Strategies Final Quiz Questions
when the advantages of stable prices are not important.
Backward integration is effective in all of these cases EXCEPT
False
Bargaining power of consumers is usually the most powerful of porters five competitive forces
True
Be decreasing time span for which planning can be done with any degree of certainty is a reason strategy evaluation is more difficult today
False
Being long term in nature, strategy implementation affects Tappan middle managers but none of the lower level employees
True
Besides net profit from operations and the sale of assets, the two basic sources of funds for an ongoing enterprise are debt and equity
True
Boards of directors are composed mostly of outsiders who are becoming more involved in an organizations strategic management
True
Both IE and BCG matrixes are called portfolio matrices
False
Buying off the outstanding shares of your company from the open market to make the company private is work going public mean
True
Carefully developed, written mission statements, should ensure unanimity Of purpose within the organization
True
Carefully prepared statements of a vision and mission are widely recognized as the first step in strategic management
False
Changes in the organizations management, marketing, finance, R&D, and CIS Strengths and weaknesses should all be the focus of a revised EFE matrix in strategy evaluation
True
Changing a strategy to fit an existing culture is not as effective as changing a firms culture to fit a new strategy
False
Chapter 13 bankruptcy is similar to chapter 11, but available only to large corporations
Strategy formulation
Collecting and evaluating information on competitors is essential for successful
False
Companies are avoiding outsourcing more and more because it is more expensive than traditional methods and it does not allow a firm to concentrate on core competencies
False
Consistency, distinctiveness, advantage and feasibility are Richard Rumelt's Four criteria for evaluating a strategy
Trur
Contingency plans are alternative plans that can be put into affect if certain key affects do not occur as expected
True
Criteria for evaluating strategy should be measurable and easily verifiable
True
Discretionary income and the demand for discretionary goods declines as interest rates rise
False
Effective strategy formulation can usually guarantee successful strategy implementation
False
Employee wellness cannot be a part of sustainability
False
Environmental changes should not change a mission statement
True
Exchanging members of conflicting parties so that each can gain an appreciation of the others point of you exemplifies a confrontation approach
False
Firms can continue to get away with placing green terminologies on their products and labels because there are still no legal or generally accepted definitions of terms like organic, green, safe or earth friendly
False
Firms should strive to engage in social activities that have no economic benefits, to avoid their being viewed as public relations ploys
True
Firms with planning systems are more closely resembling strategic management theory generally exhibit superior long-term financial performance relative to their industry
True
Five major stakeholders that affect pricing decisions are consumers, governments, suppliers, distributors and competitors
True
Forward integration strategy is especially effective when the availability of quality distributors is so limited as to offer a competitive advantage to those firms that integrate forward
True
Future shock occurs when the typing speed of changes over power an individual or organizations ability and capacity to adapt
True
Good intuitive judgment is always needed to determine appropriate weights and readings in the input stage matrices
True
Hispanics are expected to become a larger minority group in the United States than African-Americans by 2021
False
History has proven that the lower the trust and confidence of people in the ethics of an institution or society, the greater its economic strength
True
Ideally, the rational type change strategy is the most desirable
False
It is OK for firms to create expectations that exceed the service the firm can or will offer if it will attract customers
True
JM Smuckers CO's acquisition of Proctor & Gamble's Folger's coffee business is an example of related diversification
True
Linkages between a firms culture and strategies often to determine success
True
Many people consider it unethical for a firm to be socially irresponsible
False
Market penetration can be defined as the subdividing of a market into distinct subsets of customers according to the needs and buying habits
True
Marketing research is the systematic gathering, recording and analyzing of data about problems relating to the marketing of goods and services
Trus
Measuring organizational performance includes comparing expected results to actual results, investigating deviations from plans, evaluating individual performance and examining progress being made towards meeting stated objectives
True
Mission statements provide managers with a unity of direction that transcends individual, parochial and transitory needs by promoting a sense of shared expectations among all levels and generations of employees
False
Monitoring departmental and corporate performance regarding ethical issues can cause firms to misalign Ethical and strategic decision making
True
More than a statement of specific details, a mission statement is a declaration of attitude and outlook
True
Most large companies have a band in the functional structure in favor of decentralization
False
Most quantitative evaluation criteria are geared to long-term objectives rather than annual objectives
