Quizzes

True

A best-value strategy must offer products or services to a wide range of customers at the best price-value available on the market.

True

A characteristic that describes the most competitive companies is adopting the adage, "Whether it's broke or not, fix it": in other words, continually strive to improve everything about the firm.

five times

A conservative rule of thumb is to establish a business' worth as ________ the firm's current annual profit.

True

A current trend in R & D management involves the lifting of the veil of secrecy whereby firms, even major competitors, are joining forces to develop new products.

The cash account

In projected financial statements, what is used as a plug figure?

eaten away at national boundaries so that people worldwide readily see for themselves how other people live and work. We have become a borderless world with global citizens, global competitors, global customers, global suppliers, and global distributors

In recent years, the speedy flow of information through technology has

a premium paid over the book value for an acquisition

In the context of a balance sheet, goodwill represents

False

In the context of conflict management and resolution, ignoring the problem in the hopes that the conflict will resolve itself is classified as a defusion technique.

False

Increased costs are a disadvantage of a good information system.

cross-selling to customers, monitoring suppliers, keeping managers and employees informed, coordinating activities among divisions, and managing funds (All of the above)

Information collection, retrieval, and storage can be used to create competitive advantages in ways such as

strengths

Internal _______ are controllable activities in an organization that are performed especially well.

delivering materials just when they are needed

Just-in-time describes

Long-term objectives are needed at the corporate, divisional, and functional levels of an organization (all of the above).

Long-term objectives are needed at which level(s) in an organization?

True

Major competitor's strengths may represent key threats.

True

Marketing research is the systematic gathering, recording, and analyzing, of data about problems relating to the marketing of goods and services.

Supply and demand

Matching which factors would allow factories to produce desirable levels without extra shifts, overtime, or subcontracting?

Divisional

Medium-sized firms tend to use which type of structure?

suggests that strategic decision making be based primarily on holistic thinking, intuition, creativity, and imagination

Mintzberg's notion of "crafting strategies"

annual; long-term

Most quantitative criteria are geared to ________ objectives rather than to ________ objectives.

False

Most quantitative evaluation criteria are geared to long-term objectives rather than annual objectives.

more of a science than an art

Most strategy literature advocates that strategic management is

True

Multidimensional scaling involves examining three or more criteria simultaneously in a product-positioning way.

False

On the x-axis of the IE Matrix, an IFE total weighted score of 2.5 represents a weak internal position.

False

Once an effective strategy is designed, modifications are rarely required.

False

Organizations should prepare contingency plans just for unfavorable events.

True

Orphan drugs offer pharmaceutical companies no economic incentive for profitable development and distribution.

True

The Balanced Scorecard approach addresses the question "How satisfied are the firm's customers?"

False

The Sarbanes-Oxley Act has eliminated the problem of firms inflating their financial projections, so stakeholders no longer have to worry about the reliability of the financial projections of different companies.

governance

The act of oversight and direction for an organization is referred to as

False

The advantage of the educative change strategy is that implementation is quick and relatively easy.

both internal and external issues

The critical success factors in a Competitive Profile Matrix and EFE Matrix include

True

The firm should pursue conservative strategies if the coordinates of a SPACE directional vector are (-1,4).

True

The five major categories of variables known as external forces are: (1) competitive forces, (2) technological forces, (3) political, governmental, and legal forces, (4) social, cultural, demographic, and natural environment forces, and (5) economic forces.

Select several articles about these statements and ask all managers to read these as background information.

The process of developing a vision and mission statement often includes which of these as the first activity?

as many managers and employees as possible

The process of performing an external audit should involve

False

Total attractiveness scores are defined as the sum of the attractiveness scores in a given column of the QSPM and are computed in the second step of the Quantitative Strategic Planning Matrix (QSPM).

When the products of rival sellers are essentially identical and supplies are readily available from any of several eager sellers.

Under which conditions would a cost leadership strategy be especially effective?

Cost Leadership-Low Cost

Under which strategy would you offer products or services to a wide range of customers at the lowest price available on the market?

