MGT-3013 quiz 2

Strategic position emerges from three sources: a) (1) low-profit margin, many customers; (2) no needs, many customers; and (3) broad needs, few customers. b) (1) few needs, many customers; (2) broad needs, few customers; and (3) broad needs, many customers. c) (1) no needs, many customers; (2) broad needs, few customers; (3) broad needs, many customers. d) (1) high profits, many customers; (2) low profits, few customers; and (3) broad needs, many customers. e) (1) high-profit margin, few customers; (2) few needs, many customers; and (3) broad needs, few customers.

(1) few needs, many customers; (2) broad needs, few customers; and (3) broad needs, many customers.

Which of the following is not true about group decision making? Groups take longer to make decisions. The larger the group, the lower the quality of the decision. Incorrect An added benefit of group decision making is groupthink. Groups are more confident about their choices than individuals are. People who aren't familiar with one another tend to make better decisions when the members have common knowledge.

An added benefit of group decision making is groupthink. Explanation Groupthink is not a benefit of group decision making; it can include failure to consider new information and a loss of new ideas.

Stores of data that are so vast that conventional database management systems cannot handle them, and very sophisticated analysis software and supercomputing-level hardware are required, are known as ____. These data include not only data in corporate databases but also web-browsing data trails, social network communications, sensor data, and surveillance data. cyber-age databases Big Data mega IT super data new age computing

Big Data Explanation Big Data refers to stores of data so vast that conventional database management systems cannot handle them and so very sophisticated analysis software and supercomputing-level hardware are required. Big Data analytics is the process of examining large amounts of data to uncover hidden patterns, unknown correlations, and other useful information.

_______ involves gathering information about your competitors' activities so that you can anticipate their moves and react appropriately. For example, you may attend a trade show to learn what types of new products and new iPhone apps your competitors are planning to launch in the next six months. a) Environmental exploration b)Benchmarking c) Scouting d) Competitive intelligence e) MBO

Competitive Intelligence

_____ is the process of analyzing the underlying causes. Digging Analytics Undermining Management through analysis Diagnosis

Diagnosis Explanation Diagnosis is analyzing the underlying causes.

An offensive strategy is a grand strategy that involves reduction in the organization's efforts. For example, some large publishers are no longer publishing children's books because they are too expensive to produce and distribute, and because the profit margins are too low to justify the investment. True or False

False Explanation A defensive strategy, or a retrenchment strategy, is a grand strategy that involves reduction in the organization's efforts.

Sue and Jane Smith are writing the mission statement for their new consignment shop, Then & Now. Because they want their employees and business to grow and reach goals, Then & Now's mission statement should be positive and inspiring, pushing their organization and the workers to achieve goals that they believe are beyond its reach. True of False

False Explanation A mission statement should be positive and inspiring, and it should stretch the organization and its employees to achieve a desired future state that appears beyond its reach.

Evidence-based management is the use of databases and facts regarding employees to assist in decision making. True or False

False Explanation Evidence-based management means translating principles based on best evidence into organizational practice.

Several studies found that strategic planning does not benefit smaller companies, as they very seldom see improvements in financial performance from this type of planning. True or False

False Explanation Smaller companies (under 500 employees) account for about half of private-sector employment and two-thirds of net new jobs in recent years. One analysis of several studies found that strategic planning was appropriate not just for large firms—indeed, companies with fewer than 100 employees could benefit as well, although the improvement in financial performance was small. Nevertheless, the researchers concluded that "it may be that the small improvement in performance is not worth the effort involved in strategic planning unless a firm is in a very competitive industry where small differences in performance may affect the firm's survival potential."

Strategic positioning involves performing the same activities as rivals in a similar way, but at a lower cost. True or False

False Explanation Strategic positioning attempts to achieve sustainable competitive advantage by preserving what is distinctive about a company. It means performing different activities from rivals, or performing similar activities in different ways.

To achieve a sustainable competitive advantage, La Grand Parfumerie (a company that develops women's perfumes and men's colognes) must benchmark its competition so that La Grand Parfumerie can produce the same products as its competition but at a lower price. True or False

False Explanation Strategy requires trade-offs in competing. Thus, a company has to choose not only what strategy to follow but what strategy not to follow. La Grand Parfumerie will not develop a competitive advantage by simply copying its competitors' products.

