EXAM 1 - Business strategy Questions with Correct Answers 2024

EXAM 1 - Business strategy Questions with Correct Answers 2024 CH6 notes corporate level strategy - Correct Answer the strategy that top management formulates for the overall company. corporate profile - Correct Answer Identification of the industry or industries in which a firm operates. A firm may choose one of three basic profiles - Correct Answer 1. To operate in a single industry 2. To operate in multiple related industries 3. To operate in multiple unrelated industries competing in one industry examples and benefits - Correct Answer UPS, Home-depot. Benefit from the specialized knowledge that they develop from concentrating their efforts on one business area. This can help the firm improve product or service quality and become more efficient in its operations. Cons: more susceptible to sharp downturns in business cycle. this is why large firms persue diversification and compete in more than one industry. Diversification - Correct Answer company growth through starting up or acquiring businesses outside the company's current products and markets. allows a firm to grow (potentially use their products more ffectively, and make use of surplus revenue) reduce the risk and uncertainty associated with operating in a single industry. related diversification - Correct Answer diversification into a similar business that may complement the original or primary business. ex: walmart, which also operate sams club. unrelated diversification - Correct Answer growth strategy where new business lacks an common elements with the present business. cons: Because their interests are dispersed throughout