BUS 400 Test #1
____________ is a common defining characteristic that requires companies to repeatedly adapt their strategies.
high velocity
Which of the following is one of the "Dos" for wording a vision statement?
memorable
A company achieves a competitive advantage whenever it has some type of edge over rivals in attracting buyers and coping with competitive forces.
TRUE
A company's strategy is the coordinated set of actions that is managers take in order to outperform the company's competitors and achieve superior profitability.
TRUE
A company's strategy provides direction and guidance, in terms not only what the company should do, but also what it should not do
TRUE
A strategic vision delineates management's aspirations for the company's future, providing a panoramic view of "where we are going" and a convincing rationale for why this makes good business sense.
TRUE
A strategy stands a better chance of succeeding when it is predicated on actions, business approaches, and competitive moves aimed at (1) appealing to buyers in ways that set a company apart from its rivals and (2) staking out a market position that is not crowded with strong competitors.
TRUE
An effectively communicated vision is a valuable management tool for enlisting the commitment of company personnel to actions that move the company in the intended long-term direction.
TRUE
As a general rule, the lower the price of substitutes, the higher the quality and performance of substitutes, and the lower the buyer's switching costs to substitutes, will all increase the competitive pressure from substitute products.
TRUE
Companies in one industry are vulnerable to competitive pressures from the actions of companies in a closely adjoining industry whenever buyers view the products of the two industries as good substitutes.
TRUE
Key success factors by their very nature are so important to competitive success that all firms in the industry must pay close attention to them or risk becoming an industry laggard or failure.
TRUE
Long-term objectives are critical for achieving optimal long-term performance and stand as a barrier to a nearsighted management philosophy and an undue focus on short-term results.
TRUE
One of the most important things to be gleaned from strategic group mapping is that not all positions on the map are equally attractive.
TRUE
Strategy is about competing differently from rivals--doing what competitors don't do or, even better, doing what they can't do
TRUE
The duty of a company's board of directors is to exercise strong oversight and see that management performs the various tasks involved in each of the five stages of the strategy-making, strategy-executing process in a manner that best serves the interests of shareholders and other stakeholders, including the company's customers, employees, and the communities in which the company operates.
TRUE
The goal of a PESTEL analysis is to help managers determine which of the six macro-economic factors represent the most strategically relevant factors outside the firm's industry boundaries.
TRUE
The most powerful and widely used tool for diagnosing the principal competitive pressures in a market is the five forces framework.
TRUE
The nitty-gritty issue surrounding a company's business model is whether it can execute its customer value proposition profitably
TRUE
The profit formula reveals how efficiently a company can meet customer wants and needs and deliver on the value proposition.
TRUE
The strongest of the five forces determines the extent of the downward pressure on an industry's profitability.
TRUE
To meet the standard of being ethical, a company's strategy must entail actions and behavior that can pass moral scrutiny in the sense of not being deceitful, unfair or harmful to others, disreputable, or unreasonably damaging to the environment.
TRUE
A company's customer value proposition is defined as
V-P
The two crucial elements of a company's business model are
Value Prop/Profit Formula
The _______________ of a company are certain designated beliefs, traits, and behavioral norms that management has determined should guide the pursuit of its vision and mission.
Values
Which of the following is not a common "weapon" for competing with rivals? A. Offering coupons, advertising items on sale.
Vigorously watching production costs
Which of the following is not one of the common questions asked to assess the company's industry and competitive environment?
Where is the industry in terms of the product life cycle?
A company's ______________ sets forth the logic for how its strategy will create value for customers and at the same time generate revenues sufficient to cover costs and realize a profit.
Business Model
Management's blueprint for delivering a valuable product or service to customers in a manner that will generate revenues sufficient to cover costs and yield an attractive profit is known as the company's
Business Model
Buyer bargaining power is stronger in all of the following instances except when
Buyers are poorly informed about the quality, prices, and costs of sellers
Buyer bargaining power is weaker in all of the following instances except when
Buyers pose a credible threat of integrating backward into the business of sellers
In order from top to bottom, a company's strategy-making hierarchy is
C, B, F, O
Which of the following is not typically used in creating strategic group map axes?
Company Revenues
The two basic mechanisms of __________ involve either providing the customer with a product or service that the customer values more highly than others (higher perceived value), or they produce their product or service more efficiently (lower costs).
Competitive Advantage
Winning a sustainable competitive advantage over rivals generally hinges on both
Competitively valuable
__________________ establishes an overall game plan for managing a set of businesses in a diversified, multibusiness company.
Corporate Strategy
__________ is/are orchestrated by the CEO and other senior executives while __________ is/are orchestrated by the senior executives of each line of business.
Corporate/Business
Which of the following is not an important obligation a company's board of directors typically has to fulfill?
Crafting and executing the company's strategy
The ____________ lays out the company's approach to satisfying buyer wants and needs at a price customers will consider a good value
Customer Value
Which of the following is not one of the most widely encountered barriers that entry candidates must hurdle?
Customers have weak brand preferences and/or weak loyalty to incumbent sellers
Which of the following is not among the most common drivers of industry change?
Decreasing globalization
The biggest portion of a company's current strategy is its ________ strategy
Deliberate
Which of the following is not a crucial element of the strategy-making, strategy-executing process?
Determining an executive compensation plan
Well-conceived visions are _______________ to a particular organization.
Distinctive/Specific
______________ involves determining how the drivers of change are reshaping the industry landscape and altering competitive conditions.
Driving forces analysis
Which of the following factors is not part of a PESTEL analysis?
Ecological
Reactive strategy elements developed on the fly as changing conditions warrant typically make up which portion of the firm's strategy?
