Exam 7: Developing Corporate Strategy

The practice of mapping diversified businesses or products based on their relative strengths and market attractiveness is called ________.

To create economies of scope and revenue-enhancement synergies, a firm's resources should counteract with its business activities.

Revenue-enhancement synergies generally arise from ________ and ________ opportunities.

Economies of scope are only possible in production.

A firm's corporate strategy is created annually and remains stable until the following year.

Which of the following is not an option for a firm to expand the scope of its operations?

What motivates a firm to expand geographically?

A significant diversification discount is a measure of the losses anticipated from buying a parent firm and selling off its portfolio piecemeal.

Economies of scope is one of the two key factors in determining whether a corporate strategy is adding value through diversification. The other key factor is ________ opportunities.

Corporate-level strategy allows business units to operate independently of one another.

How can firms diversify in dynamic contexts?

Dissimilarity in dominant logic, or strategies, between business units in a firm increases the likelihood that managers will take more time to make decisions, and they will be ________ ones.

The profit pool incorporates key complementary businesses near the point at which a firm is directly involved in customer transactions.

Customer purchase decisions in horizontally related industries are often made consecutively.

Economies of scope and synergy are collectively referred to as revenue-enhancement opportunities.

In the late 19th century, the booming U.S. economy fostered a period of rapid business diversification.

It is easier to manage a firm that requires dissimilar dominant logics across business units.

Explain the three possible self-serving managerial motives for diversification.

In a firm with a broad scope, division-level managers share resources and cooperate to implement their strategies.

When strategies differ significantly, managers will generally be slower and less decisive.