International Business Strategy
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Course Introduction
International Business Strategy explores how organizations develop and implement strategies to compete effectively in the global marketplace. The course examines key concepts such as global market entry, competitive advantage, multinational operations, cross-cultural management, international alliances, and strategic responses to the dynamic external environment. Students analyze real-world case studies to understand the complexities of managing across borders, adapting to different regulatory and cultural landscapes, and leveraging international opportunities for growth. Emphasis is placed on strategic decision-making, risk assessment, and the integration of ethical and sustainable practices in global business operations.
Recommended Textbook
Strategic Management and Competitive Advantage 6th Edition by Jay B. Barney
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Page 2
Chapter 1: What Is Strategy and the Strategic Management Process
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Sample Questions
Q1) There is complete consensus among strategic managers and academic researchers about what a "strategy" is.
A)True
B)False
Answer: False
Q2) Describe the difference between emergent and intended strategies.Why might firms employ an emergent strategy?
Answer: Intended strategies can best be described as a firm's theories of how to gain a competitive advantage that are developed as a result of the strategic management process.Intended strategies are developed when firms choose and implement their strategies exactly as described by the strategic management process.Alternately,emergent strategies are theories of how to gain a competitive advantage in an industry that emerge over time or that have been radically reshaped once they are implemented.Firms employ emergent strategies since some of the information needed to complete the strategic management process may not be available when firms are developing their intended strategies.
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3
Chapter 2: Evaluating a Firms External Environment
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Sample Questions
Q1) All divestments are caused by industry decline.
A)True
B)False Answer: False
Q2) The objective of divestment is to extract a firm from a declining industry.
A)True
B)False Answer: True
Q3) If you were to purchase a new Apple iPod and were unable to use your previously downloaded library of digital music with your new iPod,this would be an example of a customer-switching cost you would incur to use Apple's product.
A)True
B)False Answer: True
Q4) Diseconomies of scale exist in an industry when a firm's costs fall as a function of that firm's volume of production.
A)True
B)False Answer: False
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Chapter 3: Evaluating a Firms Internal Capabilities
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Sample Questions
Q1) To the extent that a firm's resources and capabilities enhance a firm's competitive position by enabling a firm to exploit its opportunities or neutralize its threats,these resources and capabilities are valuable and are known as
A)temporary competitive advantages.
B)sustainable competitive advantages.
C)core competencies.
D)strengths.
Answer: D
Q2) Which of the following is not one of the six distinct activities in McKinsey and Company's value chain model?
A)technology development
B)product design
C)manufacturing
D)inbound logistics
Answer: D
Q3) In the VRIO framework,the R represents resources.
A)True
B)False
Answer: False
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Page 5
Chapter 4: Cost Leadership
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Sample Questions
Q1) If the potential responses of competing firms are likely to be very detrimental to the costs advantages of cost leaders,firms pursuing a cost-leadership competitive strategy should
A)drop their prices below competitors' prices to increase overall economic performance through increased volumes of profitable sales.
B)raise their prices above competitors,increasing overall economic performance through higher margins.
C)focus on a specific niche market to avoid direct competition with aggressive competitors.
D)set their prices equal to competitors' prices,sacrificing some market share for increased profit margins.
Q2) Limiting the involvement of functional managers in strategy formulation can limit their commitment to the chosen strategy.
A)True
B)False
Q3) Cost advantages based on diseconomies of scale are likely to be rare.
A)True
B)False
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6
Chapter 5: Product Differentiation
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Sample Questions
Q1) Through advertising and other consumer marketing efforts,firms attempt to alter the perceptions of current and potential customers,but only when specific attributes of a firm's products or services are altered.
A)True
B)False
Q2) Which of the following bases of product differentiation is usually costly to duplicate?
A)product features
B)links with other firms
C)reputation
D)product mix
Q3) While the U-form structure for a firm pursuing cost leadership is relatively simple,the U-form structure for a firm implementing a product-differentiation strategy can be somewhat more complex.
A)True
B)False
Q4) Product differentiation effectively reduces rivalry to zero.
A)True
B)False
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Chapter 6: Flexibility and Real Options
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Q1) Amberger Products competes in consumer electronics where there is a high level of market and technological uncertainty.To address these challenges,Amberger Products does not commit itself to a particular product design or features early on; instead,it is geared to quickly and inexpensively assess if it has succeeded or failed with a design or feature,learn from its past,regroup and try again quickly.The option that Amberger Products uses is called a ________ option.
A)staged
B)positioning
C)stepping-stone
D)scouting
Q2) The longer the time to ________,the greater is the value of a real option.
A)market
B)profitability
C)exercise
D)maturity
Q3) Cash flow projections can be reliable under conditions of uncertainty.
