Management300Test2

A group of managers analyze both, the internal strengths and weaknesses of their organization as well as the opportunities and threats of the external environment. What type of analysis is this?

SWOT analysis

Eileen, a college professor, has to pick a textbook for an upcoming course. She has just enough time to review a few books from the many choices available. She settles for one of the books, even though the best book might be a book that she hasn't yet reviewed. What is this process called?

Satisficing

Which of the following is an accurate description of satisficing?

Searching for and choosing acceptable or satisfactory ways to respond to problems and opportunities rather than trying to make the optimal decision

_____ are individuals who pursue causes such as reducing poverty, increasing literacy, protecting the natural environment, or reducing substance abuse.

Social entreprenuers

Allowing a foreign organization to take charge of manufacturing and distributing a product in its country or world region in return for a negotiated fee is referred to as:

licensing

The managers of an organization develop a single, well-researched, and effective plan to complete a set of tasks. Which of the following qualities, according to Henry Fayol, does this plan have?

Unity

In a first of its kind, a multinational tire manufacturer, introduces a new range of premium tires that can handle extreme temperatures better at a higher price. The tires are designed keeping in mind the climatic conditions in the Middle East and products are marketed only in the Middle East. The manufacturer is pursuing ____.

a focused differentiation strategy

The members of a team who bear primary responsibility for the success of a project and who stay with a project from inception to completion are called:

core members

Top management's decisions pertaining to the organization's mission, overall strategy, and structure constitutes an organization's _____.

corporate-level plan

The first step in a stage-gate development funnel is to:

encourage employees to come up with as many new product ideas as possible.

Intrapreneurial managers who leave their current organizations because of a lack of opportunity and start their own companies are known as _____.

entrepreneurs

Which method of international expansion poses the least amount of risk?

exporting

The strategy of designing the machine-worker interface to increase operating system efficiency is called _____.

facilities layout

A brand of cereal attracts customers by offering the lowest prices among other brands of cereals. The company uses a differentiation strategy in this situation.

false

A company that customizes every product to the unique demands of individual customers is likely to have the least overall cost in its industry

false

A computer operating system software manufacturer invests its profits in creating newer versions of its operating system software to make best use of the continuous changes in computer hardware. This is called diversification.

false

A newsletter publisher in a small town accepts subscription requests and handles queries only through the town's mail services. The publishing unit keeps track of its customers by entering or modifying customer information in a book. This publisher is using a customer relationship management technique.

false

A winery decides to manufacture its own packaging bottles instead of purchasing them from a bottle manufacturing company to reduces costs. The winery is employing a forward vertical integration strategy.

false

According to Henri Fayol, unity means that managers need to make every attempt to collect and use all available information in the planning process.

false

According to total quality management philosophy, quality is defined by the managers involved in quality control or engineering.

false

Allowing individuals to develop a sense of personal mastery is detrimental to organizational learning.

false

An automobile manufacturer redesigning the body of one of its cars to improve its aerodynamics is an example of quantum product innovation.

false

Corporate, business, and functional-level plans can all be applied over the same time horizon.

false

Decision making in response to threats occurs when managers search for ways to improve organizational performance to benefit customers, employees, and other stakeholder groups.

false

Developing a learning organization is a quick and easy process.

false

Each functional activity along the value chain adds value to a product when it raises costs and decreases the price a company can charge for it.

false

Entrepreneurship is the same as management.

false

Flexible manufacturing is a strategy based on the use of manual labor to reduce the costs associated with the product assembly process or the way services are delivered to customers.

false

Focused low-cost strategy serves a major segment of the overall market and tries to be the lowest-cost organization in the entire market.

false

Functional goals and strategies should be independent of divisional and corporate goals and strategies.

false

Identifying all relevant information for a decision means the manager has complete information.

false

Increasing the efficiency of a system is not related to attracting more customers.

false

Incremental product innovation results in the development of new, often radically different, kinds of goods and services because of fundamental shifts in technology brought about by pioneering discoveries.