False
Nonprofit organizations have less need for strategic management, as they are not interested in making a profit
True
A clear mission statement describes the values and priorities of an organization
False
A conservative rule of thumb for measuring the value of a firm is to establish a business worth to be 10 times the firms most current annual profit
True
A financial budget is a document that details how funds will be obtained and spent for a specified period of time
True
A good mission statement serves as a framework for evaluating both current and prospective activities
True
A leveraged buyout occurs when a firms management and other private investors using borrowed funds by out the firms shareholders
False
A low value of the dollar means lower exports in higher imports
True
A major effort in R&D may be very risky of technology is changing rapidly and the market is growing slowly
True
A mission statement should be broad enough to reconcile differences among an organizations various stakeholders
True
A mission statement should be limited enough to exclude some ventures and brought enough to allow for creative growth
True
A mission statement, sometimes called a create statement, can be defined as an enduring statement of purpose that distinguishes one organization from other similar enterprises
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
Trur
A projected financial analysis can be used to forecast the impact of various implementation decisions
True
A reason for concern over the dilution of a company stock is a possible hostile takeover
False
A recent Wall Street Journal article reported that 80% of all firms sampled had no restrictions on relationships between a supervisor and subordinate
True
A rising tide of consciousness about the importance of business ethics is sweeping the United States and the rest of the world
True
A strategy of seeking ownership or increase control of a firms suppliers is backward integration
False
A vision statement answers the question, what is our business? Where as a mission statement answers, what do we want to become?
Internal resources
According to I/O theorists, which of the following contributes LEAST to firm's performance?
True
Among the risks that still restrained firms from Initiating business with China are rampant corruption at the absence of a legal system
True
An appropriate strategy when an organization has excess production capacity is market development
False
An external audit focuses on identifying and evaluating trends and events within the control of management
True
An important question in Mission statement should answer is, what is our business?
True
An objective, logical, systematic approach for making major decisions in an organization is a way to describe the strategic management process
True
Analytical and intuitive thinking should complement each other
True
And effective bonus system should be based on two key factors annual objectives and long-term objectives
True
And effective mission statement generate the impression if firm is successful, has direction, and is worthy of time, support, and investment
True
And organizations present strategies, objectives and mission provide a basis for generating and evaluating feasible alternative strategies, coupled with the external and internal audit information
True
Annual objectives Are key components in the strategic management process because they dictate how resources will be allocated
True
Application of the strategic management process is typically more formal and larger and well established organizations
False
Approximately 36% of firms profitability can be explained by the industry, whereas 20% Of the variance and profitability is attribute it to the firms internal factors
True
True or false to exploit and create new and different opportunities for tomorrow are now the purposes of strategic management
True
Union pacific mission statement focuses on transportation rather than on railroads because good mission statements identify the utility of a firms product to its customers
True
Value chain analysis can enable a firm to better identify its own strengths and weaknesses especially as compared to competitors value chain analysis
True
Viewing businesses as star, cash cow, dog or a question mark Is an oversimplification
False
Well conceived and properly executed mission and vision statements do not need to be subject to revision
Mission Statement
What are enduring declarations of purpose that distinguish one business from other similar firms?
planning
What is the essential bridge between the present and the future that increases the likelihood of achieving desired results?
Functional structure
What type of organizational structure promotes specialization of labor and allows rapid decision making?
False
When additional debt is issued to finance implementation of strategy, ownership and control of the enterprise are diluted
True
When developing an organizational chart, it is not wise to recommend a dual title for just one executive
False
Whereas the mission statement answers the question what do we want to become? The vision statement answers the question what is our business?
Discouraging whistle-blowing
Which of the following is NOT a way that companies can help create an ethical culture in their organization?
They should use terms like "maximize," "minimize," and "as soon as possible."
Which of the following is NOT true about objectives?
"Try to serve more than one segment with the same strategy."
Which of these is NOT a rule of thumb when using product positioning as a strategy-implementation tool?
It should be coupled with analysis in decision-making.
Which statement best describes intuition?
