Strategic Management Ch. 1

The strategic management process begins​ with______. A. strategic opportunity identification B. strategy formulation C. strategy implementation D. strategy evaluation E. strategic planning

B. strategy formulation

One broad skill students can gain by taking this course is​ ______. A. to develop and use value chain​ analysis, balance​ scorecards, and financial ratio analysis B. to define and solve problems and make decisions about a particular situation C. to use a popular corporate strategic planning Excel template D. to write and evaluate vision and mission statements E. to develop a​ three-year strategic plan for any​ for-profit or nonprofit company or organization

B. to define and solve problems and make decisions about a particular situation

Three Stages of Strategic-Management process:

Formulation Implementation Evaluation

SWOT analysis

a planning tool used to analyze an organization's strengths, weaknesses, opportunities, and threats SO- strength/opp strategies WO- weakness/opp strategies ST - strength/threat strategies WT- weakness/thread strategies

Mission Statement

a statement of the organization's purpose - what it wants to accomplish in the larger environment

Objectives should be

- challenging - measurable -consistent - reasonable -clear

Why firms do no strategic planning

- no training -no understanding/appreciation of benefits -no monetary reward -no punishment -too busy putting out fires to plan ahead - view as waste bc no resulting product/service -laziness -content w/ current level of success - overconfidence - bad prior experience

Steps to Sustain Competitive Advantage

1) Continually adapting to changes in external trends/events, internal capabilities, competencies, and resources 2 formulate, implement and evaluate strategies based on those factors 3) offer products that are unique and not easily duplicated 4) accept tradeoffs by deciding what not to do; don't try to be everything to everyone

Benefits of Strategic Management

1. clearer sense of strategic vision for the firm 2. sharper focus on what is strategically important 3. improved understanding of rapidly changing environment financial improvement communication( enhanced comm, deeper understanding, greater commitment)

Which of the following is a pitfall of strategic​ planning? A. Being so formal in planning that flexibility and creativity are stifled B. Involving key employees in all phases of the planning C. Communicating the plan to employees D. Obtaining support of the process by top managers E. Using plans as standards for measuring performance

A. Being so formal in planning that flexibility and creativity are stifled

Strategic planning pitfalls

AVOID: - using strategic planning to gain control over decisions and resources - doing strategic planning to satisfy accreditation/reg - too hasty moving from mission development to strategy form - no communication to employees - top managers making intuition based decision in conflict w/ formal plan - no support from top management - top managers not supported by process - plans not used as a standard for measuring performance - delegating planning to a "planner" rather than involving all managers - not involving key parties in planning phases - not creating a collaborative environments - view planning as unnecessary

Competitive advantage

Anything a firm does especially well, compared to rival forms.

What element of strategic management answers the question​ "What do we want to​ become?" A. A mission statement B. A vision statement C. Specific​ long-term objectives D. A SWOT E. Environmental scanning

B. A vision statement

Which of the following is NOT a pitfall of strategic​ planning? A. Not using plans as standards for measuring performance B. Involving key employees in all phases of planning C. Viewing planning as unnecessary or unimportant D. Top managers making many intuitive decisions that conflict with the formal plan E. Using strategic planning to gain control over decisions and resources

B. Involving key employees in all phases of planning

Some firms view planning as a waste of time because​ ______. A. the process is​ never-ending B. no product or service is produced C. the process is too long D. it is not proven not be successful E. the return on investment is too low

B. no product or service is produced

Analytical thinking and intuitive thinking​ ______. A. are typically at odds with each other B. are seldom used together C. complement each other D. are not used in strategic planning E. guarantee strategic success

C. complement each other

Three primary intrinsic benefits of strategic planning include​ ______. A. increased return on​ investment, higher​ profits, and higher employee satisfaction B. enhanced​ communication, greater​ commitment, and higher profits C. enhanced​ communication, deeper​ understanding, and greater commitment D. less need for lower levels of​ planning, less need for​ communication, and greater commitment E. less need for​ communication, deeper​ understanding, and greater commitment