The organizational-management process consists of seven steps: (1) doing research, (2) establishing the mission and vision, (3) assessing the current reality, (4) formulating the grand strategy, (4) implementing the strategy, (6) maintaining strategic control, and (7) maintaining the feedback loop. True or False

False Explanation The strategic-management process has five steps, plus a feedback loop (see Figure 6.1): (1) establishing the mission and the vision, (2) assessing the current reality, (3) formulating the grand strategy, (4) implementing the strategy, and (5) maintaining strategic control and the feedback loop.

The local university is now facing some tough decisions, so they are using the decision tree, which contains individuals, websites, and organizations that specialize in handling sensitive and difficult decisions. True or False

False Explanation A decision tree is a graph of decisions and their possible consequences; it is used to create a plan to reach a goal.

A logic manager is someone trained about matters of ethics in the workplace. True or False

False Explanation An ethics officer is someone trained about matters of ethics in the workplace, not a logic manager.

Evidence-based management is the use of facts regarding an employee, for example when theft is suspected, and using a database to assist in decision making regarding future action. True or False

False Explanation Evidence-based management means translating principles based on best evidence into organizational practice.`

Being aware of your decision-making style does not really help you determine your strengths and weaknesses as a decision maker, but it can help you understand when a decision needs to be made. True or False

False Explanation Knowledge of styles helps you to understand yourself. Awareness of your style assists you in identifying your strengths and weaknesses as a decision maker and facilitates the potential for self-improvement.

Dave and his partner are studying the strengths and weaknesses of their construction business, Ajax Construction, as well as researching the opportunities and threats in the external environment. Dave and his partner are conducting a: a) strength statement. b) SWOT analysis. c) synergy plan. d) contingency plan. e) forecast.

SWOT analysis Explanation: SWOT analysis, also known as a situational analysis, is a search for the strengths, weaknesses, opportunities, and threats affecting the organization.

______________ focus(es) on developing a comprehensive program for long-term success. a) Mission and vision statements b) Tactical plans c) A focused sigma plan d) A synergy plan e) Strategic planning

Strategic planning Explanation Feedback: Strategic planning is concerned with developing a comprehensive program for long-term success.

A stability strategy is a grand strategy that involves little or no significant organizational change. For example, Love Forever is a jewelry store that sells only one type of item: engagement and wedding rings. The management of Love Forever does not plan to branch out into selling different types of jewelry; the company has a reputation for being the go-to store to purchase wedding rings, and it plans to maintain that strategy. True or False

True Explanation A stability strategy is a grand strategy that involves little or no significant change.

In deciding to decide, a manager agrees that he or she must decide what to do about a problem or opportunity and take effective decision-making steps. True or False

True Explanation In deciding to decide, a manager agrees that he or she must decide what to do about a problem or opportunity and take effective decision making steps. Three ways to help you decide whether to decide are to evaluate the following: 1. Importance: "How High Priority Is This Situation?" 2. Credibility: "How Believable Is the Information About the Situation?" 3. Urgency: "How Quickly Must I Act on the Information About the Situation?"

The owners of a computer repair shop want to better formulate strategies, so they are doing a SWOT analysis to understand the strengths and weaknesses within their company and the opportunities and threats of the external environment. These are some of the benefits of doing a SWOT analysis. True or False

True Explanation SWOT analysis should provide a realistic understanding of the organization in relation to its internal and external environments so that you can better formulate strategy in pursuit of the firm's mission.

Strategy implementation is putting strategic plans into effect, which means dealing with roadblocks within the organization's structure and culture and seeing if the right people and control systems are available to execute the plans. True or False

True Explanation Strategy implementation is putting strategic plans into effect. This means dealing with roadblocks within the organization's structure and culture and seeing if the right people and control systems are available to execute the plans.

Technology Specialists is an organization specializing in highly specialized technology software, but it found that its original business idea is not working. Rather than failing as a company, it chose a new direction and rewrote its business plan. Technology Specialists is an example of how managers need to think and act as if their organization is an unfinished, changeable prototype that won't be ruined by dangerous new ideas. True or False

True Explanation Treat your organization as an unfinished prototype. Leaders need to think and act as if their organization is an unfinished prototype that won't be ruined by dangerous new ideas or impossible to change because of employee or management resistance.