False
While it is socially responsible to be a good steward of the natural environment, doing so will not enable a firm to gain competitive advantage
True
Whistleblowing refers to policies that require employees to report any unethical violations they discover or see in the firm
True
White knight is a term that refers to a firm that agrees to acquire another firm when the other firm is facing a hostile takeover by some company
All of the above (Mass production, mass distribution, and mass advertising are not always required, It allows a small firm to compete successfully with a large firm, It allows a firm to operate with limited resources, and Market segmentation decisions directly affect marketing mix variables.)
Why is market segmentation an important variable in strategy implementation?
False
With a divisional structure, it is possible that competition between divisions may become so intense that it leads to improve sharing of ideas and resources for the common good of the firm
True
With information technology, in some cases it is possible to do away with the workplace by allowing employees to work at home or anywhere, anytime
Yrue
With market segmentation, a firm can better operate with limited resources
False
With the matrix structure is common for functional resources to be duplicated
true
Primary responsibility for ensuring ethical behavior rests with middle and lower level managers, since they are in position to influence many employees
True
Product development is an appropriate strategy when an organization has successful products that are in maturity stages of the product life cycle
False
Proponents of the resource-based view argue that external factors are more important than internal factors for a firm in achieving and sustaining competitive advantage
False
Punctuality, in general, is revered in all cultures of the world
Trur
Re-engineering does not usually affect the organizational structure or chart, nor does it imply job loss or employee layoffs
False
Recently and increasing number of companies have been implementing less rigorous environmental policies
True
Regardless of the size of the organization, a certain amount of management by wandering around at all levels is essential to effective strategy evaluation
False
Research shows strategic management in small firms is more formal than in large firms, but large firms that engage in strategic management outperform those that do not
True
Resistance to change can be considered the single greatest threat to successful strategy implementation
False
Return on assets is the most widely used technique for determining whether debt, Stack or a combination of debt and stock is the best alternative for raising capital to implement strategies
Falss
SWOT Matrix is widely used as an organizational tool and, if used appropriately, does not have any significant weaknesses
Trur
Segmentation Often reveals that large, random fluctuations in demand actually consist of several small, predictable, and manageable patterns
True
Shifting focus from specific issues two more general ones may increase strategist options for gaining organizational commitment
False
Small organizations require a more elaborate and detailed strategy evaluation system because they are still evolving
True
Social policy concerns what responsibilities the firm has to employees, consumers, environmentalists, minorities, communities, shareholders, and other groups
False
Social responsibility refers to actions and organization takes that are legally required to protect or enhance the well-being of living things
False
Some strategists Agree with Ralph Nader, who asserts that organizations have no obligation to do anymore for society is legally required
True
Stakeholders affect and are affected by an organization strategic decisions
False
Star, question mark, Cash cow and dogs are the four quadrants exhibited by the space matrix
True
Strategic management is an attempt to organize qualitative and quantitative information in a way that allows effective decisions to be made under conditions of uncertainty
False
Strategic objectives include those associated with growth in revenues, growth in earnings, higher Dividends, larger profit margin's and improved cash flow
False
Strategist in governmental organizations operate with far more strategic autonomy than their counterparts in private firms
False
Strategy change may be highly effective and productive if a supportive culture does not exist
True
Strategy formulation requires coordination among a few individuals, but strategy implementation requires coordination among many
True
Strategy formulation, implementation and evaluation activities occur at three hierarchical Levels and a large diversified organization; corporate, divisional and functional
True
Strategy implementation is often considered to be the most difficult stage in the strategic management process because it requires personal discipline, commitment and sacrifice
True
Strengths and weaknesses are determined relative to competitors
underestimated; overestimated
Strengths of competitors in foreign lands are often ________, and weaknesses are often ________.
