GEB Chapter 9

Also important in evaluating strategies are ________ criteria, like high absenteeism and turnover rates, or low employee satisfaction. A) numerical B) qualitative C) quantitative D) accounting E) financial

B) qualitative

The strategy-evaluation process should A) dominate decisions. B) be complex. C) be cumbersome. D) foster mutual understanding and trust. E) be restrictive

D) foster mutual understanding and trust.

Too much emphasis on evaluating strategies A) may be expensive and counterproductive. B) is not possible - the more emphasis the better. C) is good for morale, as employees like being closely evaluated. D) is always advised if the firm can afford it. E) is worse than too little or no evaluation.

A) may be expensive and counterproductive.

Corrective action should do all of the following EXCEPT A) capitalize upon internal strengths B) avoid external opportunities C) avoid external threats D) improve internal weaknesses E) strengthen an organization's competitive position

B) avoid external opportunities

According to Rumelt, the final broad test of strategy is its A) advantage. B) feasibility. C) consonance. D) consistency. E) distinctiveness

B) feasibility.

Corrective actions are almost always ________ except when external and internal factors have not significantly changed and the firm is progressing satisfactorily toward achieving stated objectives. A) unnecessary B) needed C) undesirable D) prohibitively expensive E) futile

B) needed

Competitive advantage normally is the result of superiority in resources, skills, and A) employees. B) position. C) consistency. D) feasibility. E) governance

B) position.

A particularly important twenty-first-century challenge facing all strategists today is A) deciding whether the process should be more an art or a science. B) deciding whether strategies should be visible or hidden from stakeholders. C) deciding whether the process should be more top-down or bottom-up in their firm. D) all of the above E) none of the above

D) all of the above

Quantitative criteria commonly used to evaluate strategies are A) ash budgets. B) Balanced Scorecards. C) Capital Asset Pricing Models. D) financial ratios. E) present value analyses

D) financial ratios.

All of the following are reasons strategy evaluation is more difficult today EXCEPT A) a dramatic increase in the environment's complexity B) the increasing number of variables C) the increase in the number of both domestic and world events affecting organizations D) the decreasing difficulty of predicting the future with accuracy E) the rapid rate of obsolescence of even the best plans

D) the decreasing difficulty of predicting the future with accuracy

Which of the following is a corrective action a company might take to correct unfavorable variances? A) Divesting a division B) Revising objectives C) Raising capital with stock or debt D) Allocating resources differently E) All of the above

E) All of the above

Which of these is a basic activity of strategy evaluation? A) Reviewing the underlying bases of current strategies B) Comparing expected results with actual results C) Taking corrective actions D) Choices B and C only E) All of the above

E) All of the above

Modern organizational realities demand that employees demonstrate greater A) flexibility. B) innovation. C) creativity. D) initiative. E) all of the above

E) all of the above

What is the cornerstone of effective strategy evaluation? A) Adequate and timely feedback B) Quality and quantity of managers C) Smaller ratio of top- to lower-level management D) Evaluation preceding implementation stage E) Punitive corrective actions

A) Adequate and timely feedback

Which of the following is NOT included in measuring organizational performance? A) Comparing results to competitors' expectations B) Examining progress being made toward meeting stated objectives C) Investigating deviations from plans D) Evaluating individual performance E) Comparing expected results to actual results

A) Comparing results to competitors' expectations

Research suggests that which of the following is one of the best ways to overcome individuals' resistance to change in strategy evaluation? A) Participation B) Command-and-control C) Laissez-faire system D) Rational argument E) Emotional reactions

A) Participation

Which of the following is NOT a reason for the increasing difficulty of evaluating strategies? A) Product life cycles are longer. B) Domestic and world economies are less stable. C) Product development cycles are shorter. D) Technological advancement is more rapid. E) Change is occurring more frequently

A) Product life cycles are longer.

With the passage of time strategy evaluation is becoming A) increasingly difficult. B) much simpler. C) very convenient. D) an unnecessary activity. E) less important

A) increasingly difficult.