Forward integration

Websites that can sell products directly to consumers are examples of which type of strategy?

False

Well-conceived and properly executed mission and vision statements are not subject to revision.

the Balanced Scorecard approach

What aims to balance long-term with short-term concerns, financial with nonfinancial concerns, and internal with external concerns?

Forecasts

What are educated assumptions about future trends and events called?

Mission statements

What are enduring statements of purpose that distinguish one business from other similar firms.

Growth ratios

What category of ratios measures how effectively a firm can maintain its economic position in the growth of the economy and industry?

Nearly three quarters

What portion of the firms going public in 2014 were unprofitable?

Managing by subjectives

What principle is built on the idea that there is no general plan for which way to go and what to do?

Horizontal integration

What refers to a strategy of seeking ownership of, or increased control over, a firm's competitors?

Auditing

What term is defined as a "systematic process of objectively obtaining and evaluating evidence regarding assertions about economic actions and events to ascertain the degree of correspondence between these assertions and established criteria, and communicating the results to interested users?"

True

When attachments to a culture are severed in an organization's attempt to change direction, employees and managers often experience deep feelings of grief.

Defusion

Which approach for managing and resolving conflict involves playing down differences between conflicting parties, while accentuating similarities and common interests?

Strategists

Which individuals are most responsible for the success and failure of an organization?

Average Collection Period

Which ratio would be considered an activity ratio?

Product development

Which strategy generally entails large research and development expenditures?

Representative managers and employees from throughout the firm need to be involved in determining a firm's strengths and weaknesses.

Who should perform an internal audit?

organizations have similar branch facilities located in widely dispersed areas

A divisional structure by geographic area is most appropriate when

True

A limitation of financial ratios is the fact that they are based on accounting data.

True

A mission statement can sometimes be called a statement of philosophy.

organizational culture

A pattern of behavior developed by an organization as it learns to cope with its problems of external adaptation and internal integration, and that has worked well enough to be considered valid and to be taught to new members as the correct way to perceive, think, and feel is called

False

A total weighted score of 1.0 for an EFE Matrix indicates that the firm is responding in an outstanding way to existing opportunities and threats in its industry.

some strategic information should remain confidential to top managers

With regard to the visible or hidden issue, most executives agree that

implementation

With what phase of strategic management is most strongly associated with "action"?

Culture

________ includes the set of shared values, beliefs, attitudes, customs, norms, rites, rituals, personalities, heroes, and heroines that describe a firm.

Large; small

________ organizations require more elaborate and detailed strategy-evaluation systems than ________ ones, because it is more difficult to coordinate efforts among different divisions.

True

An effective competitive intelligence program allows all areas of a firm to access consistent and verifiable information in making decisions.

shift from specific to general issues and concerns

An effective way to gain commitment and achieve desired results is to

False

An important question a mission statement should answer is, "What do we want to become."

False

An infrequently used tool in strategy evaluation is the audit.

False

An objective, logical, systematic, and non-intuitive approach for making major decisions in an organization is a way to describe the strategic management process.

answers the question "What do we want to become?"

An organization's vision statement

False

As a balance sheet entry, goodwill represents the favor a business has acquired through its environmentally conscious and socially responsible actions.

changed

Aspects of an existing culture that are antagonistic to a proposed strategy should be

False

Changing a strategy to fit an existing culture is usually more effective than changing a firm's culture to fit a new strategy.

larger market share

Financial objectives involve all of the following except

False

Financial ratios are rarely used as criteria to evaluate strategies.

Star

Forward integration would be an appropriate strategy for which of the following types of divisions in the BCG Matrix?

True

Horizontal integration is seeking ownership or increased control over competitors.

increase investor scrutiny of the firm

If a firm has a bad sustainability record this will

moving environmental affairs from the staff side of the organization to the line side

In an effort to manage ecological challenges, many companies are

False

In multidivisional organizations, each division should develop a mission statement consistent with and supportive of the corporate mission but use the corporate vision statement instead of a divisional vision statement.

