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Q:
(p. 298) Which of the following is NOT a benefit of formal, written policies?
A. They make variation in the treatment of individual problems more likely
B. They reduce misunderstanding
C. They systematically enhance indirect control and organization-wide coordination of the key purposes of policies
D. They communicate the authorization or sanction of policies more clearly
Q:
The ability to learn from operations can be helped if managers perceive that there is too much to be learned.
Q:
(p. 298) Policies offer predetermined answers to _____ problems.
A. unique
B. formal
C. routine
D. informal
Q:
Unlearning requires a firm to modify or abandon traditional ways of engaging in business.
Q:
(p. 298) Policies may be ________ or _________.
A. Written and informal; unwritten and formal
B. Written and formal; unwritten and formal
C. Written and formal; unwritten and informal
D. Written and informal; unwritten and informal
Q:
Learning from international operations is automatic.
Q:
(p. 297) Policies reduce _______ in day to day decision making.
A. The need for operating personnel
B. The number of routine problems
C. The speed with which decisions can be made
D. Uncertainty
Q:
One of the most compelling reasons for firms to begin operations outside their domestic markets is to refine their current core competencies and to develop new core competencies.
Q:
(p. 297) Policies counteract resistance to or rejection of chosen _______.
A. vision statements
B. strategies
C. mission statements
D. capabilities
Q:
(p. 297) Policies ensure ______ action.
A. slower
B. quicker
C. indirect
D. loose
Q:
The search for low labor costs has led some firms to engage in an international "race to the bottom."
Q:
(p. 297) Policies ________ basic aspects of organization behavior.
A. Negotiate
B. Institutionalize
C. Justify
D. Determine
Q:
Gaining access to new customers is, perhaps, the most traditional reason why firms begin international operations.
Q:
(p. 296) Policies establish __________ over independent action.
A. strategic control
B. Indirect control
C. direct control
D. visionary control
Q:
A product or service can be at different stages of its life cycle in different countries.
Q:
Growth is the third stage in the product life cycle.
Q:
(p. 296) Policies establish __________ over _________ by clearly stating how things are to be done _________.
A. Indirect control; dependent action; in the future
B. Indirect control; independent action; now
C. Direct control; independent action; in the future
D. Direct control; dependent action; now
Q:
(p. 296) Policies are also sometimes called
A. standard operating procedures
B. action plans
C. functional tactics
D. business strategy objectives
Q:
One estimate suggests that countertrade accounts for between 10 and 20 percent of world trade.
Q:
(p. 296) _______ communicate guidelines to decisions.
A. Policies
B. Action plans
C. Functional tactics
D. Business strategy objectives
Q:
When international firms engage in countertrade, they receive payment for the products or services they sell into a country in the form of hard currency.
Q:
(p. 296) __________ increase managerial effectiveness by standardizing many routine decisions and clarifying the discretion managers and subordinates can exercise in implementing functional tactics.
A. Outsourcing
B. Standard operating procedures
C. Corporate cultures
D. Action plans
Q:
Because the value of hard currencies can fluctuate in the world economy, firms can manage their currency risk by engaging in various hedging strategies in world money markets.
Q:
(p. 296) One way operating managers _____ is through the use of policies.
A. outsource
B. strategize
C. politicize
D. empower
Q:
Hard currencies are currencies that are traded, and thus have value, on international money markets.
Q:
(p. 296) __________ are directives designed to guide the thinking, decisions and actions of managers and their subordinates in implementing a firm's strategy.
A. Functional tactics
B. Action plans
C. Short-term objectives
D. Policies
Q:
Border levies are an example of tariffs.
Q:
(p. 296) One way operating managers ensure decision making is consistent with the mission, strategy and tactics of the business while allowing considerable latitude to operating personnel is through the use of:
A. Empowerment
B. Policies
C. Strategic evaluation
D. Facilitating strategic design
Q:
Countervailing duties are an example of quotas.
Q:
(p. 296) ________ is the act of allowing an individual or team the right and flexibility to make decisions and initiate action.
A. Management
B. Micromanagement
C. Empowerment
D. Developing strategy
Q:
Embargoes are an example of nontariff barriers.
Q:
(p. 295) ___________ is the most frequently outsourced functional activity at 75 percent.
A. Marketing
B. Payroll
C. Travel
D. HR
Q:
Japanese retail distribution has historically been much more fragmented, and much less efficient, than the system that exists in either the United States or Western Europe.
Q:
(p. 294) _________ is the main force behind the outsourcing trend.
A. Relentless cost cutting
B. Achieving internal synergies
C. Better capital budgeting
D. Keeping control internal
Q:
Distribution problems are typically limited to developing economies.
