Chapter 3-5

The Delphi group technique is a group decision-making technique in which _____.

the opinions of group member are combined and averaged

Which of the following is true of job creation?

Large firms hire at a faster rate than smaller firms.

What is one of the factors that makes an alternative infeasible?

Legal barriers

Which of the following is one of the factors responsible for the failure of a small business?

Managerial inexperience

WexAll Industries has seen demand for its RB37 start to slow down. In addition, the number of other companies producing a similar product has started to go down as well, and there have not been any new entrants into this market. The RB37 is most likely in the _____ stage of the product life cycle.

Maturity

Which of the following is an identifying a new niche in an established market?

Modifying a computer so that it is usable by untrained persons

According to the classical decision model, decision makers _____.

NOT: never make errors even under uncertain conditions

Each summer the local running club hosts a marathon and looks for sponsors to support the event. This year, the club contacted the local water bottling plant. The manager of the plant can see the benefits of this event, but the plant has never participated in something like this. Which type of decision needs to be made about the potential sponsorship of the local marathon?

Nonprogrammed

Which of the following is an example of a company that has identified a new market?

NutriMax has introduced its low-fat cookies in Asia.

________ plans have a short-term focus and are relatively narrow in scope.

Operational

Alpha Inc. is a large shoe manufacturer that caters to a large customer base. In addition to the high volume of shoes it manufactures, the company sells simple-designed sneakers for low prices. Many customers buy Alpha shoes because they are durable and inexpensive. Which of the following strategies is illustrated in the scenario?

Overall cost leadership strategy

According to research by the National Federation of Independent Business, which of the following is the most important source of money for individuals starting up new businesses?

Personal resources

The exact description of how specific activities are to be carried out would be found in which type of plan?

Rules and regulations

The starting point in formulating strategies is usually ______________.

SWOT anaylsis

Sameer runs a store that exclusively sells handmade vegan cosmetics. The store has a wide range of products manufactured by different companies. The store is relatively small in size and Sameer knows that only a small segment of customers buy such products, sohe focuses exclusively on them. Which of the following can be inferred from the scenario?

Sameer a uses a niche strategy in the retail industry.

What is the component of a strategy that specifies the range of markets in which an organization will compete?

Scope

When the prices of oil dropped, the demand for sport utility vehicles (SUVs) increased. Automakers chose to increase productions of full-size SUVs in order to increase profitability. Which step in the rational decision-making model is illustrated in the scenario?

Selecting the best alternative and implementing it

The Clippery is a dog grooming salon. Which industry segment is it most likely to operate in?

Service

Identify an accurate comparison between small businesses and large businesses.

Small businesses are better than large businesses in identifying niches.

A standing plan that outlines the steps to be followed in a particular circumstance is called a______.

Standing operating procedure

Decisions regarding standard organizational transactions are most likely to be __________ decisions.

programmed

A ________ may be part of a broader program, or it may be a self-contained single-use plan, as it is generally of less scope and complexity.

project

Small businesses______.

provide big businesses with many of the services they need

One of the four coffee machines at Jolanta's coffee shop has broken down three times in two weeks. Jolanta is trying to decide if the problem is a bad machine or if people are just using the machine wrong. Jolanta is currently _____.

recognizing and defining the decision situation

Lily's boutique sells fashionable clothing for women. It operates in the _____ industry.

retail

Ramon is in a hurry to appoint a personal assistant to help him. He posts an advertisement on a job website and picks the first person who sends in their resumé. He only checks for the candidate's qualifications and does not consider their work experience. This is an example of _____.

satisficing

In the context of the BCG matrix, ____________ are businesses that have the largest share of a rapidly growing market.

stars

The most significant disadvantage to owning a franchise is that ____________.

the franchisee may have to pay a high start-up cost

Pallavi knows that if she is able to achieve the goals set by her manager, she is likely to receive a bonus. In this case, what does the setting of goals serve as for Pallavi?

A source of motivation

What is a general factor that contributes to the success of small businesses?

Analysis of market conditions

Which might explain why construction is a good industry for small businessess?

Because many construction jobs are relatively small, local projects, local construction firms are often ideally suited as contractors.

What is one major element of organizational politics that is especially relevant to decision making because of the alliance to achieve a common goal of the group?

Coalitions

Which of the following best explains what occurs at the step of selecting the best alternatives when completing the rational decision-making process?

Consider all situational factors, and choose the alternative that best fits the situation.

What does an organization use to manage its operations across several industries and several markets simultaneously?

Corporate-level strategy

Eli makes custom-made leather handbags and wallets in a small shop. He is known for his fine leather products and hand stitching, as well as the lifetime warranty he offers on his products. His items are expensive, and he has no desire to increase the size of his shop. What has Eli developed within his shop?

Distinctive competence

What can be described as the number of different businesses that an organization is engaged in and the extent to which these businesses are related to one another?

Diversification

Evidence-based management (EBM) practices suggest treating the organization as an unfinished prototype, which means what?

Encourage experimentation and learning by doing.

Dorian is using a new process for screening potential employees in his department, but he is unsure if it is efficient and helps recruiters find the best candidates. However, Dorian continues to require the process because it was so expensive to set up the initial system. Which of the following concepts is illustrated in the scenario?

