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Evara Inc.started as a luxury brand for designer apparel.Soon, the company expanded by launching its own line of premium perfumes, watches, bags, and home furnishings.This expansion allowed the businesses under the company to share a few, if not all, of the common competencies in products, services, technology, and distribution.Which of the following corporate strategies is Evara pursuing in this scenario?


A) Taper integration strategy
B) Niche marketing strategy
C) Related-constrained strategy
D) Related-linked strategy

E) A) and B)
F) A) and D)

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Which of the following best illustrates site specificity?


A) Equipment necessary for mining bauxite and aluminum smelting
B) Bottling machinery to manufacture bottles with trademarked shapes
C) Investment made in human capital to master procedures of a specific organization
D) Investment made to train employees to operate computers

E) C) and D)
F) A) and D)

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Strategic business units that have a relatively low market share but have the potential to grow are best categorized under _____ in the Boston Consulting Group (BCG) growth-share matrix.


A) dogs
B) stars
C) cash cows
D) question marks

E) C) and D)
F) None of the above

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Why do investments in specialized assets tend to incur high opportunity costs?

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Specialized assets have significantly mo...

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Why are generic industry value chains called vertical value chains?

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Industry value chains are also called ve...

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When a firm is said to be pursuing a geographic diversification strategy, it means that the firm will:


A) introduce different products and services in an existing single market.
B) sell its products in several different regional, national, and international markets.
C) operate from multiple headquarters across the globe.
D) depend solely on its in-house facilities for all its production purposes.

E) A) and C)
F) A) and D)

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WJ Group Inc., a large multinational conglomerate, had begun to experience declining revenues over the years.The top management at the headquarters of the company decided that it was important for the company to avoid deviating from its core competencies.Thus, a few of the company's key businesses like energy, telecommunications, and automobiles were centralized, giving the top management more control over them.Also, relatively newer businesses like beverages and food processing were divested.In this scenario, WJ Group is involved in:


A) reverse engineering.
B) benchmarking.
C) restructuring.
D) crowdsourcing.

E) All of the above
F) A) and C)

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What are the advantages and disadvantages of organizing economic activity within firms?

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The advantages of organizing economic ac...

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What kind of businesses is categorized under dogs in the Boston Consulting Group (BCG)growth-share matrix?

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Strategic business units identified as d...

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The 3D television division of a large consumer electronics company has been recognized as a question mark.The company's LCD television division has been categorized under dogs.Which of the following statements will hold well in this scenario?


A) The strategic recommendation for the 3D television division is to harvest it, and the strategic recommendation for the LCD television division is to invest further in it.
B) The 3D television division will have a high market share in its industry, whereas the LCD television division will have a low-market share in its industry.
C) The 3D television division operates in a high-growth market, whereas the LCD television division operates in a low-growth market.
D) The LCD television division will benefit by pursuing a differentiation strategy, and the 3D television division will benefit by following a cost-leadership strategy.

E) C) and D)
F) None of the above

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General Electric's CEO, Jeffrey Immelt, decided to refocus GE's portfolio of businesses and leverage the firm's core competency in industrial engineering while pursuing future-growth industries.The two industries that CEO Immelt had identified as major future-growth industries were the:


A) education and entertainment sectors.
B) clean-technology sector and health care sector.
C) capital finance and information technology sectors.
D) consumer electronics sector and hospitality sector.

E) B) and C)
F) All of the above

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Managers in a firm hired to improve the firm's profitability and ultimately the shareholders' value will add to the overall costs if they pursue their own self interests.What does this best illustrate?


A) Diseconomies of scale
B) Principal-agent problem
C) Experience-curve effects
D) Information asymmetries

E) A) and B)
F) A) and C)

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Which of the following best illustrates physical-asset specificity?


A) A unique training program developed in an organization
B) A ship container designed to carry more than the average load of iron ore
C) A generic machine that can be used to churn different mixtures
D) A machine solely designed to give a candy its trademarked shape

E) A) and B)
F) B) and C)

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Bill is in an interview for a sales job that requires no experience.He is trying to portray himself as a highly enthusiastic, energetic person with high-level communication and interpersonal skills.The interviewer is convinced that Bill should be hired as a sales person in the company.However, in his resume, Bill had not mentioned his previous work experience as he was fired from that job on the account of using illegal drugs.Which of the following does this scenario best illustrate?


A) Information asymmetry
B) Principal-agent problem
C) Experience-curve effect
D) Learning-curve effect

E) A) and B)
F) A) and C)

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Neon Electronics Inc.sourced touchscreens required for its tablet computers, cell phones, and televisions from a manufacturer in China.But the demand for such components was high globally, and the supplier could not meet the quality standards of Neon Electronics.Thus, Neon Electronics decided to set up its own unit to develop and manufacture the required touchscreens.What does this scenario best illustrate?


A) Crowdsourcing
B) New product development
C) Backward vertical integration
D) Conglomerate diversification

E) None of the above
F) B) and C)

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Which of the following best illustrates forward vertical integration?


A) A firm that manufactured and sold car engines to major automobile companies launches its own line of cars.
B) A chain of ice cream parlors launches a brand of toys and accessories for children.
C) A multinational coffee chain sources its coffee beans from plantations in Brazil and Vietnam.
D) A designer shoe company that previously purchased leather from external suppliers establishes its own leather tannery.

E) All of the above
F) B) and C)

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A corporation's star SBUs will:


A) hold a high market share in a fast-growing market.
B) experience low and unstable earnings in a fast-growing market.
C) hold a small market share in a low-growth market.
D) compete in a low-growth market but hold considerable market share.

E) C) and D)
F) All of the above

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DS & Co.is following a related-linked diversification strategy, and GreenWing Inc.is following a related-constrained diversification strategy.How do the two firms differ from each other?


A) GreenWing Inc. generates 70 percent of its revenues from its primary business, while DS & Co. generates only 10 percent of its revenues from its primary business.
B) GreenWing Inc. pursues a backward diversification strategy, while DS & Co. pursues a forward diversification strategy.
C) DS & Co. will share fewer common competencies and resources between its various businesses when compared to GreenWing Inc.
D) DS & Co. pursues a differentiation strategy, and GreenWing Inc. pursues a cost leadership strategy, to gain a competitive advantage.

E) B) and C)
F) A) and B)

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Each stage of the vertical value chain typically represents a distinct _____ in which a number of different firms are competing.


A) industry
B) functional department
C) economy
D) customer segment

E) B) and C)
F) None of the above

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With reference to the Strategy Highlight 8.2, the Tata Group's corporate strategy is attempting to:


A) move from unrelated diversification to related-constrained diversification.
B) integrate different strategic positions, pursued by different strategic business units.
C) pursue a focused differentiation strategy over a focused cost-leadership strategy.
D) depend on a single product market to generate most of its revenues.

E) B) and C)
F) A) and D)

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Showing 101 - 120 of 126

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