MGMT 3000 TEST 1- SIMOON CANNON
Utilitarianism directly seeks an ethical system with no rules that will help bring out the best in people. an ethical system that defines acceptable behavior as that which maximizes consequences for the individual. ethical ideas that depend on Kyosei and human dignity. ethical behavior based on the opinions and behaviors of relevant other people. the greatest good for the greatest number of people.
the greatest good for the greatest number of people. explanation: Utilitarianism directly seeks the greatest good for the greatest number of people.
Using host-country nationals at an overseas subsidiary is generally less expensive than using expatriates. True or False
True explanation: Because sending employees abroad can cost three to four times as much as employing host-country nationals, some companies, including Texas Instruments, have made limited use of expatriates.
One of the consequences of an increasingly integrated global economy is that imports are penetrating deeper into the world's largest economies. True or False
True explanation: The increasing integration of the global economy has had many consequences, including deeper penetration of imports into the world's largest economies.
To be successful, entrepreneurs should be innovators and also have good knowledge and skills in management, business, and networking. True or False
True explanation: Successful entrepreneurs are innovators and also have good knowledge and skills in management, business, and networking. In contrast, inventors may be highly creative but often lack the skills to turn their ideas into a successful business.
Which of the following is the best example of a manager discounting the future? a manager planning for the long-term stability of a company a manager framing the decision alternatives to influence selection a manager believing that he or she can control the outcome of any decision a manager focusing on quarterly profits instead of the long-term vision a manager depending on programmed decisions for all issues
a manager focusing on quarterly profits instead of the long-term vision explanation: Often decision makers discount the future. That is, in their evaluation of alternatives, they weigh short-term costs and benefits more heavily than longer-term costs and benefits.
Which of the following is an example of a potential substitute product? Multiple Choice furniture for apartments Chipotle Burrito Bowl for a Chick-fil-A meal iTunes for iPods Evernote for a Samsung Galaxy Watch ink cartridges for printers
Chipotle Burrito Bowl for a Chick-fil-A meal explanation: A substitute is a potential threat; customers use it as an alternative, buying less of one kind of product but more of another. In this particular case, if the product is a Chipotle Burrito Bowl, a substitute would be a Chick-fil-A meal. The remaining choices are examples of complements.
When investors bid up stock prices, companies have less capital to fuel their strategies. True or False
False explanation: An important economic influence on a company is the stock market. When investors bid up stock prices, they are paying more to own shares in companies, which means the companies have more capital to fuel their strategies.
Ethical decisions are NOT guided by the underlying values of the individual. True or False
False explanation: Ethical decisions are guided by the underlying values of the individual.
Large corporations are merely passive bystanders watching entrepreneurs create new businesses. True or False
False explanation: Large corporations are more than passive bystanders watching entrepreneurs create new businesses. Even established companies try to find and pursue new and profitable ideas.
Done properly, sustainability encourages people to live in ways that can be maintained for a short period without harming environmental resources. True or False
False explanation: Sustainability is about protecting our options. Done properly, sustainability allows people to live and work in ways that can be maintained over the long term (generations) without depleting or harming our environmental, social, and economic resources.
Emotional intelligence should be viewed as something you inherit and cannot change. True or False
False explanation: The common phrase "emotional intelligence" is controversial. For instance, individuals should not consider it as a type of intelligence but as a set of skills that they can learn and develop—but these skills do matter in many ways.
The most constructive type of conflict is affective conflict. True or False
False explanation: The most constructive type of conflict is cognitive conflict, or differences in perspectives or judgments about issues. In contrast, affective conflict is emotional and directed at other people. Affective conflict is likely to be destructive to the group because it can lead to anger, bitterness, goal displacement, and lower-quality decisions.
The first formal step in the planning process is goal and plan evaluation. True or False
False explanation: The order of the steps in the planning process is as follows: situational analysis, alternative goals and plans, goal and plan evaluation, goal and plan selection, implementation, and monitor and control.
Contingency plans should be developed only after a decision has been made and implemented. True or False
False explanation: While a manager is evaluating alternatives, he or she should predict the consequences that will occur if the various options are put into effect; that is, the best time to imagine scenarios and develop contingency plans is during the alternative evaluation process.
