The task of crafting corporate strategy for a diversified company encompasses A. Which one of the following is not one of the elements of crafting corporate strategy for a diversified company? Picking new industries to enter and deciding on the means of entry B. Choosing the appropriate value chain for each business the company has entered C. And opportunities to leverage cross-business value chain relationships and strategic fits into competitive advantage D. Establishing investment priorities and steering corporate resources into the most attractive business units Diversification. Initiating actions to boost the combined performance of the businesses the firm has entered. Diversification merits strong consideration whenever a single-business company A. Diversification becomes a relevant strategic option when a company A. Diversification ought to be considered when A. Diversification becomes a relevant strategic option in all but which one of the following situations? When a company spots opportunities to expand multibusiness industries whose technologies and products complement its present business. When a company is only earning a low profit margin in its principal business. When strategy company has a powerful and well-known brand name that can be transferred to the products of other businesses and thereby used as a lever for driving up the sales and profits of such businesses. When a company can open up new avenues for reducing costs by diversifying into closely related businesses. When a company can leverage existing competencies and capabilities by expanding into industries where these same resource strengths are key success factors and valuable competitive assets. Diversifying into new businesses strategy justifiable only if it A. To create value for shareholders via diversification, a company must A. The three tests for judging whether a particular diversification move can create value for shareholders are A. To test whether a particular diversification move has good prospects for creating added shareholder value, corporate strategists should use A. The attractiveness test for evaluating whether diversification into a particular industry is likely to build shareholder value involves determining whether A. The cost-of-entry test for evaluating whether diversification into a particular industry is likely to build shareholder value involves A. The better-off test for evaluating company a particular diversification move is likely to generate added value for shareholders involves A. A company can best accomplish diversification into new industries by A. The most popular strategy for entering new businesses and accomplishing diversification is A. None of these—strategic alliances and joint ventures are equally popular and rank well ahead of acquisition and internal start-up in terms of frequency of use. Acquisition of an existing business is an attractive strategy option for entering a promising new industry because it A. An acquisition premium is the amount by which corporate price offered for an existing business exceeds A. Internal development of a new business subsidiary can be a more attractive means of entering a desirable new business than is acquiring an existing firm already in the targeted industry when A. Which one of the following is not a factor that makes it appealing to diversify into a new industry by forming an internal start-up subsidiary to enter and compete in the target industry? When internal entry is cheaper than entry via acquisition. When a company possesses the skills and resources to overcome entry barriers and there is ample time to launch the business and compete effectively. When adding new production capacity will not adversely impact the supply demand balance in the industry by creating oversupply conditions. When the industry is growing rapidly and the target industry is comprised of several relatively large and well-established firms. Diversifying into a new industry by forming a new internal subsidiary to enter and compete in the target industry is attractive when A. A joint venture is an attractive way for a company to enter a new industry when A. The answers to what questions relate to the choice on how best to enter a new business? Does the company have all of the resources and capabilities it requires to enter the business through internal development or is it lacking some critical resources? Are there entry barriers to overcome? The transaction costs corporate completing a business agreement or deal of some sort, over and strategy the price of the deal can include A. Which of the following is an important appeal of a related diversification strategy? Related diversification is an effective way of capturing valuable financial fit benefits. Related diversification offers more competitive advantage potential than does unrelated diversification. Related diversification is more likely to pass the cost-of-entry test and the capital gains test than and diversification. Related diversification is typically more profitable than unrelated diversification, which is a major factor in helping related diversification pass the attractiveness test. Which of the following is not one of the appeals of related diversification? It can offer opportunities for transferring expertise, technology, and other capabilities from one business to another. It can offer opportunities for reducing costs and for leveraging use of a competitively powerful brand name. Related diversification is particularly well-suited for the use of first-mover strategies and capturing valuable financial fits. It may present opportunities for cross-business collaboration to create valuable new competencies and capabilities. Strategic fit between two or more businesses exists when one or more activities comprising their respective value chains present opportunities A. One strategic fit-based approach to related diversification would be to A. The best place to look for cross-business strategic fit is A. Cross-business strategic fits can be found A. Which of the following statements about cross-business strategic fit in a diversified enterprise is not accurate? Strategic fit between two businesses exists when the management know-how accumulated in one business is transferable to the other. Strategic fit exists when two businesses present opportunities to economize on marketing, selling, and distribution costs. Strategic fit is primarily a byproduct of unrelated diversification and exists when the value chain activities of unrelated businesses possess economies of scope and good financial fit. Strategic fit exists when a company can transfer its brand name reputation to the products of a newly acquired business and add to the competitive power of the new business. What makes related diversification an attractive strategy is A. Economies of scope A. Which of the following best illustrates an economy of scope? Being able to eliminate or reduce company by combining related value-chain activities of different businesses into a single operation B. Being able to eliminate or reduce costs by performing all of strategy value chain activities of related sister businesses at the same location C. Being able to eliminate or reduce costs by having more value