Chapter 4-6

__________ is a technique that helps managers summarize relevant and important facts from the internal and external analyses of an organization in order to formulate strategy.

A SWOT analysis

In order for family manage businesses to survive and prosper, management group Peter Drucker advise them to _______________________.

Phil at least one key position with a non-family member

________, an ethical system, defined ethical behavior based on the opinions and behaviors of associated people.

Relativism

Which of the following steps in the formal planning process involves studying past activities, examining current conditions, and forecasting future trends?

Analyzing the situation. Planning begins with the situational analysis. Within their time and resource constraints, planners should gather, interpret, and summarize all information relevant to the planning issue in question. They studied past events, examine current conditions, and try to forecast future trends.

Which of the following statements is true of entrepreneurship?

Entrepreneurs take careful, calculated risk and are not afraid to act on those decisions.

_________ is the pursuit of lucrative opportunities by enterprising individuals under conditions of uncertainty.

Entrepreneurship

Start-ups have a major liability of fast growth.

False

Businesses should look at environmental issues as a no-win situation.

False. Businesses used to look at environmental issues as a no-win situation. Either you help the environment and hurt your business, or else you help your business at a cost of environment. But now a shift is taking place as companies deliberately incorporate environmental values into competitive strategies and into the design and manufacturing of products.

Ecocentric management focuses on practices that maximize current economic growth, irrespective of the potential harm to future generations.

False. Ecocentric management has as its goal the creation of sustainable economic development and movement of quality of life worldwide for all organizational stakeholders.

Milton Friedman contended that business cannot increase its profits while conforming to society's laws and ethical customs.

False. Milton Friedman, the Nobel prize-winning economist of the University of Chicago, is known for his now famous dictum, "The social responsibility of business is to increase profits."

In an organization, the process of planning moves in a linear fashion.

False. Planning moves in its cycle. The outcomes of plans are evaluated and, if necessary, revised.

An advantage of using a group for decision-making is that disagreements are unlikely to happen, and this phenomenon is called groupthink.

False. Pressure to avoid this agreement can lead to a phenomenon called groupthink. Pressure to go along with the group's preferred solution stifles creativity and other behaviors characteristic of vigilant decision-making.

Satisficing is less likely with groups.

False. Satisficing is more likely with groups. Most people don't like meetings and will do what they can to end them. This may include criticizing members who want to continue exploring new and better alternatives. The result is a satisficing, not an optimizing or maximizing decision.

Making decisions about an organization's short-term goals and tactics is known as strategic planning.

False. Strategic planning involves making decisions about an organization's long-term goals and strategies.

A company can easily avoid environmental issues since the creation and distribution of wealth generates very few by-products.

False. The creation and distribution of wealth generate by-products that can cause injury, loss, or danger to people in the environment. The fundamental sources of risk in modern society are the excessive production of hazards and ecologically unsustainable consumption of natural resources.

Unethical behavior happens only in a business environment.

False. Unethical behavior can happen anywhere, not just a business.

Standing plans are designed to achieve a set of short-term goals.

False. Was standing plan is designed to achieve an enduring set of goals.

___________ is an entrepreneurial alliance between innovator who has created at least one successful store and wants to grow and a partner who manages a new store of the same type in the location.

Franchising

What is the role of the economic environment in the success of entrepreneurial ventures?

Increases in the money supply and the supply of bank loans lead to improved prospects and increased sources of capital.

____________ offer a way for a business to raise capital through federally registered and underwritten sales of shares in a company.

Initial public stock offerings. In that transaction fee model, a website brings buyers and sellers together and charges a commission for each sale. /False. In the transaction fee model, companies charge a fee for goods and services. Amazon.com and online travel agents are prime examples.

____________ are new venture creators working inside big companies. they are corporate entrepreneurs, using their company's resources to build a profitable line of business based on the fresh new idea.

Intrapreneurs

According to Professor Edward Freeman, which of the following is true of ethics and corporate responsibility?

Managers can benefit their organizations by growing profits as well as behaving ethically toward stakeholders.

________ refers to the principles, rules, and values people use in deciding what is right or wrong.

Moral philosophy

Which of the following is true of the strategic vision of an organization?

The strategic vision revives a perspective on where the organization is headed. The strategic vision points to the future; it provides a perspective on where the organization is headed and what it can become.

An ethical leader is one who is both a moral person and a moral manager influencing others to behave ethically.

True

Life cycle analysis (LCA) quantifies the total use of resources and the releases into the air, water, and land.

True Life cycle analysis (LCA) is the process of analyzing all inputs and outputs, through the entire "cradle-to-grave" life of a product, to determine the total environmental impact of its production and use. LCA quantifies the total use of resources and the releases into the air, water, and land.

A common entrepreneurial malady is an aversion to record keeping.

True. Entrepreneurs, in part because they are very busy, often fail to use formal control systems. One common entrepreneurial malady is an aversion to record-keeping. Expenses mount, what records do not keep pace. Pricing decisions are based on intuition without adequate reference to costs. As a result, the company earned in adequate margins to support growth.

Employees, organizations, and communities thrive over the long term when managers apply ethical standards that direct them to act with integrity.

True. Ethics of moral principles and standards that guide the behavior of an individual or group. Employees, organizations, and communities thrive over the long term when managers apply ethical standards that direct them to act with integrity.

Managers usually face novel in unstructured problems, leaving them uncertain about how to proceed.

True. Lack of structure is typical of managerial decisions. Usually, there is no automatic procedure to follow. Problem are novel and unstructured, leaving the decision-maker uncertain about how to proceed.

