MGT300 Test 2 True/False Questions

Two types of forecasting are trend analysis and competitive intelligence.

FALSE

A defensive strategy is sometimes called retrenchment strategy.

TRUE

A formal vertical hierarchy shows a company's most typical channels of communication.

TRUE

Strategic planning determines goals for an organization for a period of 1-5 years.

TRUE

Southwest Airlines' goal of making arrival times more reliable is a tactical goal.

TRUE

The process of fitting the organization to its environment is called contingency design.

TRUE

The operating plan defines the course of action needed to achieve a stated goal.

FALSE

The use of hedging to manage the cost of aviation fuel is an example of trend analysis.

FALSE

Confidential matters and issues involving discipline cannot be effectively delegated.

TRUE

In Porter's model for industry analysis, there are three primary competitive forces in a firm's environment.

FALSE

Research shows that organizations with market cultures report higher profits and financial growth.

TRUE

A formal system of task and reporting relationships that coordinate and motivate an organization's members is known as an organizational configuration.

FALSE

A mission statement should be ambitious.

FALSE

A policy includes more specifics than does a rule.

FALSE

A ritual is a narrative based on true events, which is repeated—and sometimes embellished upon—to emphasize a particular value of an organization.

FALSE

A small florist most likely follows a diversification strategy.

FALSE

A steady-state career entails a slow-but-steady growth in level of responsibility and compensation.

FALSE

A strategic position may be based on serving the few needs of a few customers.

FALSE

Execution is tactical in nature, rather than part of a company's strategy.

FALSE

Horizontally on an organizational chart are the various companies outside of the firm, such as suppliers and distributors.

FALSE

If a marketing person reports to both the Vice President of Marketing and also to the project manager for the Ford Mustang, she works in a network organization.

FALSE

If your boss asked you to take care of a task, productivity expert Odette Pollar says it is still OK to delegate it.

FALSE

In single-use plans, a program is another name for a project.

FALSE

Strategy actualization is the term for putting strategic plans into effect.

FALSE

A good organizational culture can facilitate a low turnover rate.

TRUE

Decisions that are predictable, following a well-defined set of procedures are typical of operational planning.

TRUE

Facebook strives to be on the cutting edge of social media, and is experiencing phenomenal growth. It encourages what it calls a "hacker" mindset, always looking to break down the old in favor of something better. Of Miles and Snow's basic strategy types, Facebook would be described as a prospector.

TRUE

Ford Motor Co. has what is known as a divisional structure because it has different divisions for passenger car dealers, large trucking customers, and farm products customers.

TRUE

Harvard Business School professor Michael Porter is a leading authority on competitive strategy.

TRUE

Hierarchy of authority is also referred to as the chain of command.

TRUE

In the planning/control cycle, comparing the results with the plan is one of the control steps.

TRUE

Sharing stories, legends, or myths are good ways to develop an organizational structure.

FALSE

A functionally-organized company can also use team-based structure to work on particular problems.

TRUE

A hero is a person whose accomplishments embody the values of the organization.

TRUE

A market culture has a strong external focus and values stability and control.

TRUE

A marketing plan is an example of an action plan.

TRUE

A sustainable competitive advantage is the ability of an organization to produce goods or services more effectively than its competitors and outperform them.

TRUE

Many good mission statements include descriptions of an organization's customers, as well as its major products or services.

TRUE

Organizational culture can vary widely across organizations on dimensions of treatment of employees, teamwork, and risk taking.

TRUE

Organizations may turn to the strategic-management process after a crisis.

TRUE

The process of a business cycling through decisions first to select products and markets, then about producing and delivering the products, and finally to establish roles and processes is known as the discovery cycle.

FALSE

The starting point in establishing a grand strategy is usually an analysis of Porter's competitive forces.

FALSE

Those who found a business and the managers who follow them primarily use power and coercion to embed the culture into the organization.

FALSE

One advantage of decentralized organizations is that procedures are uniform and thus easier to control.

FALSE

One of the ways to keep a strategic plan on track is to make it very comprehensive, covering as many scenarios for the future as you can.

FALSE

Only for-profit organizations can be represented by an organization chart.