Mindful Maids Incorporated, a housecleaning services firm, has completed a SWOT analysis as part of its ongoing strategic planning process. Management has uncovered the following information through extensive research: New regulations have been passed limiting the number of hours per week the company's employees can work without receiving benefits. Mindful Maids is a company that uses environmentally friendly products; its competitors do not. More and more homeowners are concerned about the environment; it is expected that this trend will continue for decades. Compared to its competitors, its management team is by far the best in the industry. It has fallen behind in staff training over the last few years. The company has adequate financial resources to invest in its operations. The percentage of people hiring cleaning services has fallen off due to a difficult recession. Which of the following findings is a weakness for Mindful Maids? The management team of Mindful Maids is the best in the industry. Mindful Maids has fallen behind in staff training over the last several years. The number of people hiring cleaning services has fallen off recently because of a recession. Mindful Maids' competitors do not use environment-friendly products. New regulations have been passed limiting the hours employees can work without benefits.
Mindful Maids has fallen behind in staff training over the last several years. explanation: SWOT analysis is a comparison of strengths, weaknesses, opportunities, and threats that helps executives formulate strategy. Managers assess the strengths and weaknesses of major functional areas inside their organization, such as the fact that it has fallen behind in staff training.
Which of the following is one of the six major components of the strategic management process? analysis of external strengths and weaknesses employee interviews and performance reviews strategic review and evaluation analysis of internal opportunities and threats SWOT analysis and strategy formulation
SWOT analysis and strategy formulation explanation: The strategic management process has six major components: (1) establishment of mission, vision, and goal; (2) analysis of external opportunities and threats; (3) analysis of internal strengths and weakness; (4) SWOT analysis and strategy formulation; (5) strategy implementation; and (6) strategic control.
Which of the following statements about planning is accurate? Multiple Choice Tactical plans may have a time horizon of a year or two, whereas strategic plans may cover a period of less than a year. Strategic plans may have a time horizon of a year or two, whereas operational plans may cover a period of less than a year. Tactical plans may have a time horizon of a year or two, whereas operational plans may cover a period of less than a year. Strategic plans may have a time horizon of a year or two, whereas tactical plans may cover a period of less than a year. Operational plans may have a time horizon of a year or two, whereas tactical plans may cover a period of less than a year.
Tactical plans may have a time horizon of a year or two, whereas operational plans may cover a period of less than a year. explanation: Tactical plans may have a time horizon of a year or two, whereas operational plans cover less than a year. Strategic plans relate to long-term survival.
Which of the following job titles indicates that a person is a frontline manager? Executive Assistant Vice President Chief Financial Officer Human Resources Manager Team Leader
Team Leader explanation: Frontline managers, or operational managers, are lower-level managers who supervise the operations of an organization. These managers often have titles such as supervisor, team leader, or assistant manager.
Jean-Michel is the CEO of Kronos Timepieces, a retailer and manufacturer of fashion watches and watch accessories. The company, which was founded in 1925, is based in Switzerland and employs around 1,000 people in five countries. It currently sells its watches in 27 countries, with a recent expansion into several Middle Eastern and far Eastern countries. Kronos has decided to introduce a lower-priced unisex wristwatch. Jean-Michel has been considering contracting a new factory located in Singapore to manufacture the lower-priced line of wristwatches, rather than using Kronos' older, main factory, which is located in nearby Grenchen. Which of the following factors best supports Jean-Michel's decision to outsource production of the watches? Automation can often achieve significant labor cost savings, increasing the advantage of moving production abroad. The current supply chain is not as highly efficient and routine as it could be; using the Singapore factory could address that problem. Even though Kronos will incur additional costs of sending staff from Switzerland to manage the Singapore factory, costs will be lower in the long run. The company's ability to rapidly and reliably deliver its watches will be increased by the state-of-the-art facilities in the Singapore factory. The manufacture of watches is standardized and the company is sufficiently well-established, making outsourcing an attractive option.
The manufacture of watches is standardized and the company is sufficiently well-established, making outsourcing an attractive option. explanation: In deciding whether to offshore, managers should not start out with the assumption that it will be cheaper for them to do so. If, say, rapid delivery, reliability, and customer contact are paramount, then offshoring is a less attractive option. But if the product is widely available and standardized, like a calculator, and the only competitive advantage is price, the lowest possible production cost is essential and offshoring is beneficial. In a business's early stages, offshoring may well be inappropriate because managers need to stay close to the business and its customers, but given that Kronos is a mature company, moving some operations overseas is a good option.
Louise and Cecile want to start an online matchmaking service. They decide who will assume the various roles in the company, evaluate who their target customers will be, research their competitors and how they will differentiate themselves, assess the financial and regulatory issues they might expect to face, and anticipate the future risks they might encounter. Which of the following situations is most likely to happen as a result of Louise and Cecile forgetting to include certain elements in their business plan? They may realize they have not made accommodations for rules for online services. They might find that they are not well suited for the roles they have assumed. They may realize they have not decided how to get their message out to customers. They may realize that the competition is offering the same service at a lower price. They might find that there are too many matchmaking services already operating.