Corrective actions should always A) strengthen an organization's competitive position in its industry. B) streamline asset holdings. C) have no risk. D) involve abandoning existing strategies. E) all of the above

A) strengthen an organization's competitive position in its industry.

Proponents of the top-down approach contend that ________ are the only persons in the firm with the collective experience, acumen, and fiduciary responsibility to make key strategy decisions. A) top executives B) divisional managers C) middle-level managers D) lower-level managers E) non-management employees

A) top executives

What term refers to the need for strategists to examine sets of trends, as well as individual trends, in evaluating strategies? A) Consistency B) Consonance C) Synergy D) Feasibility E) Advantage

B) Consonance

Changes in the organization's management, marketing, finance/accounting, production/operations, R&D, and MIS strengths and weaknesses should be the focus of a revised A) mission. B) IFE matrix. C) vision. D) EFE matrix. E) EPM matrix

B) IFE matrix.

Which of the following statements about contingency plans is NOT true? A) Contingency plans should be as simple as possible. B) Only high-priority areas require the insurance of contingency plans. C) Contingency plans should be developed for favorable and unfavorable events. D) Strategists should plan for all possible contingencies. E) Contingency plans minimize the impact of potential threats

B) Only high-priority areas require the insurance of contingency plans.

Which of these is NOT a key financial ratio? A) Market share B) Production quality C) Earnings per share D) Asset growth E) Return on equity

B) Production quality

What aims to balance long-term with short-term concerns, financial with nonfinancial concerns, and internal with external concerns? A) Contingency planning B) The Balanced Scorecard approach C) Taking corrective action D) Benchmarking E) Consonance

B) The Balanced Scorecard approach

A revised ________ should indicate how effective a firm's strategies have been in response to key opportunities and threats. A) IFE matrix B) mission C) EFE matrix D) vision E) CPM matrix

C) EFE matrix

________ organizations require more elaborate and detailed strategy-evaluation systems than ________ ones because it is more difficult to coordinate efforts among different divisions and functional areas. A) Non-profit; for-profit B) For-profit; non-profit C) Large; small D) Small; large E) Foreign; domestic

C) Large; small

Most quantitative criteria are geared to ________ objectives rather than ________ objectives. A) top-management; employee B) short-term; annual C) annual; long-term D) environmental; community E) profit; social

C) annual; long-term

Strategy-evaluation activities should ideally be performed A) just on a periodic basis. B) only at the onset of a problem. C) on a continuous basis. D) solely upon completion of major projects. E) annually only

C) on a continuous basis.

If you discover during the course of strategy evaluation that major changes have occurred in the firm's internal strategic position, you should A) continue on the present strategic course. B) wait until the next quarter to see if things revert. C) take corrective actions. D) follow the original strategic plan. E) none of the above

C) take corrective actions.

What activity is defined as having alternative plans that can be put into effect if certain key events do not occur as expected? A) Corporate agility B) Scenario planning C) Strategy evaluation D) Contingency planning E) Forecasting

D) Contingency planning

Which of the following is true regarding the design of a firm's strategy-evaluation system? A) There is a one-size-fits-all system that works for all companies. B) It does not need to take into account the organization's size. C) The management style of a firm has no bearing on the design. D) It should be determined based on the unique characteristics of a company. E) There is one ideal system

D) It should be determined based on the unique characteristics of a company.

All of these are Richard Rumelt's criteria to evaluate a strategy EXCEPT A) advantage B) consistency C) feasibility D) distinctiveness E) consonance

D) distinctiveness

What corrective actions might a firm take during strategy evaluation? A) Revising the business mission B) Issuing stock C) Revising objectives D) Selling a division E) All of the above

E) All of the above

If success for one organizational department means failure for another department, then strategies may be A) synergistic. B) advantageous. C) trendy. D) feasible. E) inconsistent

E) inconsistent

Financial ratios are used to compare a firm's performance over different time periods, to compare the firm's performance to industry averages, and to compare a firm's performance with A) overall business standards. B) projected goals. C) the performance of suppliers. D) non-financial ratios. E) the performance of competitors

E) the performance of competitors