Tina Chapter 6

The strategy-making process begins with: a. the evaluation of alternatives. b. the assessment of the need for strategic change. c. satisficing. d. a situation analysis. e. the finalization of strategic alternatives.

b. the assessment of the need for strategic change.

In the context of BCG matrix, _____ are companies that have a large share of a fast-growing market. a. Question marks b. Cash cows c. Stars d. Core firms e. Dogs

c. Stars

_____ are companies that do not follow a consistent adaptive strategy but instead respond to changes in the external environment after they occur. a. Reactors b. Pioneers c. Defenders d. Prospectors e. Analyzer

a. Reactors

_____ are the firms in a strategic group that follow strategies related to but somewhat different from those of the core firms. a. Secondary firms b. Complementary firms c. Supplier firms d. Pioneering firms e. Industry regulators

a. Secondary firms

A focus strategy entails using either a cost leadership or a differentiation approach to producing a good or service. a. True b. False

a. True

Strategic dissonance is a discrepancy between management's intended strategy and the strategy actually implemented by the managers. a. True b. False

a. True

Resource similarity and _____ are factors that determine the extent to which firms will be in direct competition with each other. a. market commonality b. related diversification c. product differentiation d. customer autonomy e. resource quality

a. market commonality

A(n) _____ strategy is a corporate strategy that addresses the question "How should we compete in this line of business?" a. firm-level b. niche-specific c. SBU-level d. industry-level e. operations-level

d. industry-level

_____ are companies that have a small share of a slow-growing market. a. Cash cows b. Dogs c. Stars d. Question marks e. Core firms

b. Dogs

When companies are performing above or better than their strategic reference points, top management is more likely to choose a daring, risk-taking strategy. a. True b. False

b. False

Significant cost reductions, layoffs of employees, closing of poorly performing stores, offices, or manufacturing plants, or closing or selling entire lines of products or services would be characteristic of a _____ strategy. a. growth b. portfolio c. firm-level d. retrenchment e. stability

d. retrenchment

_____ means producing a product or service of acceptable quality at consistently lower production charges than competitors so that the firm can offer the product or service at the lowest price in the industry. a. Cost leadership b. Divestment c. Niche leadership d. Differentiation e. Intrapreneurship

a. Cost leadership

The threat of substitute products or services is a measure of the ease with which customers can find substitutes for an industry's goods or services. a. True b. False

a. True

There are four conditions that must be met if a firm's resources are to be used to achieve a sustainable competitive advantage. The resources must be valuable, rare, imperfectly imitable, and nonsubstitutable. a. True b. False

a. True

A company that is seeking to grow by taking risks and looking for innovations is best characterized as a(n) _____. a. prospector b. analyzer c. reactor d. innovator e. defender

a. prospector

In the context of the strategic reference point theory, the _____ strategy aims to protect an existing competitive advantage. a. risk-avoiding b. deskilling c. risk-seeking d. divesting e. risk-extension

a. risk-avoiding

The term _____ refers to the overall organizational strategy that addresses the question "What business or businesses are we in or should we be in?" a. industry-level strategy b. corporate-level strategy c. portfolio strategy d. firm-level strategy e. operations strategy

b. corporate-level strategy

The purpose of a _____ strategy is to increase profits, revenues, market share, or the number of places (stores, offices, locations) in which the company does business. a. recovery b. growth c. divestment d. retrenchment e. niche

b. growth

A _____ is an assessment of the strengths and weaknesses in an organization's internal environment and the opportunities and threats in its external environment. a. market audit b. situational analysis c. differentiation analysis d. firm-level strategy e. competitive deskilling

b. situational analysis

_____ is a discrepancy between a company's intended strategy and the strategic actions managers take when actually implementing that strategy. a. Competitive dissonance b. Competitive inertia c. Strategic dissonance d. Cstomer inertia e. Differentiation discrepancy

c. Strategic dissonance

Which of the following is NOT one of the five industry forces that determine an industry's overall attractiveness and potential for long-term profitability? a. Threat of substitute products b. Bargaining power of buyers c. Bargaining power of suppliers d. Organizational synergy e. Character of the rivalry

d. Organizational synergy

Companies that are following a _____ strategy would be most likely to try to improve the way in which they sell the same goods or services to the same customers. a. pioneering b. growth c. portfolio d. stability e.retrenchment/recovery

d. stability

AlphaWheels Inc. sell a range high-end bikes. Two-thirds of its profits come from the sale of these bikes. The bikes have a large share of a fast-growing market. According to the BCG matrix, the range of high-end bikes would be classified as a(n) _____. a. problem child b. cash cow c. question mark d. star e. exclamation point

d. star

The _____ is a measure of the degree to which barriers to entry make it easy or difficult for new companies to get started in an industry. a. bargaining power of new buyers b. bargaining power of suppliers c. scope of new SBUs d. threat of new entrants e. character rivalry

d. threat of new entrants