They may realize they have not decided how to get their message out to customers. explanation: The business plan describes the venture and its future, provides financial projections, and includes plans for marketing, manufacturing, and other business functions. Louise and Cecile have failed to make any marketing plans beyond determining their target market.
Perfect Pasta plans to open five new stores before 2021. However, if the economy does not improve and if consumer confidence does not rise as hoped, it might open just two stores. This backup plan is an example of a(n) ________blank plan. tactical strategic emergency dominant contingency
contingency explanation: Contingency plans might be referred to as "what if" plans. They include sets of actions to be taken when a company's initial plans have not worked well or if events in the external environment require a sudden change.
Farah's Falafels, a chain of Middle Eastern restaurants, periodically compares its customer reviews and menu options to other successful restaurants in order to continually improve its own performance. This practice is known as benchmarking. corporate espionage. strategic mapping. competitive intelligence. maneuvering.
benchmarking. explanation: To assess and improve performance, some companies, such as Farah's in the scenario, use benchmarking—the process of assessing how well one company's basic functions and skills compare with those of another company or set of companies.
Renaldo is creating a business plan. His first formal step should be to conduct an opportunity analysis. get others to support one's ideas. hire the right people. write a business plan. secure financing.
conduct an opportunity analysis. explanation: The first formal planning step is to do an opportunity analysis. An opportunity analysis, or opportunity assessment plan, focuses on the opportunity, not the entire venture.
Eco Lawn Care Corporation, a company that manufacturers environmentally friendly lawn care products, has been operating as a business for a year. The CEO, Markus, started his venture by deciding on the activities that would be involved and what his goals and objectives for the business were. He then started to recruit professional chemists and other personnel and grouped them according to their responsibilities. Every month Markus conducts a meeting where he brings attention to those who are doing good work and motivates everyone to achieve organizational goals. He also checks the daily productivity of each of the workers, monitoring them and providing training to those with low productivity. Markus monitors his employees and provides training to those who are performing poorly. In this case, which of the following functions of management is Markus performing? Multiple Choice organizing controlling decision making planning leading
controlling explanation: Controlling monitors performance and implements necessary changes. By controlling, managers make sure that the organization's resources are being used as planned and that the organization is meeting its goals, such as quality and safety.
Through careful monitoring of the financial budgets of a firm, managers can detect potential problems in reaching their financial goals and take actions to reverse the problem. This is an example of the ________blank function of management. staffing controlling leading organizing planning
controlling explanation: The fourth function of management, controlling, monitors performance and implements necessary changes. By controlling, managers make sure the organization's resources are being used as planned and the organization is meeting its goals, including financial ones.
Marta decided that a growing Latino population has created an opportunity to market her family's salsa recipes. Which type of opportunity is she focusing on? economic dislocations calamities government initiatives technological discoveries demographic change
demographic change explanation: Start-ups often capitalize on demographic changes. For example, all kinds of health care organizations have sprung up to serve an aging population.
Senior management at Value Products is attending a corporate retreat, and the first item for discussion is corporate social responsibility (CSR). The group has discussed this before and then shot it down because it generally costs Value Products' shareholders in the form of reduced distributions. But the new VP, Isabella, is about to explain why she believes CSR will actually benefit the shareholders and Value Products management alike. Her team begins the presentation with a discussion of CSR, both its current definition and reconciliation of past views. Jessica then discusses the importance of being a good global corporate citizen by supporting the local school system. Valentina takes the floor to make the case for doing what is expected by global stakeholders even though there are no laws requiring those actions. Finally, Scott wraps up the discussion by defining why Value Products should take legal responsibility for the firm's performance. Valentina's presentation most likely centered on taking which of the following actions? supporting Scott's proposal production of goods and services that society wants at a price that perpetuates the business and satisfies its obligations to investors obeying all laws that affect Value Products' operations engaging in additional behaviors and activities that society finds desirable and that the values of the business support doing the right thing regardless of what the law says
doing the right thing regardless of what the law says explanation: Ethical responsibilities include meeting societal expectations not written as law. This is likely to have been the central theme of Valentina's presentation.
