WPC 480 Capstone Final Exam with Questions and Answers 202324

Cooperative Strategy - means by which firms collaborate to achieve a shared objective strategic alliance - a cooperative strategy in which firms combine some of their resources to create CA joint venture - a strategic alliance in which two or more firms create a legally independent company to share some of their resources to create CA equity strategic alliance - an alliance in which two or more firms own different percentages of the company they have formed by combining some of their resources to create CA non-equity strategic alliance - an alliance in which 2+ firms develop a contractual relationship to share some of their resources to create CA business level cooperative strategy - a strategy through which firms combine some of their resources to create CA by competing in one or more product markets complementary strategic alliances - business level alliances in which firms share some of their resources in complementary ways to create CA corporate level cooperative strategy - a strategy through which a firm collaborates with one or more companies to expand its operations diversifying alliance - a strategy in which the firm shares some of their resources to engage in product or geographic distribution synergistic alliance - a strategy in which firms share some of their resources to create economies of scope franchising - a strategy in which a firm (the franchisor) uses a franchise as a contractual relationship to describe and control the sharing of its resources with its partners (the franchisees) cross border strategic alliance - a strategy in which firms with HQ in different countries decide to combine resources to create CA network cooperative strategy - strategy in which several firms agree to form multiple partnership to achieve shared objectives multidomestic - international strategy in which strategic and operating decisions are decentralized to the strategic business units in individual countries or regions for the purpose of allowing each unit the opportunity to tailor products to the local market global strategy - international strategy in which a firm's home office determines the strategies that business units are to use in each country/region transnational - international strategy in which firm seeks to achieve both global efficiency and local responsiveness greenfield venture - an entry mode through which a firm invests directly in another country or market by establishing a wholly owned subsidiary international diversification strategy - a firm expands the sales of its goods/services across the borders of global regions and countries into a potentially large number of geographic locations/markets international strategy - the firm sells goods/services outside its domestic market merger - strategy through which two firms agree to integrate their operations on a relatively coequal basis acquisition - strategy through which one firm buys a controlling or 100% interest in another firm with the intent of making the acquired firm a subsidiary within its business portfolio takeover - a special type of acquisition where the target firm does not solicit the acquiring firm's bid; thus, takeovers are unfriendly acquisitions restructuring - strategy through which firm changes its set of businesses or financial structure corporate governance - set of mechanisms used to manage the relationships among stakeholders and to determine and control the strategic direction and performance of organizations agency relationship - exists when one party delegates decision making to a second party for compensation managerial opportunism - the seeking of self-interest with guile (cunning or deceit) agency costs - the sum of incentive costs, monitoring costs, enforcement costs, and individual financial losses incurred by principals because governance mechanisms cannot guarantee total compliance by the agent ownership concentration - defined by the number of large block shareholders and the total percentage of the firm's shares they own large block shareholders - typically own at least 5% of a company's issued shares institutional owners - financial institutions such as mutual funds and pension funds that control large block shareholder positions BOD - a group of elected individuals whose primary responsibility is to act in the owner's best interests by formally monitoring and controlling the firm's TMT executive compensation - governance mechanism that seeks to align the interests of managers and owners through salaries bonuses LT incentives such as stock awards/options market for corporate control - an external governance mechanism that is active when a firm's internal mechanisms fail organizational structure - specified the firms formal reporting relationships procedures controls and authority and decision making processes organizational controls - guide the use of strategy to indicate how to compare actual results with expected results, and suggest corrective actions to take when difference is unacceptable strategic controls - largely subjective criteria intended to verify that the firm is using appropriate strategies for the conditions in the external environment and the company's CA financial controls - largely objective measure performance against previously established quantitative standards