Chapter 6 Multiple Choice Questions

. Which of the following is NOT a strategic alliance?

Joint marketing campaign

Cooperative product development

Joint venture

Merger

. What is the most frequent internal motive for a strategic alliance?

Resource need

Risk limitation

Cost minimization

Current poor performance

. A partnership between companies in different lines of business, is called:

Vertical integration alliance

Diversification alliance

Shared supply alliance

International expansion alliance

. An alliance between a supplier and a buyer that agree to use and share skills and capabilities in the supply chain, is called:

Diversification alliance

Shared supply alliance

Complementary alliance

Vertical integration alliance

. What is the most important criterion for selecting an alliance partner?

Alliance partner must help the company towards a competitive advantage.

Alliance partner must be a multinational firm with a global market presence.

Alliance partner must come from the same culture.

Alliance partner must have similar assets.

. An optimal business partner in a successful international strategic alliance should have two key qualities:

Corporate culture fit and national culture fit

Partner-related criteria and task-related criteria

Cultural fit and trust

Strategic fit and cultural fit

. Why do alliances between a large Western multinational firm and an emerging economy firm often fail?

The cultural gap between partners is too large.

The partner objectives are very divergent.

The company size of partners is very different.

The organizational cultures of partners are different.

. What is "strategic control"?

Control over the production process within an organization, in the sense of determining how the employees of an organization perform their work.

The process by which one entity influences, to varying degrees, the behaviour and output of another entity through informal mechanisms.

Control over the means and methods on which the whole conduct of an organization depends.

Control over the production process within an organization, in the sense of determining how informal practices are performed.

. The average life span for a strategic alliance is about:

10 years

3 years

7 years

5 years

. What advantage comes from trust between alliance partners?

Trust enables partners to enter into detailed formal contracts.

Trust makes partners more willing to share information.

Trust increases relational risks.

Trust causes partners to cheat on each other.

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