Phil Colley, a project manager, finds an envelope in his office mailbox. The return address indicates that it was sent by a salesman for HiTek Instruments, a long-time supplier to Phil's firm. Inside the envelope is a "thanks for the business" note and $2,000 in cash. Afraid that he will be perceived as receiving a "kickback," Phil immediately takes the envelope and cash to his manager to report what he found. Phil uses ________blank as an ethical system in his decision making. egoism utilitarianism ecocentric management conventionalism relativism
egoism explanation: According to egoism, individual self-interest is the actual motive of all conscious action. "Doing the right thing," the focus of moral philosophy, is defined by egoism as "doing the act that promotes the greatest good for oneself." If everyone follows this system, according to its proponents, the well-being of society as a whole should increase.
By leaving her job and starting her own business, Jana will become a(n) bootlegger. intrapreneur. horse trader. business incubator. entrepreneur.
entrepreneur. explanation: Entrepreneurship occurs when an enterprising individual pursues a lucrative opportunity. Therefore, by leaving her job and starting her own business, Deanna has become an entrepreneur.
Aliya and Samuel, managers from different departments at Finger Lakes Financial, are discussing the troubling behavior of an employee. Aliya says that it is the responsibility of high-level managers to take steps to prevent legal wrongdoing by punishing offenders. However, Samuel believes that every individual should take personal responsibility for his or her own behavior and that everyone needs to understand how to do the right thing. Each of the managers tends to be responsible for creating a different ________blank in their respective departments. sustainable growth legal responsibility organizational structure corporate culture ethical climate
ethical climate explanation: The ethical climate of an organization refers to the processes by which decisions are evaluated and made on the basis of right and wrong.
Sophie was very excited to be on a one-month project in Japan. While at work, Sophie's Japanese coworkers rarely tell their boss what they are thinking. Because she thinks the actions of her coworkers are not making the company as efficient as it would be back in Germany, Sophie is exhibiting culture shock. masculinity. collectivism. uncertainty avoidance. ethnocentrism.
ethnocentrism explanation: Ethnocentrism is the tendency to judge others by the standards of one's group or culture, which are seen as superior.
Most entrepreneurs start their own firms because they feel satisfaction in creating something from nothing. have unrealistic expectations about what it will entail. have failed at everything else they have done. want to get rich quickly and then sell the company. are gamblers at heart and thrive on risk.
feel satisfaction in creating something from nothing. explanation: Entrepreneurs start their own firms because of the challenge, the profit potential, and the enormous satisfaction they hope lie ahead. They feel tremendous satisfaction in building something from nothing, seeing it succeed, and watching the market embrace their ideas and products.
Nadia wants to open and run her own sandwich shop. However, she wants to leverage an existing, proven model so she can focus on managing. Which of the following should Nadia consider being, based on her desires? intrapreneur franchisee franchisor business incubator innovator
franchisee explanation: The franchisor is the innovator who has created at least one successful store and seeks partners to operate the same concept in other local markets. A franchisee is a partner in an entrepreneurial alliance who manages a new store of the same type in a new location according to the terms of the alliance with the franchisor.
Randall, senior product development manager at WasteTech Corporation, is considering the acquisition of a new waste treatment technology from a small development firm. The asking price is $10 million. However, the environmental uncertainty of the waste treatment marketplace is both complex and dynamic. Randall wants to acquire the new technology but seeks to manage the risk associated with his decision, or "hedge his bets." Key elements of his risk management strategy might be to decide upon a clan (collaborate), adhocracy (create), hierarchy (control), or market (compete) culture from which to market the technology. gain competitive intelligence through environmental scanning, develop business scenarios, forecast sales, and benchmark the technology. establish visible artifacts; develop symbols, rites, and ceremonies; and develop stories about the technology. buffer, smooth, and empower in order to manage the technology supply chain. diversify, merge, divest, prospect, or defend the technology.
gain competitive intelligence through environmental scanning, develop business scenarios, forecast sales, and benchmark the technology. explanation: Environmental uncertainty means that managers do not have enough information about the environment to understand it or predict the future. Uncertainty arises from two related factors: complexity and dynamism. As environmental uncertainty increases, managers need methods for collecting, sorting through, and interpreting information about the environment, using environmental scanning, scenario development, forecasting, and benchmarking.
Gina, a sales manager, has increasing pressure from other vendors who have shifted production of their parts overseas. She calls one of his customers who normally buys at least once a month, but hasn't placed an order with Gina in three months. The customer states that they are buying from an alternate supplier based on price. Gina is competing for orders with companies who have reduced costs by shifting production overseas. Gina faces the management challenge involved with an increasingly diverse labor force. collaboration across organizational boundaries. globalization. technological change. the importance of knowledge and ideas.
globalization. explanation: Globalization affects small companies as well as large. Many small companies export their goods. Many domestic firms assemble their products in other countries. And companies are under pressure to improve and lower the price of their products in the face of intense competition from foreign manufacturers.
