BUS Ch 6
When a division of an organization has a high relative market share and is in a fast-growing industry, it is called a
Star
What is a weakness associated with a SWOT Matrix?
The matrix has no temporal qualities
What is the highest number of strategies that can be examined at one time with the QSPM?
There is no limit
One of the steps of the SWOT Matrix is to list the firm's key external opportunities
True
Which of the following is the first step in developing QSPM
Make a list of the firm's key external opportunities/threats and internal strengths/weaknesses in the left column of the QSPM.
Relative market share position is given on the x-axis of the BCG Matrix
True
Whenever two firms merge, it becomes especially important to evaluate and consider culture-strategies linkages.
True
Which strategies aim at improving internal weaknesses by taking advantage of external opportunities
WO
Which strategies are defensive tactics directed at reducing internal weaknesses and avoiding environmental threats
WT
Market penetration can be classified as either a conservative, aggressive, or competitive strategy
True
The two positive-rated dimensions on SPACE Matrix are
FS and IS
Shifting focus from specific issues to more general ones may increase strategists' options for gaining organizational commitment
True
Viewing businesses as star, cash cow, dog or question mark is an oversimplification
True
Successful strategists minimize their own political exposure on issues that are highly controversial and in circumstances where opposition from major power centers was likely
True
Each of the nine techniques included in the strategy formulation framework rely on the use of
Intuition and analysis
Which of these is a limitation of QSPM?
Intuitive judgments and educated guesses are required.
What type of strategy would divestiture be classified as?
Defensive
The top row of a QSPM consists of alternative strategies derived from all of these except:
CPM Matrix
How many cells are in a SWOT Matrix?
Nine
A sustainability report provides information on firm's social-responsibility practices
True
Which of the following is not a step of a SWOT Matrix?
List the firm's external weakness
In the SPACE analysis, what does a (+6, +3) strategy profile portray?
A strong industry
All of the following are principles of good organizational governance, as established by Business Week, except
At least two directs are current or former company executives.
An organization that has a low relative market share position and competes in a slow-growth industry is referred to as a
Dog
A division with a high relative market share position in a low-growth industry can be described as a
Cash cow
For what type of company is the BCG Matrix ideal for analyzing?
Companies with more than one division
The two internal dimensions represented on the axes of the SPACE Matrix are
Competitive advantage and financial strength.
What type of strategies would you recommend when a firm's SPACE Matrix directional vector has the coordinates (-2, +3)
Conservative
What includes the set of shared values, beliefs, attitudes, customs, norms, personalities, heroes and heroines that describe a firm
Culture
What are two external dimensions of the SPACE Matrix?
Environmental stability and industry strength
Through which tactic is it possible to achieve similar results using different means or paths?
Equifinality
For companies located in Quadrant III of the Grand Strategy Matrix, the first strategy recommended is
Extensive cost and asset reduction
Which stage in the strategy-formulation framework focuses on generating feasible alternative strategies
Matching
The BCG Matrix limitations include all of these except:
Requiring at least three years' worth of data
Which strategy would be most appropriate for a company classified as a Dog?
Retrenchment
Which strategies use a firm's strengths to avoid or reduce the impact of external threats
ST
Which stage of the strategy-formulation framework involves the Quantitative Strategic Planning Ma
Stage 3
Most likely, what was a cash cow in the past?