FALSE

Operational goals are set by middle managers and focus on the actions needed to achieve strategic goals

FALSE

Operational planning is normally performed by middle management.

FALSE

Organization-wide, the best structure for objectives in MBO is known as a diversity pattern.

FALSE

Organizational culture appears as three layers: observable artifacts, token values, and foundational beliefs.

FALSE

Planning is usually a straightjacket for new ideas, since it effectively blocks peripheral vision in favor of a predetermined course.

FALSE

Planning occurs only at the highest levels of an organization, being done by top managers.

FALSE

Policies, procedures, and rules are types of single-use plans.

FALSE

Power refers to the rights inherent in a managerial position to make decisions, give orders, and utilize resources.

FALSE

Sometimes an organizational structure can be strong enough to take the place of organizational culture.

FALSE

Strategic conservation attempts to achieve sustainable competitive advantage by preserving what is distinctive about a company.

FALSE

Synergy is one of the benefits of a single-product strategy.

FALSE

Tactical planning is done by first-line managers and looks forward to the next 1-8 weeks.

FALSE

The "social glue" that binds customers to a particular firm is called organizational culture.

FALSE

The 'R' in a SMART goal stands for 'reachable'.

FALSE

The BCG matrix is a means of evaluating strategic business units on the basis of both their business growth rates and their profitability.

FALSE

The division of labor means that an employee should report to no more than one manager.

FALSE

The first stage of in an organization's life cycle is known as creation.

FALSE

The fit perspective assumes that the most effective cultures help organizations anticipate and adapt to environmental changes.

FALSE

The founder of McDonald's, Ray Kroc, intended that a Big Mac should taste the same anywhere, and accordingly the company has many specific procedures, making it a formulaic organization.

FALSE

The four stages of organization life cycle include birth, growth, stability, and maturity.

FALSE

The functional structure is the most typical type for small firms.

FALSE

The pink Cadillac that Mary Kay presents to the best salespeople of its cosmetic line is an example of an emblem.

FALSE

As you are promoted to higher levels in an organization, you may have to actively resist isolation.

TRUE

At 3M the Gold Step award, a trophy for successful new products, is an example of a symbol.

TRUE

Because it is unrealistic for SMART goals to be accomplished overnight, they should have target dates.

TRUE

Bombardier builds jets from 12 separately-sourced portions which can be put together in four days. This is an example of a modular organizational structure.

TRUE

Burberry makes outerwear, accessories like umbrellas, and children's clothing, which is called a related diversification strategy.

TRUE

Cash cows in the BCG matrix have slow growth but high market share.

TRUE

Companies that must respond to fast-changing customer tastes often favor an organic structure to a mechanistic one.

TRUE

Contingency planning can also be called scenario planning

TRUE

Culture exists on visible and unobservable levels.

TRUE

Deadlines can help one concentrate the mind, in order to make decisions rather than put them off.

TRUE

Determining an organization's mission is the responsibility of top management and the board of directors.

TRUE

Forecasting is a strategic-planning tool used to make long-term strategy.

TRUE

In general, organizations become more bureaucratic over their lifetimes.

TRUE

Individuals who don't want the responsibility that comes with promotion may follow a transitory career path.

TRUE

Integration is the tendency of the parts of an organization to draw together to achieve a common purpose.

TRUE

Kraft Macaroni & Cheese is now challenged by new competitors such as Annie's and other store brands, which Porter's model for industry analysis calls the threat of new entrants.

TRUE

Luxury carmaker Rolls-Royce has a focused-differentiation strategy

TRUE

Maintenance objectives are one type of objective used in MBO.

TRUE

Managers must be willing to make large, painful decisions to suddenly alter strategy.

TRUE

Managers who execute well insist on realism.

TRUE

Pfizer Pharmaceuticals, with its culture that manages failure and disappointment, and of helping drug researchers live for the small victories in discovering new drugs for various diseases, is an example of an adhocracy.

TRUE

Planning gives you expectations against which you can compare your performance.

TRUE

Roberto opened a new restaurant in Miami called Cuban Isle. He wanted to be sure a culture of service and excellence was embedded in his new organization so he posted the values of the organization in the kitchen and in the dining room. Roberto is teaching his organization the culture through this action.