false

Individual decision making is superior to group decision making in several respects.

false

Innovation refers to producing goods and services that have attributes—such as design, styling, performance, and reliability—that customers perceive as being superior to those found in competing products.

false

Inputs from an organization's members are sufficient for successful product development.

false

It is impossible for an organization to have both, low-cost as well as differentiated products.

false

Managers try to develop functional strategies that allow the organization's value chain to deliver to customers less desired product attributes for the same price.

false

Market function is the engineering and scientific research activities involved in innovating new or improved products that add value to a product.

false

People often respond poorly to greater autonomy and responsibility; the use of empowered self-managed teams decrease productivity and efficiency.

false

Process reengineering involves the fundamental rethinking and radical redesign of customer services.

false

Quality is a concept that can be applied to manufacturing but not to service organizations.

false

SWOT analysis is a planning exercise in which managers identify external environmental strengths and weaknesses.

false

Selling the same standardized product and using the same basic marketing approach in each national market is called multidomestic strategy.

false

The administrative model suggests that human decision-making capabilities are free of cognitive limitations.

false

The divisional head of an organization decides to set up the division's technical support center in another country in order to lower costs. This is an example of a functional-level strategy.

false

The fewer the inputs required to produce a given output, the lower is the efficiency and the higher the cost of outputs.

false

The level of foreign involvement and investment and degree of risk is least in wholly owned foreign subsidiaries.

false

The members of a team who bear primary responsibility for the success of a project and who stay with a project from inception to completion are called contract members.

false

The mission statements of organizations in the same market will typically be the same.

false

Total quality management focuses on stocking a large inventory so that raw materials are available even before they are needed.

false

Total quality management requires the cooperation of managers of certain functions of an organization.

false

When establishing goals, setting a completion time acts as a demotivator.

false

The goal of Six Sigma is to improve a company's quality to only six defects per million.

false (only 3 defects per million)

Self-managed teams use _____, in which different teams assemble each component part and then send those parts to a final assembly team.

fixed-position layouts

According to Henry Fayol an effective plan should have four qualities, namely unity, continuity, accuracy, and _____.

flexibility

The SUV division of a major automobile corporation decides to release a new model a month ahead of its stated release and notifies the decision to all the departments associated with the division. The departmental managers must alter their _____ to accommodate the earlier release date.

functional-level plan

_____ is a corporate-level strategy that emphasizes on reinvesting a company's profits in strengthening its competitive position in its current industry.

Concentration on a single industry

_____ is the term given to employees who engage in entrepreneurial activity and who are an important source of organizational creativity.

Intrapreneurs

Which of the following is true about the impact of information systems and the Internet on companies in general?

It has allowed for production scheduling to provide components on a just-in-time basis.

Which of the following is essential for implementing a successful total quality management program?

Breaking down barriers between functions

_____ is a decision maker's ability to discover original and novel ideas that lead to feasible alternative courses of action.

Creativity

Which of the following is a guideline to promoting individual creativity in an organization?

Creativity results when employees have an opportunity to experiment.

Which of the following is true of the impact of high-quality products?

High product quality results in high employee productivity.

Which of the following would be considered a programmed decision by James Calloway, CEO of FSE Inc.?

Hiring additional staff

_____ is the final step in implementing strategy.

Holding specific individuals or groups responsible for the attainment of corporate, divisional, and functional goals

Which of the following is true of choosing among alternative solutions?

Identifying all relevant information doesn't mean that a manager has complete information.

Which of the following is true of decision making?

In order to implement the chosen alternative many subsequent and related decisions must be made.

A furniture company is trying to keep the costs of the company low by switching its suppliers and ordering materials in larger quantities in order to reduce overall costs. The company is employing a _____.

low-cost strategy

An organization gains competitive advantage when it:

lowers costs and increases differentiation.

The first step in the managerial decision-making process is to:

recognize the need for a decision

The main aim of flexible manufacturing is to:

reduce the time required to setup production equipment.