C. enhanced​ communication, deeper​ understanding, and greater commitment

One specific skill students can gain from this course is​ ________. A. improving data literacy B. thinking critically C. formulating strategies using a SWOT analysis D. collaborating E. understanding business ethics

C. formulating strategies using a SWOT analysis

In which stage of the strategic management process is an organization likely to develop a mission​ statement? A. Strategy implementation B. Strategy evaluation C. Strategic opportunity identification D. Strategy formulation E. Strategic planning

D. Strategy formulation

Historically, where did strategic planning​ originate? A. Greek mythology B. Game play C. ​Non-profits D. The military E. Business

D. The military

Apple's financially lean position with regard to manufacturing facilities provides the firm with a​ _______ over​ Sony, which invests heavily in manufacturing facilities. A. disadvantage B. comparative advantage C. sustained competitive advantage D. competitive advantage E. strategic advantage

D. competitive advantage

The logical starting point for strategic management is to​ ______. A. perform a SWOT analysis B. implement the plan C. analyze metrics D. identify the existing​ vision, mission,​ objectives, and strategies E. hold​ off-premises retreats

D. identify the existing​ vision, mission,​ objectives, and strategies

The​ strategic-management process can be described as an​ objective, logical, systematic approach for making major decisions in an organization.​ However, it is generally recognized that​ ______ is essential to making good strategic decisions. A. undisciplined intuition B. ignoring intuition C. ignoring change D. intuition E. ignorance

D. intuition

The focus of strategic management is​ ______. A. separating all the functional areas of the business to achieve organizational success B. increasing return on investment C. the profits of the firm D. functional planning E. the integration of all the functional areas of the business to achieve its organizational objectives

E. the integration of all the functional areas of the business to achieve its organizational objectives

Business strategy is based on the assumption of competition. Upon which assumption is military strategy​ based? A. Competition B. Collaboration C. Communication D. Comparison E. Conflict

E. Conflict

Which of the following is a reason some firms do not engage in strategic​ planning? A. They are willing to invest time and effort. B. They understand the benefits of planning. C. They know the effort of planning yields monetary rewards. D. They are being punished for not planning. E. They receive no formal training in strategic management.

E. They receive no formal training in strategic management.

One benefit of strategic planning is that it allows a firm to be​ _______ in shaping its own future. A. reactive B. unconcerned C. successful D. passive E. proactive

E. proactive

Strategey Implementation

Establish annual objectives, devise policies, motivate employees, allocate resources, develop a strategy-supportive culture, create an effective org structure, redirect marketing efforts, prepare budgets; develop and use info systems, link employee compensation to org performance

Internal Strengths and Weaknesses

an organization's controllable activities that are performed especially well or poorly can be relative to competitors can be looked at a divisional stated specifically as possible

Policies

are the means by which annual objectives will be achieved. Policies include guidelines, rules, and procedures established to support efforts to achieve stated objectives

difference btw military strategy planning and business

competition vs conflic

Strategic Formulation

developing a vision/mission; identify opportunities/threats; identify strength/weaknesses; establish long term objectives; generate alternative strategies; choose which strategy to pursue

vision statement

expresses what the organization should become, where it wants to go strategically first step?

External Opportunities and Threats

refer to economic, social, cultural, demographic, environmental, political, legal, governmental, technological, and competitive trends and events that could significantly benefit or harm an organization in the future

Strategy Evaluation

reviewing external and internal factors that are the bases for current strategies, measuring performance, and taking corrective actions

Annual Objectives

short-term milestones that organizations must achieve to reach long-term objectives -measurable -quantitative -challenging -realistic -consistent -prioritized needed for each long term objective

environmental scanning/ industry analysis

the process of collecting information about forces in the marketing environment

Long-term objectives

the results that an organization seeks to achieve over a multiyear period