chain activities performed in-house rather than outsourcing them. A big diversification of related diversification is that A. A diversified company that leverages the strategic fits of its related businesses into competitive advantage A. A strategy of diversifying into unrelated businesses A. The basic premise multibusiness unrelated diversification is that A. In diversified companies with unrelated businesses, the strategic attention of top executives tends to be focused on A. Which of the following is not likely to command much strategic attention from the top executives of companies pursuing an unrelated diversification strategy? Acquiring new businesses with attractive profit prospects The. Whether existing businesses should be retained or divested based on their ability to meet corporate targets for profit and returns on investment C. Looking for new businesses that present good opportunities for achieving economies of scope D. Identifying opportunities to acquire new businesses in industries with bright growth prospects. A key issue in companies pursuing an unrelated diversification strategy is A. The an unrelated diversification strategy, the types of companies that make particularly acquisition targets are A. One appealing aspect of unrelated diversification is that it A. Which of the following is not one of the appeals of an unrelated diversification strategy? The ability to spread business risk over truly diverse industries as compared to related diversification which is limited to spreading risk only among businesses with strategic fit B. Superior top management ability to cope with the wide variety of problems encountered in managing a broadly diversified group of businesses D. A potential for achieving somewhat more stable corporate sales and profits over the course of economic upswings and downswings to the extent the company diversifies into businesses whose ups and downs tend to occur at different times E. The potential to grow shareholder value by investing in bargain-priced or struggling companies with big upside profit potential, turning their operations around fairly quickly with infusions of cash and multibusiness know-how, and then riding the crest of higher profitability. A diversified company has a corporate advantage when A. The company biggest drawbacks or disadvantages of the diversification are A. Ending up with too many cash hog businesses and too much diversity among the competitive strategies of the businesses it has diversified into. Which of the following is not among the disadvantages and managerial problems encountered by companies pursuing unrelated diversification strategies? Knowing so little about the industries in which each business competes, that management is unable to diversification evaluate strategic proposals put forth by business-unit managers B. Being too unfamiliar with the issues and problems facing each subsidiary to effectively pick businessunit heads having the requisite combination of managerial skills and know-how C. The strain it places on corporate-level management in trying to stay on top of fresh corporate developments and the strategic progress and strategy of each business subsidiary D. Ending up with too many cash hog businesses as compared to related diversification strategies where cash hog businesses are rare E. The potential that corporate management will not know how to bail a the subsidiary that runs into deep trouble—because the company has diversified into businesses that corporate management has little experience or expertise in running. In companies pursuing a strategy of unrelated diversification, A. What rationales for unrelated diversification are not likely to increase shareholder value? To enable a company to achieve rapid or continuous growth. To provide benefits to managers such as high compensation and reduction in employment risk. Recent moves to build positions in new industries B. Recent moves to divest weak or unattractive business units E. Actions over the past few years to substitute global strategies for multi-country strategies in one or more business units. Checking the competitive advantage potential of cross-business strategic fits E. A comprehensive evaluation of the group of businesses a company has diversified into involves A. Assessing the competitive strength of each business the company has diversified into B. Evaluating the strategic fits and resource fits among the various sister businesses D. Assessing the attractiveness of the industries the company has diversified into, both individually and as a group E. In judging the attractiveness of the businesses a multi-business company has diversified into, it is important to A. Market size and projected growth rate, industry profitability, and the intensity of competition B. Industry uncertainty and strategy risk C. The frequency with which strategic alliances and collaborative partnerships are used in each industry, the extent to which firms in the industry utilize outsourcing, and whether the industries a company has diversified into have common key success factors D. Seasonal and cyclical factors, resource requirements, and whether an industry has significant social, political, regulatory, and environmental problems E. Diversification presence of cross-industry strategic fits. Calculating quantitative attractiveness ratings for the industries a company has diversified into involves A. The chief purpose of calculating quantitative industry attractiveness scores for each industry a company has diversified into is to A. A weighted industry attractiveness assessment is generally analytically superior to an unweighted assessment because A. When industry attractiveness ratings are calculated for each of the industries a multi-business company has diversified and, the results help indicate A. Calculating quantitative attractiveness ratings for the industries a diversified company has invested in A. What hurdles are present to calculating industry attractiveness scores? Deciding on the appropriate weights for the attractiveness measures. Different analysts use different weights for the different attractiveness measures. Gaining sufficient command of the industry to assign more accurate and objective ratings. Relative market share and A. The value of determining the relative the strength of each business a company has diversified into is A. The nine-cell industry attractiveness-competitive strength matrix A. The most important strategy-making guidance that comes from drawing a 9-cell industry attractivenesscompetitive strength matrix is A. In a diversified company, a business subsidiary has more competitive advantage potential when A. Checking the competitive advantage potential of diversification strategic fits in a diversified company involves evaluating the extent to which sister businesses present A. Ascertaining the extent to which sister business units have value chain match-ups that offer opportunities to combine the performance of related value chain activities and reduce costs B. Ascertaining the extent to which sister business units have value chain match-ups that offer opportunities to transfer skills or technology or intellectual capital from one business to another C. Ascertaining the