BUS CH 9

What percent of China's population lack access to clean drinking water?

26 percent

What percent of cities in China lack sewer treatment facilities?

40 percent

If success for one organizational department means failure for another department, then strategies may be:

Inconsistent

Which of the following is not a reason for the increasing difficulty of evaluating strategies?

Product life cycles are longer today than ever.

Intuitive judgments are almost always involved in deriving quantitative criteria.

True

China is home to 16 of the world's 20 most polluted cities.

Truw

What term refers to a systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between these assertions and established criteria, and communicating the results to interested users?

Auditing

Corrective action should do all of the following except:

Avoid external opportunities.

In evaluating strategies, which one of Rumelt's criteria for evaluating strategies, refers to the need for strategists to examine sets of trends?

Consonance

What term refers to the need for strategists to examine sets of trends, as well as individual trends in evaluating strategies?

Consonance

What permits quick response to change, prevents panic in crisis situations, and makes managers more adaptable.

Contingency Planning

What activity is defined as having alternative plans that can be put into effect if certain key events do not occur as expected

Contingency planning

Which of the following statements about contingency plans is not true?

Develop contingency plans minimize the impact of potential threats.

All of these are Richard Rumelt's criteria to evaluate a strategy except:

Distinctiveness.

When empowered employees are held accountable for and pressured to achieve specific goals and are given wide latitude in their actions to achieve them, there can be:

Dysfunctional behavior

What is happening to strategy evaluation with the passage of time?

Increasingly difficult.

Most strategy literature advocates that strategic management is:

More of a science than an art

The strategy-evaluation process should foster:

Mutual undestanding.

Strategy-evaluation activities should be performed:

On a continuous basis

Competitive advantage normally is the result of superiority in resources, skills and

Position

Familiarity with local environments usually makes gathering and evaluating information much easier for _______ organizations than for _______ ones.

Small; large

Ineffectiveness and/or inefficiencies indicate the need for:

Some form of corrective action.

What is important because organizations face dynamic environments in which key external and internal factors often change quickly and dramatically?

Strategy evaluation

When you discover major changes have occurred in the firm's internal strategic position while conducting strategy evaluation, you should:

Take corrective action

What aims to balance long term with short term concerns, financial with non-financial concerns, and internal with external concerns:

The Balanced Scorecard approach

All of the following are reasons strategy evaluation is more difficult today except:

The decreasing difficulty of predicting the future with accuracy.

What factor determines the final design of a firm's strategy-evaluation and control system?

The organization's characteristic.

According to Rumelt, consistency and feasibility are largely based on a firm's internal assessment.

True

According to research, participation in strategy-evaluation activities is one of the best ways to overcome individuals' resistance to change.

True

Adequate, timely feedback is important to effective strategy evaluation.

True

Alvin Toffler argues that environments are becoming so dynamic and complex that they threaten people and organizations with future shock in his thought-provoking books entitled Future Shock and The Third Wave.

True

Contingency plans should be as simple as possible.

True

Corrective action in strategy evaluation is necessary to keep an organization on track toward achieving stated objectives.

True

Each year, Fortune publishes strategy evaluation research on both the United States and other countries.

True

Independent auditors are basically CPAs who provide their services to organizations for a fee.

True

Most strategists believe that an organization's well being depends on evaluation of the strategic-management process.

True

Over 90 percent of China's energy is derived from solar and nuclear power.

True

Regardless of the size of the organization, a certain amount of management by wandering around at all levels is essential to effective strategy evaluation.

True

Strengths, weaknesses, opportunities and threats should continually be monitored for change because it is not really a question of whether these factors will change but rather when they will change and in what ways.

True

The decreasing time span for which planning can be done with any degree of certainty is a reason strategy evaluation is more difficult today.

True

The strategic management process should be completely open because participation and openness enhance understanding, commitment, and communication within the firm.

True

Too much emphasis on evaluating strategies may be expensive and counterproductive.

