Exam 8: Corporate Strategy: Diversification and the Multibusiness Company

A competitive strength score above five indicates that a diversified company's relative position in the market is characterized by

The three tests for judging whether a particular diversification move can create value for shareholders are the

The most important strategy-making guidance that comes from drawing a Nine-Cell Industry Attractiveness-Competitive Strength Matrix is

The basic purpose of calculating competitive strength scores for each of a diversified company's business units is to

An acquisition of an unrelated business is deemed to have potential

What is meant by the term strategic fit? What are the advantages of pursuing strategic fit in choosing which industries to diversify into?

Economies of scope differ from economies of scale in that

Management's ranking of business units and establishing a priority for resource allocation should

What does the industry attractiveness test involve in evaluating a diversified company's business lineup? Why is it relevant?

One important dimension of resource fit concerns the potential to generate internal cash flows sufficient to fund capital requirements of its business lineup,termed the firm's

Briefly discuss when it makes good strategic sense for a company to consider diversification.

Once a company has diversified into a collection of related or unrelated businesses and concludes that some strategy adjustments are needed,which one of the following is not one of the main strategy options that a company can pursue?

Acquisition of an existing business is an attractive strategy option for entering a promising new industry because it

The difference between a cash cow business and a cash hog business is that a cash cow business

Moves to improve a diversified company's overall performance do not include

The value of determining the relative competitive strength of each business a company has diversified into is to

Diversification into a new industry cannot be considered a success unless it results in

Which of the following does not accurately describe entering a new business via acquisition,internal development,or a joint venture?

The nine-cell attractiveness-strength matrix provides clear,strong logic for

Identify and briefly discuss each of the three tests for determining whether diversification into a new business is likely to build shareholder value.