Chapter 1 Quiz--Business Policy (Williamson)

TRUE OR FALSE: Strategy and organizational structure need to be consistent with each other in order to ensure strong firm performance.

True.

Which of the following does NOT apply to a good business model? A. It stays away from new or untested ideas B. It is essential to a strategic plan C. Sell goods or services for more than it cost the company D. Providing customers with a good or service more cheaply than they can create it for themselves E. It outlines how the company hope to make a profit

A. It stays away from new or untested ideas. A "business model" should be a central element of a company's strategic plan, which describes the process of how a company hopes to earn profits. Developing a viable business model requires that a company sell goods or services for more than it costs the company to create and distribute those offerings. A more subtle, but equally important, aspect of a business model is providing customers with a good or service more cheaply than they can create it themselves.

_____ argued that many of the advantages that firms in developed countries like the United States, Japan, and Great Britain take for granted are disappearing. A. The World is Flat: A Brief History of the Twenty-First Century B. The Principles of Scientific Management C. The Prince D. Strategy and Structure: Chapters in the History of the Industrial Enterprise E. Competitive Strategy: Techniques for Analyzing Industries and Competitors

A. The World is Flat: A Brief History of the Twenty-First Century. In his book, "The World is Flat: A Brief History of the Twenty-First Century," Friedman argues that many of the advantages that firms in developed countries like the United States, Japan, and Great Britain take for granted are disappearing.

Strategic management is a process that requires the ability to manage _______. A. Pricing B. People C. Expectations D. Community E. Change

E. Change. Strategic management focuses on identifying and adapting to new opportunities. In doing so, managers must address changes within the internal and external environment appropriately to achieve higher performance.

In The Art of War, Sun Tzu's emphasized which two aspects of strategy? A. creative; deceptive B. pragmatic; discrete C. creative; considerate D. cautionary; discrete E. pragmatic; deceptive

A. creative; deceptive. In ancient China, strategist and philosopher Sun Tzu offered thoughts on strategy that continue to be studied carefully by business and military leaders today. Sun Tzu's best-known work is The Art of War. As this title implies, Sun Tzu emphasized the creative and deceptive aspects of strategy.

As of 2017, according to Fortune magazine. Based on the success Frederick Smith's intended strategy FedEx ranked _______ among the World's Most Admired Companies in 2017. A. eleventh B. fifteenth C. second D. first E. fifth

A. eleventh. As a student at Yale in 1965, Frederick Smith had to create a business plan for a proposed company as a class project. He created a delivery system that would gain efficiency by routing packages through a central hub and then pass them to their destinations. Years later, Smith started Federal Express a company whose strategy closely followed the plan laid out in his class project. As of 2017, FedEx ranked eleventh among the World's Most Admired Companies, according to Fortune magazine.

Which of the following statements holds true for strategy as a PLAN? A. It refers to a firm's place in the industry relative to its competitors. B. It is a carefully crafted set of steps that a firm intends to follow in order to be successful. C. It refers to how executives interpret the competitive landscape around them. D. It focuses on the extent to which a firm's actions over time are consistent. E. It is a specific move designed to outwit or trick competitors.

B. It is a carefully crafted set of steps that a firm intends to follow in order to be successful.

One of the following is NOT one of Mintzberg's "5 P's of strategy." A. Position B. Priority C. Ploy D. Plan E. Perspective

B. Priority. According to Mintzberg, understanding how strategy can be viewed as a (1) plan, as a (2) ploy, as a (3) pattern, as a (4) position, and as a (5) perspective is important. Each of these five ways of thinking about strategy is necessary for understanding what strategy is, but none of them alone is sufficient to master the concept

Glen is an artist who started an online business of selling hand-painted cards. He intended to mail the cards to the customer's address. He started a Web site where customers could specify the type of designs they wanted. Glen would then paint the cards according to the specifications of the customer. He later dropped the idea of mailing the cards to the customers. The fact that he still runs an online card selling business, which caters to the needs of individual customers, is an example of a _____ strategy. A. make over B. deliberate C. marked D. non-realized E. pre-termed

B. deliberate A deliberate strategy is the parts of the intended strategy that an organization continues to pursue over time.