Nurul is a native of Malaysia where Regal Menswear is building its new plant. If Nurul goes to work at Regal's factory, she will be considered a(n) Multiple Choice inpatriate. third-country national. host-country national. expatriate. immigrant.
host-country national. explanation: When establishing operations overseas, a company has the choice of hiring expatriates (individuals from the parent country of the company), host-country nationals (natives of the host country for the overseas operations), or third-country nationals (natives of a country other than the home country or the host country).
The manager of the Silver Sands Hotel noticed a tremendous decrease in the number of convention bookings. He promptly ordered the redecoration of the hotel's meeting rooms. Customer feedback later indicated that the problem had not been the meeting facilities but poor service from the cleaning staff. In this scenario, to try and solve the problem, the manager should have first tried to reduce the price of all products. hire more qualified employees. spend more on marketing and advertisement. identify the problem. generate alternate solutions.
identify the problem. explanation: Rather than promptly changing the decorations, the manager must dig deeper and attempt to identify the problem causing the decrease in the number of customers.
Nasim's employees have requested that he switch the office to flextime so that they can better manage their childcare and commuting schedules. Nasim is reluctant to make a drastic change all at once, so he agrees to experiment with staggering the starting and ending times of the workday over a 90-minute period for three months. If, at the end of that time, productivity does not decline, he will consider implementing a more extreme version of flextime. What model of decision making is Nasim using? incremental garbage can crisis bounded rationality coalition
incremental explanation: The incremental model of decision making occurs when decision makers make small decisions, take little steps, and move cautiously in piecemeal fashion toward a bigger solution.
Yolanda is a consultant for four companies with international operations. Each of them has selected a different global strategy. Acme Gaskets uses its established skills in producing gaskets that it will sell in foreign markets. Krunchers Chips produces locally targeted snacks for which it has built specialized plants in each local region. It customizes its snacks according to the tastes and preferences of the local consumers. Harman Motors offers a standardized economy automobile and has a single worldwide corporate headquarters from which it centrally manages the entire company's operations. Finally, Gold Medal Industries is located in Tajikistan where wages are quite low. The company produces machine housings that are fairly easy to manufacture and require little employee skill. These pieces are then sent to its locations abroad to be finished by a more skilled workforce, taking into account the customs and benefits desired by each of those particular populations. Which of the following global strategies is Acme Gaskets using? international global domestic multinational transnational
international explanation: In the international model, managers use their organization's existing core capabilities to expand into foreign markets.
Michelle Caldwell, finance manager, told her president, "David, I have determined appropriate revenue recognition for each of the 16 projects this month, based upon company policy and our standard procedures. Each of the projects has routine revenue accrual. I have prepared the monthly financial affidavits for each of these 16 projects, and I recommend that you approve the revenues by signing the affidavits." David's decision to approve the revenues is an example of a programmed decision because the underlying problem is trivial. is novel and unstructured. is frequent, repetitive, and routine. has a predetermined outcome. is risk-free.
is frequent, repetitive, and routine. explanation: Programmed decisions involve problems that are frequent, repetitive, and routine, with certainty regarding cause-and-effect relationships. Programmed decision making typically depends on policies, rules, and definite procedures.
Scenario B: Two entrepreneurs, Fred and Ming, were discussing the potential for success or failure of their ventures. They described their startups in the following manner: Fred stated that he had very little money invested, but he was the first in the market with his product. Ming stated that her investment in the business was very small and that her product was similar to those already in the market. According to the entrepreneurial strategy matrix, Ming's scenario can be described as involving low innovation/high risk. high investment/no risk. low innovation/low risk. high innovation/high risk. high innovation/low risk.
low innovation/low risk. explanation: The low-innovation/low-risk category includes conventional ventures that require minimal investment, such as service businesses having low start-up costs. Ming's business involves low innovation and low risk.
Katherine Lilly is considering talking to the human resources director about her manager's fraudulent behavior. However, she is reluctant because she knows as a whistleblower, you will always be encouraged by our company to go public with your concerns. the road for whistleblowers is easy and painless. many whistleblowers suffer consequences such as being ostracized. as a whistleblower, you will never suffer retaliation. the Sarbanes-Oxley Act prohibits whistleblowing.
many whistleblowers suffer consequences such as being ostracized explanation: Whistleblowing refers to telling others, inside or outside the organization, of wrongdoing. The road for whistleblowers is rocky. When whistleblowers go public, they are often seen as acting against the company's interests. Many, perhaps most, whistleblowers suffer consequences such as being ostracized, treated rudely, or given undesirable assignments.