A)True
B)False
Q4) What are stepping-stone options? What does a company do in a stepping-stone option?
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Chapter 7: Collusion
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Sample Questions
Q1) The economic profits generated by the strategies of cost leadership,product differentiation,and flexibility can be thought of as efficiency profits.
A)True
B)False
Q2) Omega,Inc.signals that if parties cheat on collusive agreements,it will decrease its prices less or increase its output less than would have otherwise been the case.Omega,Inc.is sending a(n)________ signal.
A)explicit
B)tacit
C)tough
D)soft
Q3) In an industry where the primary basis of competition is quantity,firms may invest heavily in,say,manufacturing capacity,even if those investments do not generate positive economic profits directly.Sending this kind of a signal is called ________.
A)"puppy-dog-play"
B)"fat-cat effect"
C)"top-dog strategy"
D)"lean-and-hungry look"
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9
Chapter 8: Vertical Integration
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Sample Questions
Q1) Identify the three fundamental explanations of how vertical integration can create value and discuss how value is created under each.
Q2) The downside risks associated with investing in a strategic alliance are unknown but fixed.
A)True
B)False
Q3) Budgets are an important control tool and they contribute to only positive outcomes.
A)True
B)False
Q4) Once a firm has vertically integrated it has committed its organizational structure,its management controls,and its compensation policies to a particular vertically integrated way of doing business and it has enhanced its flexibility.
A)True
B)False
Q5) Discuss the flexibility-based explanation of vertical integration.In discussing this explanation be sure to define flexibility,the role of uncertainty in this explanation,and identify when,under this explanation,firms should engage in vertical integration.
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Page 10
Chapter 9: Corporate Diversification
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Sample Questions
Q1) Firms such as PepsiCo that operate a number of businesses around the world that share a number of inputs,production technologies,or distribution channels but none of whose businesses account for more than 70% of a firm's revenues are said to be implementing a
A)related-constrained diversification.
B)related-linked diversification.
C)dominant-business diversification.
D)single-business diversification.
Q2) For multipoint competition to lead to mutual forbearance,
A)the threat of retaliation must be substantial and the firms pursuing this strategy must have strong linkages among their diversified businesses.
B)the threat of retaliation must be low and the firms pursuing this strategy must have strong linkages among their diversified businesses.
C)the threat of retaliation must be low and the firms pursuing this strategy must have weak linkages among their diversified businesses.
D)the threat of retaliation must be substantial and the firms pursuing this strategy must have weak linkages among their diversified businesses.
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Page 11
Chapter 10: Organizing to Implement Corporate
Diversification
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Q1) Some scholars suggest that the search for optimal transfer pricing should be abandoned in favor of setting transfer pricing as a(n)________ process.
A)negotiation
B)arbitrary
C)conflict resolution
D)marketing
Q2) The greatest risk associated with treating shared activities as profit centers is that divisions may choose to obtain no services from the shared activities.
A)True
B)False
Q3) The ________ is a subcommittee of the board of directors that maintains the relationship between the firm and external capital markets.
A)nominating committee
B)audit committee
C)personnel and compensation committee
D)finance committee
Q4) Describe the multidivisional,or M-form structure,and how it is used to implement a corporate diversification strategy.
Page 12
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Chapter 11: Strategic Alliances
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Sample Questions
Q1) When potential cooperative partners misrepresent the skills,abilities,and other resources that they will bring to an alliance,this is a form of cheating known as adverse selection.
A)True
B)False
Q2) Consistent with a real options perspective,firms in new and uncertain environments are likely to
A)avoid using strategic alliances.
B)develop numerous strategic alliances.
C)develop few strategic alliances.
D)engage in vertical integration.
Q3) As long as the cost of ________ to enter a new industry is less than the cost of ________,an alliance can be a valuable strategic opportunity.
A)vertically integrating; learning new skills and capabilities
B)learning new skills and capabilities; using an alliance
C)using an alliance; learning new skills and capabilities
D)learning new skills and capabilities; vertically integrating
Q4) Discuss when strategic alliances may be costly to directly duplicate.
Q5) What is the connection between strategic alliances and real options?
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Chapter 12: Mergers and Acquisitions
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Sample Questions
Q1) The price of each of a firm's shares multiplied by the number of shares outstanding represents the firm's
A)total equity base.
B)current market value.
C)total market share.
D)current market share.
Q2) How are poison pills different from shark repellents?
Q3) ________ economies are achieved by improving a firm's performance relative to its risk attributes or lowering its risk attributes relative to its performance.
A)Technical
B)Diversification
C)Pecuniary
D)Market
Q4) The cumulative abnormal return for a merger or acquisition can be positive or negative depending on whether the stock in question performs better or worse than what was expected without an acquisition.
A)True
B)False
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