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Buisness Policy > Chapter 7 > Flashcards

Chapter 7 Flashcards

1
Q

Acquisition

A

the purchase of a company that is completely absorbed by the acquiring corporation

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2
Q

Backward Integration

A

assuming a function previously provided by a supplier

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3
Q

Bankruptcy

A

a retrenchment strategy that forfeits management of the firms to the courts in return for some settlement of the corporation’s obligations

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4
Q

BCG Growth Share Matrix

A

a simple way to portray a corporation’s portfolio of products or divisions in terms of growth and cash flow

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5
Q

BOT Concept

A

a type of international entry option for a company.

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6
Q

Captive Company Strategy

A

Dedication a firm’s productive capacity as primary supplier to another company in exchange for a long term contract

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7
Q

Cash Cows

A

a product that brings in far more money that is needed to maintain its market share

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8
Q

Concentration

A

a corporate growth strategy that concentrates a corporation’s resources on competing in one industry

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9
Q

Concentric Diversification

A

a diversification growth strategy in which a firm uses it current strengths to diversify into related products in another industry

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10
Q

Conglomerate Diversification

A

a diversification growth strategy that involves a move into another industry to provide products unrelated to its current products

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11
Q

Corporate Parenting

A

a corporate strategy that evaluates the corporation’s business units in terms of resources and capabilities that can be used to build business unit values as well as generate synergies across business units

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12
Q

Corporate Strategy

A

a strategy that states a company’s overall direction in terms of its general attitude toward growth and the management of its various business and product lines

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13
Q

Directional Strategy

A

a plan that is composed of three general orientations: growth, stability, and retrenchment

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14
Q

Diversification

A

a corporate growth strategy that expands product lines by moving into another industry

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15
Q

Divestment

A

a retrenchment strategy in which a division of a corporation with low growth potential is sold

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16
Q

Dogs

A

have low market share and do not have the potential to bring in much cash

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17
Q

Exporting

A

shipping goods produced in a company’s home country to other countries for marketing

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18
Q

Forward Integration

A

assuming a function previously provided by a distributor

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19
Q

Franchising

A

an international entry strategy in which a firm grants rights to another company/individual to open a retail store using the franchiser’s name and operating system

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20
Q

Full Integration

A

a growth strategy under which a firm makes 100% of its key suppliers internally and completely controls its distributors

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21
Q

GE Business Screen

A

a portfolio analysis matrix developed by General Electric, with the assistance of the McKinsey & Company consulting firm

22
Q

Green-Field Development

A

an international entry option to build a company’s manufacturing plant and distribution system in another country

23
Q

Growth Strategy

A

a directional strategy that expands a company’s current activities

24
Q

Horizontal Growth

A

a corporate growth concentration strategy that involves expanding the firm’s products into other geographic locations and/or increasing the range of products and services offered to current markets

25
Q

Horizontal Integration

A

the degree to which a firm operates in multiple geographic location at the same point in an industry’s value chain

26
Q

Horizontal Strategy

A

a nesting of strategies by level from corporate to business to function, so that they complement and support one another

27
Q

Joint Venture

A

an independent business entity created by two or more companies in a strategic alliance

28
Q

Licensing

A

the licensing firm grants rights to another firm in the host country to produce and/or sale a product

29
Q

Liquidation

A

the termination of a firm in which all its assets are sold

30
Q

Long-term Contracts

A

agreements between two separate firms to provide agree-upon good and services to each other for a specified period of time

31
Q

Management Contracts

A

agreements through which a corporation used some of its personnel to assist a firm in another country for a specified fee and period of time

32
Q

Merger

A

a transaction in which two or more corporations exchange stock, but from which only one corporation survives

33
Q

Multipoint Competition

A

a rivalry in which a large multibusiness corporation competes against other large multibusiness firms in a number of markets

34
Q

No-Change Strategy

A

a decision to do nothing new; to continue current operations and operations and policies for the foreseeable future

35
Q

Parenting Strategy

A

the manner in which management coordinates activities and transfers resources and cultivates capabilities among product lines and business units

36
Q

Pause/Proceed with Caution Strategy

A

a corporate strategy in which nothing new is attempted; an opportunity to rest before continuing a growth or retrenchment strategy

37
Q

Portfolio Analysis

A

an approach to corporate strategy in which top management views its product lines and business units as a series of investments from which it expects a profitable return

38
Q

Production Sharing

A

the process of combining the higher labor skills and technology available in developed countries with the lower-cost labor available in developing countries

39
Q

Profit Strategy

A

a strategy that artificially supports profits by reducing investment and short-term discretionary expenditures

40
Q

Quasi-Integration

A

a type of vertical growth/integration in which a company does not make any of its key supplies but purchases most of its requirements from outside suppliers that are under its partial control

41
Q

Question Marks

A

new products that have potential for success and need a lot of cash for development

42
Q

Retrenchment Strategies

A

corporate strategies to reduce a company’s level of activities to return it to profitability

43
Q

Sell-Out Strategy

A

a retrenchment option used when a company has a weak competitive position resulting in poor performance

44
Q

Stability Strategy

A

corporate strategies to make no change to the company’s current direction or activities

45
Q

Stars

A

market leader that is able to generate enough cash to maintain its high market share

46
Q

Synergy

A

a concept that states that the whole is greater than the sum of is parts; that two units will achieve more together than they could separately

47
Q

Taper Integration

A

a type of vertical integration in which a firm internally produces less than half of its own requirements and buys the rest from outside suppliers

48
Q

Transaction Cost Economics

A

a theory that proposes that vertical integration is more efficient than contracting for good and services in the marketplace when the transaction cost of buying good and the open market become too great

49
Q

Turnaround Strategy

A

a plan that emphasizes the improvement of operational efficiency when a corporations problems are pervasive but not yet critical

50
Q

Turnkey Operations

A

contracts for the construction of operating facilities in exchange for a fee

51
Q

Vertical Growth

A

a corporate growth strategy in which a firm takes over a function previously provided by a supplier or distributor

52
Q

Vertical Integration

A

the degree to which a firm operation in multiple locations on an industry’s value chain from extracting raw materials to retailing

Buisness Policy (3 decks)

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