Strategy Analysis, Formulation, Implementation, and Execution
Under Armour, a multinational sports apparel company saw its sales drop in North America while sales in the Asia/Pacific rose 12 percent that same year. The company plans an entry into a new geographical location, Vietnam—which is considered an emerging market and also a potential supplier—with its established and best-selling product line: women's running shorts. If you were advising Under Armour, what would you least be likely to recommend to this company?
Create a sales plan that aims to enhance initial sales and market penetration with low prices based on high operational costs.
The strategic options to improve a diversified company's overall performance do not include which of the following categories of actions?
Increasing dividend payments to shareholders and/or repurchasing shares of the company's stock
Why do mergers and acquisitions sometimes fail to produce anticipated results?
Key employees at the acquired company can quickly become disenchanted and leave.
A cross-border alliance was not created when
NOT CORRECT - The British insurance company Geico became a wholly owned subsidiary of Berkshire Hathaway.
How would you explain the difference between a one-business company and a diversified company?
The first uses a business-level strategy, while the second uses a set of business strategies and a corporate strategy
The implementation process is likely to be hampered by missed deadlines, misdirected efforts, and managerial ineptness if
a capable results-oriented management team is not in place.
Steps to update a company's capabilities to match changing market conditions and customer expectations take place often include
acquiring, developing, and strengthening key resources and capabilities.
Building organizational bridges with external allies is aided by
appointing "relationship managers" and giving them responsibility for making particular strategic partnerships or alliances generate the intended benefits.
Perceived value and signaling value are often an important part of a successful differentiation strategy because
buyers seldom will pay for value they don't perceive, no matter how real the value of the differentiating extras may be.
What a company's top executives are saying about where the company is headed long term with respect to its future product-market-customer-technology mix
constitutes the strategic vision for the company.
The process of benchmarking SunPower's value chain activities against its rivals in the solar power industry would not entail
constructing a company value chain and identifying which activities are primary and which are support activities.
As a rule, the collective impact of competitive pressures associated with the five competitive forces
determines the extent of the competitive pressure on industry profitability.
When a company has a proficiency in performing a strategically and competitively important value chain activity better than its rivals, it is said to have a
distinctive competence.
The two most important parts of SWOT analysis are
drawing conclusions from the SWOT listings about the company's overall situation and translating these conclusions into strategic actions to better match the company's strategy to its resource strengths and market opportunities, correct the important weaknesses, and defend against external threats.
When justifying her considerations for her China-based wine importation company's foreign market entry, Ming-Chi probably would not choose
entering a new foreign country via internal development and building a foreign subsidiary from scratch, because it is cheaper than entering into strategic alliances and cooperative agreements.
Effectively communicating the strategic vision down the line to lower-level managers and employees has the value of
explaining "where we are going and why" and, more importantly, inspiring and energizing company personnel to unite to get the company moving in the intended direction.
Multinational companies that forbid the payment of bribes and kickbacks in their codes of ethical conduct and that are serious about enforcing this prohibition
face a particularly vexing problem of losing business to competitors that have no scruples—an outcome that penalizes ethical companies and company personnel.
If management is to match a company's organization structure to its strategy in an effective way, then it is essential
for strategy-critical value-chain activities to be the main building blocks on the organization chart.
The strategic impetus for forward vertical integration is to
gain better access to end users and better market visibility.
The advantages of using an acquisition strategy to pursue opportunities in foreign markets include
having a high level of control and speed as an entry strategy to overcome trade barriers.
The organizing challenge of a decentralized structure that stresses employee empowerment is
how to exercise control over the actions and decisions of empowered employees so that the business is not put at risk while trying to capture the benefits of empowerment.
If you were a consultant to SunPower, one of the largest solar power companies in the United States, you would not recommend which activity to remedy high internal costs relative to its rivals?
implementing aggressive strategic resource mapping to permit across-the-board cost reduction
The principal offensive strategy options include all of the following except
initiating a market threat and counterattack simultaneously to effect a distraction.
Business process reengineering
involves radically redesigning and streamlining the workflow (typically enabled by cutting-edge use of online technology and information systems), with the goal of achieving quantum gains in performance of the activity.
A competitive environment where there is weak to moderate rivalry among sellers, high entry barriers, weak competition from substitute products, and little bargaining leverage on the part of both suppliers and customers
is conducive to industry members earning attractive profits.