Escalation of commitment

A plant manager had taken measures to try to reduce worker turnover. For four months, they monitored the implementation of the measures. They now find that the turnover rate is reduced by 10 percent. Which step of the rational decision making model is illustrated in the scenario?

Evaluating the results

Which is a contract between an entrepreneur and a parent company that requires the entrepreneur to pay the parent company for the use of its trademarks, products, formulas, and business plans?

Franchising agreement

Which of the following is used to provide a source of motivation for an organization's employees?

Goals

Due to an explosion at a supplier's plant, L'Meese will no longer be able to achieve goals set by her division manager. What should L'Meese remember about goals?

Goals are targets, not absolute objectives.

Which of the following would be considered as an organizational weakness in the context of the SWOT analysis?

Insufficient cash revenues

According to the BCG matrix, what should a company do with the cash that is generated by cash cows?

Invest in its stars.

Which of the following statements is true about the administrative model of decision making?

It suggests that managers tend to satisfice when making decisions.

Which of the following statements is true in the context of decision making under a state of risk?

The decision maker used probability estimates to assess alternatives.

What must a decision maker understand in order to make the most effective decision possible?

The situation driving the decision

Why is it important to identify weaknesses in a SWOT analysis?

To correct them

In which way can managers use information from the product life cycle?

To determine which strategies for products need evolve

When devising a new strategy, it is best to start with________.

a SWOT analysis

What is a coalition?

an informal alliance of individuals or groups formed to achieve a common goal

Keisha is Vice President of accounting, and she has to decide which computer software to purchase for her department. She has looked at all of the possible alternatives and is leaning toward the system with which she is most familiar. This is an example of _________.

bounded rationality

In a BCG matrix, _________ are businesses that have a large share of a market that is not expected to grown substantially.

cash cows

The administrative model of decision making _____.

describes how decisions are actually made

Alba Motorbikes is known for its heavyweight motorcycles. The company places emphasis on the quality of the bikes and after-sale service. The brand also enjoys customer loyalty. This scenario described Alba Motorbikes' _____________.

distinctive competence

Sasha owns a day care center and makes all decisions about how the center runs, what services it provides, and at what prices. She has funded the venture with her own savings and has complete responsibility for the success or failure of the venture. Sasha is most likely a(n)________.

entrepreneur

William had invested in an initial public offering. He kept incurring losses due to unfavorable market conditions. However, he decided to keep the investment because he had spent so much money on it. This scenario best exemplifies _____.

escalation of commitment

Research suggests that the majority of new businesses ____________.

fail within the first few years of founding

Most small businesses employ______.

fewer than 20 people.

Henry created a new flavor of ice cream to add tohis menu of homemade ice creams in the ice cream parlor he owns in Florida. The ice cream became an instant hit; he plans to sell the ice cream in Georgia by supplying it to retailers there. Henry is involved in_______.

identifying a new market

Banks, independent investors, and government funds are all examples of _________ that be approached to finance a small business.

lenders

A good deal of money is usually needed to start a(n) ____________ business because of the investment normally required in equipment, energy, and raw materials.

manufacturing

In general, while identifying alternatives, the more important the decision, the ___________.

more alternatives should be generated

One disadvantage of group decision making is that _____.

one person may dominate the group

Kamiya plans to open a business writing software. While researching her strategy, Kamiya discovered a profitable niche in children's educational software. How will pursuing this niche help Kamiya outperform her competitors?

It will give her a distinctive competency.

Relish has a chain of outlets that sells baked products. Relish requires all its employees to complete a month's training before they can work in the kitchen. This is an example of a________.

Policy

When the low-indicator light turns red on the frozen drink machine, Kareem follows an established set of procedures to refill and reset the machine. In doing so, he's making a(n) _____ decision.

Programmed

What refers to a condition in which the availability of each alternative and its potential payoffs and costs are all associated with probability estimates?

State of risk

The Power House coffee shop wants to increase sales and local foot traffic. The owner has considered daily specials, loyalty programs, and expanding his menu selection. Ultimately, he decided to implement a loyalty program because it stimulates repeat business and customer loyalty. Which step has the manager of the Pour House reached in his rational decision-making process?

Step 4: Selecting the best alternative

What is a potential downfall when using a SWOT analysis?

Subjective assessment

Which of the following is NOT one of the basic factors usually cited to explain new business success?

Sufficient capital

_____ is a portfolio management technique that considers industry attractiveness and competitive position rather than focusing solely on market growth and market share.

The GE Business Screen

In the context of the GE Business Screen, a determinant of an organization's competitive position is_______.

technological know-how, product quality, service network, price competitiveness, and operating costs.

Amina, the senior marketing manager, has estimated costs and has forecasted sales for the company's new product. However, there are many unknowns in both the new product development and market conditions that she cannot predict. Amin is making new product launch decisions under a condition of _________.

uncertainty

Which of the following statements is true about entrepreneurs?

​Entrepreneurs assume the risks of their business ventures.

Business-level strategy is _________.

the set of strategic alternatives that helps an organization focus its competitive efforts for each industry or market in a targeted and focused manner