Questions and Answers of Managerial Economics 15th

1 What are the main features of the Nestlé strategy in ice cream? How do they differ, if at all, from those of Unilever?
10 Communication of ideas to all those involved: how will this be done? Will we gain the commitment of the managers and employees affected?
9 The possibility of acquisition, merger or joint venture with other companies and the implications:have we fully explored other options that would bring their own benefits and problems?
8 Amount and timing of marketing investment and expertise required: do we have the funds? When will they be required? Do we have the specialist expertise such as advertising and promotions agency
7 New products and how they are to be developed: are we confident that we have the portfolio of fully tested new products on which so much depends? Are they real breakthrough products or merely a
6 New technical skills, new plant and costs of closure of old plant: do we have the skills? Do we need to recruit or hire temporarily some specialists?
5 Number of employees and, in the case of redundancy, any costs associated with this: what are the national laws on sacking people and what are the costs?
4 Tax liabilities and dividend payments: what are the implications, especially on timing?
3 Working capital requirements: do we have enough working capital?
2 Projection of cumulative profits: is it sufficiently profitable?
1 Capital investment required: do we have the funds?
3 Given Unilever’s market dominance, what strategies would you adopt if you were entering the ice cream market? How do you attack a dominant competitor?
2 What are Unilever’s main strengths? Where do its weaknesses lie? What, if anything, should Unilever do about its weaknesses?
1 What is the source of Unilever’s advantages over its competitors?
comment on the weaknesses in the classic process and suggest how these might be overcome.
describe the main elements of the classic prescriptive process for developing strategic management;
apply empirical evidence and guidelines to the various options in order to assist the selection procedure;
undertake an evaluation of strategic options in order to select the most appropriate option;
outline the main prescriptive procedures and techniques used in selecting between strategy options;
identify the six main criteria that might typically be used to evaluate the content of strategic options;
distinguish between the content and the process of the prescriptive approach;
9 Given that emergent approaches to strategic management are important, are there any circumstances in which you might use such an approach with regard to corporatelevel strategy options?
8 ‘Good corporate parents constantly search for ways in which they can improve the performance of their businesses.’(Michael Goold) Is it wise for corporate parents to interfere in the strategies
7 Using the Nokia case ( Case 9.2 ) as an example, what are the benefits and costs of focusing on one product area such as mobile telephones? Would you recommend Nokia to diversify in such a way
6 What are the benefits and problems of unrelated diversification?Do multi-product companies need to find degrees of relatedness in all their subsidiaries?
5 Can small companies benefit from any of the corporatelevel strategy concepts explored in this chapter? If so, which ones and why? If not, then does that mean that small companies cannot diversify?
4 Choose two organisations with which you are familiar, one from the commercial sector (perhaps from work or from your place of study) and one voluntary body(perhaps from a hobby, sport or society to
3 This chapter suggests that corporate headquarters should make the final decision with regard to acquisitions and other major activities. Do you agree with this?What are the difficulties of this
2 Using Siemens as an example (see Case 9.1 ), why would this company choose to acquire other companies rather than grow from within? What are the benefits and problems with such a corporate strategy?
1 Considering the Unilever case earlier in the chapter, does the ‘path-to-growth’ strategy represent an option available only to Unilever or can other companies benefit from such an approach?
3 Given the size of the operation, would you make any changes to Unilever’s strategic decision-making process?Are you convinced that the new structure and product focus will be any better at
2 To what extent is Unilever’s strategic decision-making process a result of its history?
1 In what way is the Unilever strategic planning process prescriptive? How, if at all, does it help innovation?
3 How important were the management teams to strategic choice? Did it really have to changes in 2004, 2007 and 2010?
2 What was the significance of the introduction of the new Android software for Nokia’s chosen strategy? Do companies always need such a technological development to ensure strategic success? Do
1 Why did Nokia select only one area for development?What is the strategic risk involved in selecting one area out of four?
2 What conclusions do you draw on the strategic benefits of operating a corporate strategy? Does the theory outlined in this chapter help?
1 Can Siemens ever achieve the profit margins of GE? What should it do now – continue to divest under-performing parts and invest in the profitable parts? Or is something more radical required –
outline the main corporate-level strategy tools available to a corporate headquarters.
use the product portfolio matrix to choose between corporate-level strategy options;
describe the role of corporate headquarters and identify the implications for strategy development;
identify the levels of diversification in corporate strategy and their implications for strategy options;
outline the benefits and costs of corporate-level strategy options;
define and explain the two main elements of corporate-level strategy;
11 It has been argued in this chapter that small businesses can develop competitive advantage over larger companies by offering higher degrees of service. What are the possible problems with this
10 Take a small student society or charitable institution with which you are familiar. What strategic options based on its resources does it have for development?