Henry was having a few friends over for dinner, many of whom Henry knew from an international management association. Henry's company provides services to create detailed maps of world areas from satellites, which the firm then sells via the Internet to firms, countries, and others around the world. One of his guests, Tamia, bakes cakes for a living. Her recipes are so well liked that her company has grown dramatically. She has just sold the right to manufacture her cakes to a firm in eastern Alpland. Another friend, Chang, is a director at InSpiral, and his wife, Chloe, has contracted with the breakfast chain Flapjack Frank's to open a branch in their state, bearing all the preliminary expenses and development costs. Chang also announced that InSpiral and another company, McElwee's, are starting a new venture. Finally, Kamala works for New Frontier Technologies, which is headquartered in her home country, and is soon to go abroad to work in New Frontier's new facility, which is an independent company that New Frontier owns and controls in another country. The guests were discussing how their companies decided to "go global." Which of the following ways of entering into the global marketplace is Tamia's company using? licensing exporting merging outsourcing importing
merging explanation: International licensing is an arrangement by which a licensee in another country buys the rights to manufacture a company's product in its own country for a negotiated fee.
Bill Wessels has reviewed the strategic plan from corporate headquarters and is considering how to develop an annual business plan for his business unit that fulfills its part of the strategic plan. Bill is probably a(n) middle-level manager. frontline manager. strategic manager. top-level manager. operational manager.
middle-level manager. explanation: Middle-level managers translate broad strategic goals into tactical plans that are relevant to a particular unit in the organization—often a functional area like customer service or human resources. Tactical plans focus on the major actions a unit must take to fulfill its part of the strategic plan. For example, if the strategy calls for the rollout of a new product line, the tactical plan for the manufacturing unit might involve the design, testing, and installation of the equipment needed to produce the new line.
Love Your Home is a housewares manufacturing company. The company's basic purpose is "to be the place you want to call home." The management states that the company's long-term strategic intent is "to build an empire in the housewares industry, setting the trend for people to have fashionable and affordable household goods, easily available, wherever they may be." Love Your Home's basic purpose—to be the place you want to call home—is an example of a(n) mission statement. business definition. strategic vision. tactical goal. operational goal.
mission statement. explanation: The mission is a clear and concise expression of the basic purpose of the organization. It describes what the organization does, whom it does it for, its basic good or service, and its values.
Ellie manages a restaurant and must decide on next week's work schedule for the employees. This is an example of a ________blank decision. programmed risky reprogrammed nonprogrammed complex
programmed explanation: A nonprogrammed decision is a new, novel, complex decision having no proven answers. Making the weekly schedule is a situation Ellie encounters frequently, and she can use proven formulas to accomplish it. Making the schedule is therefore a programmed decision.
The Ascent, a mountain bicycle manufacturer, has been in the bicycle industry for a year now. The CEO wishes to better the company. He starts by looking at the sales records of the year that they have been in business and notices that the company's sales have been declining at a steady pace for the past six months and that at present they are selling only half as many bicycles as they want to. In an attempt to increase sales, he either wants to bring down the prices of his bicycles or expand the company by opening a new branch in another area. The CEO shares his views with the sales manager and finance managers. Together they decide that reducing the prices would definitely increase sales, although the profits would come down. They also determine that opening a new branch would only increase expenses. They conclude that they will reduce the prices of the bicycles. The plan is implemented and the CEO keeps a record of the sales every month to make sure the change is effective. Which of the following steps in the basic planning process does the CEO perform when he closely watches the sales reports each month? goal and plan evaluation situational analysis goal and plan selection monitor and control implementation
monitor and control explanation: Although it is sometimes ignored, the sixth step in the formal planning process—monitoring and controlling—is essential. Without it, managers will never know whether their plans are succeeding.
The two strategic models that have relatively high manufacturing costs are multinational and transnational. international and transnational. global and international. multinational and international. global and transnational.
multinational and international. explanation: One disadvantage of the international model is that it frequently does not provide the opportunity to achieve a low-cost position via scale economies. One disadvantage of the multinational form is higher manufacturing costs and duplication of effort.
