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Q:
(p. 134) Among the factors that make for the creation of a global industry are all of these EXCEPT
A. Economies of scale
B. The presence of heterogeneous product needs across markets
C. A low level of trade regulation
D. A high level of R & D expenditures on products
Q:
Flexibility is only valuable when the decision-making setting a firm is facing is uncertain.
Q:
(p. 134) Rapid technological development:
A. Requires less management control
B. Has no affect on product life cycles
C. Lengthens product life cycles
D. Shortens product life cycles
Q:
(p. 134) A global planning process provides:
A. Cross purposes for subsidiaries
B. An ordered means for assembling, analyzing and distilling information
C. A means for misinformation to occur
D. Another information explosion
Q:
Flexibility is always valuable.
Q:
(p. 134) Strategic management planning must be global for six reasons. One of them is:
A. The increased cope of the global management task
B. Decreased globalization of firms
C. Increase in global monopolies
D. Slowing technology
Q:
Once a firm has vertically integrated it has committed its organizational structure, its management controls, and its compensation policies to a particular vertically integrated way of doing business and it has enhanced its flexibility.
Q:
(p. 133) Which of the following is NOT an aspect of global business that makes global planning necessary?
A. Shorter distances
B. Greater distances
C. The interrelationship of global operations
D. Differences in environmental factors in different countries
Q:
Research suggests that, in general, vertically integrating is more flexible than not vertically integrating.
Q:
(p. 133) The automobile industry is an example of a _______ industry.
A. multidomestic
B. global
C. transnational
D. multinational
Q:
Flexibility is low when the cost of changing strategic choices is low.
Q:
(p. 133) The retailing industry is an example of a _______ industry.
A. global
B. multidomestic
C. transnational
D. multinational
Q:
(p. 133) The expanding list of global industries include all of these EXCEPT
A. Automobiles
B. Mainframe computers
C. Insurance
D. Commercial aircraft
Q:
Flexibility refers to how costly it is for a firm to alter its strategic and organizational decisions.
Q:
If a supplier is overly reliant on a single customer, this supplier can be at risk of opportunism on the part of the customer.
Q:
(p. 133) A ______ is one in which competition crosses national borders.
A. Stakeholder activism
B. Multidomestic industry
C. Polycentric environment
D. Global industry
Q:
If a firm engages in vertical integration into a business activity where it does not possess any of the valuable, rare, or costly-to-imitate resources it needs to gain a competitive advantage, it may find itself at a competitive disadvantage to the extent that some firms already have competitive advantages in these business activities.
Q:
(p. 133) Factors that increase the degree to which an industry is multidomestic include:
A. A need for standardized products
B. Fragmented industry with few competitors
C. Distribution channels unique to each country
D. The existence of economics of scale
Q:
Firms should not vertically integrate into business activities where they do not possess the resources necessary to gain competitive advantages.
Q:
(p. 133) A ______ is one in which competition is essentially segmented from country to country.
A. Stakeholder activism
B. Multidomestic industry
C. Globalized economy
D. Polycentric environment
Q:
Firms should avoid vertically integrating in those businesses where they possess valuable, rare, and costly-to-imitate resources and capabilities.
Q:
(p. 131) The demands placed on the global firm by the foreign environments in which it operates, principally by foreign governments is called
A. Globalization
B. Localization
C. Formalization
D. Stakeholder activism
Q:
Transaction-specific investments make parties to an exchange vulnerable to opportunism, and vertical integration solves this vulnerability problem.
Q:
(p. 130) Which one of the following is NOT a factor that contributes to the increase in complexity of the global environment?
A. Globals face multiple political, economic, legal, social and cultural environments
B. Interactions between the national and foreign environments are complex
C. Geographic closeness impacts communication
D. Cultural and national differences make control difficult
Q:
A transaction-specific investment is any investment in an exchange that has significantly more value in the current exchange than it does in alternative exchanges.
Q:
(p. 130) State of marketing and distribution systems is a variable included under which category (as outlined by Business International Corporation)?
A. Political factors
B. Business factors
C. Transportation factors
D. Distribution factors
Q:
The threat of opportunism is the least when a party to an exchange has made transaction-specific investments.
Q:
(p. 130) According to Business International Corporation, variables to be included under labor factors include:
A. Degree of skill
B. Availability of raw materials
C. Degree of anti foreign discrimination
D. Cost of local borrowing
Q:
Firms should only bring market exchanges within their boundaries when the cost of vertical integration is more than the cost of opportunism.
Q:
(p. 130) Which of the following is NOT a geographic factor in choosing a foreign manufacturing site?
A. Efficiency of transport
B. Proximity of site to export markets
C. Availability of local raw materials
D. Availability of tariff protection
Q:
If one of a firm's exchange partners behaves opportunistically, this reduces the economic value of the firm.
