Horizontal integration is an appropriate strategy when the competitors of an organization are doing poorly

Learning effects are cost savings that come from learning by doing

The Chief Executive Officer (CEO) is the principal general manager of the organization

Internal stakeholders are customers, suppliers, creditors, governments, unions, local communities, and the general public

Michael Porter has argued that low cost and differentiation are two basic strategies for creating value and attaining a competitive advantage in an industry

Business-level strategy is a strategy to use competitor resources and distinctive competencies to gain a competitive advantage

The principle concern of corporate-level strategy is to identify the industry or industries a company should participate in to maximize its long-run profitability

Organizational design is the process through which managers select the combination of organizational structure and control systems that they believe will enable the company to create and sustain a competitive advantage

A diversified company is one that operates in only one single industry to “stick to its knitting”.

Personal control is a control through the establishment of a comprehensive system of rules and procedures to direct the actions or behavior of divisions, functions, and individuals

A company has a competitive disadvantage when its profitability is higher than the average for its industry

SWOT is an acronym used to describe Strengths, Weaknesses, Opportunities and Technologies

Horizontal integration is seeking ownership or increased control over competitors

A strategy is a set of related actions that managers take to increase their company’s performance

The purpose of organizing is to achieve coordinated effort by defining task and authority relations

Strategy implementation is the way in which a company creates organizational arrangements that allow it to pursue its strategy most effectively

An industry is the same thing as a market segment

A tangible resource is something physical

Wake Up Coffee Company has decided to enter the coffee machine manufacturing business for a six-month trial run. They are likely to have the same unit costs of manufacturing as the other established competitors in this industry

A product can meet customers’ needs by addressing their wants, needs and cravings

Companies usually set up manufacturing facilities in a foreign country before they start selling products there

Most manufacturing companies begin entry into a new national market by exporting

A commonality is an attribute shared by two or more business units that allows them to create more value when they operate together

Transfer pricing may lead to battles over establishing the fair price of a resource developed in one division that is to be sold to other divisions that require it

A good manager can be flexible when it comes to sticking to the original plan; to get good results the intended strategy does not have to become the realized strategy

For a cost leader, competitive parity on the basis of differentiation is unnecessary and will result in lower profits

In outsourcing, a company purchases resources from outside through long-term contracts instead of being made in-house

Output controls focus on resources such as knowledge, skills, abilities, values and motives of employees

A declaration of an organization’s “reason for being” is the mission statement

A technology company is likely to have a flat organizational structure, giving employees wide discretion to meet customers’ demands

The marketing and sales function of a company is a support activity on the value chain

A cost leader would likely be the first to offer theatre-quality sound in a DVD player

A firm's distinctive competence arises out of the competitive advantages it holds over its rivals

Product bundling ( gói sản phẩm) involves offering customers the opportunity to buy a complete range of products they need at a single combined price

The four components for a successful acquisition are target identificatieon and screening, bidding strategy, integration, and learning from the experience

Customer needs are desires, wants, or cravings satisfied by means of the characteristics of a product

Horizontal integration is the process of acquiring or merging with industry competitors in an effort to achieve the competitive advantages that come with large size or scale

Companies that pursue an international strategy focus on increasing profitability by reaping the cost reductions that come from economies of scale and location economies (global strategy).

Typically, firms have a substantial ability to control trends in its general environment if it is able to correctly predict them

Highlands Coffee Company has decided to enter the coffee machine manufacturing business for a six-month trial run. They are likely to have higher unit costs of manufacturing than the other established competitors in this industry

Integrating mechanisms help coordination take place among people, functions, and divisions throughout the hierarchy of authority

Mass customization is an example of a combination strategy because it provides unique products to customers and lower costs to the firm

The corporate level of management occupies the apex of decision-making within the organization.

Flattening a structure speeds organizational communication and decision-making

A SWOT analysis examines the external strengths and weaknesses in an industry environment and the internal opportunities and threats in the firm

Market power is the degree to which a company utilizes effective marketing

Internal stakeholders are stockholders and employees, including executive officers, managers, and board members

A business unit is a self-contained division (with its own functions - for example, finance) that provides a product or service for a particular market

Differentiation strategy is a strategy of trying to achieve a competitive advantage by creating a product that is perceived by customers to be unique in some important way

A virtual corporation outsources all of its functional activities.

The span of control is defined as the number of subordinates a manager directly manages

Companies that pursue a localization strategy focus on increasing profitability by reaping the cost reductions that come from economies of scale and location economies

Functional managers are responsible for supervising a particular function, that is, a task, activity, or operation, like accounting, marketing, R&D, information technology, or logistics.

A hierarchy of authority is a chain of command based on the relative authority that each manager has

The traditional differentiation strategies of building a strong brand identity and use of prestige pricing are easier to accomplish today due to the increased use of the Internet and digital technologies

A goal is a precise and measurable future state that a company attempts to realize

Industry structure accounts for the majority of variance in firm profit rates

General managers are responsible for supervising a particular function, that is, a task, activity, or operation, like accounting, marketing, R&D, information technology, or logistics

Strategy formulation requires coordination among a few individuals, but strategy implementation requires coordination among many

Tasks and activities are grouped together by business function in a divisional organizational structure

A company's stakeholders are individuals or groups with an interest, claim, or stake in the company, in what it does, and in how well is performs

The mission of a company lays out some desired future state - it articulates, often in bold terms, what the company would like to achieve

A company has a competitive advantage when its profitability is higher than the average for its industry

Marketing strategy refers to the position that a company takes with regard to pricing, promotion, advertising, product design, and distribution

The greater the pressures for cost reductions are, the more likely it is that a company will want to pursue some combination of exporting and wholly owned subsidiaries

Companies that pursue a global standardization strategy tend to centralize product development functions such as R&D at home

Output control is control through the establishment of a comprehensive system of rules and procedures to direct the actions or behaviour of divisions, functions, and individuals

Strategic choice is the evaluation of alternative strategies and the selection of the best alternative

At the maturity stage of the industry life cycle, products tend to become more like commodities, and this is now a fragmented industry

Developing strategies for competing in the individual business areas is the specific responsibility of the business-level managers

The greater the number of hierarchical levels, the less scope subordinates have to distort facts, so that the costs of managing the hierarchy decreases

Barriers to entry are legal prohibitions to expansion of the number of competitors in an industry

External stakeholders are stockholders and employees, including executive officers, managers, and board members

In franchising, the franchisee grants the franchisor the right to use the parent's name, reputation, and business skills in a particular location or area

Vertical integration is a corporate-level strategy that involves a company entering new industries to increase its short-run profitability

A company's level of integration is the extent to which it seeks to coordinate its value-creation activities and make them interdependent

Personal control is the desire to shape and influence the behavior of a person in a face-to face interaction in the pursuit of the company’s goals

Emergent strategies are the unplanned responses to unforeseen circumstances

The differentiator is protected from industry competitors by its cost advantage

The vast majority of acquisitions result in value destruction rather than value creation

The critical strengths and weaknesses that are likely to determine if the firm will be able to take advantage of opportunities while avoiding threats are called internal strategic factors

Functional strategy is the approach a functional area takes to achieve corporate and business unit objectives and strategies by maximizing resource productivity

Strategic management is difficult to apply when the organization’s output is difficult to measure objectively

Senior management is usually the group in a firm that is most responsible for the company’s strategic management