Entering a new business or industry to create a competitive advantage in one or more of an organization's existing divisions or businesses is called _____.

related diversification strategy

The implementation of the customer relationship management (CRM) is a method of improving an organization's _____.

responsiveness to customers

_____ results from the tendency to generalize inappropriately from a small sample or from a single vivid event or episode.

Representativeness bias

When uncertainty exists, the probabilities of alternative outcomes cannot be determined and future outcomes are unknown.

True

The last step in the managerial decision-making process is:

learning from feedback

A high quality, well-designed product will always be successful in the market.

false

Cameo Ltd., a record label company, subsequently entered the airline industry to expand business. This example of a record label company entering the airline industry is an example of _____.

unrelated diversification

The development of a set of functional-level strategies that support a company's business-level strategy and strengthen its competitive advantage is known as:

value chain management

In performing a SWOT analysis, a firm realized that its managers were untrained to handle the requirements of its new division. The firm would classify this as a(n) _____.

weakness

Which of the following is a reason for incomplete information?

Ambiguity

The duration over which a plan is intended to be applied or endured is called _____.

time horizon

_____ is a plan of action to improve the ability of each of an organization's functions to perform its task-specific activities in ways that add value to an organization's goods and services.

Departmental-level strategy

_____ is a critical analysis of a preferred alternative, defending unpopular or opposing alternatives for the sake of argument.

Devil's Advocacy

Corey has been looking at several alternative locations for his new facility and performs a cost-benefit analysis in order to determine the net financial payoff of each location. Which criterion of decision-making is Corey focusing on?

Economic Feasibility

Steven, a marketing manager, wants to budget the advertising for a new product launch. He is trying to determine the amount of money that the company can afford to spend on advertising. Which criterion of decision-making is he focusing on?

Economic Feasibility

Which of the following is the rationale behind the development of flexible manufacturing techniques?

Efficiency will increase with increase in the actual production time.

Which of the following is true about total quality management?

Employees should be asked for suggestions about improvements.

Having committed large amounts of manpower and money to his landscaping business, Tony continues to keep the business running despite incurring heavy losses. What is the source of Tony's cognitive bias?

Escalating commitment

Which of the following statements about simultaneously pursuing both a low-cost strategy and a differentiation strategy is true?

Extremely well managed companies may be able to keep low costs and differentiate their products.

Cognitive biases enable managers to make good decisions.

False

Dialectical inquiry is easier to implement than devil's advocacy to blunt the effects of groupthink in group decision making.

False

Escalating commitment is the tendency of decision makers to overestimate their ability to control activities and events.

False

Managers with limited expertise are more likely to make better intuitive judgments than those with greater expertise.

False

Nonprogrammed decision making is a routine, virtually automatic process.

False

The administrative model suggests that human decision-making capabilities are free of cognitive limitations.

False

The classical decision-making model assumes that managers require very little or no information in order to make an optimum decision.

False

The tendency of managers to ignore critical information is not as serious as the existence of incomplete information.

False

Which of the following is an advantage of group decision making?

Managers can draw on the combined skills, competencies, and accumulated knowledge of group members.

_____ is the decision-making method in which group members write down ideas and solutions, read their suggestions to the whole group, and discuss and then rank the alternatives.

Nominal group technique

_____ is the process through which managers seek to improve employees' desire and ability to understand and manage the organization.

Organizational Learning

Dale, a manager, is assessing possible alternative solutions of a problem. Dale attempts to determine if a possible alternative will threaten other company projects. Which criterion of decision-making is Dale focusing on?

Practicality

Dan, the president of Bank Missouri, is attempting to determine whether the bank has both the capability and the resources to open a branch facility in a new location. Which criterion of decision-making is Dan focusing on?

Practicality

_____ results from the tendency to make decisions based on preexisting beliefs even though evidence suggest that those beliefs are wrong.