Gerard is a general manager for Handy Dandy Corporation, a tool-manufacturing firm. He is considering some changes to the production floor, which include layout adjustments and the purchase of new equipment to improve efficiency. He also wants to promote one of his employees to team leader. Which of the following functions of management is Gerard performing? controlling organizing planning training leading
organizing explanation: Organizing is assembling and coordinating the human, financial, physical, informational, and other resources needed to achieve goals. Organizing activities include specifying job responsibilities, grouping jobs into work units, marshaling and allocating resources, and creating conditions so that people and things work together to achieve maximum success.
Steven is marketing manager for Abrams Technologies, a firm that sells environmental control systems to the coal-fired power industry. Steven's business is highly competitive, with many existing rivalries and new players. However, coal-fired power plants are being shut down in favor of substitute forms of energy, e.g., wind and natural gas. Thus, opportunities to sell environmental control systems to coal-fired power plants are rare, and his clients have many choices of providers and technologies. Steven's firm has long-term pricing agreements with its equipment suppliers, so Steven knows what external costs Abrams will incur on potential new projects for environmental control systems. The competitive force that appears to represent the lowest risk to Steven's firm is impact of new competitors. power of suppliers. impact of substitute or complement services or products. competition between existing rivals. power of customers.
power of suppliers explanation:. Competition will be keen among existing rivals and new competitors; they represent high risk. Steven's customers have many choices, including non-coal technologies, so both of these factors (clients and substitutes) represent high risk. Steven's firm has pricing agreements with its suppliers, so this (power of suppliers) appears to represent the lowest risk.
Joaquín, a human resources manager, has to lay off either of two department heads, Coral or Mike, because the downsizing process that is going on in the organization calls for the merging of their two departments. However, Joaquín cannot decide whom to lay off, since they are both excellent managers and he does not want to dismiss either of them. In this case, Joaquín is having a difficult time making a decision due to experiencing ________blank conflict. organizational psychological affective interdependence cognitive
psychological explanation: Conflict occurs when there are opposing pressures from different sources, occurring on the level of psychological conflict or of conflict between individuals or groups. For instance, a manager may have to decide whom to lay off when he or she does not want to lay off anyone.
Trade allows each country to obtain products and produce products more efficiently, which leads to reduced efficiency. narrows down the market for managers. leads to increased prices. causes countries to produce more varied goods. raises the standards of living.
raises the standards of living. explanation: Because trade allows each country to obtain more efficiently what it cannot as easily produce on its own, it lowers prices overall and makes more goods more widely available. This in turn raises living standards-and may broaden the market for a manager's own products.
The Sarbanes-Oxley Act is intended to maintain truth in advertising. requires whistleblowers to be fired. requires strict adherence to accounting rules. monitors environmental concerns. allows senior managers to refuse to sign off on financial results.
requires strict adherence to accounting rules explanation: Congress passed the Sarbanes-Oxley Act in 2002 to improve and maintain investor confidence. The law requires companies to have more independent board directors, to adhere strictly to accounting rules, and to have senior managers personally sign off on financial results.
Haru, a new manager at an electronics company, has been asked to focus on the competitive environment of the organization. Which of the following is a factor Haru should focus on? demographics technology economic performance government regulation rivals
rivals explanation: The competitive environment is composed of the firm and its rivals, suppliers, customers (buyers), new entrants, and substitute or complementary products. At the more general level is the macroenvironment, which includes legal, political, economic, technological, demographic, and social and natural factors that generally affect all organizations.
Leonardo has just been promoted to manage a staff of 10 people and wants to make a good impression on top management. He recently held his first staff meeting to solve a fairly large problem with the project, but it did not go well. All 10 staff members were there. His goal was to get buy-in from the group, but instead little progress was made. Since the first meeting did not go well, Leonardo read several management books on working with groups and thought perhaps a longer meeting would allow time to explore several points of view. He chose a Friday afternoon so everyone could go home afterward and not have to rush off to other work appointments. To his surprise, the first idea he suggested was accepted by the group, and the meeting was over in no time. The group was most likely engaging in ________blank so they could end the meeting and go home early. intellectual stimulation satisficing vigilance maximizing goal displacement
satisficing explanation: Satisficing is more likely with groups. Most people do not like meetings and will do what they can to end them. The result is a satisficing rather than an optimizing or maximizing decision.