Dennis, the owner of a popular restaurant, is a religious man, and he needs to make a decision on whether he will add beer and wine to his menu, based on the recommendations of his chefs and others. When confronted with a choice when making a decision, he tends to make his decisions based on his beliefs, even if evidence shows those beliefs are wrong. If his religious beliefs favor not serving alcohol in his café, according to the prior-hypothesis bias he would choose not to add beer and wine to his menu. True or False

True Explanation When confronted with a choice, decision makers with strong prior beliefs tend to make their decision based on their beliefs, even if evidence shows those beliefs are wrong. This is known as the prior-hypothesis bias. Although it's always more comforting to look for evidence to support your prior beliefs, you need to be tough-minded and weigh the evidence.

Research shows that most managers have characteristics that fall into two or three decision-making styles, and that decision-making styles vary across occupations, job level, and countries. True or False

True Explanation Research shows that very few people have only one dominant decision-making style. Rather, most managers have characteristics that fall into two or three styles. Studies also show that decision-making styles vary across occupations, job level, and countries. There is not a best decision-making style that applies to all situations.

During a management workshop, Tony, the HR manager, spoke about making decisions related to firing an employee. He said, "I have several rules of thumb that I use to make a decision. First, I ask if it's legal and then if it's ethical." He then laid out several other steps he uses in the decision-making process related to firing. Tony's "rules of thumb" are also known as heuristics. True or False

True Explanation Scholars call "rules of thumb" heuristics—strategies that simplify the process of making decisions.

Johnson's Fruit Farm is one of several stores in the county where customers can purchase locally grown fruits and vegetables. However, Mrs. Johnson also offers weekly workshops in her store on topics such as canning, healthy eating, and how to grow a garden, which no other store in the county does. By offering these unique workshops, the Johnsons are engaging in strategic positioning. True or False

True Explanation Strategic positioning means performing different activities from rivals, or performing similar activities in different ways.

A goal is a specific commitment to achieve a measurable result within a stated period of time. a. True b. False

a. True

Alexia, a district manager for a retail hardware store, asked her store managers for their store goals next year. Denise, one of the store managers, said, "I am going to increase my market share significantly next year by visiting businesses." Alexia then responded to Denise with "Precisely how much are you going to increase your market share and by what date?" Alexia is asking Denise to formulate a SMART goal. a. True b. False

a. True

In the office of every general manager of Relaxing Hotel there is a small poster that reads, "We ant to become the only place our customers want to stay for the night while traveling." This is the vision statement for Relaxing Hotels. a. True b. False

a. True

Neal, a middle manager for a large restaurant chain, received an e-mail from the CEO outlining the new goal of decreasing company costs over the next three years. This is an example of a strategic goal. a. True b. False

a. True

Prior to opening his business, Sal, the owner of The Italian Kitchen, is writing a document that explains the reason for his business. This statement would be a part of his mission statement. a. True b. False

a. True

Strategic management is a process in the formulation, implementation, and execution of strategies and strategic goals to advance the purposes of the organization. a. True b. False

a. True

To start work every day, David sits down and sets his goals for the day and then he decides how to achieve them, formulating future courses of action to achieve the specified results. This is the definition of planning. a. True b. False

a. True

A(n) ________ is the declaration that expresses what the organization should become and where it wants to go strategically. a. vision statement b. objectives statement c. code of ethics d. management code e. mission statement

a. vision statement

To help with hiring decisions during peak seasons and holidays, Touching Cards uses time-series forecasts, like sales from last Valentine's Day and Christmas, to predict future sales based on patterns of historical data. Touching Cards is making use of a seasonal trend. a trend decision. diagnosis. analytics. a logical system.

analytics Explanation Analytics, or business analytics, is the term used for sophisticated forms of business data analysis. In one example of analytics in gambling, data-mining software was used to analyze vast amounts of casino customer data to target profitable patrons.

