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Management Policy > Exam 2 - Chapter 4-8 > Flashcards

Exam 2 - Chapter 4-8 Flashcards

1
Q

Among the Rationale for international expansion is to “work patents” in other countries. This means?

A

Producing and or selling your product in the foreign country

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2
Q

One of the marketing conditions which might influence a company’s choice as to where to pursue an overseas expansion might be homologation requirements. An example of this would be?

A

adjusting your product to local voltages

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3
Q

The advantages of entering an international marketing via licensing include which of the following?

A

Little or no capital exposure

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4
Q

Offsetting your exchange rate risk by purchasing a financial instrument which guarantees limits on your exchange rate exposure is called?

A

Hedging

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5
Q

Host government policies can often influence companies to locate there via incentives. What is any one incentive which a foreign government or province might use?

A

Have a tax free zone for manufacturing

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6
Q

Remittable funds represent?

A

The amount of profit you can take out of a country

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7
Q

One of the reasons to enter a strategic alliance or JV in a new country is to gain access to distribution. In this case, your partner may help you?

A

By filling out your product line

By helping you to get access to distributors and retailers

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8
Q

Dumping is variously described as?

A

Selling a product in a foreign market at a price which is below the price in your home market
Selling a product below your fully allocated cost

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9
Q

Accusations of dumping are adjudicated by?

A

WTO

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10
Q

What is any one reason you might decide to not enter into a foreign market?

A

Country destabilizing, demographics don’t make sense for your business

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11
Q

In many situations, it is wise to disperse manufacturing and assembly operations to various sites in order, for example to minimize distribution costs by getting closer to the customer. What is any reason for centralizing manufacturing operations?

A

Shipping air containers around the country, provides a lower cost to build plants close to another

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12
Q

If investing in a foreign market, you need to protect a proprietary manufacturing process or formula, you might decide to enter a foreign market by this type of FDI

A

Green field site

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13
Q

What would be an example of leveraging a strong brand as a means of achieving diversification?

A

Miracle Whip expanded into other business - Salad dressings, to Mayonnaise

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14
Q

Decisions about diversification should always be evaluated and measured primarily by virtue of their effect on?

A

Shareholders

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15
Q

The most popular approach to diversifying a business is by?

A

Acquisition

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16
Q

If I were in the business of making shoes, what is any business i might choose to move into by virtue of extending my existing business or skills?

A

Apparel business, belts, socks

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17
Q

In the BCG Analysis, businesses which start out as a ______(having a small relative share in a fast growing industry) may, through investment, improve their relative share position and become ________. As the industry matures, they may become ________ and as technological and other forces cause obsolescence they may eventually drift into the end of their life cycle as

A

Question Mark, Star, Cash Cow, Dog

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18
Q

Achievement of cost savings by virtue of the reduction in unit costs accompanying the total size of the production operations?

A

Economy of Scope, Value Chain economics

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19
Q

The multi-business strategy in which elements of the corporation may share a common customer base or a common distribution scheme would be called?

A

Related diversification

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20
Q

The characteristics of an unrelated diversification strategy would include which of the following?

A

Targets for acquisitions would include bargains or undercapitalized business, There is generally no business to business strategy,

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21
Q

The popular evaluation schemes for corporate strategy in multi-business enterprises are based on which two of the following?

A

Business unit competitive strength, industry attractiveness

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22
Q

In a leveraged buyout?

A

The company becomes a private entity, The company usually takes on a high debt load

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23
Q

A proceeding in which the assets of a company are sold off and the company is closed down is referred to as?

A

Chapter 7 Bankruptcy

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24
Q

If a tender offer is made directly to the shareholders of a publicly-held company, this is an indication of which of the following?