Glen is an artist who started an online business of selling hand-painted cards. He intended to mail the cards to the customer's address. He started a Web site where customers could specify the type of designs they wanted. Glen would then paint the cards according to the specifications of the customer. He later dropped the idea of mailing the cards to the customers as he found it too costly. The fact that Glen dropped the idea of mailing the cards to the customers is an example of a _____ strategy. A. make over B. non-realized C. marked D. pre-termed E. deliberate

B. non-realized A non-realized strategy refers to the parts of the intended strategy that are abandoned.

_____ stressed on how strategy and organizational structure need to be consistent with each other in order to ensure strong firm performance. A. Thomas Friedman B. Michael Porter C. Alfred Chandler D. Frederick W. Taylor E. Niccol&?ograve; Machiavelli

C. Alfred Chandler. Also in 1962, Harvard professor Alfred Chandler published "Strategy and Structure: Chapters in the History of the Industrial Enterprise." This book describes how strategy and organizational structure need to be consistent with each other in order to ensure strong firm performanc

_____ refers to a stage in the strategic management process wherein managers must constantly look out for trends and events in the external environment that affect the overall economy and also monitor changes in the particular industry in which the firm operates. A. Strategy evaluation and control B. Strategy evolution C. Environmental and internal scanning D. Strategy formulation E. Strategy implementation

C. Environmental and internal scanning.

Which of the following statements holds true for strategy as a POSITION? A. It focuses on the extent to which a company's actions over time are consistent. B. It is a specific move designed to outwit or trick competitors. C. It refers to a firm's place in the industry relative to its competitors. D. It is a carefully crafted set of steps that a firm intends to follow in order to be successful. E. It refers to how executives interpret the competitive landscape around them.

C. It refers to a firm's place in the industry relative to its competitors.

_____ stressed on how organizations could become more efficient through identifying the one best way of performing important tasks. A. The World is Flat: A Brief History of the Twenty-First Century B. Strategy and Structure: Chapters in the History of the Industrial Enterprise C. The Principles of Scientific Management D. The Prince E. Competitive Strategy: Techniques for Analyzing Industries and Competitors

C. The Principles of Scientific Management. In "The Principles of Scientific Management," Taylor stressed how organizations could become more efficient through identifying the "one best way" of performing important tasks.

Mike owns a store which sells baseball bats. He soon realizes that the customers who buy baseball bats also ask for baseball jerseys. Therefore, he starts stocking baseball apparel to cater to the needs of his customers. This is an example of a(n) _____ strategy. A. realized B. pre-termed C. emergent D. intended E. marked

C. emergent. An emergent strategy is an unplanned strategy that arises in response to unexpected opportunities and challenges.

What is the second step in the strategic management process? A. Organizational Design B. Financial Evaluation C. Strategy Formulation D. Environmental and Internal Scanning E. Understanding Strategy and Performance

D. Environmental and Internal Scanning. Understanding the nature and context of the firms internal and external situation provides a framework for making effective strategic decisions.

_____ refers to a stage in the strategic management process which involves developing specific strategies and actions. A. Strategy evaluation and control B. Strategy evolution C. Environmental and internal scanning D. Strategy formulation E. Strategy implementation

D. Strategy formulation.

According to the chapter, which of the following does NOT apply to an emergent strategy? A. Can be a response to unexpected challenges B. It is considered an unplanned strategy C. Can result in either economic success or disaster D. Usually part of the initial business plan E. Can be a response to unexpected opportunities

D. Usually part of the initial business plan. An emergent strategy is an unplanned strategy that arises in response to unexpected opportunities and challenges.

Glen is an artist who started an online business of selling hand-painted cards. He intended to mail the cards to the customer's address. He started a Web site where customers could specify the type of designs they wanted. Glen would then paint the cards according to the specifications of the customer. Glen soon started offering cash refunds in case the customer was not satisfied with the cards because he realized that other online businesses had also started offering the same facilities. He now runs a booming business. This is an example of a(n) _____ strategy. A. pre-termed B. marked C. arranged D. realized E. established

D. realized A realized strategy is the strategy that an organization actually follows. Realized strategies are a product of a firm's: (1) intended strategy: what the firm planned to do. (2) deliberate strategy: the parts of the intended strategy that the firm continues to pursue over time. (3) emergent strategy: what the firm did in reaction to unexpected opportunities and challenges.

_____ offered concepts such as Five Forces Analysis and Generic Strategies that continue to strongly influence how executives choose strategies. A. The World is Flat: A Brief History of the Twenty-First Century B. The Principles of Scientific Management C. The Prince D. Strategy and Structure: Chapters in the History of the Industrial Enterprise E. Competitive Strategy: Techniques for Analyzing Industries and Competitors

E. Competitive Strategy: Techniques for Analyzing Industries and Competitor. The second pivotal event in 1980 was the publication of "Competitive Strategy: Techniques for Analyzing Industries and Competitors" by Harvard professor Michael Porter. This book offers concepts such as Five Forces Analysis and Generic Strategies that continue to strongly influence how executives choose strategies more than thirty years after the book's publication.