Emergent
Which of the following are not elements to look for when trying to identify a company's strategy?
Executive Comp
A company's mission is the coordinated set of actions that its managers take in order to outperform the company's competitors and achieve superior profitability.
FALSE
A company's strategy can be determined to be a winning strategy if it passes two of the three tests of a winning strategy, but fails the third test
FALSE
Extreme stretch goals are warranted under all conditions.
FALSE
Generally speaking, a lack of a unified collection of strategies will not weaken the overall strategy and is not likely to impair company performance.
FALSE
High entry barriers and weak entry threats today always translate into high entry barriers and weak entry threats tomorrow.
FALSE
Mimicking the strategy of successful industry rivals--with either copycat product offerings or maneuvers to stake out the same market position--often works
FALSE
Once set, a company's vision, mission, objectives, strategy, and approach to strategy execution are essentially finalized; managing them then becomes a periodic event.
FALSE
The most powerful and widely used tool for diagnosing the principal competitive pressures in a market is the PESTEL analysis.
FALSE
The nitty-gritty issue surrounding a company's business model is whether it can specify its profit formula accurately
FALSE
Which of the following are the four dimensions of a typical Balanced Scorecard?
Fin, Cust, IP, Or
Which of the three tests of a winning strategy assesses how well a company's strategy matches the company's situation?
Fit Test
A winning strategy must pass which three tests?
Fit, Competitive, Performance
Which of the following are the three tests that can be applied to determine whether a strategy is a winning strategy?
Fit, Competitive, Performance
Which of the following are not among the four most frequently used and dependable strategic approaches to setting a company apart from rivals, building strong customer loyalty, and winning a competitive advantage?
Flexible
The key concern for corporate strategy is
Gain advantage
The key concern for business strategy is
Gain and Sustain Competitive Advantage
The most telling and trustworthy signs of good management are
Good strategy and Execution
Supplier bargaining power is weaker in all of the following instances except when
Industry members do not account for a big fraction of suppliers' sales
Supplier bargaining power is stronger in all of the following instances except when
Industry members have the potential to integrate backward in order to self-manufacture their own inputs
_____________ are those competitive factors that most affect industry members' ability to survive and prosper in the marketplace.
Key success factors
The idea that a company operates in a broad environmental context that goes beyond just the industry in which it situated is commonly referred to as the
Macro-environment
Which of the following is not a common reason why a company must be willing and ready to modify a strategy?
Managerial angst
_______ restrict firms in one strategic group from entering another more attractive strategic group in the same industry.
Mobility barriers
In order from bottom to top, a company's strategy-making hierarchy is
O, F, B, C
___________ are an organization's performance targets--the specific results management wants to achieve.
Objectives
A company's profit formula, on a per-unit basis, can be expressed as
P-C
___________ assesses the strategic relevance of the six principal components of the macro-environment.
PESTEL Analysis
Well-chosen objectives are all of the following except
Popular
A company's mission statement describes its
Present business and purpose
The evolving nature of a company's strategy means that the typical company strategy is a blend of (1) ___________ planned initiatives to improve the company's financial performance and secure a competitive edge and (2) ___________ responses to unanticipated developments and fresh market conditions.
Proactive/Reactive
The _____________ describes the company's approach to determining a cost structure that will allow for acceptable profits, given the pricing tied to its customer value proposition.
Profit formula
Which of the following is not one of the elements in Michael Porter's SOAR Framework for Competitor Analysis?
Reactions
A company's strategy in toto is commonly called its __________ strategy.
Realized
Which of the following is not a component of a company's macro-environment?
Rival firms
Which of the following factors is not a sign of weaker rivalry among competing sellers?
Rivals face high exit barriers
In most situations, managing the strategy execution process does not include which of the following principal aspects?
Senior Managers
A company's strategy does not include choices about which of the following?
Shareholder
Which is not one of the five steps of the strategy-making, strategy-executing process?
Shareholders
The technique for displaying the different market or competitive positions that rival firms occupy in the industry is known as
Strategic Group Mapping
A ___________ maps out where a company is headed, establishes strategic and financial targets, and outlines the basic business model, competitive moves, and approaches to be used in achieving the desired business results.
Strategic Plan
A company's ___________ lays out its direction, business model, competitive strategy, and performance targets for some specified period of time.
Strategic Plan
Top management's views about the company's long-term direction and what product-market-customer business mix seems optimal for the road ahead constitute a _______ for the company.
Strategic vision
Two distinct types of performance targets are required in organizations. These two types of objectives are
Strategic/Financial
_______ set(s) performance targets high enough to stretch an organization to perform at its full potential and deliver the best possible results.
Stretch Objectives
The key concern for functional area strategies is
Support Business Strategy
When a company possesses elements of a strategy that give buyers lasting reasons to prefer the company's products or services over those of competitors--reasons that competitors are unable to nullify, duplicate, or overcome despite their best efforts--it is said to have a
Sustainable Competitive Advantage
A strategic vision + mission + objectives + strategy =
A Strategic Plan
To pass the fit test, a strategy must exhibit fit along which dimensions?
All Three
A well-thought-out, forcefully communicated strategic vision pays off in which of the following respects?
All of the above
Which is of the following is not a characteristic or trait of a strong independent board of directors?
All of the above
A company's strategy includes choices about
Attract, Compete, Position
Sometimes companies can overemphasize one area of objectives. A common framework that many companies use to ensure that they do not focus too much on either strategic or financial objectives is a(n)
Balanced scorecard
All of the following are "Don'ts" for wording a vision statement except for Don't
Be Graphic