The economic responsibilities of business include satisfying its obligations to investors.

True. The economic responsibilities of business or to produce goods and services that society wants at a price that perpetuate the business and satisfies its obligations to investors. Economic responsibility may also extend to offering certain products to needy consumers at a reduced price.

To be effective, goals should be measurable, specific, attainable, relevant, and time-bound.

True. To be effective, goals should have certain qualities, which are easy to remember with the acronym SMART: specific, measurable, attainable, relevant, and time bound.

_________ is an ethical system, which states that all people should oppose certain values that society needs to function.

Universalism

Which of the following is a benefit of business incubators?

access to shared services. Incubators offer benefits such as lower rents and shared costs. Shared staff costs, such as for receptionist and administrative assistants, avoid the expense of a full-time employee would still provide convenient access to services.

In the context of successful business models for e-commerce, sites that pay commissions to other sites to drive business to their own sites involve the __________ model.

affiliate

Submarines Inc., a chain of sub shops, periodically compares the quality of its food and service with its competitors in order to continually improve its performance. This corporate strategy is known as ______.

benchmarking. Benchmarking is the process of assessing how well one company's basic functionsand skills compare with those of another company or set of companies. The goal of benchmarking is to thoroughly understand the "best practices" of other firms and to undertake actions to achieve better performance and lower costs.

According to the __________ plan of Neon, Inc., if expansion to new markets in Australia does not materialize, the company will strive for expansion in Asia.

contingency

In the context of common management challenges, leadership deteriorates into micromanagement when entrepreneurs fail to ________________.

delegate work

Resources or source of competitive advantage only when they are __________.

difficult to imitate. Resources are a source of competitive advantage only when they create customer value, or rare, are organized, and are difficult to imitate.

The notion of _______, and ethical system, similar to Adam Smith's concept of the invisible hand in business.

egoism. According to egoism, individuals self interest is the actual motive of all conscious action. "Doing the right thing," the focus of moral philosophy, is defined by egoism as "do the actor promotes the greatest good for oneself."

A(n) ______________ is a new business having growth and high profitability as primary objectives.

entrepreneurial venture

A(n) ______________ is a situation, problem, or opportunity in which an individual must choose among several actions that must be evaluated as morally right or wrong.

ethical dilemma. This is also known as an ethical issue.

According to Kohlberg's model of cognitive moral development, people in the ___ stage make decisions based on concrete rewards and punishments and immediate self-interest.

preconventional

According to Kohlberg's model of cognitive moral development, people in the ___ stage seeing beyond authority, laws, and norms and follow their self chosen ethical principles.

principled

In the context of resources and core capabilities, the tangible assets of an organization include _____.

real estate. Tangible assets include real estate, production facilities, and raw materials.

Nikki usually makes decisions on the basis of what her friends expect her to do. Which ethical system do Nikki's actions reflect the most?

relativism. Nicki's actions reflect relativism. Relativism defines ethical behavior based on the opinions and behaviors of relevant other people. Relativism acknowledges the existence of different ethical viewpoints. For example, norms, or standards of expected and acceptable behavior, vary from one culture to another.

In which step of the planning process to managers identify the priorities and trade-offs among goals and plans?

selection of goals and plans. In step for the planning process, once managers have assessed the goals and plans, they select the most appropriate and feasible alternative. The evaluation process identifies the priorities and trade-offs among the goals and plans.

A plan to integrate employees into new payroll system, assuming that is not likely to be repeated in the foreseeable future, is an example of a ______ plan.

single-use

In the context of successful business models for e-commerce, the ________ model involves charging monthly or annual fees for website visits or access to website content.

subscription

The success of an entrepreneurial venture is often jeopardized by the death of its founder. Which of the following is an important measure to minimize this problem?

succession planning

The side street effect refers to ____________.

the appearance of unexpected opportunities as one follows a plan

In the context of the planning process, implementation of selected plans will be most successful when ______________.

they are linked to other organizational systems like budgets and rewards

According to the ethical system of utilitarianism, which of the following is true?

Seeking the greatest good for the greatest number of people should be the overriding concern of decision-makers.

Which stage of the planning process is Jekyll Incorporated involved in if it is assessing how well alternative plans meet high priority goals while considering the cost of each initiative and the likely investment return?

evaluating goals and plans. In the third stage of the planning process, managers evaluate the advantages, disadvantages, and potential effects of each alternative goal and plan. They must prioritize the goals and even eliminate some of them. Also, managers consider how well alternative plans meet high-priority goals, considering the cost of each initiative and the likely investment return.

In the context of the planning process, ___________ are the targets or ends a manager wants to reach.

goals

The outcome of a situation analysis is the _________.

identification and diagnosis of planning assumptions, issues, and problems

Polo Corporation brings buyers and sellers together and charges a commission for each sale. This type of business model is known as the ______ model.

intermediary

When working for software company, David created a new venture based solely on his idea while using his company's proprietary technology. David can be described as a(n) __________.

intrapreneur. Intrapreneurs are new venture creators working inside big companies. They are corporate entrepreneurs, using their company's resources to build a profitable line of business based on a fresh new idea. In this case, David is an intrapreneur as he created a new venture based solely on his idea while using his company's proprietary technology.

The odds of survival for new venture improve if ____________.

it grows to at least 10 or 20 people. The odds of survival for new venture improve the venture grows to at least 10 or 20 people, has revenues of $2 million or $3 million, and is pursuing opportunities with growth potential. Also, good economic times to get easier to start a business and to survive.

To basic ethical ideals underpin the Caux Principles for Business. They are ______.

kyosei and human dignity