Prior Hypothesis Bias

_____ is the fundamental rethinking and radical redesign of business procedures to achieve dramatic improvements in critical measures of performance such as cost, quality, service, and speed.

Process reengineering

Which of the following should an organization do in order to obtain a competitive advantage through superior innovation?

Produce products with technologies that have not been used previously

Peggy, a foreman at a petrochemical plant, asks the plant superintendent to hire an additional worker whenever overtime hours for the previous month increase by more than 15 percent over the headcount. What type of decision is this?

Programmed

Which of the following is true about quantum product innovations?

Quantum product innovations are rarer than incremental product innovations.

Which of the following should an organization do in order to obtain a competitive advantage through superior efficiency?

Reduce the number of inputs it requires to produce a given amount of outputs

Which of the following will most likely be an opportunity according to an organization's SWOT analysis?

The company can probably takeover one of its bankrupt competitors.

Which of the following is essential for a good value chain management?

The marketing function should define business in terms of customer needs rather than the type of products.

According to an organization's SWOT analysis, which of the following would be a potential strength?

The organization has the highest profit margin in its market.

Which of the following is true about the members of a self-managed team?

They assume the responsibilities of first-line managers.

Which of the following is a reason why managers fail to generate creative solutions?

They find it difficult to view problems from a fresh perspective.

_____ is a management technique that focuses on improving attributes of an organization's products such as superior design, features, reliability, and after-sales support.

Total Quality Management (TQM)

A manager who makes a programmed decision relies on established rules and guidelines.

True

A skunkworks is a group of intrapreneurs who are deliberately separated from the normal operation of an organization to encourage them to devote all their attention to developing new products.

True

The higher the level of entrepreneurship in a firm, the higher the level of learning and innovation.

True

The key to a good assessment of the alternatives is to define the opportunity or threat exactly.

True

To avoid production blocking that occurs during brainstorming, the nominal group technique is often used.

True

A technique that forces managers to choose among competing projects so functional resources are not spread thinly over too many projects is referred to as:

a stage-gate development funnel.

According to Henry Fayol, _____ means that managers need to make every attempt to collect and use all available information in the organization's planning process.

accuracy

The first step in implementing a strategy is:

allocating responsibility for implementation to the appropriate individuals or groups.

A group of managers meets face-to-face and generates and debates a wide variety of alternatives from which to make a decision. This is called:

brainstorming

A(n) _____ strategy indicates how a division intends to compete against its rivals in an industry.

business-level

Divisional managers' decisions pertaining to divisions' long-term goals, overall strategy, and structure is called an organization's _____ plan.

business-level

A functional-level plan states the goals that the managers of each function will pursue to help their division attain its ______ goals, which, in turn, will allow the entire company to achieve its ______ goals.

business-level; corporate

Which of the following is a potential outcome when organizations offer a very high level of responsiveness to customers?

company costs will become too high

As a part of its yearly planning activities, PDQ Financial Services, generates a list of possible future scenarios and creates a plan to respond to each of these forecasts. PDQ Financial Services is practicing _____.

contingency planning

A written agreement that details factors such as responsibilities, resource commitments, budgets, time lines, and development milestones is referred to as a _____.

contract book

There has been a rapid increase in the percentage of population of a third-world nation switching to cellular technology in recent years. A major multinational telecommunication services company decides to take advantage of this change and plans to setup industry in the country with the intention of dominating the country's telecommunication market. This is an example of a _____.

corporate-level strategy

According to TQM philosophy, the _____, not the _____ in quality control or engineering, define what quality is.

customers; managers

In large organizations the functional level of management is also known as the _____ of management.

departmental level

In order to design for ease of production, a company should:

design products that have fewer component parts.

The first step in planning for an organization is:

determining the organization's missions and goals.

