MGT 405 Comprehensive Strategy and
International Expansion Concepts with
Complete Solutions
What is Political Risk? - Answer- Risks arising from instability or weakness in national
governments affecting foreign-owned businesses.
What is Economic Risk? - Answer- Risks from threats like piracy, inflation, and
instability in a foreign market's monetary system.
What is a Greenfield Investment? - Answer- Establishing a foreign subsidiary from
scratch, requiring extensive prior international experience.
What is a Joint Venture? - Answer- A cooperative arrangement with a foreign partner to
share ownership, costs, risks, and benefits.
What is the difference between Related and Unrelated Diversification? - Answer-
Related Diversification involves industries with strategic fit, while Unrelated
Diversification has no operational fit.
What is the Best-Cost Provider strategy? - Answer- A hybrid strategy delivering more
value for money than rivals, requiring genuine cost efficiencies.
What does 'Stuck in the Middle' refer to? - Answer- A situation where a firm tries to
pursue multiple generic strategies without committing to one.
What is the purpose of the 9-Cell Portfolio Matrix? - Answer- To score business units by
industry attractiveness and competitive strength for resource allocation.
What is the difference between Corporate Strategy and Business-Level Strategy? -
Answer- Corporate Strategy addresses where to compete, while Business-Level
Strategy focuses on how to compete within a single industry.
What is the significance of the 'Think Global, Act Local' approach? - Answer- It allows
local managers to adapt strategies while maintaining a global competitive theme.
What is the role of economies of scope? - Answer- Cost savings from sharing inputs,
assets, or capabilities across multiple businesses.
, What is the main goal of a Focused Low-Cost strategy? - Answer- To target a narrow
buyer segment and serve it at a lower cost than rivals.
What is the Focused Differentiation strategy? - Answer- Targeting a narrow segment
and tailoring the offering with premium features valued by those buyers.
What is the importance of adapting business models in developing markets? - Answer-
To cater to local circumstances while retaining global scale advantages.
What should a firm do if it cannot adapt its business model economically? - Answer-
Avoid the market and wait for more favorable conditions.
What is a business-level strategy? - Answer- A coordinated set of actions managers
take to outperform competitors and achieve superior profitability within a given market.
What are the two distinguishing dimensions of business-level strategy? - Answer-
Market scope (broad vs. narrow) and competitive advantage (lower costs vs.
differentiation).
What are Porter's five generic strategies? - Answer- 1. Broad Low-Cost Provider, 2.
Broad Differentiation, 3. Best-Cost Provider, 4. Focused Low-Cost, 5. Focused
Differentiation.
What characterizes a Broad Low-Cost Provider strategy? - Answer- Lower costs than
rivals across the full market, achieved by undercutting on price or holding price for
higher margins.
What is the main focus of a Broad Differentiation strategy? - Answer- Creating attributes
that rivals can't easily match, allowing for premium pricing and building brand loyalty.
What does Best-Cost Provider strategy aim to achieve? - Answer- Offering more value
for money than rivals, but risks being squeezed between true cost leaders and true
differentiators.
What defines a Focused Low-Cost strategy? - Answer- Serving a narrow segment at
lower cost than rivals, appealing to smaller firms without resources for the full market.
What is a Focused Differentiation strategy? - Answer- Tailoring premium features for a
narrow niche, commanding a price premium within that segment.
What does it mean to be 'stuck in the middle'? - Answer- A firm tries to pursue more
than one strategy without fully committing, leading to below-average profitability.
What is value chain alignment? - Answer- The process of ensuring that every function
within a firm reinforces the same competitive advantage.
International Expansion Concepts with
Complete Solutions
What is Political Risk? - Answer- Risks arising from instability or weakness in national
governments affecting foreign-owned businesses.
What is Economic Risk? - Answer- Risks from threats like piracy, inflation, and
instability in a foreign market's monetary system.
What is a Greenfield Investment? - Answer- Establishing a foreign subsidiary from
scratch, requiring extensive prior international experience.
What is a Joint Venture? - Answer- A cooperative arrangement with a foreign partner to
share ownership, costs, risks, and benefits.
What is the difference between Related and Unrelated Diversification? - Answer-
Related Diversification involves industries with strategic fit, while Unrelated
Diversification has no operational fit.
What is the Best-Cost Provider strategy? - Answer- A hybrid strategy delivering more
value for money than rivals, requiring genuine cost efficiencies.
What does 'Stuck in the Middle' refer to? - Answer- A situation where a firm tries to
pursue multiple generic strategies without committing to one.
What is the purpose of the 9-Cell Portfolio Matrix? - Answer- To score business units by
industry attractiveness and competitive strength for resource allocation.
What is the difference between Corporate Strategy and Business-Level Strategy? -
Answer- Corporate Strategy addresses where to compete, while Business-Level
Strategy focuses on how to compete within a single industry.
What is the significance of the 'Think Global, Act Local' approach? - Answer- It allows
local managers to adapt strategies while maintaining a global competitive theme.
What is the role of economies of scope? - Answer- Cost savings from sharing inputs,
assets, or capabilities across multiple businesses.
, What is the main goal of a Focused Low-Cost strategy? - Answer- To target a narrow
buyer segment and serve it at a lower cost than rivals.
What is the Focused Differentiation strategy? - Answer- Targeting a narrow segment
and tailoring the offering with premium features valued by those buyers.
What is the importance of adapting business models in developing markets? - Answer-
To cater to local circumstances while retaining global scale advantages.
What should a firm do if it cannot adapt its business model economically? - Answer-
Avoid the market and wait for more favorable conditions.
What is a business-level strategy? - Answer- A coordinated set of actions managers
take to outperform competitors and achieve superior profitability within a given market.
What are the two distinguishing dimensions of business-level strategy? - Answer-
Market scope (broad vs. narrow) and competitive advantage (lower costs vs.
differentiation).
What are Porter's five generic strategies? - Answer- 1. Broad Low-Cost Provider, 2.
Broad Differentiation, 3. Best-Cost Provider, 4. Focused Low-Cost, 5. Focused
Differentiation.
What characterizes a Broad Low-Cost Provider strategy? - Answer- Lower costs than
rivals across the full market, achieved by undercutting on price or holding price for
higher margins.
What is the main focus of a Broad Differentiation strategy? - Answer- Creating attributes
that rivals can't easily match, allowing for premium pricing and building brand loyalty.
What does Best-Cost Provider strategy aim to achieve? - Answer- Offering more value
for money than rivals, but risks being squeezed between true cost leaders and true
differentiators.
What defines a Focused Low-Cost strategy? - Answer- Serving a narrow segment at
lower cost than rivals, appealing to smaller firms without resources for the full market.
What is a Focused Differentiation strategy? - Answer- Tailoring premium features for a
narrow niche, commanding a price premium within that segment.
What does it mean to be 'stuck in the middle'? - Answer- A firm tries to pursue more
than one strategy without fully committing, leading to below-average profitability.
What is value chain alignment? - Answer- The process of ensuring that every function
within a firm reinforces the same competitive advantage.