Jimena works for a small company that makes nut butters from ingredients like cashews and macadamia nuts, and jams from mixtures of tropical fruits. She reports to the CFO. It is her job to predict the costs of raw materials for the next five years. She uses various research sources, including the news, to learn who the competitors are and what they have been doing. In fact, she subscribes to an analyst e-newsletter that tells her about crop availability and weather conditions all around the globe. Every month she develops a spreadsheet for her boss indicating the likely costs of fruits and nuts given the type of weather conditions expected in each area of the world and thus the availability of particular crops. She is also involved in a team that is investigating how to cut production costs. They have recently met with Spicy Sides, a company that produces jars of condiments. Spicy Sides is considered the top company in the condiment industry, especially in its knowledge of how to pack food products in jars. Jimena's team is comparing their processes to those of Spicy Sides to see how they might improve. The spreadsheet that Jimena uses gives her a chance to examine different projections, which is a form of scenario development. benchmarking. domain selection. divestiture. strategic maneuvering.
scenario development. explanation: Scenario development creates alternative combinations of different factors (such as the weather and harvest of various crops) into a total picture of the environment and the firm. It is a narrative that describes a particular set of future conditions.
Javi Torres, general manager of Fabricated Products, Incorporated, told his mentor, "I find it difficult to support our corporate social performance without corporate financial performance." His mentor replied, "Javi, the accumulated evidence indicates that profits and ethical behavior cannot go hand in hand." managers can benefit their organizations only by growing profits." managers are not responsible for behaving ethically when dealing with their stakeholders." managers must emphasize ethical behavior toward stakeholders at the cost of growing profits." social responsibility is associated with better financial performance."
social responsibility is associated with better financial performance." explanation: The relationship between corporate social performance and corporate financial performance is complex; socially responsible organizations are not necessarily more or less successful in financial terms. But on net, the accumulated evidence indicates that social responsibility is associated with better financial performance. Companies can avoid unnecessary and costly regulation if they are socially responsible. Such actions also can pay dividends to the conscience, to the personal reputation, and to the public image of the company as well as in the market response. Plus, society's problems can offer business opportunities, and profits can be made from systematic and vigorous efforts to solve these problems.
Crowley Heat Exchangers, Incorporated, is the only provider of a patented high-efficiency heat exchanger. Global Construction Corporation desires to include Crowley's heat exchanger in a proposal for a major project for Global's largest client. However, Crowley charges a premium price for its patented equipment. As a result, Global's potential profit on the major project is eroded, which is an example of the high bargaining power of complements. new entrants. customers. suppliers. competitors.
suppliers. explanation: Organizations are at a disadvantage if they become overly dependent on a powerful supplier. In this case, Global is at a disadvantage because Crowley, as the only provider of the desired equipment, has the ability to charge a premium price for the equipment. Thus, if Global desires to include Crowley's equipment in its bid to its largest client, Global must reduce its own profits to remain competitive.
Karl's office has always used Bentley computers. His technical people have suggested that he switch all his employees over to Best computers. Karl is reluctant because it will mean not only replacing all the computers but also buying all new software and taking the time to train everyone. Karl is worried about strategic maneuvering. benchmarking. switching costs. barriers to entry. environmental uncertainty.
switching costs. explanation: Dependence on suppliers results from high switching costs—the fixed costs buyers face if they change suppliers. For example, once a buyer learns how to operate a supplier's equipment, such as computer software, the buyer faces both economic and psychological costs in changing to a new supplier.
Katya is evaluating whether she has the right personality to be an entrepreneur. Which of the following characteristics should she have if she wants to succeed? commitment to work-life balance comfort with the status quo obsession with earning money tolerance of risk and uncertainty discounting of own weaknesses
tolerance of risk and uncertainty explanation: Entrepreneurs are more likely to succeed if they have certain characteristics, including tolerance of risk, ambiguity, and uncertainty. They are calculated risk takers and risk managers, tolerant of stress, and able to resolve problems.
In order to achieve cost economies, Geo Manufacturing bases its production plants in Mexico to manufacture their base product and then ship it to Japan for final assembly using higher technical skills and customizing the product to fit local needs. In this case, Geo Manufacturing is using the ________blank model of organizational structure. multinational intranational global transnational international
transnational explanation: To achieve cost economies with a transnational model, companies may base global-scale production plants for labor-intensive products in low-wage countries, such as China and Mexico, and production plants that require a skilled workforce in high-skill countries, such as Germany and Japan.
Talia, store manager for Best Value Foods, learned that the store's commercial freezer failed overnight, and, for several hours, the frozen foods reached temperatures that were potentially unsafe. She decided to discard the food, at a cost of many thousands of dollars, because she believed it was the right thing to do; the health of consumers was at stake. Talia used ________blank as an ethical system to make her decision. universalism relativism egoism conventionalism utilitarianism
universalism explanation: According to universalism, all people should uphold certain values, such as honesty and other values that society needs to function.