Exam 2 !

Question 1

The international strategy that attempts to combine global scale efficiencies with local responsiveness in a geographic region is the _ strategy.
global
multi-domestic
transnational
universal

Answer 1

transnational

Question 2

Which of the following international strategies is used by Nike to compete globally?
global
transnational
multi-domestic
trans-multinational

Answer 2

global

Question 3

A manufacturer of kitchen and laundry appliances plans to produce and sell different varieties of appliances in various countries due to differences in kitchen and home sizes, electrical power variations, alternative fuels, and cultural preferences. This manufacturer will be following the _ strategy

Answer 3

multi-domestic

Question 4

T/F: “Cost Leadership” strategy focuses on increasing benefits in delivering value to customers.

Answer 4

False

Question 5

T/F: Competitive scope describes the breadth of the target market the organization wishes to serve.

Answer 5

True

Question 6

The five business level strategies include all EXCEPT
focus integrated strategy
differentiation
cost leadership
integrated cost leadership/differentiation

Answer 6

focused integrated strategy

Question 7

In an organization using the differentiation strategy, which of the following functions is most likely to be more important than the others?
operations
accounting
personnel
marketing

Answer 7

marketing

Question 8

A firm successfully implementing a differentiation strategy would expect:

Answer 8

To charge premium prices

Question 9

What is the central equation of value creation?

Answer 9

Customer Value = Benefits - Cost

Question 10

What are the 5 business-level strategies?

Answer 10

-Cost leadership
-Differentiation
-Focused cost leadership
-Focused differentiation
-Integrated cost leadership/differentiation

Question 11

What dimensions do business-level strategies differ on?

Answer 11

Competitive advantage (cost vs uniqueness)
Competitive scope (broad or narrow target)

Question 12

Where does cost leadership fall on the business-level strategies table?

Answer 12

lowest cost/broad market

Question 13

Where does differentiation fall on the business-level strategies table?

Answer 13

distinctiveness/broad market

Question 14

Where does Focused cost leadership fall on the business-level strategies table?

Answer 14

lowest cost/narrow market

Question 15

Where does focused differentiation fall on the business-level strategies table?

Answer 15

distinctiveness/narrow market

Question 16

Where does integrated cost leadership/differentiation fall on the business-level strategies table?

Answer 16

in the middle

Question 17

What does Cost leadership strategy focus on?

Answer 17

Cost

Question 18

Cost leadership strategy using _ _ _ to make _ _.

Answer 18

economies of scale to make standardized products

Question 19

What is an advantage of cost leadership strategy?

Answer 19

cost advantages are difficult to replicate

Question 20

What are risks of cost leadership strategy?

Answer 20

-lower prices
-customer preferences change
-new supplier enters the market

Question 21

what does the differentiation strategy focus on?

Answer 21

benefits

Question 22

differentiation strategy offers _ _ _.

Answer 22

perceptions of uniqueness

Question 23

what does the focused strategies focus on?

Answer 23

-the needs of a specific market segment & focus on narrow customer segment

Question 24

the differentiation strategy allows firms to charge a _ for their products.

Answer 24

premium

Question 25

What are the advantages of differentiation strategy?

Answer 25

-perceived value is difficult to replicate

Question 26

What are the competitive risks of differentiation?

Answer 26

-perceived price too high? -clones

Question 27

What is integrated strategy?

Answer 27

focus on differentiation and low cost could serve broad and narrow market

Question 28

In integrated strategy the goal is to achieve _.

Answer 28

flexibility

Question 29

What is a competitive risk of the integrated strategies?

Answer 29

possibility of being neither fish nor fowl. could be bad at both

Question 30

What is Blue Ocean strategy?

Answer 30

Firms decided they dont want to compete and go into new market space with no boundaries

Question 31

What is the Red Ocean strategy?

Answer 31

the traditional view of strategy -lots of competition and fighting for consumer attention

Question 32

Cost structure is lowered by _ and _ competition factors not highly valued by the buyers

Answer 32

eliminating and reducing

Question 33

Buyer value is increased by _ and _ competition factors never offered in the industry

Answer 33

raising and creating

Question 34

What are the two ways to design a blue ocean strategy?

Answer 34

ERRC framework strategy canvas (value curves)

Question 35

What does ERRC stand for?

Answer 35

Eliminate Raise Reduce Create

Question 36

What are motives for international strategies?

Answer 36

-sourcing of resources/supplies -seeking to expand/develop new markets -competitive rivalry -leverage core competencies and learning

Question 37

What are the international strategies?

Answer 37

multidomestic global transnational

Question 38

How do you implement international structures?

Answer 38

-geographic-are divisional structure -worldwide divisional structure -global matrix structure

Question 39

What are modes of entry?

Answer 39

-exporting -licensing -franchising -international strategic alliance and joint venture -greenfield venture -international acquistion

Question 40

In international strategies, what are two important and potentially competing issues?

Answer 40

standardization and customization

Question 41

What is a global international strategy?

Answer 41

single marketplace, with standardized goods and services

Question 42

What is a multidomestic international strategy?

Answer 42

independent subsidiaries, focus on specific domestic market

Question 43

What is transnational international strategy?

Answer 43

firm attempts to combine benefits of global scale efficiencies with the benefits of local responsiveness ex) McDonalds has standardized products in other countries but also offer foods to fit that country

Question 44

Multidomestic strategy offers _ products for a _ domestic market

Answer 44

specific, particular

Question 45

What are the characteristics of exporting?

Answer 45

high cost, low control

Question 46

List the modes of entry from least to most control/riskiest... acquisitions, licensing, exporting, strategic alliances, new wholly owned subsidiary.

Answer 46

exporting licensing strategic alliances acquisitions new wholly owned subsidiary

Question 47

what is the riskiest mode of entry?

Answer 47

new wholly owned subsidiary

Question 48

What are the risks of international strategy?

Answer 48

political & economic

Question 49

What are the risks of international strategy that are considered blind spots?

Answer 49

cookie cutter problem geographical distances cultural differences overconfidence

Question 50

What is the cookie cutter problem?

Answer 50

when you try to treat a foreign market as the same as your home market

Question 51

What is the value curve with blue ocean strategy?

Answer 51

company is comparing to its competitors based on key factors of competition - blue ocean creates new values to set themselves apart

Question 52

What is exporting in modes of entry?

Answer 52

selling products in foreign markets

Question 53

What is licensing in modes of entry?

Answer 53

allowing foreign company to use intellectual property

Question 54

what is strategic alliances in modes of entry?

Answer 54

partnering with foregin company to share resources, expertise, and risks

Question 55

what is acquisitions in modes of entry?

Answer 55

purchasing an existing company in foreign market

Question 56

what is new wholly owned subsidiaries in modes of entry?

Answer 56

setting up a completely owned company in foreign market through greenfield investments