mqm 385 – Flashcards
56 test answers
Unlock all answers in this set
Unlock answers 56question
why firms engage in acquisitions
answer
-access new markets and distribution channels -gain access to a new capability or competency - preempt rivals
Unlock the answer
question
strategic alliances
answer
voluntary arrangements between firms that involve the sharing of knowledge, resources, and capabilities with the intent of developing processes, products or services
Unlock the answer
question
mangerial hubris
answer
a form of self delusion in which managers convince themselves of their superior skills in the face of clear evidence to the contrary
Unlock the answer
question
reasons for mergers (3)
answer
1-principal agent problems 2- the desire to overcome competitive disadvantage 3-superior acquisition and integration compatibility
Unlock the answer
question
relational view of competitive advantage
answer
strategic management framework that proposes that critical resources and capabilities frequently are embedded in strategic alliances that span firm boundaries
Unlock the answer
question
why do firms enter strategic alliances
answer
Strengthen competitive position -Apple vs. Amazon Enter new markets -Local partner for global growth -Microsoft partners with Yahoo on search Hedge against uncertainty -Real options approach --Roche invests in Genentech 1990 & buys it in 2009 Access critical complementary assets -Pixar partners with Disney Learn new capabilities -GM & Toyota (NUMMI) - formed in1984 --Who won the learning race? Probably Toyota....
Unlock the answer
question
Governing Strategic Alliances
answer
contract agreements for Non-equity Alliances -Explicit Knowledge Equity Alliances -Tacit Knowledge -Corporate Venture Capital Joint Ventures
Unlock the answer
question
Non-equity Alliances
answer
partnership based on contracts between firms. the most frequent forms are supply agreements, distribution agreements, and licensing agreements. (explicit)
Unlock the answer
question
explicit knowledge
answer
knowledge that can be codified for example information, facts, instructions, recipes. knowing about a process or product
Unlock the answer
question
Equity Alliances
answer
partnership in which at least one partner takes partial ownership in the other ( tacit)
Unlock the answer
question
tacit knowledge
answer
knowledged that cannot be codified. concerns knowing how to do a certain task. acquired through active particpation.
Unlock the answer
question
corporate venture capital (CVC)
answer
equity investments by established firms in entrepreneurial ventures
Unlock the answer
question
Joint Ventures
answer
a standalone organization created and jointly owned by two or more paretn companies( both explicit and tacit)
Unlock the answer
question
acquiree
answer
company that is being taken over
Unlock the answer
question
acquirer
answer
company that is taking over another company
Unlock the answer
question
Alliance Management Capability
answer
a firms ability to effectively manage three alliance-related tasks concurrently, often across a portfolio of many different alliances. -Partner Selection and Alliance formation -Alliance Design and Governance -Post-formation Alliance Management -Partner Compatibility
Unlock the answer
question
Partner Selection and Alliance formation
answer
the expected benefits of the alliancne must exceed its cost.
Unlock the answer
question
partner capatibility
answer
the cultural fit between different firms
Unlock the answer
question
partner commitment
answer
the willingness to make available necessary resources and to accept short term sacrifices to ensure long term rewards.
Unlock the answer
question
Alliance Design and Governance
answer
choose an appropriate governance mechanism from: non-equity contract, equity alliance, or joint venture. inter organizational trust is huge to an alliance success.
Unlock the answer
question
Post-formation Alliance Management
answer
the third phase in a firms alliance management capability concerns the ongoing managment of the alliance. sorce of competative advatage.