Two separate groups of managers are given a problem to solve, and then each group presents its proposed solution to top management in an attempt to determine the best course of action. This process is called:

dialectical inquiry

Successful implementation of TQM requires substantial cooperation between:

different value chain functions

An organization attempting to succeed by distinguishing its products from those of the competition is most likely to use a(n) _____.

differentiation strategy

A _____ is a plan of action to improve the ability of each of an organization's departments to perform its task-specific activities in ways that add value to an organization's goods and services.

functional-level strategy

Which of the following must managers in product development avoid to promote innovation and speed up product development?

funding too many projects ideas at one time

Most electronic goods have the option of changing the operating language. This done by manufacturers so that the same electronic device can be supplied and marketed around the world. The manufacturers in this case are applying a(n) _____.

global strategy

Scott finds information that counters the claims of the production team. However, Scott decides to ignore the new-found evidence in support of the team's decision. Scott is being adversely influenced by:

groupthink

Which of the following is not a product attribute or quality that most customers prefer?

high prices

There is constant, fierce competition between telecommunication companies due to the continuous advances in mobile technology and a wide range of customers tastes. This is called _____.

hypercompetition

An organization which increases its quality can improve its profits by _____ the prices of its products due to increased reliability and _____ its operating costs due to increased productivity.

increasing; reducing

Great cost savings can result from _____ inventory turnover and _____ inventory holding costs, such as warehousing and storage costs.

increasing; reducing

Illumin, a light bulb manufacturing company strives to improve the longevity and brightness of its bulbs by continuously changing designs and trying different combinations of materials and component parts while manufacturing them. This is an example of _____.

incremental product innovation

The gradual improvement and refinement of existing products over time as existing technologies are perfected is known as _____.

incremental product innovation

Managers must rely on their ______ to make the best decision when faced with uncertainty and ambiguity.

intuition and judgement

The stock of raw materials, inputs, and component parts that an organization has on hand at a particular time is called _____.

inventory

Japanese consumer electronics company Sony Corporation and the Swedish telecommunications company Ericsson combining a part of their resources to manufacture mobile phones is an example of a(n) _____.

joint venture

A _____ is a small-wheeled container used in a just-in-time inventory system to move component parts from suppliers to the assembly line.

kanban

In the Five Forces Model, the _____ that companies compete against one another for customers, the _____ the level of profits is likely to be for that industry.

more; lower

In order to cater to local tastes and culinary traditions, and often in respect of particular laws or religious beliefs, McDonald's offers customized versions of its menu to suit different countries. This is an example of _____.

multidomestic strategy

A standing plan that acts as a general guide to action that applies to the employees of an organization is called a _____.

policy

Though not formally written, an organization allows its employees to dress casually on Fridays. This is a(n) _____ of the organization.

policy

The classical model specifies how decisions should be made. In other words it is:

prescriptive

The _____ plan specifies all of the relevant information that managers need to decide whether to go ahead with a full-blown product development effort.

product development

The management of the value-chain activities that bring new products or services to market is called _____.

product development

Which of the following functions is responsible for transforming creating, assembling, or providing a good or service?

production

Barbara, a school superintendent, hires an additional teacher whenever the student enrollment in a grade goes beyond 35. This can be classified as a(n) _____ decision.

programmed

Six Sigma shares with TQM its focus on improving value chain processes to increase _____.

quality

The goods and products manufactured using fundamental shifts in technology as a result of pioneering discoveries are termed:

quantum product innovations

Because of the hostile external environment, AKY Consulting, treats its multiyear corporate-level plan as a _____ plan in order to maintain flexibility without losing sight of the need to plan for the long term.

rolling

A _____ enables managers to make midcourse corrections if environmental changes warrant or to change the thrust of the plan altogether if it no longer seems appropriate?

rolling plan

A firm has a formal, written guide regarding its zero-tolerance attitude towards sexual harassment and the consequences of its violation. By definition, this is a _____ of the firm.

rule

The _____ function plays a crucial role in an organization's value chain by locating customers and then informing and persuading them to buy the company's products.

sales

Another name for contingency planning is _____.

scenario planning

An organization's audit revealed that its customer support system is the least effective department. The customer support system is a major source of the organization's _____ defects.

