Senior Sem Ch.2

In which of the following situations is an adjustment of a company's strategy most likely needed?

the company repeatedly fails to achieve performance goals and the company faces a drop in its market position.

Which of the following are NOT likely to happen if a company's financial objectives are met or exceeded?

the company will go into bankruptcy, senior executives will be fired, and revenues will decrease

What is described by a company's mission statement?

the company's present purpose and the company's present business.

A vision represents

the future that the firm is trying to create.

Values represent

the guardrails that keep the firm from making bad decisions.

Who is primarily responsible for crafting and implementing business strategy in a multibusiness organization?

the head of each business unit.

Organizing and guiding a new business activity is called ___

entrepreneurship.

What will a typical strategic plan accomplish?

establish a time period for accomplishing goals and allocate resources that will help implement the plan.

Volkswagen's board of directors fulfilled which of the following of its four important obligations to shareholders?

Volkswagen's board of directors did not fulfill any of its primary obligations to shareholders.

Employees at various levels within an organization are best served by performance objectives that ______

relate specifically to what their departments are doing.

Who is ultimately responsible for the results that a company strategy produces?

The chief executive officer (CEO)

The key characteristics of a well-stated organizational objective are not represented by

Yahoo!'s extreme stretch goals to return that company to profitability and raise its stock price

What is a company slogan?

a brief phrase that summarizes the company's vision

Whole Foods's choice to develop strict standards and labeling for seafood can best be categorized as

a mission component

How would you best characterize the definitive difference between a vision and a mission?

a mission statement typically concerns a company's present business scope and purpose, whereas a strategic vision sets forth "where we are going".

Which of the following are developed during the first stage in crafting a company strategy?

a mission statement, a strategic vision, and a set of core values.

What is a stretch objective?

a performance target that will require significant effort to achieve

Which are the primary components of a strategic plan?

a vision of where it is headed, a set of performance targets, and a strategy to achieve them.

A company mission statement should do which of the following?

establish the company's own identity, specify what services and products the company offers, and identify the company's customers or markets.

TOMS Shoes' company values are

an integral of this company's DNA; its executives seek to ingrain designated core values into corporate culture.

What are strategic objectives primarily concerned with?

an organization's competitive position and an organization's market standing.

Financial objectives

are necessary to set and to achieve because adequate profitability and financial strength increases a company's long-term health.

Typically, a company's strategy making must _____

begin at the top of a company

Typically, a company's strategy making must ______.

begin at the top of a company.

In keeping with its vision and values, Whole Foods could have

bought its own fishing vessels and processing capacity

You are the owner of the voracious vegetarian, a single-business healthy fast-food restaurant. Your strategy-making hierarchy would most likely consist of

business strategy, functional strategies, and operating strategies.

The process of crafting and executing a company's strategy primarily consists of all of the following except

choosing employees who can support the strategy execution and strive for change.

Better financial performance typically results from which of the following?

competitive advantage, a stronger market standing, and more competitive vitality

Strategic performance is measured by the rise and fall of a company's ______

competitiveness

When management discovers that there are strategic conflicts among the various levels of an organization, what should management do?

consider which low-level strategies might be changed to accommodate high-level strategies and ensure all conflicts are resolved.

Honor, integrity, teamwork, superior customer service, and innovation are examples of company ______.

core values

In most situations, managing the strategy execution process does not primarily include which of the following principal aspects?

establishing long-run and short-run strategic and financial objectives

What entrepreneurial skills help managers craft and implement a successful company strategy?

daring to be innovative, adjusting the strategy as conditions shift, and noticing signs that the business climate is changing.

Who is the target audience of an organization's strategic vision statement?

everyone in the organization

An organization should set performance targets for which of the following?

each of the organization's separate businesses, each of the organization's individual work units, and each of the organization's product lines.

Which factors do managers consider when establishing performance objectives?

economic conditions within the industry, the company's internal capabilities, and competition from other businesses.

Which of the following are true about how the content of a company's strategic plan is typically shared with different audiences?

excerpts of the plan are posted on the company website, a summary of the plan is published in the company's annual report, and the plan is circulated to the managers within the company.

Which statements are true about companies where core values are taken seriously?

executives demonstrate the values in their own behavior and executives attempt to make the values an integral part of the corporate culture.

What are the best tactics for convincing lower-level managers and employees to support the company's strategic vision?

explaining why the company is taking a particular direction and sharing updates and progress reports.

An effectively worded mission statement does not

express that making a profit is the company's true business purpose.

When setting objectives, which types of performance targets must be established?

financial and strategic

An effectively worded strategic vision statement is?

flexible, focused, and directional.

A business strategy

focuses on crafting responses to changing market circumstances and initiating actions to develop strong competitive capabilities in a particular line of business

To mobilize employee support for a new strategic vision for a company, executives should _____

give convincing reasons for taking the organization in a new direction.

Google's vision, "to organize the world's information and make it universally accessible and useful" can be said to be a good example of

how companies may communicate management's aspirations to stakeholders (customers, employees, stockholders, suppliers, etc.) and help steer the energies of company personnel in a common direction by using an easily remembered slogan

The most demanding and lengthy part of the strategy management process is ______.

implementing the strategy

Financial objectives are important for doing which of the following?

increasing profit margins, achieving shareholder satisfaction, and increasing revenue.

To implement a strategy, what elements will a manager usually need to assemble?

information and operating systems, personnel with appropriate skills and expertise, and adequate resources for activities critical to strategic success

Which elements form part of a company's strategic plan?

intended competitiveness moves, company direction, and basic business model.

Nike's vision, "to bring innovation and inspiration to every athlete in the world,"

is a short slogan to illuminate the organization's direction and purpose.