Star
The match an organization makes between its internal resources and skills and the opportunities and risks created by its external factors can be defined as
Strategy
Strategy analysis and choice largely involves making __________ decisions based on __________ information
Subjective; objective
A positive feature of QSPM is that sets of strategies can be examined sequentially or simultaneously
True
According to the Grand Strategy Matrix, when a Quadrant I firm is too heavily committed to a single product, then concentric diversification may reduce the risks associated with a narrow product line
True
An organization's present strategies, objectives and mission provide a basis for generating and evaluating feasible alternative strategies, coupled with the external and internal audit information
True
Boards of directors are composed mostly of outsiders who are becoming more involved in an organization's strategic management
True
Both IE and BCG Matrices are called portfolio matrices
True
Conservative strategies in a SPACE Matrix most often include product development, market development, market penetration and concentric diversification
True
Culture includes the set of shared values, beliefs, attitudes, customs, norms, personalities, heroes and heroines that describe a firm
True
Good intuitive judgment is always needed to determine appropriate weights and ratings in the input stage matrices
True
Having no temporal qualities, the BCG Matrix is a snapshot of an organization at a given point in time
True
In a BCG Matrix the pie slice indicates the proportion of corporate profits generated by that division
True
The BCG Matrix does not reflect whether or not various divisions or their industries are growing over time
True
The ES and CA dimension variables in a SPACE Matrix are assigned a numerical value ranging from -1 (best) to -6 (worst).
True
The IE Matrix can be divided into three major regions that have different strategy implications: grow and build, hold and maintain and harvest or divest
True
The Sarbanes-Oxley Act put an end to the "country-club" atmosphere of most boards and has shifted power from CEOs to directors
True
The Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix, the Strategic Position and Action Evaluation (SPACE) Matrix, the Boston Consulting Group (BCG) Matrix, the Internal-External (IE) Matrix and the Grand Strategy Matrix are included in stage two of the strategy-formulation framework
True
The firm should pursue aggressive strategies if the coordinates of a SPACE directional vector are (5,4)
True
The firm should pursue conservative strategies if the coordinates of a SPACE directional vector are (1,4).
True
The major overall benefit of the BCG Matrix is that it draws attention to the cash flow, investment characteristics and needs of an organization's various divisions
True
The most important determinants of an organization's overall strategic position are considered to be the two internal dimensions, financial strength (FS) and competitive advantage (CA), and the two external dimensions, industry strength (IS) and environmental stability (ES)
True
The purpose of matching key factors is to generate feasible alternative strategies
True
The size of the circle in a BCG Matrix corresponds to the proportion of corporate revenue generated by that business unit
True
To objectively evaluate feasible alternative strategies identified in Stage 2, the QSPM uses input information derived from Stage 1
True
In the BCG Matrix, which element represents the industry growth rate in sales, measured in percentage terms?
Y-axis
What tactic involves shifting focus from specific issues to more general ones?
Generalization
What analytical tool has four quadrants based on two dimensions: competitive position and market growth?
Grand Strategy Matrix
Firms located in which quadrant of the Grand Strategy Matrix are in an excellent strategic position?
I
Although Quadrant _____ companies are growing, according to the Grand Strategy Matrix, they are unable to compete effectively, and they need to determine why the firm's current approach is ineffective and how the company can best change to improve its competitiveness.
II
According to the Grand Strategy Matrix, organizations in which .quadrant have a strong competitive position but are in a slow-growth industry
IV
Which stage of the strategy formulation framework includes an Internal Factor Evaluation Matrix and a Competitive Profile Matrix
Input
Which stage of the strategy formulation framework contains the Internal-Factor Evaluation Matrix
Input stage
Which analytical tool consists of a nine-cell matrix?
Internal-External Matrix
Which of these is not a SPACE Matrix quadrant?
Offensive
Today, what are boards of directors composed mostly of
Outsiders
Which analytical tool determines the relative attractiveness of various strategies based on the extent to which key external and internal critical success factors are capitalized?
QSPM
Which strategy formulation technique reveals the relative attractiveness of alternative strategies and thus provides an objective basis for selecting specific strategies
QSPM
Which matrix is included in the decision stage of the strategy formulation framework?
Quantitative Strategic Planning Matrix
How would a division with a low relative market share position in a high growth industry be described?
Question Mark
Which section of the SWOT Matrix involves matching internal strengths with external opportunities
The SO cell
What term is defined as the product of multiplying ratings by attractiveness scores in each row of the QSPM
total attractiveness scores
According to the Grand Strategy Matrix, which strategy is recommended for a firm with rapid market growth and a strong competitive position?
Market penetration
The act of oversight and direction for an organization is referred to as:
governance