40 Questions
Firms engaging in globalization must prioritize culturally insensitive decisions when using the strategic management process.
False
Globalization has led to lower performance standards in many competitive dimensions.
False
A company's ability to meet local standards is sufficient to earn above-average returns in the twenty-first century.
False
The flow of workers is restricted across global economies.
False
Technology-related trends have a negligible impact on competitive environments.
False
Managers do not need to learn how to operate effectively in a 'multi-polar' world.
False
Firms competing domestically are not affected by global performance standards.
False
Global companies' goods or services are typically inferior to those of domestic firms.
False
Walmart's proprietary approach to supply chain management involves the effective use of tangible resources.
False
Knowledge is a tangible resource that can be easily quantified and measured.
False
Firms do not need to develop and acquire knowledge in order to gain a competitive advantage.
False
A strong knowledge-base is not necessary for creating innovations.
False
Knowledge spillovers to competitors are rare and do not need to be addressed.
False
The iPhone introduced by Apple only changed the cell phone industry.
False
Strategic flexibility involves coping with certainty and stability in a competitive environment.
False
Firms with strategic flexibility are unable to respond to various demands and opportunities in a competitive environment.
False
Apple's iPad is contributing to changes in the publishing industry by moving from hard copies to electronic books.
True
The Internet and IT advances have given small firms less flexibility in competing with large firms.
False
Building routines that facilitate the diffusion of local knowledge throughout the organization is not important for firms.
False
Knowledge is not a critical organizational resource and a valuable source of competitive advantage in the twenty-first century.
False
The basis of competition shifted from intangible resources to hard assets in the 1980s.
False
Apple's new technologies and products are contributing to the old industrial age.
False
The iPod revolutionized how music is sold to and used by consumers through iTunes.
True
Dramatic changes in information technology have not occurred in recent years.
False
It took the radio 35 years to get into 25 percent of all homes in the United States.
False
The rate of technology diffusion has decreased substantially over the past 15 to 20 years.
False
The impact of technological changes on individual firms and industries has been minimal.
False
People still rent movies on videotapes at retail stores.
False
The publishing industry is moving rapidly from electronic format to hard copy.
False
Perpetual innovation refers to the slow pace of technological changes.
False
The shorter product life cycles resulting from rapid diffusions of new technologies place a competitive premium on being able to quickly introduce new, innovative goods and services into the marketplace.
True
Technology diffusion and disruptive technologies are not related to the information age.
False
Strategic flexibility can be easily developed by firms without any challenges.
False
A firm's past core competencies can facilitate strategic flexibility.
False
Technological changes can hinder a firm's ability to develop strategic flexibility.
False
The I/O model emphasizes the role of internal organizational factors in determining a firm's performance.
False
A firm's ability to learn quickly and adapt to changes is crucial for strategic flexibility.
True
The I/O model assumes that a firm's managers have significant control over its performance.
False
Industry properties have no impact on a firm's performance according to the I/O model.
False
Strategic flexibility is not necessary for a firm to compete effectively in today's business environment.
False
Study Notes
The March of Globalization
- Firms engaging in globalization must make culturally sensitive decisions when using the strategic management process.
- Globalization has led to higher performance standards in many competitive dimensions, including quality, cost, productivity, product introduction time, and operational efficiency.
- These standards affect firms competing in both the global and domestic markets.
- Customers prefer to purchase from global competitors rather than domestic firms due to superior goods or services.
- Workers flow freely among global economies, and employees are a key source of competitive advantage.
- Managers must learn to operate effectively in a "multi-polar" world with many important countries having unique interests and environments.
Technology and Technological Changes
- Technology-related trends and conditions can be categorized into three areas: technology diffusion and disruptive technologies, the information age, and increasing knowledge intensity.
- These categories significantly alter the nature of competition and contribute to highly dynamic competitive environments.
- Technology diffusion refers to the rate at which new technologies become available and are used, which has increased substantially over the past 15-20 years.
- The impact of technological changes on individual firms and industries has been broad and significant, with examples including the shift from movie rentals on videotapes to electronic formats.
- Perpetual innovation is a term used to describe the rapid and consistent introduction of new, information-intensive technologies that replace older ones.
- The iPhone and iPod are examples of "disruptive technologies" that have changed several industries, including the cell phone and music industries.
The Information Age
- Dramatic changes in information technology (IT) have occurred in recent years, including the development of personal computers, cellular phones, artificial intelligence, virtual reality, massive databases, and social networking sites.
- The ability to effectively and efficiently access and use information has become an important source of competitive advantage in virtually all industries.
- IT has given small firms more flexibility in competing with large firms, if the technology is used efficiently.
Increasing Knowledge Intensity
- Knowledge is the basis of technology and its application, and is a critical organizational resource and an increasingly valuable source of competitive advantage.
- The basis of competition has shifted from hard assets to intangible resources, including knowledge, since the 1980s.
- Relationships with customers and suppliers are examples of intangible resources that need to be managed.
- Knowledge is gained through experience, observation, and inference, and is an intangible resource.
- The value of intangible resources, including knowledge, is growing as a proportion of total shareholder value.
Strategic Flexibility
- Strategic flexibility is a set of capabilities used to respond to various demands and opportunities in a dynamic and uncertain competitive environment.
- Firms must develop strategic flexibility in all areas of their operations to cope with uncertainty and its accompanying risks.
- Strategic flexibility involves continuous learning, which provides the firm with new and up-to-date skill sets, allowing it to adapt to its environment as it encounters changes.
The I/O Model of Above-Average Returns
- The industrial organization (I/O) model explains the external environment's dominant influence on a firm's strategic actions.
- The model specifies that the industry or segment of an industry in which a company chooses to compete has a stronger influence on performance than do the choices managers make inside their organizations.
- The firm's performance is determined primarily by a range of industry properties, including economies of scale, barriers to market entry, diversification, product differentiation, the degree of concentration of firms in the industry, and market frictions.
This quiz covers the cultural sensitivities and complexities involved in global business operations, using examples like Starbucks in European markets.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