Members of an organization are most likely to support a new strategic vision if the document does which of the following?

is explained by top executives to as many people as possible, explains where the organization is going and why, and is distributed throughout the organization.

You have been asked to evaluate Kampus Kombucha's mission statement, "to heal and refresh everyone we touch". You would most likely observe that Kampus Kombucha's mission statement

is vague, fairly uninformative, and blurs the essence of this company's business activities.

Which statements are true of a company's strategic vision?

it steers the organization in a specific direction, it is crafted by the company's top managers, and it explains why the vision makes sound business sense.

What caused the governance failure at Volkswagen?

lack of independent directors

Although senior managers have _________ for crafting and executing a company's strategy, it is the duty of a company's board of directors to exercise strong oversight and ensure that the five tasks of strategic management are conducted in a manner that is in the best interests of shareholders and other stakeholders

lead responsibility

The governance failures at Volkswagen

led to the resignation of the CEO, product recall, declining sales, potential lasting negative effects on the brand, and harm to multiple parties in areas where Volkswagen operated.

Which statements are true about assessing the effectiveness of a strategic plan?

managers should evaluate how the strategy is working throughout the company, managers should make adjustments in areas that aren't working well and continue strategies that are succeeding, and managers should search diligently for ways the strategy can be improved.

To ensure that employees will help execute the company's strategy, what should a manager do?

managers should reward employees when they achieve performance goals, managers should provide a leadership to keep the strategy moving forward, and managers should encourage a company culture that will help the strategy succeed.

The German governance model requires German corporations to operate two-tier governance structures. In addition, German law requires large companies to have at least 50 percent supervisory board representation from workers. This structure is meant to provide

more oversight by independent board members and greater involvement by a wider set of stakeholders.

Which of the following should a manager do to implement a strategic plan?

motivate employees, build and strengthen competitive capabilities, and direct organizational change

The manager of a plant that produces canned goods and is owned by a food and beverage company develops a strategy for updating its production lines while maintaining its quality controls. This is an example of a(n) ______.

operating strategy

Virtually all boards of directors have an audit committee, which is always composed entirely of

outside directors

What are the obligations of a company's board of directors?

overseeing the company's financial accounting and financial reporting practices, evaluating the strategic leadership abilities of the CEO, and evaluating the company's direction and strategy.

What are lagging indicators?

performance measurements resulting from decisions and activities in the past.

In a small, privately owned company, the strategic plan is most likely something that the owner has ______

pondered without writing down

The balanced scorecard

provides a company's employees with clear guidelines about how their jobs are linked to the overall objectives of the organization.

When conditions outside or inside the company change enough to cause substantial disruptions, managers should _____

reevaluate the organization's direction and strategy.

To measure how well a company is moving in the intended direction, it is important to ______

set objectives

Operating strategies are designed to manage which of the following?

specific activities, such as internet sales and key units, such as distribution centers

If a company's board of directors is strong and independent, what should it be able to do?

stop management from taking actions that are too risky or inappropriate, guide and judge the CEO and other executives, and certify to shareholders that the CEO is performing as the board expects.

The most reliable leading indicators are ______

strategic outcomes that measure competitiveness and market position

A sense of "where we are going" is called the company's ____

strategic vision

Top management's views and conclusions about the company's long-term direction and which product-customer-market-technology mix seems optimal for the road ahead together constitute a company's

strategic vision

Business strategy, in contrast to corporate strategy, involves which of the following?

strengthening the market position of individual business units and improving the performance of individual business units.

Sometimes a company's CEO is the main person who develops the organization's strategy. This most often happens in which of the following situations?

the CEO is the owner and manager of a small company, the CEO is the founder of a company that grew into a larger corporation, and the CEO has particularly strong strategic leadership skills.

Volkswagen's supervisory board was unwilling to take responsibility for the emissions scandal because

the board did not feel they had the technical expertise to make decisions on emissions and controls.

Which of the following groups is primarily responsible for challenging a chief executive officer (CEO) who is acting inappropriately in that position?

the board of directors

Top executives can unify the various strategies within a company by telling lower managers and other personnel about which of the following?

the organization's vision, the organization's objectives, and the major components of the corporate strategy

While developing a strategic vision, a company's managers might change which of the following?

the products the company will offer, the markets in which the company will compete, and the type of customers the company will serve.

Why do some companies state their core values but make little effort to ensure that individual personnel and the company in general will abide by them?

the statement about values serves only to make the company look good.

A mission represents

the strategic actions the firm takes.

Why are stretch objectives helpful?

they help an organization perform at its full potential, they motivate employees to be more productive, and the prevent employees from settling for a comfortable level of performance.

What purposes are served by a company slogan?

to define the organization's direction, to motivate personnel to overcome obstacles, and to help employees maintain focus on the company's purpose.

When charting a company's direction, why do managers set objectives?

to establish performance targets that the managers hope to achieve, using the company's mission and vision.

Why do companies designate a set of core values?

to guide the company as it pursues its vision and mission, to guide the behavior of personnel, and to encourage certain beliefs, traits, and behavioral norms.

What is the role of a company's board of directors?

to oversee top executives and ensure that they craft and implement an effective strategy and to ensure that the company is operating in the best interests of shareholders and other stakeholders.

What is the purpose of a company's strategic vision?

to steer the company toward long-term growth and profits.

Within the hierarchy of a company, a number of strategies are likely to have been developed and implemented by various people. Under what circumstances will the company perform most effectively?

top executives clearly communicate a company's strategy to company personnel, all the strategies are unified, and all employees understand the company's long-term direction

Effectively communicating the strategic vision down the line to lower-level managers and employees has the value of

winning the support of employees to help make the vision a reality.

A commonly used and easily understood strategic objective is

winning x percent of market share.

As a company strategy is implemented, it will typically _____

work well in some areas and not so well in others.