EXAM #1 Chapters 1-3

The strategic-management process is becoming more widely used by small firms. nonprofit institutions. governmental organizations. multinational conglomerates. All of these

All of these

According to Peter Drucker "Imagination is more important than knowledge, because knowledge is limited, whereas imagination embraces the entire world."

False

Identifying an organization's existing vision, mission, objectives, and strategies is the final step for the strategic management process.

False

Middle managers are generally the most visible and critical of all strategic managers.

False

The best approach for strategists is to carefully develop strategic plans themselves and then present them to operating managers to execute.

False

Which statement best describes intuition? It represents a minor factor in decision-making integrated with analysis. It should be coupled with analysis in decision-making. It alone should be used in decision-making. It is management by ignorance. It is better than analysis in decision-making.

It should be coupled with analysis in decision-making.

What can be defined as the art and science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives? Strategy implementation Strategy evaluation Strategic management Strategic leading Strategy formulation

Strategic management

What are the means by which long-term objectives will be achieved? Strengths Opportunities Policies Strategies Weaknesses

Strategies

Which individuals are most responsible for the success and failure of an organization? Human resource managers Strategists Personnel directors Stakeholders Financial planners

Strategists

What step in the strategic management process involves mobilizing employees and managers to put strategies into action? Strategy implementation Competitive advantage Strategy evaluation Strategic advantage Strategy formulation

Strategy implementation

There is a dramatic shift in mass retailing to selling only the most expensive merchandise. opening dramatically larger supercenters. "trading up" and taking customers from more exclusive stores. cutting back on their online presence. operating stores with less square footage.

There is a dramatic shift in mass retailing to

Firms can be more proactive with strategic management.

True

Objectives should be measurable, challenging, reasonable, consistent, and clear.

True

Strategic management is an attempt to organize qualitative and quantitative information in a way that allows effective decisions to be made under conditions of uncertainty.

True

Strategy implementation is often considered to be the most difficult stage in the strategic-management process

True

Which of the following is NOT a reason given for poor or no strategic planning in an organization? Planning is viewed as a waste of time Content with current success Too busy "firefighting" to plan ahead Trust of management makes it unnecessary No monetary rewards for planning

Trust of management makes it unnecessary

How do line managers become "owners" of the strategy? By executing plans formulated by other people By buying off top managers By becoming a shareholder of the firm By involvement in the strategic-management process By attending top manager meetings

By involvement in the strategic-management process

________ is NOT a strategy-implementation activity. Establishing annual objectives Taking corrective actions Motivating employees Allocating resources Devising policies

Taking corrective actions

The goal of strategic management is to eliminate competitive advantage. achieve competitive advantage. achieve and maintain competitive advantage. eliminate and abolish competitive advantage. maintain competitive advantage.

achieve and maintain competitive advantage.

Both business and military organizations must ________ and ________ to be successful. be impervious to change; continually improve adapt to change; constantly improve shun change; stay the course be impervious to change; stay the course None of these

adapt to change; constantly improve

An organization's vision statement is a constant reminder to its employees of why the organization exists. broadly charts the future direction of an organization. addresses the basic question: "What is our business?" answers the question: "What do we want to become?" None of these

answers the question: "What do we want to become?"

Strategic management enables an organization to ________, instead of just responding to threats in its business environment. be immune to threats be reactive relinquish control over its destiny avoid responsibility for shaping its future be proactive

be proactive

Superior strategy formulation and implementation ________ an opponent's superiority in numbers and resources. are irrelevant to are not enough to surmount can overcome can lead to unite

can overcome

Anything that a firm does especially well compared to rival firms is referred to as opportunity cost. an external opportunity. comparative disadvantage. unsustainable advantage. competitive advantage.

competitive advantage.