False
Strengths opportunities strategies are based on using a firms internal strengths to take advantage of external opportunities and threats
True
Strengths, weaknesses, opportunities and threats should continually be monitored for change because It is not really a question of whether these factors will change but rather when they will change and in what ways
True
Sustainability refers to the extent that an organizations operations and actions protect, mend, and preserve rather than harm or destroy the natural environment
True
The BCG matrix does not reflect whether or not various divisions or their industries are growing overtime
False
The BCG matrix requires more information about the divisions than the IE matrix
True
The IE Matrix can be divided into three major regions that have different strategy implications; grow and build, hold and maintain, and harvest or die best
True
The Internet is changing the very nature of many industries by altering product lifecycles and changing the historical trade off between production standardization and flexibility
False
The basic premise of the research-based view is that the mix, type, amount and nature of a firms internal resources should be considered first and foremost in devising strategies that can lead to sustainable competitive advantage
False
The best thing strategist can do is develop strategic plans themselves and then present them to operating managers to execute
False
The controlling function of management is synonymous to strategy formulation
False
The end of the fiscal year is the best time to do a strategy evaluation
False
The focus of restructuring is changing the way work is actually carried out
True
The foundation for development of a comprehensive mission statement is provided by a clear vision
Trus
The functions of information systems are growing in importance because organizations Are becoming more complex, decentralized and globally disbursed
True
The major overall benefit of the BCG matrix is that it draws attention to the cash flow, investment characteristics and needs of an organizations various divisions
True
The major reason for developing a business mission is to create customers, and one of the most crucial questions into finding a business mission is who is our customer?
True
The most effective differentiation basis are those that are hard or expensive for rivals to duplicate
True
The most important determinants of an organizations overall strategic position are considered to be the two internal Dimensions, financial strength (FS) and competitive advantage (CA), In the 2X ternal dimensions, industry strength (IS) and environmental stability (ES)
True
The next step after segmenting markets so a firm can target particular customer groups is defined out what customer groups one and expect
True
The only certain thing about the future of any organization is change
False
The overall aim of the balance scorecard is the balance financial objectives with strategic objectives
Asking managers to read selected articles about mission statements
The process of developing a vision and mission statement often includes which of these as the first activity?
True
The process of performing an internal audit, compared to the external audit, provides more opportunity for participants to understand how their jobs, departments and divisions fit into the whole organization
True
The process of strategic management is facilitated immensely is if the firms that have an effective information system
Trye
The purpose of matching key factors is to generate feasible alternative strategies
true
The size of the circle in a BCG matrix corresponds to the proportion of corporate revenue generated by that business unit
False
The strategic management process is static in an organization
True
The strategic management process should be completely open because participation and openness and hands understanding commitment and communication within the firm
conceptually the same as; more complex
The strategic-management process for multinational firms is ________ for purely domestic firms, and the process is ________ for international firms.
False
There are four basic types of diversification; concentric, conglomerate, forward and backward
False
There is no need for a mission statement in a small nonprofit organization
True
There is no one ideal strategy evaluation system for all organizations
False
Three areas, according to James Vanhorn, comprise the functions or basic decision areas of finance; the investment decision, the financing decision in the earnings decision
True
To achieve coordinated effort by defining task in authority relations is the purpose of organizing
False
To develop an exhaustive list of every possible factor that could influence the business is the aim of an external audit
True
To perform an external audit, a company first must gather competitive intelligence and information about social, cultural, demographics, environmental, economic, political, legal, governmental and technological trends
True
Today, managers and employees can be found personally liable if they ignore, conceal, or disregard a pollution problem
True
Too much emphasis on evaluating strategies may be expensive and counterproductive
False
Tourism oriented firms in the United States are hampered when the value of the dollar falls
True
the sarbanes-oxley act Put an end to the country club atmosphere of most boards and has shifted power from CEOs to directors
True
According to Michael Porter, five competitive forces create vital opportunities and threats to organizations: 1.) new entrants, 2.) substitute products or services, 3.) bargaining power of suppliers, 4.) bargaining power of buyers and 5.) rivalry among existing firms
True
According to Porter, strategies allow organizations to gain competitive advantage from three different bases; cost leadership, differentiation and integration
True
According to research, participation in strategy evaluation activities as one of the best ways to overcome individuals resistance to change
True
According to research, the most successful new product companies use in a research and development strategy that ties internal strength to External opportunities and is linked with corporate objectives
True
Adequate, timely feedback is important to effective strategy evaluation
False
After decades of debate and struggle, firms have finally definitively determine the appropriate social policies
it should be a paper process more than a people process.
All of the following are guidelines for effective strategic planning EXCEPT
the Matrix requires at least three years worth of data.
