Exam 6: Corporate Strategy

Stacy works as a manager at Daffodils Corp., a manufacturing firm that has not been performing well.Despite the availability of research materials and databases, she uses her own experience to make acquisitions because she is usually very confident about the success of her plans.This attitude of Stacy can be termed _____.

Zia, the CEO of Indigo Corp., states that it is essential to diversify the company into new markets and to create new products.She believes that it is important and profitable to tap new customer bases and challenging markets as this experience will help the company grow financially as well as expand its knowledge base on strategic management.Which of the following statements strengthens Zia's belief?

Virgo Inc.earns less than 70 percent of its revenue from manufacturing computers.It recently started manufacturing tablets.The company made use of existing technology and materials and decided to distribute the tablets through the same distributors used for its computers.In this scenario, Virgo Inc.chose _____.

Amber Corp., a jute manufacturing company, wants to diversify into the food industry.In order to do so, the board of directors decides to move some of its existing resources, expertise, and technology to set the base of the food unit.The market analysts at Amber predict that this unit has a high growth potential.Thus, rather than leaving the new food unit to grow on its own, the board decides to invest in it as it this will help increase the corporate value of the company.In this scenario, Amber Corp.is trying to create value by acting as a(n) _____.

Lee, the CEO of Libra Inc., decided that the best way to diversify this food processing company would be to set up its own small-scale beverage producing unit in a new area where its new products would have high demands.This decision by Lee best reflects a(n)_____.

What are the mechanisms that help companies in exploiting and/or expanding their resources and capabilities?

Azure LLC is a toy manufacturing company.The company has recently started manufacturing industrial wiring for construction companies.In this scenario, Azure LLC has chosen _____.

In vertical integration, movement in the direction of raw materials is _____.

Jupiter LLC is a manufacturer of leather items.The board of directors of Jupiter realized that it is better to produce handbags and shoes together rather than in two separate factories.This way, the company can reduce its production costs.This scenario best illustrates a(n) _____.

Saturn Inc.is an e-commerce company that sells home appliances.The firm recently started selling its line of packaged food items online.In this scenario, Saturn Inc.chose _____.

Marble Cakes Inc., after serving a good number of customers in its home state, has set up business in three other states with additional menu options of cupcakes, donuts, and coffees to generate new customers.This has enabled the company to successfully maintain its corporate strategy.Marble Cakes Inc.is engaging in _____.

A firm earning more than 95 percent of the revenues from a single line of business is known as a _____.

Sparkle LLC, a beverage industry, earns almost all of its profits only by selling beverages.Sparkle LLC can be best categorized as a _____.

Elegant Meals Inc., a company that owns a chain of restaurants, sells dinnerware to its customers who fancy them.Since their restaurants are known for their interior designs, they also sell home décor products.By selling these products, Elegant Meals Inc.caters to a(n) _____.

A dominant vertical business differs from a dominant business in that a dominant business:

Which of the following is a defining feature of firms that practice related-constrained diversification?

The movement into an adjacent, or unrelated, market that is not along a firm's own value chain defines the term _____.

Explain the ways in which diversification adds value.

Blue Work LLC, a software company, purchased an electronics and electrical company and implemented its resources and technologies in the target company.Blue Work changed the entire culture and brand of the target company and introduced its own culture such that the identity of the target company disappeared.Blue Work benefitted from this acquisition and witnessed a significant growth.This type of acquisition is known as a _____.

In order to successfully carry out an acquisition, the managers at Pink Inc.prepared a list of potential target companies that it could purchase.In the next step, the managers evaluated each prospective company in depth to understand their methods of operations, processes, procedures, strengths, and limitations in order to choose the best target company.This process of evaluating the companies is best known as _____.