Strategic Management Question Answer 2021


Hewlett Packard licences some of its intellectual property through strategic alliances. Which of following is correct

This is an equity strategic alliances because licensing does not involve the creation of a new company, but does involve an equity commitment


Disney’s ABC and Google’s YouTube formed an Alliance that will allow Disney to advertise movies and products by showing short clips. The type of alliance is classified as a — Alliance



Of the value neutral incentives to diversify all of the following are internal form incentive except

Stricter interpretation of antitrust laws


In fast cycle markets companies rely on __ engine of growth

Lower cost

Customer service

Internet marketing

Innovation 《《


Examples of intangible resources that a company has are

Goodwill And extend image


Which of the following true statement about organisational structures for implementing business level strategies

An Integrated cost leadership/ differentiation strategy requires a multi divisional structure using high formalization centralised decision making and vertical coordination


Walt Disney company and Johnson and Johnson are examples of Companies successfully used related diversification

Activities and transferring core competencies


Globalisation has led to

Higher product quality


A company in our industry is least likely to make use of patents and copyrights

Fast cycle market


In the context of BCG Matrix products that have a small share of a fast growing market are


Innovation microprocessor maker Intel often — its own product before competition*




Re engineers <<


Which one of the following is not component of competitor analysis

Market Size


Which one of the following is not component of competitor analysis

Comparing our goals to that of the competitor


An increase in the value of the Rupee — Indian firms Exports



Nokia and Intel have specific goals in the development of new products to support

Induced strategic behaviour


Till early 1990 Bajaj producer of scooters in India had obtained

Higher Margin, large product portfolio


The benefits of being a first mover can be substantial especially in a

Fast cycle


A firm’s mission

Intended to emotionally inspire employees and other stakeholders


Manufacturer of jewellery imitates the style of a popular and expensive brand using manufactured stones

Threat by the cost leader


With 75% of the coming from tobacco business and rest from agri

Dominant business diversification strategy


Which of the following is not an attribute of a successful acquisition

investment advertising and image building are made quickly


Wal Mart effective strategy/structure configuration is

Cost leadership/functional


A restaurant developed the new appetizer that is a hit with customers

All of these are met


— Is not found in fast cycle markets

Patents and copyrights


Which of these refers to a special type of acquisition strategy where in the target didn’t select the acquiring



The decision of what entry board to use is primarily based on all of the following factors except

country’s situation and government policies


Manufacturer of speciality jams and jellies has decided to Ally itself

Vertical complementary


Which of the following is not a value creating activity to control overhead and production cost


A successful _ innovation will be less risky but less profitable than a successful _ innovation

Incremental, radical


The resources based view of the firm

Emphasizes that sustainable competitive advantage can be based on resources


One of the primary reasons for failure of cross border strategic alliances is

The incompatibility of the partners


Products developed through _ are often offered at a lower prices without as many features then products developed through _

Imitation, innovation


The best organisation structure to use

In the Cooperative form


The BCG matrix separates businesses into four categories based upon

How profitable the business is, size of the market share


__ Strategy is a corporate level strategy that minimizes risk by diversifying investment among various business and product



Ambrose is a scientist working for a company

Ambrose is a key employee in the firm’s primary business


Selecting the organisational structure and controls that effectively implement

Firms must be flexible while retaining a degree of stability


Cost leadership Strategy targets the industries

Most typical


An organisation __ is composed of the key individual

Top management team


A team which is used to describe how rapidly consistently new

Perceptual innovation


A well-known Portfolio strategy Toot that manager’s use to decide how to invest

BCG matrix


which one of the following is not component of general external environment

ethical environment


Analysing income distribution in India for analysis of business environment world

Wage Differential between male and female employees working for a large manufacturer


In the airline industry consolidation among fuel providers serving airport facility

Any increase in switching cost because the airlines have no choice but to use


Global corporate level strategy assumes

More standardization of products across country markets


Suppliers are powerful when

They offer a credible threat of Forward integration


Internal analysis enables a firm to determine what the company

Can do


One means that is considered to improve the effectiveness of outsider directors is

Requiring outside directors to own significant equity Stakes in the firm


One method of facilitating the transfer of competencies between firms is to

Transfer key people into new management positions


Business level strategies are concerned specially

Creating differences between the firm positions and the competitors


Primary responsibility of development of strategic visions and Mission of organisation is



Types of complementary strategic alliances are

Vertical and Horizontal


Which of the following is true

Strategy has a More important influence on structure than structure has on strategy


All competitive advantages do not accrue to large size firms

Are more likely to have organisational stack


When Rival firms complete address avli by trying to attract competitors

Slow industry growth


Fastest and Easiest way for a firm to diversity its sports portfolio is through

it is difficult and time intensive for companies to develop products that differ from their current product line