Unlock the answer
question
Build-Borrow-or-Buy framework
answer
conceptial model that aids strategists in deciding whether to pursue internal development(build), enter a contract arrangement or strategic alliance(borrow), or acquire new recorces cap and and competencies (buy)
Unlock the answer
question
Advantages of Expanding Internationally
answer
Gain Access to a Larger Market- economies of scale Gain Access to Low-cost Input Factors- raw materials / labor Develop New Competencies- learn new ideas Location Economies
Unlock the answer
question
location economies
answer
benefits from locating value chain activities in the worlds optimal geographies for a specific activity wherever that may be
Unlock the answer
question
Disadvantages of Expanding Internationally
answer
The Liability of Foreignness Loss of Reputation Loss of Intellectual Property
Unlock the answer
question
CAGE Distance Framework
answer
National Culture (know Hofstede's dimensions)/Cultural distance Administrative and Political Distance Geographic Distance Economic Distance
Unlock the answer
question
national culture
answer
programming of the mind that differentiates human goups
Unlock the answer
question
Integration Responsiveness Framework
answer
International Strategy Multi-domestic Strategy Global-standardization Strategy Transnational Strategy
Unlock the answer
question
Integration Responsiveness Framework
answer
ststrategy framework that juxtaposes the pressuuurs an mne faces for cost reductions and local responsiveness to derive four different strategies to gain and sustain competitive advant when competing globally
Unlock the answer
question
international strategy
answer
involves leveraging home based cocre competencies by selling the same products or services in both domestic and forign markets
Unlock the answer
question
multi domestic strategy
answer
intent that local consumers will perceive them to be domestic companies
Unlock the answer
question
global strandariation strategy
answer
to take advantage of economies of scale, produce at cheapest, closest place possible
Unlock the answer
question
transnational strategy
answer
attepts to combine the benefits of localization strategy with globalstadadization
Unlock the answer
question
Death of Distance Hypothesis
answer
assumption that geographic location alone should not lead to firm level competitive advantage because firms are now more than ever able to source inputs
Unlock the answer
question
National Competitive Advantage
answer
worldshisp in specific industries. best cars in Germany, computers in china and twain ect. Australia - mining
Unlock the answer
question
Porter's Diamond Framework(explains national competitive advantage) why some countries are better at things than others
answer
Factor Conditions- natural resources, human capital, ect Demand Conditions- Competitive Intensity in Focal Industry Related and Supporting Industries/Complementors
Unlock the answer
question
Public Stock Company
answer
an important institutional rrangement in modern, free-market economies. it provides goods and services as well as employment, pays taxes, and increases the standard of living.
Unlock the answer
question
State Charter
answer
issued by the state to a company's shareholders so it can do business.
Unlock the answer
question
Shareholders
answer
owners, who legally own stock in the company
Unlock the answer
question
Board of Directors
answer
governs and oversees the firms managment
Unlock the answer
question
Management
answer
hire, supervise, and coordinate employees to manufacture products and provide services.
Unlock the answer
question
Employees
answer
manufacture products and provide services.
Unlock the answer
question
Limited Liability
answer
the investors are responsible only for the capital specifically invested, not in other investments or personal wealth.
Unlock the answer
question
Transferability of Ownership
answer
trading of shares of stock on exchanges such as the NYSE and NASDAQ. Easy transferability.
Unlock the answer
question
Legal Personality
answer
the company or non- living entity is regarded as similar to a person with legal rights and obligations
Unlock the answer
question
Separation of Ownership and Control
answer
stockholders are the legal owners of the company, they delegate decision making to managers.
Unlock the answer
question
Corporate Governance
answer
system of mechanisms to direct and control and enterprise in order to ensure that it pursues its strategic goals successfully and legally. Agency Theory (Principal -- Agent Conflict) Board of Directors, Inside Directors, and Outside Directors Other Governance Mechanisms Management Business Ethics
Unlock the answer
question
Agency Theory
answer
a theory that views the firm as a nexus of legal contracts
Unlock the answer
question
Inside and outside directors
answer
inside- CFO, COO, etc outside- not employees of the firm. senior executives from other firms or professionals
Unlock the answer
question
moral hazard
answer
a situation in which information asymemetry increases the incentive of one party to take undue risk
Unlock the answer
question
shared value creation framework
answer
a model proposing that managers have a dual focus on shareholder value creation and value creation for society
Unlock the answer
question
global strategy
answer
part of a firms corporate strategy to gain and sustain a competitive advantage when competing against other foreign and domestic companies around the world
Unlock the answer