Q:
(p. 130) According to Business International Corporation, the variables to be included under capital-source factors include:
A. Proximity of site to export market
B. Modern banking-systems
C. Availability of tariff protection
D. Current currency rate
Q:
If Iron Horse Helmets (IHH) were to contract with a Chinese manufacturing firm to provide IHH with superior quality helmets for sale in the United States but discovered that the shipments were actually of inferior quality when they were received, IHH would be said to be acting opportunistically.
Q:
(p. 130) Business International Corporation recommends that 7 broad categories of factors be considered in a corporation's assessment of a foreign manufacturing site. Which of the following described one of these categories?
A. Size of GNP
B. Tax factors
C. Technical factors
D. Social factors
Q:
Opportunism exists when a firm is unfairly exploited in an exchange.
Q:
(p. 130) Political factors in choosing a foreign manufacturing site include:
A. Attitude toward foreign investment
B. Cost of local borrowing
C. Degree of labor force in management
D. Currency rate
Q:
A firm with a high ratio between value added and sales has brought many of the value-creating activities associated with its business inside its boundaries, consistent with a high level of vertical integration.
Q:
(p. 129) Internal assessment involves identification of the basic ______ of a firm's operations.
A. Opportunities
B. Strengths
C. Threats
D. Competitors
Q:
When companies staffed and operated their own call centers in the United States, they were engaging in backward vertical integration, but when they started using independent companies in India to staff and operate these centers, they were more vertically integrated.
Q:
(p. 127) Top-down governance structure is evident in which orientation of a global firm?
A. Ethnocentric
B. Regiocentric
C. Geocentric
D. Polycentric
Q:
If Wal-Mart were to purchase a factory to make socks and it planned to sell these socks in its stores, this would be an example of forward vertical integration.
Q:
(p. 127) Global personnel development and placement occurs in which orientation of a global firm?
A. Ethnocentric
B. Regiocentric
C. Geocentric
D. Polycentric
Q:
"Firms can simultaneously implement cost-leadership and product-differentiation strategies if they learn how to manage the contradictions inherent in these two strategies." Explain the statement.
Q:
(p. 127) Host country culture is a dominant factor in which orientation of a global firm?
A. Ethnocentric
B. Regiocentric
C. Geocentric
D. Polycentric
Q:
Is it possible for a firm to implement a cost-leadership and product-differentiation strategy simultaneously?
Q:
(p. 127) Repatriation of profits to home country represents which orientation of a global firm?
A. Ethnocentric
B. Regiocentric
C. Geocentric
D. Polycentric
Q:
Discuss the similarities and differences of the organizational structures used by firms pursuing a cost-leadership and a product-differentiation strategy and discuss the importance of broad decision-making authority within a product-differentiation strategy.
Q:
(p. 127) Careful examination of critical global environmental features with particular attention to the status of the host nation is called:
A. Internal assessment
B. External assessment
C. Ethnocentric orientation
D. Cultural assessment
Q:
Identify the two primary forms that the substitutes for bases of product differentiation can take.
Q:
(p. 128) Understanding the ______ risk involved is a key element in the decision to do business in a foreign nation.
A. financial
B. economic
C. social
D. political
Q:
Identify which bases of product differentiation are likely to be almost always easy to duplicate, which can sometimes be costly to duplicate and which are usually costly to duplicate and discuss under what conditions a bases of differentiation is likely to be costly to imitate and can be a source of sustained competitive advantage.
Q:
(p. 127) External and internal assessments are conducted ______ a firm enters global markets.
A. after
B. during
C. before
D. once
Q:
Describe the role of product differentiation and how product differentiation helps firms take advantage of opportunities in fragmented industries, in emerging industries, in mature industries and in declining industries.
Q:
(p. 128) Closed countries typically have _______ policies.
A. Open
B. Isolationist
C. Many
D. Few
Q:
(p. 128) ______ countries maintain their stability by restricting the flow of money, goods, services, people, and information across their borders.
A. Open
B. Closed
C. Most
D. Few
Q:
What is the impact of product differentiation on each of the environmental threats identified in the five forces framework?
Q:
What is the relationship between product differentiation and managerial creativity?
Q:
(p. 128) In which of these orientations is national responsiveness a key strategic priority?
A. Ethnocentric
B. Polycentric
C. Geocentric
D. Regioentric
Q:
(p. 128) In which of these orientations is repatriations of profits to home country a key priority?
A. Polycentric
B. Ethnocentric
C. Geocentric
D. Regioentric
Q:
Identify the three broad categories of product differentiation and identify two bases of differentiation under each category.
Q:
Define product differentiation and discuss the role that customer perceptions play in product differentiation.