Military strategy is based on an assumption of ________, whereas business strategy is based on an assumption of ________. cooperation; conflict conflict; cooperation competition; conflict conflict; competition cooperation; competition

conflict; competition

Long-term objectives should be all of the following EXCEPT reasonable. continually changing. challenging. consistent. measurable.

continually changing

Which of the following is often considered to be the first step in strategic planning? Determining opportunities and threats Developing a mission statement Making a profit Establishing goals and objectives Developing a vision statement

developing a vision statement

The act of strengthening employees' sense of effectiveness by encouraging and rewarding them for participating in decision-making and exercising initiative and imagination is referred to as transformation. empowerment. authoritarianism. proaction. delegation.

empowerment

By the nature of what they do, strategists tend to have similar attitudes, values, ethics and concerns for social responsibility.

false

In mass retailing, big-box companies like Walmart, Best Buy, and Sears are increasing the square-footage of their retail locations. participating in a dramatic shift to becoming bigger. gaining competitive advantage over smaller stores. noticing a sharp decline in online purchases. finding that less brick and mortar is better.

finding that less brick and mortar is better.

According to Greenley, strategic management offers all of the following benefits EXCEPT enhanced communication. increased resistance to change. increased discipline. more effective allocation of time and resources. increased synergy.

increased resistance to change

Strategy evaluation is necessary because the SEC requires strategy evaluation. internal and external factors are constantly changing. firms have limited resources. the IRS requires strategy evaluation. success today is a guarantee of success tomorrow.

internal and external factors are constantly changing.

What types of skills are especially critical for successful strategy implementation? Interpersonal Visionary Marketing Conceptual Technical

interpersonal

The strategic-management process is a continuous process. is a semiannual process. applies mostly to companies with sales greater than $100 million. occurs once a year. applies mostly to small businesses.

is a continuous process.

The strategic-management process represents a(n) ________, ________, and ________ approach for determining an enterprise's future direction. intuitive; disorganized; subjective intuitive; disorganized; objective logical; systematic; subjective inconsistent; systematic; subjective logical; systematic; objective

logical; systematic; objective

A strong ________ heritage underlies the study of strategic management. cultural government military political social

military

Organizations using strategic management are generally ________ than those that do not. more complex less successful less complex more profitable less profitable

more profitable

Annually, ________ businesses in the United States fail. less than 1,000 more than 100,000 about 10,000 exactly 100 almost 10 million

more than 100,000

Specific results an organization seeks to achieve in pursuing its basic mission are policies. tenets. objectives. strategies. rules.

objectives

Terms such as objectives, mission, strengths, and weaknesses were first formulated to address problems on the battlefield. in the military hierarchy. in interpersonal relationships. on the trading floor. in the boardroom.

on the battlefield

What are guides to decision making that address repetitive or recurring situations called? Objectives Rules Strategies Policies Goals

policies

An organization should take a(n) ________ approach in its industry. reactive rather than a proactive proactive rather than a reactive adversarial rather than a collegial collegial rather than an adversarial cooperative rather than a competitive

proactive rather than a reactive

Sometimes ________ is used to refer to strategic formulation, implementation and evaluation, with ________ referring only to strategic formulation. strategic planning; strategic processing strategic planning; strategic management strategic implementation; strategic focus strategic management; strategic processing strategic management; strategic planning

strategic management; strategic planning

According to Webster's New World Dictionary, ________ is "the science of planning and directing large-scale military operations, of maneuvering forces into the most advantageous position prior to actual engagement with the enemy." business formulation competitive advantage war strategy

strategy

An important activity in ________ is taking corrective action. strategy evaluation strategy implementation strategy formulation strategy leadership All of these

strategy evaluation

Internal ________ are controllable activities in an organization that are performed especially well. strengths objectives incompetencies opportunities factors

strengths

Business or military success is generally the happy result of accidental strategies. undermined by the element of surprise. the product of both attention to changing external and internal conditions and the insightful adaptations to those conditions. unrelated to external conditions. None of these

the product of both attention to changing external and internal conditions and the insightful adaptations to those conditions.

The decision to expand or diversify operations is a strategy-formulation issue.

true

Generally, external opportunities and threats are key functions in strategy implementation. key functions in strategy exploitation. uncontrollable by a single organization. unable to have a significant impact on an organization. not worth monitoring and evaluating.

uncontrollable by a single organization.

All of these are pitfalls an organization should avoid in strategic planning EXCEPT using strategic planning to gain control over decisions and resources. too hastily moving from mission development to strategy formulation. using plans as a standard for measuring performance. failing to involve key employees in all phases of planning. being so formal in planning that flexibility and creativity are stifled.

using plans as a standard for measuring performance.