service

Plans that are developed to handle nonprogrammed decision making in unusual or one-of-a-kind situations are called _____.

single-use plans

A written set of instructions which describes the series of actions that a manager should take in a specific situation is known as a:

standard operating procedure

Policies, rules, and standard operating procedures (SOPs) are all types of _____ plans.

standing

Employees tend to be motivated and perform better if they are taken in by the vision of the top managers of their organizations. It therefore becomes essentials for top managers to develop a strong sense of _____.

strategic leadership

A(n) _____ is a cluster of decisions about what goals to pursue, what actions to take, and how to use resources to achieve goals.

strategy

A tire company's products are more expensive than those offered by its competitors, but are still sought after by customers since they are more durable and perform better under harsh conditions. The tire company, in this case, has achieved competitive advantage through _____.

superior quality

Attaining _____ includes all the other methods of achieving competitive advantage.

superior responsiveness to customers

Two divisions of a company decide to use the same manufacturing facilities to capitalize on the organization's excess capacity and reduce fixed costs. This is an example of _____.

synergy

Mistakes in decision-making that some managers make repeatedly are known as:

systematic errors

A business plan that is updated every year depending on the changes in the organization and in the external environment that have taken place in the previous year is known as a rolling plan.

true

A specific action plan created to complete various aspects of a program is called a project.

true

A value chain is a chain of functional activities that transforms inputs into finished goods or services customers value.

true

A written set of instructions that describes the series of actions that a manager should take in a specific situation is called the standing operation procedure (SOP) of an organization.

true

An agreement in which managers pool or share their organization's resources and know-how with a foreign company, and the two organizations share the rewards and risks of starting a new venture is called a strategic alliance.

true

Decision making in response to opportunities occurs when managers search for ways to improve organizational performance to benefit customers, employees, and other stakeholder groups.

true

Effective process reengineering reduces the number of order fulfillment tasks that must be performed or reduces the time each task takes.

true

Entering a new industry or buying a company in a new industry that is not related in any way to an organization's current businesses or industries is called unrelated diversification.

true

Entrepreneurship is noticing an opportunity to satisfy a customer need and then deciding how to find and use resources to make a product that satisfies that need.

true

Groupthink causes the unintended effect of discouraging individuals from raising issues that run counter to majority opinion.

true

Holding specific individuals or groups responsible for the attainment of corporate, divisional, and functional goals is the last step in implementing strategy.

true

In a process layout, each workstation is self-contained, and a product goes to whichever workstation is needed to perform the next operation to complete the product.

true

Managers make decisions whenever they are engaged in planning, organizing, leading, or controlling.

true

Product development is the management of the value chain activities involved in bringing new or improved goods and services to the market.

true

Scenario planning is also known as contingency planning.

true

Soliciting information and suggestions about improvements from employees is one of the steps in implementing a successful TQM program.

true

The ability of the CEO and top managers to convey a compelling vision of what they want the organization to achieve to their subordinates is called strategic leadership.

true

The first step in defining an organization's mission is to define its business.

true

The gradual improvement and refinement of existing products over time as existing technologies are perfected are called incremental product innovations.

true

The greater the rate of technological change in an industry, the more important it is for managers to innovate.

true

The illusion of control causes managers to overestimate the odds of a favorable outcome and, consequently, to make inappropriate decisions.

true

The materials management function controls the movement of physical materials from the procurement of inputs through production and to distribution and delivery to the customer.

true

The more steps required to assemble a product or provide a service, the more opportunities there are for making a mistake.

true

Total quality management is a technique that focuses on improving the quality of an organization's products and services.

true

When considering vertical integration as a strategy to add value, managers must be careful because sometimes it may reduce a company's ability to create value when the environment changes.

true

Nokia has established production operations in foreign countries to sell its phones in those regions. The production operations perform as separate entities without any local direct involvement. These production operations are _____ of Nokia.

wholly owned subsidiaries