MGT 405 Chpt 9

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MGT 405 Chpt 9
2011-03-31 01:22:01
strategic management

Corporate-Level Strategy: Horizontal Integration, Vertical Integration, & Strategic Outsourcing
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  1. A collection of businesses in different industries in the media sector
    Media empire
  2. What are the 3 corporate level strategies for repositioning and redefining a company's business model?
    • Horizontal integration
    • Vertical integration
    • Strategic integration
  3. In order to increase profitability, a corporate-level strategy should enable a company or one or more of its business divisions or unit to perform value-chain functional activities
    • (1) at a lower cost and/or
    • (2) in a way that allows for differentiation
  4. The process of acquiring or merging with industry competitors to achieve the competitive advantages that arise from large size and scope of operations
    Horizontal integration
  5. When one company uses its capital resources, such as stock, debt, or cash, to purchase another company
  6. An agreement between equals to pool their operations and create a new entity
  7. Offering customers the opportunity to buy a complete range of products at a single combined price
    Product bundling
  8. Involves a company taking advantage of or leveraging its established relationship with customers by acquiring additional product lines or categories that it can sell to them
  9. Expands its operations backward into an industry that produces inputs for the company's products
    Backward vertical integration
  10. Expands forward into an industry that uses, distributes, or sells the company's products
    Forward vertical integration
  11. Being taken advantage of by a trading partner after the investment in specialized assets has been made
  12. When a company exits industries adjacent to its core industry in the industry value chain
    Vertically disintegrates
  13. The prices one division of a company charges other divisions for its products
    Transfer prices
  14. The costs of solving the transaction difficulties that arise the managerial inefficiencies and the need to manage the handoffs or exchanges between business units to promote increased differentiation or to lower a company's cost structure
    Bureaucratic costs
  15. Long term agreements between two or more companies to jointly develop new products or processes that benefit all companies concerned
    Strategic alliances
  16. Independent component suppliers compete to be chosen to supply a particular component, made to agreed upon specifications, at the lowest price
    Competitive bidding strategy
  17. They enter into long-term contracts with at least two suppliers for the same component
    Parallel sourcing policies
  18. Decision to allow one or more of a company's value-chain activities or functions to be performed by independent specialist companies that focus all their skills and knowledge on just one kind of activity
    Strategic outsourcing
  19. Companies that have pursued extensive strategic outsourcing
    Virtual corporation