Which of the following statements holds true for strategy as a PATTERN? A. It is a carefully crafted set of steps that a firm intends to follow in order to be successful. B. It refers to how executives interpret the competitive landscape around them. C. It refers to a company's place in the industry relative to its competitors. D. It is a specific move designed to outwit or trick competitors. E. It focuses on the extent to which a firm's actions over time are consistent.

E. It focuses on the extent to which a firm's actions over time are consistent.

Which of the following statements holds true for strategy as a PLOY? A. It refers to how executives interpret the competitive landscape around them. B. It focuses on the extent to which a firm's actions over time are consistent. C. It is a carefully crafted set of steps that a firm intends to follow in order to be successful. D. It refers to a firm's place in the industry relative to its competitors. E. It is a specific move designed to outwit or trick competitors.

E. It is a specific move designed to outwit or trick competitors.

Which of the following statements holds true for strategy as a PERSPECTIVE? A.It focuses on the extent to which a company's actions over time are consistent. B. It is a specific move designed to outwit or trick competitors. C. It refers to a firm's place in the industry relative to its competitors. D. It is a carefully crafted set of steps that a firm intends to follow in order to be successful. E. It refers to how executives interpret the competitive landscape around them.

E. It refers to how executives interpret the competitive landscape around them.

The book, The Prince, was written by _____. A. Frederick W. Taylor B. Michael Porter C. Alfred Chandler D. Thomas Friedman E. Niccol&?ograve; Machiavelli's

E. Niccol&?ograve; Machiavelli's. Niccol&?ograve; Machiavelli's 1532 book "The Prince" offers clever recipes for success to government leaders. Some of the book's suggestions are quite devious, and the word Machiavellian is used today to refer to acts of deceit and manipulation.

_____ refers to a stage in the strategic management process which entails crafting an effective organizational structure and corporate culture. A. Strategy evaluation and control B. Strategy evolution C. Environmental and internal scanning D. Strategy formulation E. Strategy implementation

E. Strategy implementation. Strategy implementation is the final stage of the strategic management process.

_____ offers an insightful guide for conquering and ruling territories and recipes for success to government leaders. A. Strategy and Structure: Chapters in the History of the Industrial Enterprise B. Competitive Strategy: Techniques for Analyzing Industries and Competitors C. The Principles of Scientific Management D. The World is Flat: A Brief History of the Twenty-First Century E. The Prince

E. The Prince Niccol&?ograve; Machiavelli's 1532 book "The Prince" offers clever recipes for success to government leaders. Some of the book's suggestions are quite devious, and the word Machiavellian is used today to refer to acts of deceit and manipulation.

Run and Play, a well-known athletic wear company, operates through a number of outlets which are owned and managed by private individuals. The company has allowed these outlets to use its brand name and products. They can do so after paying a fee to Run and Play. The outlets also pay a part of their revenue to the Run and Play. This is an example of: A. differentiation. B. positioning. C. brand essence. D. comparative scaling. E. franchising.

E. franchising. Franchising involves an organization (called a franchisor) granting the right to use its brand name, products, and processes to other organizations (known as franchisees) in exchange for an upfront payment (a franchise fee) and a percentage of franchisees' revenues (a royalty fee).

Jeff wants to open a fast food shop near a mall in order to attract the crowds that visit the shopping mall. This is an example of a(n) _____ strategy. A. pre-termed B. marked C. realized D. emergent E. intended

E. intended An intended strategy is the strategy that an organization hopes to execute

TRUE OR FALSE: The capstone course established by the Ford Foundation focuses on the notion that a single way of addressing a problem leads to the success of a firm.

False. A widely circulated report created by the Ford Foundation recommended all business schools offer a "capstone" course. The goal of this course would be to integrate knowledge across different business fields such as marketing, finance, and accounting to help students devise better ideas for addressing complex business problems. This course would emphasize critical thinking skills in general, particularly the notion that multiple ways of addressing a problem could be equally successful.

TRUE OR FALSE: Taylor's emphasis on maximizing organizational performance became redundant when strategic management as a field developed.

False. Taylor's emphasis on maximizing organizational performance became the core concern of strategic management as the field developed.

TRUE OR FALSE: Taylor believed that businesses would be much more efficient if principles for management were derived through scientific investigation.

True.

TRUE OR FALSE: When an organization's environment is very stable and predictable, strategic planning can provide enough of a strategy for the organization to gain and maintain success.

True.