Author: Anonymous

Institutional owners, despite their size, are usually unable to discipline ineffective top-level managers and cannot influence a firm’s choice of strategies and overall strategic direction

Generally, a board member who is a source of information about a firm’s day-to-day activities is classified as a(n) __________ director.

Firms in China that have higher state ownership have been shown to have more volatility and lower market value, in part because government-mandated social goals take precedence over shareholder returns

For firms in a vertical complementary alliance (such as between Toyota and its suppliers), it is more difficult to identify the strategic center firm than in a horizontal complementary alliance (e.g., airline alliances)

Both top executives and owners of the firm wish to diversify the firm to reduce risk

Awareness by top managers of the existence of external investors in the form of individuals (e.g., Carl Icahn) and groups (e.g., hedge funds) often positively influences them to align their interests with the firm’s shareholders

KorniCo. is considering possible strategies to defend against a hostile takeover. They have narrowed it down to four options. Because of pressure from shareholders, they need to adopt a strategy that is shown to have a positive effect on shareholder wealth. Based on that criterion, which of the following should they choose?

The experience that results from long tenure in a firm is known to extend the breadth of an executive’s knowledge base

Research shows that structure has a more important influence on strategy than the reverse

A centralized structure does not provide information from local stores that would be useful in changing its technology quickly. This example illustrates the effect of structure on strategy