BUS Ch 6

When a division of an organization has a high relative market share and is in a fast-growing industry, it is called a

Star

What is a weakness associated with a SWOT Matrix?

The matrix has no temporal qualities

What is the highest number of strategies that can be examined at one time with the QSPM?

There is no limit

One of the steps of the SWOT Matrix is to list the firm's key external opportunities

True

Which of the following is the first step in developing QSPM

Make a list of the firm's key external opportunities/threats and internal strengths/weaknesses in the left column of the QSPM.

Relative market share position is given on the x-axis of the BCG Matrix

True

Whenever two firms merge, it becomes especially important to evaluate and consider culture-strategies linkages.

True

Which strategies aim at improving internal weaknesses by taking advantage of external opportunities

WO

Which strategies are defensive tactics directed at reducing internal weaknesses and avoiding environmental threats

WT

Market penetration can be classified as either a conservative, aggressive, or competitive strategy

True

The two positive-rated dimensions on SPACE Matrix are

FS and IS

Shifting focus from specific issues to more general ones may increase strategists' options for gaining organizational commitment

True

Viewing businesses as star, cash cow, dog or question mark is an oversimplification

True

Successful strategists minimize their own political exposure on issues that are highly controversial and in circumstances where opposition from major power centers was likely

True

Each of the nine techniques included in the strategy formulation framework rely on the use of

Intuition and analysis

Which of these is a limitation of QSPM?

Intuitive judgments and educated guesses are required.

What type of strategy would divestiture be classified as?

Defensive

The top row of a QSPM consists of alternative strategies derived from all of these except:

CPM Matrix

How many cells are in a SWOT Matrix?

Nine

A sustainability report provides information on firm's social-responsibility practices

True

Which of the following is not a step of a SWOT Matrix?

List the firm's external weakness

In the SPACE analysis, what does a (+6, +3) strategy profile portray?

A strong industry

All of the following are principles of good organizational governance, as established by Business Week, except

At least two directs are current or former company executives.

An organization that has a low relative market share position and competes in a slow-growth industry is referred to as a

Dog

A division with a high relative market share position in a low-growth industry can be described as a

Cash cow

For what type of company is the BCG Matrix ideal for analyzing?

Companies with more than one division

The two internal dimensions represented on the axes of the SPACE Matrix are

Competitive advantage and financial strength.

What type of strategies would you recommend when a firm's SPACE Matrix directional vector has the coordinates (-2, +3)

Conservative

What includes the set of shared values, beliefs, attitudes, customs, norms, personalities, heroes and heroines that describe a firm

Culture

What are two external dimensions of the SPACE Matrix?

Environmental stability and industry strength

Through which tactic is it possible to achieve similar results using different means or paths?

Equifinality

For companies located in Quadrant III of the Grand Strategy Matrix, the first strategy recommended is

Extensive cost and asset reduction

Which stage in the strategy-formulation framework focuses on generating feasible alternative strategies

Matching

The BCG Matrix limitations include all of these except:

Requiring at least three years' worth of data

Which strategy would be most appropriate for a company classified as a Dog?

Retrenchment

Which strategies use a firm's strengths to avoid or reduce the impact of external threats

ST

Which stage of the strategy-formulation framework involves the Quantitative Strategic Planning Ma

Stage 3

Most likely, what was a cash cow in the past?

Star

The match an organization makes between its internal resources and skills and the opportunities and risks created by its external factors can be defined as

Strategy

Strategy analysis and choice largely involves making __________ decisions based on __________ information

Subjective; objective

A positive feature of QSPM is that sets of strategies can be examined sequentially or simultaneously

True

According to the Grand Strategy Matrix, when a Quadrant I firm is too heavily committed to a single product, then concentric diversification may reduce the risks associated with a narrow product line

True

An organization's present strategies, objectives and mission provide a basis for generating and evaluating feasible alternative strategies, coupled with the external and internal audit information

True

Boards of directors are composed mostly of outsiders who are becoming more involved in an organization's strategic management

True

Both IE and BCG Matrices are called portfolio matrices

True

Conservative strategies in a SPACE Matrix most often include product development, market development, market penetration and concentric diversification

True

Culture includes the set of shared values, beliefs, attitudes, customs, norms, personalities, heroes and heroines that describe a firm

True

Good intuitive judgment is always needed to determine appropriate weights and ratings in the input stage matrices

True

Having no temporal qualities, the BCG Matrix is a snapshot of an organization at a given point in time

True

In a BCG Matrix the pie slice indicates the proportion of corporate profits generated by that division

True

The BCG Matrix does not reflect whether or not various divisions or their industries are growing over time

True

The ES and CA dimension variables in a SPACE Matrix are assigned a numerical value ranging from -1 (best) to -6 (worst).

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 divest

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

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix, the Strategic Position and Action Evaluation (SPACE) Matrix, the Boston Consulting Group (BCG) Matrix, the Internal-External (IE) Matrix and the Grand Strategy Matrix are included in stage two of the strategy-formulation framework

True

The firm should pursue aggressive strategies if the coordinates of a SPACE directional vector are (5,4)

True

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

True

The major overall benefit of the BCG Matrix is that it draws attention to the cash flow, investment characteristics and needs of an organization's various divisions

True

The most important determinants of an organization's overall strategic position are considered to be the two internal dimensions, financial strength (FS) and competitive advantage (CA), and the two external dimensions, industry strength (IS) and environmental stability (ES)

True

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

True

To objectively evaluate feasible alternative strategies identified in Stage 2, the QSPM uses input information derived from Stage 1

True

In the BCG Matrix, which element represents the industry growth rate in sales, measured in percentage terms?

Y-axis

What tactic involves shifting focus from specific issues to more general ones?

Generalization

What analytical tool has four quadrants based on two dimensions: competitive position and market growth?

Grand Strategy Matrix

Firms located in which quadrant of the Grand Strategy Matrix are in an excellent strategic position?

I

Although Quadrant _____ companies are growing, according to the Grand Strategy Matrix, they are unable to compete effectively, and they need to determine why the firm's current approach is ineffective and how the company can best change to improve its competitiveness.

II

According to the Grand Strategy Matrix, organizations in which .quadrant have a strong competitive position but are in a slow-growth industry

IV

Which stage of the strategy formulation framework includes an Internal Factor Evaluation Matrix and a Competitive Profile Matrix

Input

Which stage of the strategy formulation framework contains the Internal-Factor Evaluation Matrix

Input stage

Which analytical tool consists of a nine-cell matrix?

Internal-External Matrix

Which of these is not a SPACE Matrix quadrant?

Offensive

Today, what are boards of directors composed mostly of

Outsiders

Which analytical tool determines the relative attractiveness of various strategies based on the extent to which key external and internal critical success factors are capitalized?

QSPM

Which strategy formulation technique reveals the relative attractiveness of alternative strategies and thus provides an objective basis for selecting specific strategies

QSPM

Which matrix is included in the decision stage of the strategy formulation framework?

Quantitative Strategic Planning Matrix

How would a division with a low relative market share position in a high growth industry be described?

Question Mark

Which section of the SWOT Matrix involves matching internal strengths with external opportunities

The SO cell

What term is defined as the product of multiplying ratings by attractiveness scores in each row of the QSPM

total attractiveness scores

According to the Grand Strategy Matrix, which strategy is recommended for a firm with rapid market growth and a strong competitive position?

Market penetration

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

governance