All of the following are limitations of the BCG Matrix EXCEPT
All of the following are reasons strategy evaluation is more difficult today EXCEPT
All of the following are reasons strategy evaluation is more difficult today EXCEPT
Preventing environmental harm
All of the following business actions are considered to be unethical EXCEPT
Do not offer me ideas, emotions, ambience, feelings, and benefits. Offer me things.
All of the following utility statements are relevant in developing a mission statement EXCEPT
forward integration
Amazon installing "Amazon Lockers" in grocery, 7-Eleven, and drugstores that accept packages for later pickup, in order to combat issues with missing deliveries or having packages stolen, is an example of which type of strategy?
True
America's largest employer, by far, is the nonprofit sector
False
Americans are on the move in a population shift to the north east and Midwest given the significant rise in population in the Sun Belt region
True
Do United States leads the world in promoting women and minorities into mid and top level managerial positions in business
True
Dumping banned or flawed products in foreign markets is considered to be an unethical business practices
True
In a BCG matrix pie slice indicates the proportion of corporate profits generated by that division
True
In a multi divisional organization, each division should develop a mission statement consistent with and supportive of the corporate mission
True
In a turbulent, high velocity market, elite change strategy is best whenever the firm has the resources to pursue this approach
True
In an EFE matrix, Opportunities often receive higher weights than threats, but threats to can receive highway to if they are especially severe or threatening
True
In appropriate strategy when an organizations present channels of distribution can be used to market new products to current customers and horizontal diversification
True
In low earning periods, too much debt in the capital structure of an organization can endanger stockholders returns and jeopardize company survival
True
In many respects, business strategy is like military strategy
False
In most industries, only minor costs of producing a product or service are incurred within operations, so production Does not have great value as a competitive weapon in a company's overall strategy
True
In order for a firm To achieve sustained competitive advantage, a firm must continually adapt to changes in external trends and events and effectively formulate, implement, and evaluate strategies that capitalize upon those factors
True
In order for a firm to achieve sustained competitive advantage, A firm must continually adapt to changes in external trends and events and effectively formulate, implement, and evaluate strategies that capitalize upon those factors
False
In order to be considered bribery, the gift offered must either be money or a physical item
True
In some foreign countries, paying bribes and kickbacks is acceptable
False
In strategy evaluation, a revised IFE Matrix should indicate how effective a firms strategies have been in response to key opportunities and threats
False
In terms of number of employees, restructuring usually involves increasing the size of the firm
A strong industry position
In the SPACE analysis, what does a (+6, +3) strategy profile portray?
False
In the United States, an amicable relationship is often mandatory before conducting business
False
In times of depressed stock prices, stock issuance is often proved the most suitable alternative for obtaining capital
False
Increased costs are a disadvantage of a good information system
middle- and lower-level managers, and even nonmanagers, should be involved in the strategic planning process.
Increased education and diversity of the workforce at all levels are reasons why
False
Increased education and diversity of the workforce at all levels are reasons why the top down approach should be favored in organizations
True
Increased efficiency, quality, productivity and job satisfaction can come from cross training of workers
True
Integrating ethical decision making into performance appraisal process is one way that firms can align ethical and strategic decision making
True
Internal R&D and contract R&D Are the two basic forms of R&D in organizations
True
Introducing present products into new geographic areas is market development
True
Intuitive judgments are almost always involved in deriving quantitative criteria
False
Once a firm acquires a competitive advantage, they are usually able to sustain be competitive advantage indefinitely
True
One of the benefits of having a clear mission and vision as promoting a sense of shared expectations among all managers and employees
True
One of the fundamental strategy evaluation activities is reviewing external and internal factors that are the basis for current strategies
False
Onepositive feature of QSPM Is that it does not require intuitive judgments and educated assumptions
False
Organizing is the corner stone of affective strategy formulation
True
Peoples anxieties are raised with the thought of change because they fear economic loss, inconvenience, uncertainty and a break in normal social pattern
True
Periodic ethics workshops can help sensitize people to workplace circumstances in which ethics issues may arise
True
Policies refer to specific guidelines, methods, procedures, rules, forms, and administrative practices establish to support and encourage work toward stated goals
True
Political forecasts can be the most important part of an external audit for firms that depend heavily on government contracts