MGMT 478 Exam 2 Study Guide Review
1.corporate level strategy: actions a firm takes to earn/gain a
competitive ad- vantage by selecting and maintaining a group of
different businesses competing in different product markets; focuses on
firms that diversify
2.business level strategy: focuses on a firm competing in a single market
3.portfolio strategy: When each subsidiary develops its own strategic
plan and business level strategy then forwards it to headquarters,
where it is assembled into a portfolio (for entire org.)
4.strategic business unit: different subsidiaries or divisions a business has
to offer
5.example of SBU: General motors has Chevy, Buick, Cadillac and GMC
6.what do all SBUs have in common?: - unique business mission
- product lines
- competitors
- at times, markets relative to other SBUs in same firm
7.business growth: how rapidly an industry/market is moving (dimension
,of Boston Consulting Group Matrix)
8.market share: does the SBU have a larger or smaller share than
competitors (dimension of Boston Consulting Group Matrix)
9.dog: small market share of a slow growth/mature industry (an
evaluation of SBUs)
10.cash cow: large market share of a mature/slow growth market (an
evaluation of SBUs)
11.question mark: small market share of a rapidly expanding industry
(an evalua- tion of SBUs)
12.star: large market share of a rapidly expanding industry (an
evaluation of SBUs)
13.3 Levels of Diversification: 1. Low Levels of Diversification
2.Moderate to High Levels of Diversification
3.Very High Levels of Diversification
14.single business diversification strategy: 95% or more of rev comes
from a single business (low level diversification strategy)
15.dominant business diversification strategy: 70-95% of rev comes
from a single business (low level diversification strategy)
16.related constrained diversification strategy: less than 70% of the total
, sales rev comes from the dominant business & all business share
products, technological & distributional linkages (moderate to high level
diversification strategy)
17.related linked diversification strategy: less than 70% of total sales rev
comes from the dominant business and there are only limited links
between businesses (moderate to high level diversification strategy)
18.unrelated diversification strategy: less than 70% of total sales rev
comes from dominant business and there are no links between
businesses (very high level diversification strategy)
19.economies of scope: cost savings that the firm creates by sharing or
transfer- ring one or more corporate level core competencies among its
businesses (value creation method w/ mod. to high levels of
diversification)
20.corporate level core competencies (CCC): complex set of resources
and capabilities that link different businesses; linkages
- experience
- expertise
- managerial knowledges
- technological knowledges
1.corporate level strategy: actions a firm takes to earn/gain a
competitive ad- vantage by selecting and maintaining a group of
different businesses competing in different product markets; focuses on
firms that diversify
2.business level strategy: focuses on a firm competing in a single market
3.portfolio strategy: When each subsidiary develops its own strategic
plan and business level strategy then forwards it to headquarters,
where it is assembled into a portfolio (for entire org.)
4.strategic business unit: different subsidiaries or divisions a business has
to offer
5.example of SBU: General motors has Chevy, Buick, Cadillac and GMC
6.what do all SBUs have in common?: - unique business mission
- product lines
- competitors
- at times, markets relative to other SBUs in same firm
7.business growth: how rapidly an industry/market is moving (dimension
,of Boston Consulting Group Matrix)
8.market share: does the SBU have a larger or smaller share than
competitors (dimension of Boston Consulting Group Matrix)
9.dog: small market share of a slow growth/mature industry (an
evaluation of SBUs)
10.cash cow: large market share of a mature/slow growth market (an
evaluation of SBUs)
11.question mark: small market share of a rapidly expanding industry
(an evalua- tion of SBUs)
12.star: large market share of a rapidly expanding industry (an
evaluation of SBUs)
13.3 Levels of Diversification: 1. Low Levels of Diversification
2.Moderate to High Levels of Diversification
3.Very High Levels of Diversification
14.single business diversification strategy: 95% or more of rev comes
from a single business (low level diversification strategy)
15.dominant business diversification strategy: 70-95% of rev comes
from a single business (low level diversification strategy)
16.related constrained diversification strategy: less than 70% of the total
, sales rev comes from the dominant business & all business share
products, technological & distributional linkages (moderate to high level
diversification strategy)
17.related linked diversification strategy: less than 70% of total sales rev
comes from the dominant business and there are only limited links
between businesses (moderate to high level diversification strategy)
18.unrelated diversification strategy: less than 70% of total sales rev
comes from dominant business and there are no links between
businesses (very high level diversification strategy)
19.economies of scope: cost savings that the firm creates by sharing or
transfer- ring one or more corporate level core competencies among its
businesses (value creation method w/ mod. to high levels of
diversification)
20.corporate level core competencies (CCC): complex set of resources
and capabilities that link different businesses; linkages
- experience
- expertise
- managerial knowledges
- technological knowledges