If a company does not possess stand-alone resource strengths capable of contributing to competitive advantage,
it may have a bundle of resources that can be leveraged to develop a distinctive competence.
For every emerging opportunity, there exists a(n)
market penetration curve, and this typically has an inflection point where the business model falls into place.
In 2018, Suelin Chen and Mark Zheng co-founded Cake, a free social media app that catalogs users' end-of-life wishes, instructions, and documents such as obituaries. Cake, based in Boston, makes money through strategic partnerships primarily with health care providers and will eventually add fee-based premium services in global markets. Cake has decided to expand outside its U.S. home market in order to
match its core competencies and capabilities with rival social media companies such as What'sApp and Facebook.
The market opportunities most relevant to a low-cost provider of mobile phones are those that
offer the best prospects for growth and profitability in emerging markets.
Which of the following can aid company strategists in identifying key success factors in their industry? low switching costs of buyers and suppliers global distribution capabilities of suppliers accurate filling of buyer orders short delivery time capability product attributes and service characteristics that buyers consider to be crucial
product attributes and service characteristics that buyers consider to be crucial
Sourcing a supply from a small, women-owned business is an example of a corporate social responsibility action to
promote workforce diversity.
First-mover advantages are unlikely to be present when
rapid market evolution (due to fast-paced changes in technology or buyer preferences) presents opportunities to leapfrog a first-mover's products with more attractive next-version products.
A company that fails to manage its strategic alliance probably has incorporated contractual safeguards. made opportunities for learning a routine management process. refrained from making commitments to its partners and ensured they do the same. established strong interpersonal relationships and established trust. created a system to manage alliances in a systematic fashion.
refrained from making commitments to its partners and ensured they do the same.
The principal advantages of strategic alliances over vertical integration or horizontal mergers/acquisitions are
resource pooling and risk sharing, more adaptive response capabilities, and greater speed of deployment.
Collaborative relationships between particular sellers and buyers in an industry can represent a source of strong competitive pressure when
sales are made to buyer groups with either strong bargaining power or high sensitivity.
The real purpose of the company's strategic vision
serves as management's tool for giving the organization a sense of direction.
An engaging and convincing strategic vision
should be done in language that inspires and motivates company personnel to unite behind executive efforts to get the company moving in the intended direction.
Visible actions to reallocate operating funds and move people into different and new organizational units
signal a determined commitment to strategic change and can help catalyze and give credibility to the implementation process.
A no-pressure/no-adverse-consequences work environment does not necessarily lead to satisfactory outcomes because there is always a cadre of ambitious people who relish the challenge. establishing more positive than negative motivational reward elements. superior strategy execution or operating excellence. workforce morale issues. excessive shortfall in performance.
superior strategy execution or operating excellence.
Uber prizes ruthless internal competition and WeWork promotes a partying, self-dealing culture. These two companies are examples of workplaces cultures
that increase the risk of reputation-damaging incidents.
Excellent execution of an excellent strategy is
the best test of managerial excellence and the best recipe for making a company a standout performer.
What makes related diversification an attractive strategy?
the opportunity to convert cross-business strategic fit into competitive advantage over business rivals whose operations don't offer comparable strategic fit benefits
Why do companies decide to enter a foreign market?
to capture economies of scale in product development, manufacturing, or marketing
The marketing emphasis of a company pursuing a broad differentiation strategy usually is to
tout differentiating features and charge a premium price that more than covers the extra costs of differentiating features.
Strategy formulation is
typically a blend of proactive and reactive strategy elements.
Leadership actions or managerial practices that perpetuate an unhealthy or problem culture normally do not
use empowerment to help create a motivated workforce.
What actions, behaviors, and work practices that are conducive to good strategy implementation support the strategy execution effort?
using peer pressure to company personnel to perform, enhancing worker productivity and buy-in, and focusing the attention of employees on what is most important
The basic strategy options for local companies in competing against global challengers include
utilizing understanding of local customer needs and preferences to create customized products or services, developing business models to exploit shortcoming in local infrastructure, and using acquisitions and rapid growth to defend against expansion-minded multinationals.
Being a first mover is not particularly advantageous under which circumstance?
when markets are slow to accept the innovative product offering of a first mover, and fast followers possess sufficient resources and marketing muscle to overtake a first mover
When should a business not be divested?
when the business is a cash cow