Exam 13: The Strategy of International Business

Which of the following is associated with firms following the global standardization strategy?

Universal needs exist when the tastes and preferences of consumers in different nations are similar if not identical.

_____ include the design, creation, and delivery of a product.

_____ can be defined as the rate of return that the firm makes on its invested capital, which is calculated by dividing the net profits of the firm by total invested capital.

A firm's strategy can be defined as the actions that managers take to attain the goals of the firm.

Lenovo's ThinkPad laptop computers are designed in the United States, the case, keyboard, and hard drive are made in Thailand; the display screen and memory in South Korea; the built-in wireless card in Malaysia; and the microprocessor in the United States. In each case, these components are manufactured and sourced from the optimal location given current factor costs. In this example, Lenovo has:

A firm that is pursuing a(n) _____ strategy is simultaneously trying to achieve low costs through location economies, economies of scale, and learning effects, and trying to differentiate its product offering across geographic markets.

When consumer tastes and preferences differ significantly between countries, there is low pressure for local responsiveness.

A(n) _____ customizes the product offering to local demands and increases the value of that product in the local market.

What is strategy? How does strategy relate to a firm's profitability?

Skills within the firm that competitors cannot easily match or imitate and that may exist in the firm's value creation activities.

A firm benefits by basing each value creation activity it performs at that location where economic, political, and cultural conditions, including relative factor costs, are most conducive to the performance of that activity. Firms that pursue such a strategy can realize _____.

Which of the following is less likely to add to the pressure for a firm to be locally responsive?

How can firms successfully leverage the skills developed at the subsidiary level?

_____ refer(s) to systematic reductions in production costs that have been observed to occur over the life of a product.

_____ activities are basically concerned with creating the product, marketing and delivering the product to buyers, and providing support and after-sales service.

What are learning effects? When are learning effects most significant?

To leverage subsidiary skills, companies should establish incentive systems that encourage local employees to acquire new skills.

When companies disperse different stages of the value chain to those locations around the world where perceived value is maximized or where the costs of value creation are minimized, companies create:

What is the difference between profitability and profit growth?