Strategic organizational competency

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1. In a company with a strategic organizational competency, they are able to create new, profitable business units more quickly than do other companies and this allows them to take advantage of profitable opportunities for diversification.
a. True b. False

2. A company can pursue related diversification to enhance the competitive position of its core business.
a. True b. False

3. Which of the following is perhaps the MOST important reason why acquisitions fail?
a. The expense of the acquisition
b. The timing of the acquisition
c. Management’s unwillingness to make the necessary effort to make the acquisition work effectively
d. Incompetence on the part of workers in the acquired firm
e. Difficulties in coordinating manufacturing activities

4. If a company is to increase the probability of a new product’s commercial success, the company must foster close links between:
a. marketing and sales.
b. engineering and advertising.
c. quality assurance and inventory management.
d. research and development (R&D) and marketing.
e. accounting and industrial engineering.

5. The three main types of diversification strategies are
a. acquisitions, joint ventures, and divestments.
b. acquisitions, mergers, and buyouts.
c. acquisitions, internal new ventures, and joint ventures.
d. related acquisitions, unrelated acquisitions, and mergers.
e. joint ventures, strategic alliances, and long-term contracts.

6. Microsoft’s relationships and experiences in the computer industry and expertise in managing industries surrounding external networks led them to create new business units in the video game, online portal, and search engine industries. This is an example of which of the following?
a. Sharing resources and capabilities
b. Leveraging competencies to create a new business
c. Transferring competencies across businesses
d. Utilizing general organizational competencies
e. Economies of scope