Research shows that because of its economic importance and individual motives, entreprenual activity is __ across the globe



Golden lotus, an exercise club targeting healthy individuals over 50

Power of customer buyers


Companies that are following __ strategy try to improve the way in which they sell the same product



Moon flower cosmetics company executive are aware that the Asian customer base is interested

Joint venture


Firms in emerging economies may want to form strategic alliances for developing countries because

It gains the foreign firm Technology


Big Bazaar’s net profit increased from 2.2 % in 2008-2009 to 3% in 2009-2010 despite recession and a consequent drop in sales by 1%

Cost leadership


Buyers are powerful when

Switching cost are low


Total profits earned in an industry at a points along the value chain are called as

Profit pool


__ are individuals acting independently or as part of an organisation who see an opportunity



Choose the best option. An industry is a group or firms producing products that are

Close substitutes


Which of the following is not a value creating activity associated with differentiation

Emphasis on product quality


Which of the following is not an entry barrier to an industry

Bargaining power of suppliers


The decision of what entry mode to use is primary

Country’s situation and government policies


Which among the following firm demonstrates focus differentiation strategy



Choose the best option scanning monitoring forecasting assessing

External environment analysis


Cross functional work team is having difficulties in operating smoothly

Formality of structure


higher efficiencies as a result of the experience of firm gains through higher cumulative production is

Experience curve effect


A strategic group is not

Companies in the industry against which the top managers compare, evaluate


Zimmer centrepulse is the world’s largest producer of the replacement hips and knees



The following firms are example of unrelated diversification strategy except



Following will increase the probability that lower level manager will become a successful

Training and development programs


All the Sears website customers can chat online with customer service representatives

Social marketing


Embedded knowledge is difficult to transfer because

It is usually informal and not documented


The means of entry into International markets that offer the greatest control

Greenfield Ventures


Firms in the standard cycle market may form alliances in order to

Capture economies of scale


Reliance has forayed from Textiles business to fabrics to chemicals. This is an example of

Backward vertical integration


Integrated set of actions designed to produce or deliver goods or services related to that of competitors is called

Cost leadership


All of the following are characteristics of the global economy except

The increased use of tariffs to protect industries


Ethical practices to understand and anticipate strategies of Rival firms include

Attending trade fairs


Company wika Enterprises, a Sports goods Company has a Sport Club comprising of its customers

Increased richness of customer relationship


The best multi divisional organisational structure to use

Depends on the degree of diversification


Between 2014 and 2017, Reliance Industries invested around $5 billion on projects

Backward diversification


Shekhar is the son of very prominent Fortune 500 CEO 15 credited Shekhar

High Social Low human


Which of the following is not one of the primary reasons pharmaceuticals firms use

Extending patent rights on developed pharmaceuticals


Walmart acquired 77% stake in Flipkart for 516 billion in 2016 this is an example of

Horizontal acquisition


Resources that are difficult and costly to change are

Intangible resources


Which one of the following is the most critical measure of customer satisfaction

Customer satisfaction scores


The resources and capabilities that serve as a source of competitive advantage for a firm over its rival are called

Core competences


__ is the purchase of value creating activity from an external supplier



CVC’s recent merger with caremark, a large manager

Virtual integration market power


Which Type of diversification is most likely to create financial economies



Corporate governance revokes relationship between

Shareholders and managers*


Choose the best option globalisation of business markets has resulted in

Opportunity As well as threat to a firm


Successfully creating innovation through internal means requires

Acquisitions of innovative firms


That value of an existing technology and create new market is known as

Disruptive technologies


Omicorn artificial intelligence has a core competency of being able to respond to competitors



A multidomestic corporate level strategy is one in which

The firm customers product for IIT in which competitors


Internal Corporate venturing does not involve

Autonomous strategic behaviour


All of the following are tangible resources except

Firm’s reputation


Competitive advantage is not sustainable for a long time in a

Fast cycle market


Customers __ of business level strategies

Are the Foundation


Which of the following is not a reason for acquisition



A manager in your company is proposing the acquisition of Taylor company

The acquisition of Taylor should be primarily for defensive rather than strategic reasons.



