Question

1.

Why are modern firms generally not deeply vertically integrated?

Modern firms have less risky alternatives to manage buyers and supplier than full integration

Modern firms are trying to undo vertical integration from twenty years ago.

Modern firms prefer to outsource as much as possible to suppliers and buyers to cut costs.

Modern firms rarely have problems with buyers and suppliers.

None of these

2.

For coca cola and pepsi cola, the huge amount of capital invested in bottling plants, trucks, labors, etc. means that tangible resources are more important than intangible resources in their competitive advantage

8.

Who are stakeholders from a strategic management perspective?

Anyone that has an equity stake in the firm.

Anyone who is dependent upon the firm for critical goods.

Anyone that can materially affect the firm.

Anyone that cares about the firm.

Anyone for whom the firm is ethically responsible.

9.

Which of the following is sufficient on its own to create a competitive advantage

Making tradeoffs

Fit between strategy and core competencies

Industry structure

None of these are sufficient on their own

Difficulty in competitors imitating a completive advantage

13

A firm is in an industry that has seen major changes that have led to plummeting profits for the firm. The CEO has decided to make radical change to the firm's strategy and go in an entirely new direction, changing from a differentiator strategy in the industry to a cost leadership strategy that has been successful for several firms during the change. Which is the best response to this proposed strategic change from the CEO?

Do it because a firm must make a radical change if the environment changes radically.

Do it because there are plenty of examples to imitate and make this strategy successful.

Do not do it because it is unlikely our firm can succeed against established cost leaders.

Do not do it because it is very risky to make any major change.

Answer 1

1.why are modern firms generally not deeply vertically integrated?

Ans:-Modern firms have less risky alternatives to manage buyers and supplier than full integration

2. In an increasingly complex world, individuals and businesses are faced with more and more choices but seemingly have less and less time to make those choices. The ability of strong brand to simplify consumer decision making, reduce risk, and set expectations is thus invaluable.

Creating strong brands that deliver on that promise, maintaining and enhancing the strength of those brands over time is thus a management imperative. Consumer research insights have long played an important role in managerial decision making in many areas of marketing, for example, in the development of advertising, pricing, and channel strategies.

Branding involves the process of endowing products and services with the advantages that accrue to building a strong brand (e.g., enhanced loyalty, price premiums, etc.). Branding’s emergence as a management priority has led to a similar need to inform practicing managers of concepts, theories, and guidelines from consumer research to facilitate their brand stewardship.

PepsiCo has a strong financial backbone to support its aggressive marketing strategies, promotional campaigns and social activities. It works in collaboration with various governments in the countries that it operates and has operational ties with various civic authorities. It's capacity to generate finances is showcased by the fact that it could raise 31.37 billion rubles from a Ukrainian juice manufacturer, WBD which it acquired last year [i]

Organisational Resources- PepsiCo recently revamped its organizational structure in an effort to handle the double digit growth prospects. It has three broad units, each of which looks after a sizeable business. The CEO of the company Indra Nooyi is known to be a flamboyant leader. She is known to lead by delegation and empowerment. This increases the loyalty of the employees towards the organization [ii] .

Physical Resources - PepsiCo has state-of-the-art manufacturing plants at three locations in India [iii] . In addition to this, it has 37 bottling plants, of which 17 are owned by PepsiCo. These are spread all over India, which help in increasing the reach of its products and ensuring timely delivery.

Technological Resources - PepsiCo tries to keep itself abreast of the latest technological developments. In a recent step taken, it has added hydrogen injected trucks to its delivery fleet in Canada [iv] . This was done as an effort towards increasing the fuel efficiency of its fleet and reducing emissions.

Human Resources - PepsiCo attracts some of the best minds in the industry. By providing them enough financial and non-financial motivation and handing them challenging tasks to perform, they keep their employees satisfied and loyal to the organization.

Innovation Resources - The pace of innovation in functional foods and beverages division in PepsiCo has picked up since 2002. PepsiCo is second, after Kraft in this industry with 101 innovations since then. Some competitors are outspending PepsiCo on R&D investments by nearly two to one margin [1] . But PepsiCo has been making good use of every dime spent on the R&D as is seen from the number of innovations vis-à-vis its competitors.

Reputational Resources - In a study conducted , it was seen that Pepsi as a brand enjoys a good reputation with the customers. They like it for its distinct taste. The study also pointed out that the brand name of Pepsi is certainly a force to reckon with. The quality perception of the product is generally high. However most of the customers see it as a drink second to Coke. One area wherein PepsiCo scores over its rivals is the social initiatives like contract farming and positive water balance. Due to this, it has a very strong reputation with its suppliers.

creating momentum in the critical emerging markets of China and India. In the Indian subcontinent, Pepsi Beverages International (PBI) has more than 45% market share of carbonated soft drinks (CSD). FLI also has a strong global presence, with sales in 44 countries supported by 71 manufacturing plants outside North America, as well as 62,000 associates and 22,000 routes outside North America. In many countries, it enjoys greater than 30% market share. While 61% of PepsiCo's salty snack revenues come from North America, Latin America contributes 18% of revenues, Europe/Africa contributes 17%, and Asia contributes 4%

Core Competencie

3.Who are stakeholders from a strategic management perspective?

Anyone who is dependent upon the firm for critical goods.

4.Which of the following is sufficient on its own to create a competitive advantage

Fit between strategy and core competencies

Industry structure

5.A firm is in an industry that has seen major changes that have led to plummeting profits for the firm. The CEO has decided to make radical change to the firm's strategy and go in an entirely new direction, changing from a differentiator strategy in the industry to a cost leadership strategy that has been successful for several firms during the change. Which is the best response to this proposed strategic change from the CEO?

Do it because a firm must make a radical change if the environment changes radically.