100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
OAM 331 Exam 2 ) UPDATED Actual Exam Questions and CORRECT Answers $9.99   Add to cart

Exam (elaborations)

OAM 331 Exam 2 ) UPDATED Actual Exam Questions and CORRECT Answers

 2 views  0 purchase
  • Course
  • OAM 331
  • Institution
  • OAM 331

OAM 331 Exam 2 ) UPDATED Actual Exam Questions and CORRECT Answers Blue Ocean Strategy Key Takeaways (C12) - CORRECT ANSWER- -Red oceans are existing industries, blue ocean means doing business where there is no competition. -Blue ocean strategy is not about technology innovation. -Incumbent...

[Show more]

Preview 4 out of 37  pages

  • September 22, 2024
  • 37
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers
  • OAM 331
  • OAM 331
avatar-seller
MGRADES
OAM 331 Exam 2 ) UPDATED Actual
Exam Questions and CORRECT Answers
Blue Ocean Strategy Key Takeaways (C12) - CORRECT ANSWER- ✔✔-Red oceans are
existing industries, blue ocean means doing business where there is no competition.
-Blue ocean strategy is not about technology innovation.
-Incumbents often create blue oceans within their core business.
-The most appropriate unit of analysis is not an industry or company, but the managerial
actions and decisions to create a market (aka strategic move).
-Never use competition as the benchmark.
-Rejects the productivity trade-off; blue oceans mean increasing value AND reducing costs.
-This is a business model → only achieved when the system of company's utility, price, and
cost are properly aligned!!
-Creating a new market provides immediate barriers to imitation


Corporate Strategy answers the question ______________________ (C15) - CORRECT
ANSWER- ✔✔"where to compete".


Corporate strategy == the overall plan for a diversified company -- is both the darling and the
stepchild of contemporary management practice.


The darling ⇒ because CEOs have been obsessed with diversification since the early 1960s.


The stepchild ⇒ because almost no consensus exists about what corporate strategy is, much
less about how a company should formulate it.


They work better together than they do separately.


Business Unit (Competitive) Strategy (C15) - CORRECT ANSWER- ✔✔Single product
market.
How to create competitive advantage.
How to compete.

,Competition Occurs at the Business Unit Level.
Diversified companies do not compete, Only their business units do


Corporate (Company-wide) Strategy (C15) - CORRECT ANSWER- ✔✔Multiple
industries/markets concurrently.
What businesses to be in and how corporate should manage.
Where to compete:
-Vertical integration (value chain).
-Diversification (product, services).
-Geography.


Unless a corporate strategy places primary attention on nurturing the success of each unit, the
strategy will fail, no matter how elegantly constructed.


GE Corporate strategy (C15)


What is the General Electric situation, complication, key question? - CORRECT ANSWER-
✔✔Question: Look at this presentation from GE: How does this relate to corporate strategy?
(ON EXAM)
They do lots of business in different areas.


GE using "Best Practices" to be more operational efficient with mergers.


GE bought Oil-Services with a huge amount of money, Turnout: BAD


Three corporate strategy premises (C15) - CORRECT ANSWER- ✔✔Premise #1:
Competition occurs at the business level; diversified companies do not compete.


Premise #2: Diversification inevitably adds costs and constraints to business units.
1 company runs a weekly executive meeting ⇒ pass it on the employee ranking.
Point ⇒ meeting all the time.
Takeaway ⇒ lose focus as you diversify.

,Premise #3: Shareholders can readily diversify themselves.


3 tests for diversification: (C15) - CORRECT ANSWER- ✔✔attractiveness, cost-of-entry,
better-off tests.


The attractiveness test
==> the industries chosen for diversification must be structurally attractive or capable of
being made attractive.


The cost-of-entry test
==> the cost of entry must not capitalize all the future profits.


The better-off test
==> either the new unit must gain competitive advantage from its link with the corporation or
vice versa.


Attractiveness Common Fails (C15) - CORRECT ANSWER- ✔✔-Falsely believe the target
industry is *similar*.
-Low cost of entry = "why not."
-Falsely believe fast growth = *profitability*


Cost of entry Common Fails (C15) - CORRECT ANSWER- ✔✔-*overpaying* for
acquisition ⇒ buyers remorse.
-*underestimating* the cost to ramp up start-up


Better-off test Common Fails (C15) - CORRECT ANSWER- ✔✔-Does the corporation bring
significant advantage to the new unit (or vice versa)?
-Is the benefit "one time" or long-term


4 corporate strategy steps to Unlock Value: (C15) - CORRECT ANSWER- ✔✔1) portfolio
management,

, 2) restructuring,
3) transfer skill,
4) share activities


portfolio management prereqs (C15) - CORRECT ANSWER- ✔✔-Superior insight to
identify *winners*; sell off losers.
-Private company or underdeveloped markets


restructuring prereqs (C15) - CORRECT ANSWER- ✔✔-Willingness to *intervene*.
-Willingness to *sell* units when complete


transferring skills prereqs (C15) - CORRECT ANSWER- ✔✔-Proprietary skills, which can
be transferred.
-Beachhead for new market and opportunities.


sharing activities prereqs (C15) - CORRECT ANSWER- ✔✔-Share resources, economies of
scale & *scope*.
-Overcome organizational resistance


Portfolio management is less compelling proposition because of ____________________ (2
things) (C15) - CORRECT ANSWER- ✔✔cheap $, free markets.


The idea that corporations acquire sound businesses and let them run autonomously seems
less relevant than in the past.


-Unprecedented 20+ years of inexpensive capital.
-Free-flow of information and managerial talent.
-Large pool venture capital, and private equity investors.


Two notable exceptions to the criticism of portfolio management (C15) - CORRECT
ANSWER- ✔✔Berkshire Hathaway.

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller MGRADES. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for $9.99. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

67096 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 14 years now

Start selling
$9.99
  • (0)
  Add to cart