MIDTERM EXAM - SAMPLE TEST

STRATEGIC MANAGEMENT DIRECCION ESTRATEGICA

LTW STUDNTS
Approval conditions
Finish the exam by 10 AM
In order to get a passing grade of 4 (four) you need 60% of total points. We round numbers afterwards.

EXAM STRUCTURE
TRUE OR FALSE, EXPLAIN - 30% points
MULTIPLE CHOICE
30% POINTS
SHORT CASE-BASED 30% POINTS
GENERAL QUESTIONS
10% POINTS
1-TRUE OR FALSE, EXPLAIN
I provide some examples, but there should be approximately 6-10 sentences for the true and false
exercises.
1.A- In the EFE matrix below, we should suggest improving on how they address Opportunity 5, rather
than 4. True or false Explain.
Answer: False. You cant improve on Opportunity 5. It already has the highest rating.
1.B- If you change the rating for Threat 1 to 3, then you must change another Rating to 2, to
compensate. For example lower Threat 7 to 2.
Answer- False. Ratings do not compensate each other. They are independent.
1.
2.
3.
4.
5.

Opportuniti es
141millionpossiblecustomersinEurope,UK,andGermany
Strengtheningforeigncurrenciesvs.dollarEuroadvantages
Increasedusageofwirelessservices
Smallwirelessprovidersareconsolidatingwithlargerprovidersdue
toincreasedcompetition
Increaseddesireforhighspeedinternetservice

Threats
1. Newregulatorycomplaints(newphone#portability)
2. Risingcostsofhealthcare
3. Globalunresteconomicmonetaryandfinancial
4. Consumerprivacyrightsunderattack
5. Weakconsumerspending
6. Decreasingdemandfortraditionalvoicelinesandfixedlines
7. Increasingoverlapoftelecommunicationterritories
8. Increasingcompetitionforprovidersofwebsearchdirectories
9. Increasingprovidersofwirelessservices
10. Brandrecognition
TOTALS

Weight
0.06
0.06
0.02

Rating
1
1
4

WeightedScore
0.06
0.06
0.08

0.06

0.12

0.10

0.40

Weight
0.10
0.07
0.12
0.02
0.10
0.05
0.06
0.02
0.06
0.10
1.00

Rating
2
2
2
4
2
4
3
2
4
4

WeightedScore
0.20
0.14
0.24
0.08
0.20
0.20
0.18
0.04
0.24
0.40
2.64

1-C. IKEA implements a Route 3 strategy, so they must have very low costs on every activity.
Anwer- False: cost reductions must be outside its differentiated activities.

1-D. This is an example of WT Strategy. Based on our insuficient plant capacity and the fact that two
major foreign competitors from the industry decided to leave the country, then we pursue horizontal
integration by buying competitor`s facilities.
Answer- False. It's WO
1-E- No matter if you are already in or out of an industry, it is more attractive for you if entry and exit
barriers are low.
Answer. False. If you are already inside: it is more attractive when entry barriers are high (and exit
barriers low). But if you are outside and trying to enter, it is more attractive if entry barriers are low
(easier for your company actually) and exit barriers low.

2. MULTIPLE CHOICE 30% (I show 2 examples, but there might be 6-10 questions)
2.a. Select the Support activities mentioned below (from Michael Porter's value chain analysis)
2.a.1. Service
2.a.2. Inbound logistics
2.a.3. Technological development X
2.a.4. Human Resources X
2.b. The following tools are applicable to the second stage for strategy formulation: Matching
2.b.1. CPM
2.b.2. BCG X
2.b.3. SWOT TOWS X
2.b.4 EFE and IFE
.............
3- QUESTIONS ON SHORT CASE (30% POINTS)
There will be a case... and some of the examples for questions are:
3.a.) The case is about an integration of this type (select the correct option)
3.a.1) Backward
3.a.2) Horizontal
3.a.3) Forward
3.a.4) None of the above options

3.b) Does the company have a sustainable competitive advantage ? Explain.

I gave 2 examples, but there might be 4-6 questions in this section.

General questions 10% POINTS

1- If a german knife company enters Argentina, establish offices and let someone else do the
production, then
1.a) which is their entry strategy? Enlarge a bit, apply it to this example.