Chapter 9
____ is the characteristic of ensuring that long-term strategic objectives and plans are established and that the proper management structure is in place to achieve those objectives, while at the same time making sure that the structure functions to maintain the corporation's integrity, reputation, and responsibility to its various constituencies.
Corporate Governance
What are the five issues, beyond financial, a firm uses to evaluate its strategies when developing a balanced scorecard?
Customers, Managers/Employees, Operations/ Processes, Community/Social Responsibility, and Business Ethics/Natural Environment
The strategy-evaluation process includes three basic activities. Which activity(s) below is not one of the three?
Develop a clear vision and mission.
What are the basic activities of the strategy-evaluation process?
Examine the underlying bases of a firm's strategy, compare expected results with actual results, and take corrective actions to ensure the performance conforms to plans.
Executives should keep assignments, team memberships, and meeting formats constant for a year.
False
In many organizations, strategy evaluation is simply an appraisal of how well an organization has performed.
False
Mintzberg refers to strategic planning as an "inevitable" process, whereas strategy scientists use the term "absolute" process.
False
Numbers supported by words, rather than words supported by numbers, should be the medium used to explain strategic issues and organizational responses.
False
Strategy evaluations should be simple but cumbersome and restrictive.
False
Successful companies maintain loose financial controls.
False
There are no good reasons to keep the strategy process and strategies themselves visible and open rather than hidden and secret.
False
This textbook is framed primarily on the fact that strategic planning is an art rather than a science.
False
Which publication annually publishes the "World's Most Admired Companies," which provides helpful strategy-evaluation information?
Fortune
When evaluating strategies, GAAP stands for what term?
Generally accepted accounting principles
When evaluating strategies, GAAS stands for what term?
Generally accepted auditing standards
When evaluating strategies, IFRS stands for what term?
International financial reporting standards
Which of the following is suggested to make strategic planning more effective?
It should be a people process more than a paper process.
Which statement below is not a guideline for effective strategic planning, according to R. T. Lenz?
It should contain vague planning jargon.
What is the second of the three strategy-evaluation activities?
Measure organizational performance.
Which strategy-evaluation activity includes comparing expected results with actual results, investigating deviations from plans, evaluating individual performance, and examining progress toward meeting stated objectives?
Measuring organizational performance
Which of the following is a current trend in the U.S. regarding Boards of Directors?
Much greater board member accountability with smaller boards
Advantages of keeping the strategic-planning process secret include which statement below?
Participants in a visible strategy process become more attractive to rival firms, that may lure them away.
Four reasons to be completely open with the strategy process and resultant decisions are given in the chapter; these reasons include all of the following except which one?
Participation and openness lead to conciseness and accuracy.
As described in Chapter 9, what is the first strategy-evaluation activity?
Review the underlying bases of strategy.
____ is the third strategy-evaluation activity.
Take corrective actions.
Which strategy-evaluation activity requires making changes to competitively reposition a firm for the future?
Taking corrective actions
Contingency plans should be established if ____
a new technological advancement makes a new product obsolete sooner than expected
Developed in the early 1990s by Harvard Business School professors Robert Kaplan and David Norton and refined continually since then, the ______ is a strategy-evaluation and control technique.
balanced scorecard
The basic premise of ______ is that firms should establish objectives and evaluate strategies on criteria other than using only financial measures.
balanced scorecard
The Balanced Scorecard strategy evaluation and control technique derives its name from the need of firms to balance _____
financial and nonfinancial measures
The act of oversight and direction provided by a Board of Directors is referred to as _____
governance
Most strategy literature advocates that strategic management is_____
more a science than an art
Strategy-evaluation activities should be performed _____
on a continuing basis
When conducting strategic planning, some firms prefer to keep strategies hidden because _____
participants in a visible strategic process become more attractive to rival firms, which may lure them away
Linneman and Chandran report that contingency planning gives users like DuPont, Dow Chemical, Consolidated Foods, and Emerson Electric three major benefits. It enables _____.
rapid responses to change, prevents panic in crisis situations and make managers more adaptable
The strategic planning process should _____
strengthen the "good ethics is good business" policy
Does this textbook advocate a top-down or bottom-up approach to strategic planning?
Bottom-up