Shorter <<


Non important


Case study

Assume that Disney can benefit operations and corporate

Ability to manage creativity and service excellence


What level and type of diversification best characterized Disney in the 1970’s

Dominant business


What level and type of diversification best characterized Disney at the beginning of 21st century

Related Constrained


Disney offered new products such as Sports franchisees. TV Networks ESPN in 21st century. This decision with



CEO of Icon image associate wishes to radically change the corporate culture of the firm

The members of the board of the directors


All of the following statements are true about the use of Defence tactics by the target firm during a hostile takeover except

Defence tactics make the cost of takeover lower


Panera bread develops and produces its old dough based products but it works with manufacturing partners to create a new soups. Panera bread is therefore

Pursuing innovation through both internal and cooperative strategies


Sukhdev, the CEO of dictionary has been paid a lump sum amount into three years salary because dictionary has been bought in a hostile takeover by its main competitor. Sukhdev received

Golden parachute


A __ is the capacity for a set of resources to perform a task or activity in an integrative manner



Disney suffered lawsuits in France at Disneyland Paris as a result of the lack of fit between its transferred personal and the French employees charged to enact them. This is an example of

The Liability of foreignness


Selecting the organisational structure and controls that effectively implement The Chosen strategy is a challenge for managers because

Firms must be flexible while retaining a degree of stability


The benefits of a simple organisational structure include all of the following except

No need for sophisticated information systems


Managerial employment risk is the

Manager’s risk of job loss, loss of compensation and/or loss of reputation


The board of directors for indipop inc is searching for a new CEO. The firm is in need of new directions after suffering several years of declining performance and increasingly demoralized management and employees decided it needs a CEO who can be a transformational leader. To the specific and the board needs to identify applicants who have

Excellent analytical skills


Which of the following factors most encourages stability in a firm’s strategy

Internal CEO succession and a homogeneous top management team


Choose the incorrect statement

Outsourcing and building effective vendor relationships are not value chain activities


Successfully creating innovations through internal means requires

Significant Spending on R&D*


Zara has Pioneer cheap chic in clothing apparel. Zara offers current and desirable fashion goods at relatively low prices

Integrated cost leadership/differentiation


The board of directors of Cyberscope Inc is designing a stock option plan for its CEO that will motivate the CEO to increase the market value of the firm. consequently the board is

Setting the option strike price substantially higher than the current stock price


In 2007 Hindalco company acquired the Canadian company novelis (the production of flat rolled aluminium products)



The integrated cost leadership/differentiation strategy is difficult to implement mostly because
a. different primary and support activities are emphasized when using cost leadership and differentiation strategies.
b. this strategic approach demands more flexibility than most firms can manage.
c. the dual reporting relationships required for this strategy slow organizational decision-making.
d. the cost leadership strategy requires less structured job roles than does the differentiation strategy.


The __________ structure is best for implementing the related constrained diversification strategy.
a. functional
b. competitive form of the multidivisional
c. SBU form of the multidivisional
d. cooperative form of the multidivisional


The BEST multidivisional structure to use
a. is the competitive form.
b. is the SBU form.
c. is the cooperative form.
d. depends on the degree of diversification.


trategic Focus, Cisco used the ____________ structure to implement its ___________ strategy.
a. functional; cost leadership.
b. SBU form of the multidivisional; related linked
c. cooperative form of the multidivisional; related linked
d. cooperative form of the multidivisional; related constrained

The cooperative multidivisional firm
a. establishes profit centers based on products or markets.
b. has a flat organizational structure which broadens jobs and empowers workers.
c. is a structure organized around both functional specialization and business projects.
d. is a structure requiring heavy use of horizontal integrative devices.


Which of the following is a TRUE statement about implementing corporate-level strategies and effective organizational structures?
a. Firms pursuing a related-linked strategy should implement a competitive structure with a competitive culture and centralized strategic planning activities.
b. Firms pursuing an unrelated diversification strategy should use an SBU structure with a small corporate staff, emphasize the R&D function, and integrate divisions to achieve synergies.
c. Firms pursuing a related-linked strategy should use an SBU structure, emphasize interdependence among divisions, and manage the strategic planning function from the central office.
d. Firms pursuing a related-constrained strategy should implement a cooperative structure, use integrative devices to link divisions, centralize the R&D function, and emphasize sharing.



The heavy use of integrative mechanisms in the ____ multidivisional organizational structure is intended to achieve ____.
a. cooperative; economies of scope
b. competitive; cost efficiencies
c. functional; sensitivity to cultural diversity
d. SBU; quick response to local customer needs


A firm pursuing a related-constrained diversification strategy would typically need all of the following EXCEPT
a. centralization of some organizational functions for the sake of coordination.
b. frequent, direct contact between division managers.
c. division managers’ rewards based on division financial performance.
d. temporary teams or task forces formed around specific projects.


A private university is made up of various “schools,” such as the School of Journalism, the School of Business, the School of Law, the School of Arts and Sciences, and so forth. The university is experiencing some financial problems and the top administration has decided to have each school of the university become a profit center. This scheme is somewhat parallel to the organizational ____ structure.
a. network
b. strategic business unit multidivisional
c. functional
d. matrix


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