TRUE

Staff personnel have authority functions in that they provide advice, recommendations, and research to line managers.

TRUE

The U.S. government space program is an example of a single-use plan

TRUE

The administrative part of the adaptive cycle focuses on establishing roles and organizational processes.

TRUE

The purpose of MBO is to motivate subordinates.

TRUE

The reporting relationships on an organizational chart are known as the vertical hierarchy of authority.

TRUE

The strategic-management process has five steps and a feedback loop.

TRUE

The type of training provided to new hires and the frequency of performance evaluations contribute to their understanding of the organization's culture.

TRUE

There are seven leader behaviors that help a manager successfully execute a strategy.

TRUE

Too little or unreliable historical data may result in erroneous trend analyses

TRUE

When employees are forced to adhere to an organization's values through extensive procedures and bureaucracies, its culture is said to be weak.

TRUE

When the National Football League annually presents the winners of the Superbowl with rings in a ceremony, it is an example of a ritual.

TRUE

According to Miles and Snow's basic strategy types, a defender protects its strong position in an industry by constantly seeking new opportunities for growth.

FALSE

An organization with different grouping of people based on its products, customers, or geographic regions has a functional structure.

FALSE

Bad planning is usually a result of top managers' inability to gather enough information.

FALSE

By definition, an organization includes 10 or more people

FALSE

Good strategy allows a company to be everything to everyone.

FALSE

Guthrie Community College has done a SWOT analysis and discovered that the number of college-bound high-school juniors in its state has grown by nearly 20% in the past few years. This is a strength for Guthrie.

FALSE

In this time of Internet connections and speedy-access computer databases, one typically has complete information for planning and decision making.

FALSE

Planning helps managers to cope with events that can be predicted, but is not particularly helpful when conditions are uncertain.

FALSE

SMART goals that are challenging yet can be met within the available scope of time, equipment, and financial support are known as achievable, the 'A' in SMART.

FALSE

Southwest Airlines' goal of being highly profitable is a tactical goal.

FALSE

Strategic planning is appropriate for large companies, but does not help the performance of small companies.

FALSE

Strategic goals focus on objectives for the organization as a whole.

TRUE

Formal business plans can be dangerous to the survival of new businesses; many who try them fail because of the resources required to write and agree upon the plan.

FALSE

In MBO, objectives that employees fail to meet should be put aside for the next period in favor of ones that they can achieve.

FALSE

In a world of rapid and discontinuous change, the ability to please nonmanagerial employees has been called the golden trait among managers.

FALSE

In the planning/control cycle, carrying out the plan is one of the control steps.

FALSE

MBO was developed by Frederick Taylor as part of scientific management.

FALSE

Marriot Hotel's statement in which it states its desire "to be the world's leading provider of hospitality services" is a mission statement.

FALSE

Microsoft has been accused of adapting competitors' products after those firms spent the resources and took the risks to develop them. Companies with this strategy are known as analyzers by Miles and Snow.

FALSE

Mission and vision statements should be created once the strategic planning process is complete.

FALSE

Strategic management is the process of involving select managers from the executive leadership of the organization in the formulation and implementation of strategies and strategic goals.

FALSE

The first step in an MBO program is for the manager to set objectives for her subordinate.

FALSE

The first step of the strategic-management process is to establish the grand strategy

FALSE

The planning/control cycle has three planning steps and three control steps.

FALSE

The career path that most resembles the traditional view of climbing the stairs in a corporate hierarchy is the linear career

TRUE

Obsolete technology and outdated facilities are examples of organizational threats.

FALSE

A clan culture has an external focus and values flexibility rather than stability and control.

FALSE

A company must be able to execute three core processes of business including people, products, and administration.

FALSE

A company with a formalized, structured work environment aimed at achieving efficiency, timeliness, and reliability in the creation and deliver of products has a clan culture.

FALSE

A corporation that uses a network structure is often called matrix corporation.

FALSE

A hospital is an example of a mutual-benefit organization

FALSE

Allowing business-casual dress in the workplace is an example of the espoused values portion of organizational culture.