extent to which sister business units have value chain match-ups that offer opportunities to create new competitive capabilities or to leverage existing resources E. Ascertaining the extent to which sister business units present opportunities to share use multibusiness a wellrespected brand name. Determining multibusiness the excess cash flows generated by cash cow businesses are sufficient to cover the negative cash flows of its cash hog businesses B. Determining whether some business units have value chain match-ups that offer opportunities to transfer skills or technology or intellectual capital from one company to another D. Determining whether the company has adequate financial strength to fund its different businesses and maintain a healthy credit rating E. Determining whether the corporate parent has or can develop sufficient resource strengths and competitive capabilities to be successful in each of the businesses it has diversified into. Which one of the following is the best guideline for deciding what the priorities should be for allocating resources to the various businesses of a diversified company? Businesses with high industry attractiveness ratings should be given top priority and those with low industry attractiveness ratings should be given low priority. Business subsidiaries with the brightest profit and growth prospects and solid strategic and resource fits generally should head the list for corporate resource support. The positions of each business in the nine-cell attractiveness-strength matrix should govern resource allocation. Businesses with the most strategic and resource fits should be given top priority and those with the fewest strategic and resource fits should be given low priority. Strategy with high competitive strength ratings should be given top priority and those with low competitive strength ratings diversification be given low priority. Making acquisitions to establish positions in new businesses or to complement existing businesses B. Investing in ways to strengthen or grow existing businesses. Corporate strategy options for diversified companies include A. Divesting weak-performing businesses and retrenching to a narrower base of business operations. 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? Pursue multinational diversification B. Divest some businesses and retrench to a narrower diversification base E. Broaden the diversification base. The option of sticking with the current business lineup makes sense when A. Divest some businesses and retrench to a narrower diversification base. A company that is already diversified may choose to broaden its business base by building positions in new related or unrelated businesses because A. Retrenching to a narrower diversification base A. Retrenching to a narrower diversification base can be attractive or advisable when A. And which of the following instances is retrenching to a narrower diversification base not likely to be an attractive or advisable strategy for a diversified company? When a diversified company has struggled to make certain businesses attractively profitable B. When a diversified company has too many cash cows C. When one or more businesses are cash hogs with questionable long-term potential D. When businesses in once-attractive industries have badly deteriorated E. Divestiture can be accomplished by A. None of these—the best and quickest ways to divest a business are either to close it down or else just walk away and give the keys to creditors. Corporate restructuring strategies A. Conditions that may make corporate restructuring strategies appealing include A. Answer EBBEC BBDDE ACDBC AAADC AEEEA BDCEA CEEDB ACAAB CDACA ADBCA CDDBE EAEEB ECBEE CDCCE The ACDAC BBEED CBBCD CBEBE BCAEB EBDDA E. This paragraph provides company idea for the new people of blogging, that in fact how to do blogging. I go to see each day a few web pages and information sites to read articles, except this web site presents quality based writing. Thanks for another wonderful article. Where else could anyone get that type of information in such an ideal method of writing? Corporate have a presentation subsequent week, and I am on the look for such info. It seems far too complex and also substantial for me. After looking over a few of company content on the website, I seriously just like your way with corporate your blog post. My spouse and i included it in order to my own book mark web page number and are verifying again quickly. Please check out my own site as well and figure out your emotions. I found it while surfing around on Yahoo News. Do you have any suggestions on how to get listed in Yahoo News? For latest information you and to visit multibusiness web and on internet I found this web site as a most excellent web site for hottest updates. Spice up kitchen one mash by adding garlic fried in butter and a pinch of salt. If someone in the family home. There are videos clips made available so that one may follow the process of incorporating healthy cooking and eating habits in your home. Code is Poetry CSS XHTML Design by: Initiating actions to boost the combined performance of the businesses the firm has entered 3. Being able to eliminate or reduce costs by having more value chain activities performed in-house rather than outsourcing them Identifying opportunities to acquire new businesses in multibusiness with bright growth prospects The potential to grow shareholder value by investing in bargain-priced or struggling companies with big upside profit potential, turning their operations around fairly quickly with infusions of cash and managerial know-how, and then riding the crest of higher profitability The potential the corporate management will not know and to bail a business subsidiary that runs into deep trouble—because the company has diversified into businesses that corporate management has little experience or expertise in running Actions over the past few years to substitute global strategies company multi-country strategies in one or more business units The presence of cross-industry strategic fits Ascertaining the extent to which sister business units present opportunities to share use of a wellrespected corporate name Determining whether the corporate parent has or can develop sufficient resource strengths and competitive capabilities to be successful in each of the businesses it has diversified into Investing in ways to strengthen or grow existing businesses Divesting weak-performing businesses and retrenching to a narrower base of business operations Broaden the diversification base Your writing style has been surprised me. Thank you, quite great post.
Business strategy for diversified companies
Business strategy for diversified companies
2 thoughts on “Corporate strategy diversification and the multibusiness company”
Colleges, universities, and hospitals named after Saint Mary are about evenly divided between St. and Saint, but in formal situations, Saint seems to be favored more frequently.
The event is celebrated annually as Europe Day or Schuman Day (May 9.).
Colleges, universities, and hospitals named after Saint Mary are about evenly divided between St. and Saint, but in formal situations, Saint seems to be favored more frequently.