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The most serious drawbacks to vertical i...View Answer
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A) It allows a company to concentrate on its core business, leverage its key resources and core competencies, and do even better what it already does best.
B) It can hollow out a firm's own capabilities and cause it to lose touch with activities and expertise that contribute fundamentally to the firm's competitiveness and market success.
C) It reduces the company's risk exposure to changing technology and/or buyer preferences.
D) It improves organizational flexibility and speeds time to market.
E) It involves an activity that can be performed better or more cheaply by outside specialists.
G) C) and D)
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Cost-based strategies involve lowering p...View Answer
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A) The alliance is critical to the company's achievement of an important objective.
B) The alliance helps block a competitive threat.
C) The alliance helps open up important new market opportunities.
D) The alliance helps build, enhance, or sustain a core competence or competitive advantage.
E) The alliance helps the company obtain additional financing on better credit terms.
G) A) and C)
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A) a merger involves one company purchasing the assets of another company with cash, whereas an acquisition involves a company acquiring another company by buying all of the shares of its common stock.
B) a merger is the combining of two or more companies into a single corporate entity, whereas an acquisition involves one company (the acquirer) purchasing and absorbing the operations of another company (the acquired) .
C) in a merger, the companies retain their original names, whereas in an acquisition the name of the company being acquired is changed to be the name of the acquiring company.
D) a merger is a combination of three or more companies, whereas an acquisition is a pooling of interests of just two companies.
E) a merger involves two or more companies deciding to adopt the same strategy, whereas an acquisition involves one company taking over the strategy-making function of another company.
G) A) and E)
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A) producer of organic vegetables deciding to acquire a compost company.
B) footwear manufacturer developing own-branded retail stores.
C) crude oil refiner purchasing an oil well drilling and exploration company.
D) hospital opening a nursing home for the aged.
E) maker of prescription drugs acquiring a chemical manufacturer.
G) A) and C)
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Hit-and-run (also known as guerrilla) of...View Answer
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A) is nearly always a more attractive strategic option than merger and acquisition strategies.
B) carries the substantial risk of raising a company's costs.
C) carries the substantial risk of making a company overly dependent on its suppliers.
D) increases a company's risk exposure to changing technology and/or changing buyer preferences.
E) involves farming out certain value chain activities presently performed in-house to outside vendors.
G) C) and D)
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A) increasing a company's ability to strongly differentiate its product and be successful with either a broad differentiation strategy or a focused differentiation strategy.
B) obtaining higher quality and/or cheaper components or services, improving a company's ability to innovate, and reducing its risk exposure.
C) speeding a company's entry into foreign markets.
D) permitting greater use of strategic alliances and collaborative partnerships.
E) giving a firm more direct control over the costs of value chain activities.
G) B) and D)
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Merger and acquisition strategies are a ...View Answer
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A) that partners will not fully cooperate or share all they know, preferring instead to guard their most valuable information and protect their more valuable know-how.
B) becoming dependent on other companies for essential expertise and capabilities.
C) the added time and extra expenses associated with engaging in collaborative efforts.
D) having to compromise the company's own priorities and strategies in reaching agreements with partners.
E) the collaborative arrangements will not live up to expectations.
G) A) and B)
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A) to gain quick access to new technologies or other resources and capabilities
B) to create a more cost-efficient operation out of the combined companies
C) to expand a company's geographic coverage
D) to facilitate a company's shift from a broad differentiation strategy to a focused differentiation strategy
E) to extend a company's business into new product categories
G) None of the above
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The principal offensive strategy options...View Answer
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A) to be the first mover.
B) to be a fast follower.
C) to be a late mover (because it is cheaper and easier to imitate the successful moves of the leaders and moving late allows a company to avoid the mistakes and costs associated with trying to be a pioneer-first-mover disadvantages usually overwhelm first-mover advantages) .
D) to be the last mover-playing catch-up is usually fairly easy and almost always is much cheaper than any other option.
E) to carefully weigh the first-mover advantages against the first-mover disadvantages and act accordingly.
G) A) and C)
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A) leapfrogging competitors by being the first adopter of next-generation technologies or being first to market with next-generation products
B) offering an equally good or better product at a lower price
C) blocking the avenues open to challengers
D) attacking the competitive weakness of rivals
E) capturing unoccupied or less-contested territory by maneuvering around
G) A) and B)
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A) partners that respectively have considerable resource weaknesses in the marketplace.
B) partners that are not only experienced with strategic alliances, but who also routinely enter into collaborative agreements with firms in peripheral industries.
C) partners based in countries with distinctly different cultures and consumer buying habits and preferences.
D) joining forces in R&D to develop new technologies cheaper than a company could develop the technology on its own.
E) collaboration with suppliers or distribution allies or when both parties conclude that continued collaboration is in their mutual interests.
G) A) and E)
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A) an activity can be performed better or more cheaply by outside specialists.
B) it allows a company to focus its entire energies on its core business.
C) it restricts a company's ability to assemble diverse kinds of expertise speedily and efficiently.
D) it reduces the company's risk exposure to changing technology and/or changing buyer preferences.
E) it allows a company to leverage its key resources.
G) B) and D)
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Typically, strategic alliances involve s...View Answer
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A) The hoped for outcomes and changes to existing operations may not eventuate.
B) Cost savings are equal or better than expected.
C) Gains in competitive capabilities quickly materialize.
D) Efforts to mesh corporate cultures go smoothly.
E) Key employees at the acquired company can quickly become disenchanted and leave.
G) B) and C)
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In order to capture the benefits of enga...View Answer
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