MKTG 336 Exam 2 - FLASHCARDS - Chapter 6

Question 1

True or false: Companies should meet the needs of both low–growth and high–growth markets?

Answer 1

TRUE

Question 2

True or false: New competitive models are required to handle the current shifts from West to East and the rise of the challenge of rapidly developing economies (RDEs)?

Answer 2

TRUE

Question 3

What philosophy relates to many products and services drawing on many skills, ideas, and systems to compete in many markets?

Answer 3

Philosophy of manyness

Question 4

How can companies expand market access in rapidly developing economies (RDE’s)?

Answer 4

1. Increasing the number of countries served
2. Penetrating into new customer segments and new product categories in existing markets

Question 5

True or false: Deeper market penetration poses difficult challenges for Western companies as their business models target premium products?

Answer 5

TRUE

Question 6

True or false: Multinational companies must go beyond the premium segments and serve the midmarket?

Answer 6

TRUE

Question 7

What approach considers a full range of factors beyond labor costs?

Answer 7

Best-cost-country sourcing

Question 8

With Best-cost-country sourcing, what must companies weigh?

Answer 8

1. Trade-offs among factor costs
2. Supply chain restraints and transportation costs
3. Relative strengths and weaknesses of RDEs

Question 9

What does best-cost-country sourcing allow companies to do?

Answer 9

Allows companies to create a diversified portfolio of supply sources in different regions and develop best-cost supply chains

Question 10

What is the need for a differentiated approach that responds to local demands in RDEs?

Answer 10

Local adaptation

Question 11

What is the local growth team (LGT) model?

Answer 11

Focuses on empowering smaller, specialized teams within a company to drive growth for specific products, regions, or customer segments, rather than a central growth team managing everything

Question 12

Through what can economies of scale and scope be advanced?

Answer 12

Through:
Process standardization
Adoption of common technology
Rapid information sharing

Question 13

True or false: Resource advantages developed in different markets can be shared and diffused to other operating units around the world?

Answer 13

TRUE

Question 14

What is selling domestically produced products to buyers in other countries?

Answer 14

Exporting

Question 15

True or false: contracting only includes licensing contracts?

Answer 15

False. Contracting Includes both licensing and management contracts

Question 16

What type of contract is where one firm permits another to use its intellectual property in exchange for royalties?

Answer 16

Licensing

Question 17

What type of contract is where an industrial firm assembles a package of skills that provide an integrated service to the client?

Answer 17

Management contract

Question 18

What is sourcing a product from a producer located in a foreign country for sale there or in other countries?

Answer 18

Contract manufacturing

Question 19

What is a business relationship established by two or more companies?

Answer 19

Strategic global alliance (SGA)

Question 20

What are challenges of strategic alliances?

Answer 20

1. Establishing trust and coordination
2. Implementing alliances on a global scale
3. Maintaining alliances over time

Question 21

What are advantages of a joint venture?

Answer 21

1. Opening up of new markets to both organizations
2. Better relationship with local organizations and with customers
3. Ability to respond to changing market needs
4. Awareness of cultural sensitivities
5. Less vulnerable to political risks

Question 22

What are disadvantages of a joint venture?

Answer 22

1. Problems with disclosing sensitive information
2. Disagreements over how profits are to be shared
3. Clashes over management style
4. Differing perceptions on strategy

Question 23

True or false: an advantage of a joint venture is they have a better relationship with local organizations and with customers?

Answer 23

TRUE

Question 24

True or false: an advantage of a joint venture is opening up of new markets to both organizations?

Answer 24

TRUE

Question 25

True or false: an advantage of a joint venture is an ability to respond to changing market needs?

Answer 25

TRUE

Question 26

True or false: an advantage of a joint venture is awareness of cultural sensitivities?

Answer 26

TRUE

Question 27

True or false: an advantage of a joint venture is that it is less vulnerable to political risks?

Answer 27

TRUE

Question 28

True or false: a disadvantage of a joint venture is that there are problems with disclosing sensitive information?

Answer 28

TRUE

Question 29

True or false: a disadvantage of a joint venture is that there can be disagreements over how profits are to be shared?

Answer 29

TRUE

Question 30

True or false: a disadvantage of a joint venture is there can be clashes over management style?

Answer 30

TRUE

Question 31

True or false: a disadvantage of a joint venture is there can be differing perceptions on strategy?

Answer 31

TRUE

Question 32

What are different modes of entry?

Answer 32

Exporting, licensing, contract manufacturing, and joint ventures

Question 33

What modes of entry do you use for high risk markets?

Answer 33

Licensing, contract manufacturing, or joint ventures with a minority share

Question 34

What type of strategy permits individual subsidiaries to compete independently in their home-country local markets?

Answer 34

Multidomestic strategy

Question 35

What type of strategy seeks to establish a cohesive global presence by integrating operations across various countries?

Answer 35

Global strategy

Question 36

True or false: a multi-domestic pattern of international competition is common when downstream activities are important to competitive advantage?

Answer 36

TRUE

Question 37

True or false: Firms pursue separate multidomestic strategies in each of their foreign markets?

Answer 37

TRUE

Question 38

What dimension of competition centers on where each activity is performed, including the number of locations?

Answer 38

Configuration

Question 39

What dimension of competition refers to how similar activities performed in various countries are coordinated or coupled with each other?

Answer 39

Coordination

Question 40

In a multidomestic strategy, each market should be viewed in terms of what?

Answer 40

Culture Administration/Politics Geographic Economy

Question 41

In a global strategy, can a company's position in one country affect its position in another country?

Answer 41

Yes

Question 42

What is the framework for a global strategy?

Answer 42

1. Build on a unique competitive position 2. Emphasize a consistent positioning strategy 3. Establish a clear home base for each distinct business 4. Leverage product-line home bases at different locations 5. Disperse activities to extend home-base advantages 6. Coordinate and integrate dispersed activities

Question 43

Does exporting have high or low commitment?

Answer 43

Low

Question 44

Does exporting have high or low complexity?

Answer 44

Low

Question 45

Do strategic alliances have high or low commitment?

Answer 45

Lower

Question 46

Does contracting have high or low commitment?

Answer 46

Low

Question 47

Does contracting have high or low complexity?

Answer 47

Low

Question 48

Do joint ventures have high or low complexity?

Answer 48

Higher

Question 49

Do joint ventures have high or low commitment?

Answer 49

Higher

Question 50

Do multidomestic and global strategies have high or low commitment?

Answer 50

High

Question 51

Do multidomestic and global strategies have high or low complexity?

Answer 51

High