True

Two government agencies—IRS and GAO—employ government auditors responsible for making sure organizations comply with federal laws, statutes and policies.

True

Controls need to be _________ rather than__________.

Action oriented; information oriented

The purpose of strategy evaluation is to:

Alert management to problems or potential problems.

Which of these is/are a basic activity of strategy evaluation?

All of the above (Reviewing the underlying internal and external factors that represent the bases of current strategies, measuring organizational performance, taking corrective actions)

What corrective actions should a firm take during strategy evaluation?

All of the above (revising the business mission, issuing stock, revising objectives, selling a division).

Which of these is not a key attribute in Fortune's strategy evaluation research on "America's Most Admired Companies"?

Amount of physical resources

Most quantitative criteria are geared to ______ objectives rather than ________ objectives:

Annual; long-term

An organization's ability to adapt successfully to changing circumstances refers to its

Corporate agility

Product design, manufacturing, transportation, customer use, packaging, product disposal and corporate rewards should reflect ________ considerations to develop constructive relations with employees, consumers, suppliers and distributors.

Environmental

Corrective actions are not needed when:

External and internal factors have no significantly changed

What is not a characteristic of an effective evaluation system?

Information-oriented

Which type of auditors are specifically responsible for safeguarding the assets of a company?

Internal auditors

Criteria for evaluating strategies should be measurable and easily verifiable.

True

Future shock occurs when the type and speed of changes overpower an individual or organization's ability and capacity to adapt.

True

Identifying both beneficial and unfavorable events that could possibly derail the strategy or strategies is the first step of effective contingency planning.

True

Measuring organizational performance includes comparing expected results to actual results, investigating deviations from plans, evaluating individual performance and examining progress being made toward meeting stated objectives.

True

Strategies may be inconsistent if policy problems and issues continue to be brought to the top for resolution.

True

Strategy-evaluation activities must be meaningful, i.e., they should specifically relate to a firm's objectives.

True

Taking corrective actions does not necessarily mean that existing strategies will be abandoned, or even that new strategies must be formulated..

True

The Balanced Scorecard Approach deals with the question, "How satisfied are the firm's customers."

True

There is no one ideal strategy-evaluation system for all organizations.

True

Timely approximate information is generally more desirable as a basis for strategy evaluation than accurate information that does not depict the present.

True

Which of the following is not a reason why some firms prefer to conduct strategic-planning in secret?

It enhances understanding, commitment and communication within the firm.

All of the following are reasons to be completely open with the strategy process except:

Openness limits rival firms from imitating or duplicating the firm's strategies.

What is the best way to overcome individuals' resistance to change in strategy evaluation?

Participation

Strategy evaluation is based on:

Qualitative and quantitative criteria.

Financial ratios are used to compare a firm's performance over different time periods, compare the firm's performance to industry averages, and compare a firm's performance with:

The performance of competitors.

In the important publication used to evaluate a firm's strategy, the Fortune 50 includes all of the following except:

The top hospitals

What is the cornerstone of effective strategy evaluation?

Adequate and timely feedback.

What county has the largest percentage of the worlds most polluted cities?

China

Which of the following is not included in measuring organizational performance?

Comparing results to competitors' expectations.

A revised __________ should indicate how effective a firm's strategies have been in response to key opportunities and threats.

EFE matrix.

A final broad test of strategy is it:

Feasibility

What is the basis for quantitative financial evaluation?

Financial ratios.

What occurs when the nature, types and speed of changes overpower an individual's or organization's ability and capacity to adapt?

Future shock

Changes in the organization's management, marketing, finance/accounting, R&D and CIS strengths and weaknesses should be the focus of a revised:

IFE matrix.

Which of these is not a key financial ratio?

Production quality

Which of the following is not a component of the Balanced Scorecard?

Social responsibility`11q

Corrective actions should:

Strengthen an organization's competitive position in its industry.