A

A hostile takeover effort

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25
A spinoff is sometimes undertaken in order to unlock the value in the stock. What does that mean?
The share prices of the constituent parts of the company will trade at a higher combined price than the original company shares
26
In your instructors view, the most critical strategic decision made by a management team involve:
The employment of available cash flow for investment in new or existing businesses or ventures
27
Which of the following are drivers of unethical behavior, according to the text and the discussion in class?
Pressure from investors to meeting earnings targets, Pressure in behalf of the employees to achieve bonus or stock option targets, Desire for personal wealth
28
According to the text's discussion of the costs of unethical strategies, examples of the lowest visible costs would be which of the following?
Hits to the stock price, potential lawsuits
29
According to the instructors comments in class, the most serious cost of an EEOC complaint might well be?
The effort expended in defending the complaint by HR and other personnel
30
If we sat that what is ethical is governed primarily by the stands of the local culture in which we are operating, we are following which of these concepts?
Ethical relativism
31
Businesses usually embrace social responsibility initiatives?
Out of self-interest
32
Peter Drucker believed that social responsibility?
Was not a proper role for business
33
Support for the local United ay would be an example of?
Social Responsibility
34
What is any one positive value of socially responsible behavior on the part of a company?
The local economic impact for a community, empowered workers
35
Which of the following are characteristics of corporate environmental sustainability programs?
Can be a competitive advantage, Usually linked to the business itself or the interests of employees, the ultimate goal is a closed system
36
When a company first starts up, the proprietor may handle sales, while another individual manages the manufacturing and service part of the business. This would be described as _____ Organization
Functional
37
A large multi-SBU company which could be characterized as related diversification would like to have an organizational structure which was most like which of the following?
Matrix
38
Where mistakes can be critical and tight control is necessary, the span of control forward favored by most organizations is?
Vertical, with each boss having just two or three reporting subordinates
39
According to your instructor, the best organizational structure is?
There is no best structure
40
In Frederick Herzberg's Two-Factor Theory of Organizational Behavior, which of the following would be considered maintenance factors
Day car services, office size, vacation benefits, merit increases in pay
41
The most important element in allocating resources is?
Assessing the risk
42
A program which proceeds from the observation that everyone has a customer or customers, inside or outside the organization, is?
TQM
43
Policies and Procedures?
Provide strategic guidance for company direction, Are for recurring situations
44
Which of the following are among the guidelines for monetary incentives?
Make the incentive a major part of the compensation package, Ensure objectivity to the extent possible, Tie incentives to results(not effort)
45
Alignment schemes are intended to align the interests of?
Management and Shareholders
46
Profit Sharing?
A right based on the achievement of a threshold earnings level for the company
47
Performance Stock Options?
A right based on achievement of a company goal plus the passage of time
48
Banked Bonuses?
A right based on sustained performance over time
49
Phantom Stock/Options?
A right based on a calculation of earnings and price/earnings ratio for an industry
50
Which of the following are tests of alignment techniques?
Has an impact on employee behavior
51
When we sat that a corporate culture is insular, we mean that?
It believes that the only good ideas come from within the organization
52
In Your instructors view, the hardest part of encouraging creativity in an organization is?
Learning to tolerate failure of creative initatives
53
One of the elements discussed as part of staying informed was development of information without evaluation skill. What does that mean?
Knowing if something is right or wrong just at a quick glance, being aware of surroundings
54
What did Richard Cory Do?
Put a bullet through his head?
55
The only president of the US who also served as chief justice of the supreme court?
William Howard Taft
56
Top line?
Revenue
57
Bottom line?
Net Income
58
Market Cap?
Price per share * Outstanding shares
59
ROE?
Most frequently used by shareholders
60
EBITA?
Money you make out of basic business before considering accounting affects
61
P/E?
Still used in investment community of what the investors confidence in management might be.
62
Inventory Resources: Physical?