FALSE

An organization chart it is most often illustrated with a tall, slender rectangle showing each level of the company

FALSE

Corporate culture is as also known as organizational structure.

FALSE

Director of operations is an example of a staff position.

FALSE

Espoused values represent the values and norms actually exhibited in the organization.

FALSE

General Electric sells lighting products and is also involved in plastics, broadcasting, and financial services. GE uses a related diversification strategy

FALSE

In a cost-leadership strategy, an organization targets a wide market and offers products of services of unique and superior value compared to competitors.

FALSE

Lawrence and Lorsch's term for the tendency of an organization's parts to disperse and fragment is demarcation.

FALSE

A common challenge to strategy implementation is resistance by people within the organization.

TRUE

A grand strategy can be established by using tools like SWOT analysis and forecasting.

TRUE

A procedure is a standing plan that outlines the response to particular problems or circumstances.

TRUE

A single-product strategy can be described as focused but vulnerable.

TRUE

An adhocracy culture attempts to create innovative products by being adaptive, creative, and quick to respond to the environment.

TRUE

An advantage in using centralized authority is that there is less duplication of work, because fewer employees perform the same task.

TRUE

An investigation of companies with different organizational cultures showed that long-term financial performance was highest for those with an adaptive culture.

TRUE

An organization is said to be flat when there are only a few levels with wide spans of control.

TRUE

An organization's basic assumptions are difficult to change.

TRUE

A strategy is a large-scale action plan that sets direction for an organization

TRUE

A vision has a clear sense of the future and the actions needed to get there.

TRUE

In order for MBO to be successful, it must be implemented throughout the entire organization.

TRUE

In the planning/control cycle, part of the control process can be to improve future plans.

TRUE

Management of a small company in an industry that is not very competitive should not engage in strategic planning because the small gains in performance may not be worth the effort.

TRUE

Organizational threats are the environmental factors that hinder an organization's ability to achieve a competitive advantage.

TRUE

Planning and strategic management derive from an organization's mission and vision about itself.

TRUE

SWOT analysis helps management to develop a realistic understanding of the organization in relation to internal and external environments.

TRUE

Strategic positioning can be achieved by performing similar activities to rivals, but in different ways.

TRUE

Strategy formulation is the process of choosing among different strategies and altering them to best fit the organization's needs.

TRUE

A vision statement expresses what the organization should become and where it wants to go strategically.

TRUE

An organization should adopt strategic management and strategic planning to encourage new ideas

TRUE

An organization's goals arranged from low-level to high-level can be termed a means-end chain.

TRUE

Best Buy plans to keep its prices low and make few changes in the near future, which is an example of a stability strategy.

TRUE

Competitive intelligence challenges the brains of employees to make them better equipped to produce novel ideas for business.

FALSE

Contingency planning is a hypothetical extension of a past series of events into the future.

FALSE

Ford's Sync in-dash communications platform, despite its high level of technology, has been unable to provide the company with a distinct competitive advantage.

FALSE

A bike messenger company that operates in the downtown area of a large city recently set the following goal: "All deliveries should be completed as quickly as possible." This example meets the criteria for a SMART goal.

FALSE

A business plan is a document with the purpose of outlining a proposed firm's profit and loss statements for its first operating cycle.

FALSE

A comprehensive strategy assesses current organizational performance and then explains how its mission is to be accomplished.

FALSE

A continuity strategy is a grand strategy that involves little or no significant change.

FALSE

A development strategy is a grand strategy that involves expansion.

FALSE

A good vision statement should describe a company's major strengths and competitive advantage in its industry

FALSE

A target is a specific commitment to achieve a measurable result within a stated period of time.

FALSE

A vision will be demoralizing to employees if it describes a future state that appears beyond the reach of the organization.

FALSE

According to Burt Nanus, good vision statements are useful because they help people to consider all interesting elements in their environments.

FALSE

Blockbuster Video was slow to adapt to the latest trends in its industry, such as DVD-by-mail and movie downloads online. When it tried to incorporate the same into its business model, it was well behind competitors like Netflix. Blockbuster might be defined as a defender, according to Miles and Snow.

FALSE