organization firms need to develop as they redistribute information, knowledge and rewards? -encourage employees to offer ideas, ask questions, and express concerns -encourage widespread sharing of information from various sources -utilize technology that fosters tighter controls -encourage collaborative decision-making and the sharing of best practices
utilize technology that fosters tighter controls
The most expensive and risky entry mode is -joint ventures -wholly owned subsidiaries -franchising -strategic alliances.
wholly owned subsidiaries
A ________ is a business in which a multinational company owns 100 percent of the stock. -joint venture -strategic alliance -wholly owned subsidiary -franchising operation
wholly owned subsidiary
If an international firm has a multidomestic strategy and a relatively high level of product diversity, the best choice for its organizational structure is a(n) ________ structure. -international division -worldwide functional -worldwide product division -worldwide matrix
worldwide matrix