9 If key competitive resources are important, can they be acquired in the space of a few months or do they take years to develop? What are the implications of your response for the development of
8 ‘During the 1990s, top executives will be judged on their ability to identify, cultivate and exploit the core competencies that make growth possible.’ (Gary Hamel and C K Prahalad) Discuss
7 Identify the probable key competitive resources of the following: a charity like UNICEF; a major consumer electronics company; a holiday travel tour operator; a multinational fast-moving consumer
6 Choose an organisation with which you are familiar and identify the upstream and downstream parts of the value chain for that organisation. Which is the most important for that organisation or do
5 ‘A recurring theme to criticisms of strategic planning practice is the pedestrian quality of the strategic options that are considered.’ (George Day) By what methods might this legitimate
4 Take an organisation with which you are familiar, such as a small voluntary group, and consider the possibilities of expansion: apply the market options matrix and expansion method matrix to your
3 ‘Generic strategies are a fallacy. The best firms are striving all the time to reconcile opposites.’ (Charles Baden-Fuller and John Stopford) Discuss this statement.
2 Plot the position of News Corporation on the generic strategies matrix. What conclusions, if any, can you draw from this about future strategies for the company? (Note the hint in the ‘if any’
1 Do small firms have anything useful to learn from a consideration of the options available from generic strategies?
10 What are our competitors undertaking in the area of resources, skills and competencies?
9 How is the environment changing? What impact will this have on current and future core skills and resources?
8 What new resources , skills and competencies do we need to acquire over the next few years? How do they relate to our vision?
7 What other skills do we have in relation to our customers? What are the core skills? Are they unique to our organisation or do many other companies have them? How might they change?
6 How do our customers benefit from our competencies and resources? What real benefits do they obtain? Are we known for our quality? Our technical performance against competition? Our good value for
5 What financial resources do we have? Are they sufficient to fulfil our vision? What is our profit record(or financial record in not-for-profit organisations)? Is the record sufficiently good to
4 What people skills do we have? How important is their contribution to our competencies? How vital are they to our resources? Are there any key workers? How difficult would they be to replace? Do we
3 How do we generate value added ? Is there anything different from our competitors? Looking at the main areas, what skills are involved in adding value?
2 What links are there between the products that we manufacture or services that we operate? What common ground is there?
1 What technology do we have? Is it exclusive? Is it at least as good as the competition? Is it better?
4 Why has News Corporation been so successful? Where does it go from here?
3 In such a fast-changing market, is it possible to follow the prescriptive approach of options development and selection?Would News Corporation perhaps be better advised to have a general vision and
2 How and where does News Corporation add value to its services? And where does it obtain its competitive advantage?What strategies has it adopted on barriers to entry?
1 Among the media companies, there is disagreement on the best route forward for strategic management: the software route versus the hardware route. Where does News Corporation stand in this debate?
4 What lessons, if any, can be drawn from the global TV market on the broad task of developing strategic options?
3 What strategy options would you consider if you were given the task of developing a truly global TV network?Would it be profitable?
2 If you were developing strategy options for a small company, what strategy options would you consider? What problems might you encounter?
1 Do Porter’s generic strategies provide any useful insights in structuring the strategic opportunities in global TV?Think carefully about the criticisms before you answer this question.
3 Can companies in the media and travel industries, like television stations and theme parks, gain and retain competitive advantage simply by offering new products? Or do they need to rethink other
2 Using concepts from this chapter, what are the options available to Disney over the next five years?
1 What are the competitive advantages of the Disney group?Which, if any, are sustainable over time?
How are managers selected and motivated to implement strategies?
What special considerations apply when seeking innovatory strategies?
What are the main principles involved in designing an organisation’s structure to implement its strategy?
What are the consequences for the chosen strategies?
What are the main features of alternative strategic approaches?
How do emergent strategic considerations alter the decisions?
What is the distinction between strategic context and the other two elements – content and process?
Which options make valid assumptions about the future? Are feasible? Contain acceptable business risks? And are attractive to stakeholders?
Which options are particularly suitable for the environmental and resource conditions facing the organisation?
Which options are consistent with the purpose of the organisation?
What is the important distinction between strategic content and strategic process?
How do we develop and decide strategic management?
What options arise from being part of a corporation?
What are the benefits of being part of a group? And the problems?
What strategy options arise from these opportunities?
What are the main resource-based opportunities available to the organisation?
What are the main environment-based opportunities available to the organisation?
9 ‘Innovate or fall behind: the competitive imperative for virtually all businesses today is that simple.’ (Dorothy Leonard and Susan Straus)Is this true? Is innovation fundamental to all
8 Quinn argues that large companies need to behave like small entrepreneurial ventures to be truly innovative.Gluck suggests that major innovations only come from a‘big-bang’ push that needs
7 Identify some recent innovations and classify them into market pull and technology push. Explain how each innovation has been delivered into the market, using the S-shaped curve to show the process.
6 Do you think that the increased use of information technology will affect all organisations equally? Will some remain relatively unaffected apart from the introduction of a few computers and a link
5 With the introduction of the web, it has been argued that this: ‘will give consumers increased access to a vast selection of goods but will cause a restructuring and redistribution of profits
4 Take an organisation with which you are familiar and classify its technologies into basic, core and peripheral.What conclusions can you draw on sustainable competitive advantage for the
3 ‘In an economy where the only certainty is uncertainty, one sure source of lasting competitive advantage is knowledge.’(Ikijuro Nonaka) Do you agree with Nonaka about the unique importance of

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