Physical: Location, equipment, ownership of mines, buildings, distribution, warehouses, trucks, containers, roll-on roll off facilities
63
Inventory Resources: Human?
Sales force
64
Inventory Resources: Organizational?
Support primary functions of business(customer service is strong,
65
Inventory Resources: intangible?
patents, trademarks, intellectual property
66
Inventory Resources: Alliances?
Alliances: resources that you have by virtue of your alliances
67
Competitive advantage - Valuable?
In the marketplace
68
Competitive advantage - Rare?
Is it unique capability o resources(always compare to competitors)
69
Competitive advantage - Hard to Copy or imitate?
capital investment, patent estate, reputation built over time
70
Measurement of internal resources is always against who?
Always compare against competitors
71
SWOT External Factors?
Look at external factors and ask which of these create opportunities. Technology changes, maybe focus on e-commerce…. Changes in demographics(old people in US and Europe), Social changes(people becoming more mobile-south and west), economic factors(buildup of people along the coast in china of GDP of $20,000).
72
SWOT Internal Factors?
Internal factors: always just compared to competitors. these are difficult because people don’t like to admit failure.
73
Porters Primary Activities?
Primary: operations, marketing
74
Porters Secondary Activities?
Secondary: HR, R&D
75
What is Benchmarking?
Best practice in any industry to relate to benchmark
76
Industry Value Chain?
look at the entire value chain. Distributor to sales to marketing. Each steps adds value from raw material supply to customer purchase
77
Supplier Dis-advantage?
Pressure via multiple sources/put someone in business, Back integrate, Partner with supplier/utilize JIT delivery
78
Low Cost Provider?
Everything looks alike, commodities… etc
79
Differentiation?
Allows for a larger margin and or an enhanced market share. Basis of the differentiation can be anything the customer values(service, selection, prestige)
80
Niche?
Hazards, gets too big… attracts flies.
81
Multiple strategies?
Offering a number of things at different price points to everyone. ?Ball Park, Airlines.
82
Best cost provider?
Find a niche in the market, target is best example. A bit better of a situation
83
Stuck in the middle danger?
Try to become a differentiated product, add costs. Advertising, quality… Will the customer give you the higher cost that you deserve
84
Strategic Alliance?
Expedite development of new products or technologies, Improve costs, security of supply or distribution
85
Mergers?
Financial Synergy, Sales Synergy
86
Market entry JV?
get into a market by using a company that knows the law, customers
87
Free standing JV?
- Each partner brings something to the game. Complementary skills, salesforce & technology.
88
Critical Mass?
Companies have to combine for Pharmacy, $250 million minimum to be in business for R & D
89
Problems in mergers in acquisitions?
: management, competition, over promising to wall street
90
Reasons for Vertical Integration?
You can’t get to market or your getting gouged by your supplier.
91
Recognition of offensive strategies?
Leapfrogging to next generation technology, going after rival's most profitable market
92
Defensive Strategies?
New products, product improvements, brand extensions
93
Blue ocean strategy?
coming up with something where there is no competitive offering. Examples include FedEx and eBay
94
First mover has advantage of?
pioneering image
95
Fast Follower?
no money to convert practices, take advantage of what the first mover makes
96
Factors which influence the speed of market development?
Is new infrastructure required, will buyers need to adopt new habits or suffer switching costs
97
Rationale for international expansion?
Access to new customers, increased volume(economies of scale)
98
Factors which influence choice of geography?
Do we have cultural confluence: easy to put this product into this culture because its not strange for them. GDP, demographics, income, density, cost in particular country, exchange rates, remittable funds risks, host government policies,
99
Licensing?
- no guts no glory, give people right to use technology and you take royalty payment
100
Franchising?
have a supply agreement, and you get a franchise fee
101
Exporting?
Least risky is exporting
102
FDI
Usually done with acquisitions
103
Local vs. Global Marketing and Management choices?
Always prefer global arrangement because its cheaper, share ideas among different managements…. Sold through such different ways you have to use distributors
104
Centralize Manufacturing?
Centralize - cost you less, or because the cost of the item to manufacture is 90% of it. Waste treatment plant
105
De-centralize?
- Customers are spread out, cost of transporting something is more valuable then the manufacturing
106
Concept of patient money?
Several years in a country before you start making money.
107
Reasons to diversify?
Opportunity for synergy costs or growth in sales? Allocate resources

Management Policy (1 decks)

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