False

The test of an effective evaluation system is its complexity.

outsiders

Today, boards of directors are composed mostly of

More lenders are examining the environmental liabilities of businesses seeking loans.

Preserving the environment should be a permanent part of doing business for which of the following reasons?

researching resource availability

R & D employees and managers perform all of the following tasks except

liquidation

Selling all of a company's assets, in parts, for their tangible worth is called

True

Serving two segments with the same strategy is not a step in perceptual mapping.

the responsibilities a firm has to employees, consumers, environmentalists, minorities, communities, shareholders, and other groups

Social policy can best be defined as

False

Some strategists agree with Ralph Nader, who asserts that organizations have no obligation to do any more for society than is legally required.

False

Step one of the Quantitative Strategic Planning Matrix (QSPM) assigns weights to each key external and internal factor.

Marketing, finance and accounting, production and operations, research and development (R&D), (all of the above)

Strategic management focuses on integrating management, _________, and information systems to achieve organizational success.

When technological change is fast paced and competition revolves around rapidly evolving product features.

Under which condition would a differentiation strategy be especially effective?

False

Strategy changes may be highly ineffective, but not counterproductive, if a supportive culture does not exist.

True

Strategy implementation is often considered to be the most difficult stage in the strategic management process.

Avoidance, defusion, and confrontation

What are the three categories of approaches for managing and resolving conflict?

Stability position and industry position

What are the two external dimensions of the SPACE Matrix?

Profitability

What category of ratios includes return on total assets and return on stockholders' equity?

Force

What change strategy involves giving orders and enforcing those orders?

Contingency plans

What has been shown to permit quick response to change, prevent panic in crisis situations, and make managers more adaptable?

Matrix

What is the most complex form of organizational structure?

Product and service planning

What marketing function includes test marketing?

A joint venture

What occurs when two or more companies form a temporary partnership or consortium for the purpose of capitalizing on some opportunity?

Serve two segments with the same strategy.

Which is not a required step in perceptual mapping?

Altering an organization's structure, replacing one or more key individuals, selling a division, revising a business mission, establishing or revising objectives, devising new policies, issuing stock to raise capital, adding additional salespersons, differently allocating resources, or developing new performance incentives (All of the above).

Which of the following is a corrective action a company might take to correct unfavorable variances?

Devising policies, revising reward and incentive plans, minimizing resistance to change, developing an effective human resources function (all of the above).

Which of the following is a management issue central to strategy implementation?

It requires intuitive informed judgments.

Which of these is a limitation of QSPM?

Forward integration

Amazon's start of rapid delivery services in some U.S. cities is an example of which type of strategy?

When a company has been successful.

According to Drucker, what is the best time to ask "What do we want to become?" and "What is our business?"

"What is our business?"

According to Drucker, which question is synonymous with asking, "What is our mission"?

True

According to Porter, five competitive forces define the nature of competitiveness in a given industry: (1) rivalry among competing firms, (2) potential entry of new competitors, (3) potential development of substitute products, (4) bargaining power of suppliers, and (5) bargaining power of consumers.

Generating, evaluating, and selecting strategies.

According to the comprehensive strategic management model, which step immediately follows the establishment of long-term objectives?

make enough profit to cover the costs of the future, because if this is not achieved then no other social responsibility can be met

According to the text, the first social responsibility of any business is to

True

After segmenting markets so a firm can target particular customer groups, the next step is to find out what customer groups want and expect.

consolidating

All of the following are basic activities of management except

False

Alternative strategies not selected for implementation should be discarded, as they have a tendency to contaminate the contingency plans.

bestowing a gift to influence the recipient's conduct

Bribery involves

False

Cash Cows represent the organization's best long-run opportunities for growth and profitability.

intense - and sometimes cutthroat

Competition in virtually all industries is

action-oriented; information-oriented

Controls need to be _______ rather than ________.

formulation

During what stage of strategic management are a firm's specific internal strengths and weaknesses determined?

require infrequent major changes, but are always subject to revision

Effective and carefully planned mission statements

True

External audits attempt to identify key variables that offer actionable responses.