Q:
(p. 294) Relentless cost cutting is the main force behind the trend of _____.
A. Strategic planning
B. Outsourcing
C. Goal setting
D. Globalization
Q:
In some international markets, adequate distribution networks exist but are tied up by new entrants to these markets.
Q:
(p. 274) __________ is acquiring an activity, service or product necessary to provide a company's products or services from "outside" the people or operations controlled by that acquiring company.
A. Specialization
B. Fragmentation
C. Outsourcing
D. Acquisition or merging
Q:
In order for the basis of an international strategy to attract new customers, those products or services must address the needs, wants, and preferences of customers in foreign markets at least as well as, if not better than, alternatives.
Q:
(p. 294) __________ obtaining work previously done by employees inside the companies from sources outside the company.
A. Specialization
B. Fragmentation
C. Outsourcing
D. Acquisition or merging
Q:
(p. 294) Outsourcing starts for most firms with:
A. The outsourcing of production
B. The outsourcing of the marketing function
C. The outsourcing of payroll production
D. The outsourcing of corporate strategy decisions
Q:
How are poison pills different from shark repellents?
Q:
Describe three major challenges that firms integrating acquisitions are likely to face.
Q:
(p. 294) Involving operating managers can increase the __________ of operating managers to the strategies developed.
A. Resistance
B. Limitations
C. Commitment
D. Evaluation
Q:
Identify and discuss the three rules that target firm managers should follow to maximize the probability of earning economic profits from their merger and acquisition strategies.
Q:
(p. 294) Operating managers must establish short-term objectives and operating strategies that contribute to:
A. Business-level goals
B. Corporate-level goals
C. Goals toward diversification
D. Specialization
Q:
(p. 291) Which of the following is NOT a way that specificity in functional tactics contributes to successful implementation?
A. Helping ensure that functional managers know what needs to be done and can focus on accomplishing results
B. Limiting the need for top management's confidence in and sense of control over the business strategy
C. Clarifying for top management how functional managers intend to accomplish the business strategy
D. Facilitating coordination among operating units within the firm by clarifying areas of interdependence and potential conflict
Q:
Identify and discuss six rules that firms bidding on a target firm in an acquisition should follow to increase the possibility that an acquisition strategy will earn superior performance.
Q:
Describe and discuss five reasons why bidding firms might still engage in acquisitions even if, on average, they do not create value for a bidding firm's stockholders.
Q:
(p. 291) Functional tactics are more _________ than business strategies.
A. Specific
B. Focused on the general direction of the firm
C. Focused on a commitment to corporate strategy
D. Long-term
Q:
If there is one target firm with a current market value of $20,000 as a stand-alone entity and five bidding firms, each of which has a current market value of $30,000 as a stand-alone entity, and the value of the target firms and any of the bidding firms combined is $60,000, estimate the price the bidding firms would be willing to pay for the target firm and the return to stockholders of bidding and target firms when there is strategic relatedness between firms.
Q:
(p. 291) Business strategies provide _______ direction.
A. General
B. Focused
C. Generic
D. Narrow
Q:
Identify the three potential sources of strategic relatedness between bidding and target firms that were detailed by Lubatkin in 1983 and the four general reasons why bidding firms might want to engage in merger and acquisitions as detailed by Jensen and Ruback in 1983.
Q:
(p. 293) The ___________ of functional tactics allows functional managers to adjust to changing current conditions.
A. Shorter time horizon
B. Focus on growth
C. Specificity
D. Business focus
Q:
Identify and differentiate between the five different FTC categories of mergers and acquisitions.
Q:
(p. 291) __________ identify activities to be undertaken now or in the immediate future.
A. Long-term tactics
B. Business strategies
C. Corporate strategies
D. Functional tactics
Q:
If there are five bidders (each of which has a current market value of $50,000) interested in a target firm that has no strategic relatedness with any of the bidding firms and has a current market value of $25,000, identify the economic profits that will be earned by both the bidding firm's equity holders and the target firm's equity holders and discuss this case.
Q:
(p. 291) Which is NOT one of the differences between business strategies and functional tactics?
A. Reinforcement of the strategy
B. Time horizon
C. Specificity
D. Participants who develop them
Q:
(p. 291) Every ________ in a company executes functional tactics that support the business's strategy and help accomplish strategic objectives.
A. Competitive rivalry
B. Supplier/customer
C. Value chain activity
D. Business unit manager
Q:
Discuss the differences between mergers and acquisitions and differentiate between friendly and unfriendly acquisitions.
Q:
(p. 291) Functional tactics translate _______ into action designed to accomplish specific short-term objectives.