A business plan is a tool used by the federal government to determine how to strengthen the business sector through macroeconomics and microeconomics a. True b. False

b. False

The planning/control cycle is an order planning system in which employees work with customers to plan orders and discuss delivery times. a. True b. False

b. False

There is little proof that writing out goals helps an individual feel more confident and energetic when entering a new group. a. True b. False

b. False

A music teacher asked her students to set a really hard goal, such as increasing their practice time by 10 hours per week, which would cause her students to reach beyond what they think is possible. This is known as a(n) a. mission statement b. stretch goal c. strategic goal d. MBO plan e. growing goal

b. stretch goal

Donna is the service desk coordinator in a department store, and she has set a goal this month of finishing her daily office work quicker so she can assist at the Service Desk earlier in the morning. She knows this will also help decrease theft, which will assist the company in achieving its goal of decreasing costs. Donna's goal of finishing her office work quicker is a(n) a. strategic plan b. strategic goal c. operational goal d. tactical plan e. operating plan

c. operational goal

A(n) ________ is a standing plan that outlines the general response to a designated problem or situation. a. order b. norm statement c. policy d. ethical value e. standing rule

c. policy

An organization should adopt planning and strategic management to a. decrease costs and increase synergy b. keep employees happy, encourage new ideas, and decrease costs c. provide direction and momentum, encourage new ideas, and develop a sustainable competitive advantage d. develop MBO, encourage new ideas, and increase profits e. provide encourage new ideas and increase organization diversity

c. provide direction and momentum, encourage new ideas, and develop a sustainable competitive advantage

A goal is a. a type of mission statement b. a type of plan c. a norm that can result in organization synergy d. a specific commitment to achieve a measurable result within a stated period of time e. the purpose of the organization

d. a specific commitment to achieve a measurable result within a stated period of time

A ____ is a graph of decisions and their possible consequences. decision structure corporate hierarchy resolution graph decision-result assessment decision tree

decision tree Explanation A decision tree is a graph of decisions and their possible consequences; it is used to create a plan to reach a goal. Decision trees are used to aid in making decisions.

________ is setting goals and deciding how to achieve them. a. Focusing b. Organizing c. Regulating d. Controlling e. Planning

e. Planning

Frank, the fire chief, told his employees to "Think big and endeavor to be more detailed and caring while at work and in setting goals. Therefore, when you give me your goals, I want them to be specific, measurable, attainable, results-oriented, and have target dates." Frank was asking for his workers' a. focused heart statements b. policies c. strategic goals d. synergy objectives e. SMART goals

e. SMART goals

Mr. Jones, the department manager, told his employees that he wanted them to write down their work goals for the year. To help his workers achieve their stated goals, the next thing that he should ask for are each worker's a. code of ethics b. business plan c. personal vision d. values e. action plan

e. action plan

Quality Vacuum has been manufacturing excellent vacuum cleaners for over 50 years. In the employee break room is a banner that reads, "We will always provide the highest-quality vacuums at the lowest cost to our customers and always give honest, winning customer service, thereby earning a fair profit for our stakeholders." This statement is Quality Vacuum's a. heart pact b. objective statement c. vision statement d. code of ethics e. mission statement

e. mission statement

Jeff, the owner of The Toy Box (a toy store), has chosen his products carefully. They are all handmade of wood; none are cheap games made of cardboard and paper. He knows he will be selling his toys to both adults and children; for example, his expensive chess and backgammon sets are quite expensive because the board and pieces are all made of wood by local artists and craftsmen. He knows that his customer base will not include parents who are looking for an inexpensive toy for their children or to give as a birthday gift; there is another store in town that offers mass-produced games. As part of his marketing outreach, Jeff offers "game nights" where he sets up game boards and invites local teens and adults to take part in light-hearted competitions, where the winners receive a 10 percent discount to a game at the Toy Box. All of Jeff's activities are aimed at giving Jeff a a. defensive strategy b. blue ocean strategy c. diversified portfolio d. vertical integration e. sustainable competitive advantage

e. sustainable competitive advantage

Pat, the human resources manager, has significant experience handling ethical issues in the workplace. Over the years he has received extensive training in matters of workplace ethics. Due to Pat's legal background (he is a member of the local bar association), the management of his company rely on Pat to assist them with legal issues, especially with ethical dilemmas. The ideal role for Pat within the organization is oversight specialist. whistle-blower. ombudsman officer. ethics officer. proprietary officer.

ethics officer Explanation An ethics officer is someone trained about matters of ethics in the workplace, particularly about resolving ethical dilemmas.

