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Question
Consider the case of a manufacturing firm that purchases subassemblies from a supplier, creates a finished product, and then sells that product to a wholesale distributor. What advantages might this firm gain from forward integration? From backward integration? What potential pitfalls of vertical integration might the firm face?Answer
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Related questions
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Which form of control was transmitted by Walt Disney?
a) Bureaucratic control through rules and procedures
b) Control through norms and values
c) Financial control through accurate financial statements
d) Output control
e) Incentive systems
Q:
Standardization is employed to squeeze out costs in manufacturing. Standardization may be achieved through standardization of
a) inputs.
b) work processes.
c) outputs.
d) both work processes and outputs.
e) inputs, conversion activities, and outputs.
Q:
The two main innovations in a multidivisional structure (over a functional or product structure) are
a) a matrix structure at the divisional level and a flat structure at the corporate level.
b) a product structure at the divisional level and a functional structure at the corporate level.
c) the organization of business units into one or more divisions and the placement of corporate-level positions to oversee the activities and financial control over each division.
d) self-contained divisions with operating responsibility and a group of divisional managers with collective strategic responsibility.
e) a matrix structure at the divisional level and a functional structure at the corporate level.
Q:
A camera manufacturer that has separate divisions for making personal cameras, movie cameras, and film acquired a small film developer and a car battery supplier. Which of the following structures is most appropriate for this firm?
a) Functional
b) Multidivisional
c) Geographic
d) Matrix
e) Product team
Q:
As new, small firms grow and mature, which structure are they likely to choose?
a) Simple
b) Geographic
c) Product
d) Matrix
e) Functional
Q:
_______________ provides the vehicle through which managers can coordinate the activities of a company's various functions, divisions, and business units to take advantage of their skills and competencies.
a) Organizational structure
b) Decentralization
c) Organizational culture
d) Span of control
e) Strategic control
Q:
The most common measures managers and other stakeholders use to monitor and evaluate a company's performance are financial controls.
Q:
When more than two functions or divisions share a common problem, a task force may be the appropriate integrating mechanism.
Q:
An organization that divides manufacturing and operations be regions uses geographic structure.
Q:
The degree of horizontal differentiation in the product structure is higher than in the functional structure.
Q:
The role of organizational structure is to provide managers with specific feedback on how well an organization and its members are performing and building competitive advantage.
Q:
In the value chain, support activities are those involved in the physical creation of the product, its marketing and delivery to buyers, and its after-sales service.
Q:
List and briefly discuss each of the elements of Michael Porter's Five Forces Model.
Q:
Beverage makers are finding that water sales are increasing due to consumers' preferences for healthy drinks. Which part of the macroenvironment does this represent?
a) Economic forces
b) Social forces
c) Embryonic forces
d) Political forces
e) Demographic forces
Q:
The threat from new entrants is greatest in the _________ stage of the industry life cycle.
a) embryonic
b) growth
c) shakeout
d) maturity
e) decline
Q:
In growth industries,
a) replacement demand is increasing rapidly.
b) technological expertise is the most important entry barrier.
c) rivalry is high.
d) distribution channels are poorly developed.
e) buyers are familiar with the industry's product.
Q:
Which of the following is not a determinant of the extent of rivalry among established companies?
a) The number and size distribution of companies in the industry
b) The power of buyers
c) The cost structure of firms in an industry
d) Exit barriers
e) Demand conditions
Q:
Within Porter's framework, a _________ competitive force can be regarded as a(n) __________.
a) strong; threat
b) weak; threat
c) strong; opportunity
d) weak; competitive advantage
e) strong; competitive advantage
Q:
The stability of a mature industry is threatened by price wars.
Q:
Within an industry, each strategic group may face a different set of opportunities and threats.
Q:
Substitute products are the products of different businesses or industries that can satisfy similar customer needs.
Q:
The bargaining power of suppliers is the ability to raise the price of inputs or to raise the costs of the industry in other ways.
Q:
Exit barriers are the economic, strategic, and emotional factors that prevent companies from leaving an industry.
Q:
Many fragmented industries are characterized by low entry barriers and commodity-type products that are hard to differentiate.
Q:
Absolute cost advantage is enjoyed by incumbents in an industry and that new entrants cannot expect to match.
Q:
Michael Porter argues that the stronger each of the five forces, the more limited the ability of established companies to raise prices and earn greater profits.
Q:
Which of the following is not one of the criteria for evaluating potential acquisition candidates?
a) Age
b) Product market position
c) Financial position
d) Management capabilities
e) Competitive environment
Q:
Internal new ventures are likely to be preferred when
a) entry barriers are high.
b) exit barriers are high.
c) a company possesses a set of valuable competencies in its existing businesses that can be leveraged to enter new business.
d) the company needs more mega-opportunities.
e) the industry is in the mature stage of the industry life cycle.
Q:
Hamel and Prahalad have developed a model that can help managers assess how and when they should expand beyond their current market or industry. They find that it is useful to view a company as a
a) portfolio of resources.
b) portfolio of situational advantages.
c) portfolio of strategies.
d) portfolio of core competencies.
e) portfolio of strategic intent.
Q:
A hospital examines its processes closely and then changes them to become more patient-centered. Among the changes are new ways of doing tasks and new groupings of workers. This is an example of
a) restructuring.
b) reengineering.
c) TQM.
d) benchmarking.
e) downsizing.