A. Corporate strategy
B. Grand strategy
C. Competitive will
D. Business strength
Q:
P&G is a leading consumer goods company in the United States that has grown its business through a combination of international growth, alliances, acquisitions and mergers. In 2003, P&G acquired the beauty care company Wella to acquire products that would complement its current product. In 2004, P&G acquired AG-Hutchison Ltd to establish a stronger presence in the Chinese consumer goods products market. In 2005, P&G acquired Gillette, another consumer goods company, in a deal worth approximately $57 billion dollars.The most significant challenge P&G is likely to face in integrating each of the acquired companies into P&G's operations is likely to be ________ differences between P&G and each of the companies.A) logisticalB) culturalC) operationalD) distribution
Q:
(p. 291) ________ are key, routine activities that must be undertaken in each functional area.
A. Business tactics
B. Resource tactics
C. Functional tactics
D. Corporate tactics
Q:
(p. 291) One benefit of short-term objectives and action plans is its _________, which clarify personal and group roles in a firm's strategies and help realistically challenge managers to perform well. These objectives are particularly effective when linked to the firm's reward structure.
A. Motivational payoff
B. Structured clarity
C. Compensation structure
D. Complicated nature
Q:
(p. 291) One benefit of short-term objectives and action plans is that they provide a __________. They can provide clear, measurable mechanisms for developing budgets, schedules and trigger points, which help control the implementation of strategy.
A. Basis for strategy evaluation
B. Basis for motivation
C. Basis for strategy implementation
D. Basis for strategic control
Q:
If P&G wanted to increase the probability that it would be able to earn superior economic performance from its acquisition of Gillette, P&G should
A) share information about Gillette with other potential bidders.
B) share information about strategic fit potential between P&G and Gillette with Gillette.
C) wait to submit its bid for Gillette until there are multiple interested bidders.
D) close the acquisition deal as quickly as possible.
Q:
(p. 291) Functional tactics translate thought (______) into action designed to accomplish specific short-term objectives.
A. policies
B. mission
C. vision
D. grand strategy
Q:
(p. 291) A benefit of short-term objectives and action plans comes from the __________. If this is done and managers participate, short-term objectives and action plans provide valid bases for addressing and accommodating conflicting concerns that might interfere with strategic effectiveness.
A. Process development
B. Strategy development
C. Strategic control
D. Clarity of purpose
Q:
(p. 290) Short-term objectives and action plans give operating personnel a better understanding of their role in the firm's ______.
A. Goals
B. Financial performance
C. Strategic management
D. Mission
Q:
(p. 290) The link between short-term and long-term objectives should resemble ________ through the firm from basic long-term objectives to specific short-term objectives in key operation areas.
A. Cascades
B. Building blocks
C. Small barriers
D. Fences
Q:
(p. 290) Some firms assign ____ to establish and communicate the relative priority of objectives.
A. rewards
B. objectives
C. weights
D. policies
Q:
(p. 289) Words like "primary," "top," and "secondary," may be used to indicate:
A. Long-term objectives
B. Measurability
C. Priority
D. Strategic objectives
Q:
________ is an example of an ineffective and inconsequential response by a target firm.
A) A Pac Man defense
B) A Blue Man defense
C) A crown jewel sale
D) A golden parachute defense
Q:
(p. 290) A(n) _______ does not necessarily communicate the real difference in the importance of objectives.
A. Simple flow
B. Simple ranking
C. Statistical measure
D. Established priority
Q:
(p. 289) Difficulties in quantifying objectives can often be overcome by initially focusing on _________ and then identifying _________.
A. Measurability; functions
B. Measurable activity; measurable outcomes
C. Measurable outcomes; measurable activity
D. Line units; measurable activity
Q:
________ does not affect the wealth of target firm equity holders.
A) Blue Man defense
B) Pac Man defense
C) Golden parachute
D) Silver parachute
Q:
(p. 289) It is far easier to quantify the objectives of ______, like production, than of certain ______ areas like personnel.
A. Line units; function
B. Staff units; line
C. Outcomes; staff
D. Line units; staff
Q:
Supermajority voting rules are an example of a
A) poison pill.
B) white knight.
C) golden parachute.
D) shark repellent.
Q:
(p. 289) ________ can help avoid conflicting assumptions about the relative importance of annual objectives, which could otherwise inhibit progress toward strategic effectiveness.
A. Establishing priorities
B. Establishing action plans
C. Distinguishing the measurable objectives
D. Establishing measurable outcomes
Q:
________ include a variety of relatively minor corporate governance changes that, in principle, are supposed to make it more difficult to acquire a target firm.
A) Shark repellents
B) White knights
C) Greenmail
D) Poison pills