Leela's Home Decorators believes that the demand for its services will expand greatly, because a real-estate developer has just purchased 100 acres in town. The developer is planning to build 1,000 condominium units on the property. The managers of Leela's Home Decorators are making a projection for the future, also known as a a) past correction. b) trend. c) benchmark. d) forecast. e) final analysis.

forecast Explanation: A forecast is a vision or projection of the future.

Salvador, who works as a waiter in a top restaurant in Manhattan, likes the fast pace of his work and the fact that things are always changing there. Salvador can be said to have a large need for structure. have a low tolerance for ambiguity. have a high task orientation rank high on the stress index. have a high tolerance for ambiguity.

have a high tolerance for ambiguity. Explanation Some people desire a lot of structure in their lives (a low tolerance for ambiguity) and find ambiguous situations stressful and psychologically uncomfortable. In contrast, others do not have a high need for structure and can thrive in uncertain situations (a high tolerance for ambiguity, like Salvador).

Francis, who is starting a painting business, plans to write down the purpose of his painting business and his company's reason for being. Francis is writing his: a) mission statement. b) code of ethics. c) vision statement. d) proprietorship pact. e) ownership belief statement.

mission statement

Stars are _____, according to the BCG matrix. Stars have included Apple and the diamond company DeBeers. a) beyond reach, due to their high purchase price and profits b) highly overvalued, so are not wise purchases c) companies with slow growth and high market share d) risky new ventures e) organizations with high growth and high market share which are definite keepers

organizations with high growth and high market share which are definite keepers Explanation: In the BCG matrix, stars have high growth and high market share, and they are definite keepers.

When a manager is so frantic to get rid of the problem that he or she can't deal with the situation realistically, the manager is experiencing avoidance management. defensive avoidance. a fog reaction. panic. life avoidance.

panic Explanation In panic, a manager is so frantic to get rid of the problem that he or she can't deal with the situation realistically. Troubled by anxiety, irritability, sleeplessness, and even physical illness, if you're experiencing this reaction, your judgment may be so clouded that you won't be able to accept help in dealing with the problem or to realistically evaluate the alternatives.

In defensive avoidance, when managers can't find a good solution, their usual response is doing nothing. taking the easiest way out. procrastination, passing the buck, or denying the risk of any negative consequences. finding the most cost-effective solution. frantically getting rid of the problem.

procrastination, passing the buck, or denying the risk of any negative consequences. Explanation In defensive avoidance, a manager can't find a good solution and follows by (a) procrastinating, (b) passing the buck, or (c) denying the risk of any negative consequences.

Many customers have visited Sally's Diner for decades because of the diner's friendly service. Most customers feel that Sally's is the friendliest placed around. In a SWOT analysis, the friendly service at Sally's is an example of a company a) vision. b) strength. c) weakness. d) opportunity. e) threat.

strength. Explanation: Strengths are inside or internal matters. They are the skills and capabilities that give the organization special competencies in executing strategies in pursuit of its vision. Strengths could be work processes, organization, culture, staff, product quality, production capacity, image, financial resources and requirements, service levels, and other internal matters.

Anthony, the plant manager, was talking with another manager about Tim, the lead engineer in the corporate R & D department. Anthony remarked, "Tim is so bright, and he is an expert in designing products. But like so many experts, he can't imagine what it's like to be as ignorant as the rest of us. I think at times, he cannot see things from an outsider's perspective." Tim is suffering from the curse of knowledge. the tunnel vision effect. an analytics perspective. a narrow perspective. the intellectual fog effect.

the curse of knowledge Explanation As our knowledge and expertise grow, we may be less and less able to see things from an outsider's perspective. Hence, we are often apt to make irrational decisions. Why do some engineers design electronic products (such as DVD remote controls) with so many buttons, devices ultimately useful only to other engineers? Why are some professional investors and bankers prone to taking excess risks? Why are some employees so reluctant to adopt new processes? The answer may be what's known as the curse of knowledge.

An organization's vision statement states _____. For example, the Cleveland Clinic's vision statements says that it "strives to be the world's leader in patient experience, clinical outcomes, research, and education." a)the organization's purpose or reason for being b) its competition and external environment c) what the company wants to become, where it wants to go strategically d) the organization's purpose or reason for being e) the ethical and diversity standards of the organization

what the company wants to become, where it wants to go strategically