Q:
(p. 128) In which of these orientations are we likely to see hierarchical product divisions?
A. Polycentric
B. Ethnocentric
C. Geocentric
D. Regioentric
Q:
(p. 128) In which of these orientations is governance bottom-up?
A. Ethnocentric
B. Polycentric
C. Geocentric
D. Regioentric
Q:
According to Coach's website, the company has built a distinctive style and prestigious image over the past 40 years to develop a reputation as "America's preeminent designer, producer, and marketer of fine accessories and gifts for women and men including handbags, business cases, luggage and travel accessories, wallets, outerwear, eyewear, gloves, scarves and fine jewelry." Coach employs a multi-channel distribution channel to reach its customers, including company-owned stores and boutiques in the stores of prominent specialty retailers both within the United States and abroad, and the company operates an online store. Consumers who purchase coach products are generally willing to pay the premium price due to the superior quality of Coach's products as well as the perceived prestige of owning a Coach product. Coach stresses these features in its advertising campaigns and regularly allows movies and television shows to favorably feature Coach products in appropriate scenes. Over the last five years. Coach has partnered with automobile manufacturers such as Lexus to produce automobiles with Coach interiors. In an effort to expand its international reach, Coach intends to increase its international distribution and is expanding into Japan through Coach Japan, Inc., a joint venture with a local company that will allow Coach to control international distribution and to maintain a consistent brand strategy domestically and abroad.One feature of Coach's compensation policies is likely to beA) rewards for cost reduction.B) rewards for efficiency.C) rewards for creative flair.D) rewards for manufacturing efficiency.
Q:
(p. 128) In which of these orientations is governance top-down?
A. Polycentric
B. Ethnocentric
C. Geocentric
D. Regioentric
Q:
(p. 127) American firms often adopt a ______ orientation for pursuing strategies in Europe.
A. polycentric
B. regiocentric
C. geocentric
D. ethnocentric
Q:
(p. 127) A firm with a _______ orientation adopts a global systems approach to strategic decision making, thereby emphasizing global integration.
A. polycentric
B. geocentric
C. regiocentric
D. ethnocentric
Q:
(p. 127) A company with a ______ orientation adopts a global systems approach to strategic decision making, thereby emphasizing global integration.
A. Ethnocentric
B. Polycentric
C. Regiocentric
D. Geocentric
Q:
(p. 127) A(n) ______ orientation exists when the parent attempts to blend its own predisposition with those of the region under consideration.
A. Polycentric
B. Regiocentric
C. Ethnocentric
D. Geocentric
Q:
(p. 127) If a corporations has a(n) ______ orientation, then the culture of the country in which a strategy is to be implemented is allowed to dominate the decision-making process.
A. Polycentric
B. Ethnocentric
C. Regiocentric
D. Geocentric
Q:
(p. 127) Which one of the following is NOT a strategic orientation of global firms?
A. Omnicentric
B. Ethnocentric
C. Polycentric
D. Regiocentric
Q:
(p. 127) A(n) ______ orientation believes that the values and priorities of the parent organization should guide the strategic decision making of all its operations.
A. Ethnocentric
B. Polycentric
C. Regiocentric
D. Geocentric
Q:
(p. 124) Direct penetration of foreign markets makes sense as a competitive weapon because a firm can drain vital ____ from a foreign competitors domestic operations.
A. cash flows
B. export sales
C. dividends
D. debt
Q:
(p. 126) ______ leads in optics, solid-state physics, engineering, chemistry and process metallurgy.
A. Japan
B. France
C. The U.S.
D. Germany
Q:
Cross-functional product development teams are suitable for a firm pursuing a ________ strategy.
A) cost-leadership
B) confrontation
C) product-differentiation
D) stuck-in-the-middle
Q:
(p. 126) Which country leads in chemicals and pharmaceuticals, precision and heavy machinery, heavy electrical goods and surface transport equipment?
A. France
B. Germany
C. Japan
D. The U.S.
Q:
Recent research shows that firms can simultaneously implement cost-leadership and product-differentiation strategies if they learn how to manage the ________ inherent in these two strategies.
A) consistencies
B) similarities
C) contradictions
D) superfluousness
Q:
(p. 126) In the past 30 years, the U.S. has ______ in terms of technological advantage.
A. Substantially enhanced
B. Maintained a status quo
C. Declined dramatically
D. Reaches the number one spot in the world
Q:
Recent research suggests that ________ firms must have competitive levels of cost to survive.
A) low-cost
B) all
C) domestic
D) product-differentiation
Q:
(p. 124) The most involved strategy level in the evolution of a global corporation in characterized by
A. Technology transfer
B. Export-import operations
C. Foreign licensing
D. A substantial increase in foreign investment