Business Strategy - Exam 1 (MC)

How do good corporate citizens function? A. They pursue discretionary activities that contribute to the betterment of society, especially in areas where government has chosen not to focus its efforts or has fallen short. B. They are active participants in the political processes. C. They identify up-and-coming managers who have a future in local- or state-level politics. D. They create a democratic workplace where the voices of lower-level employees are heard through representation on the board of directors. E. They seek to replace government functions with more efficient, market-driven solutions.

A. They pursue discretionary activities that contribute to the betterment of society, especially in areas where government has chosen not to focus its efforts or has fallen short.

When SunPower's managers engage in the process of developing a list of questions to evaluate their company's internal situation, which question does not address the task of evaluating SunPower's resources and competitive position? A. Which are SunPower's least and most profitable geographic market segments? B. How well is SunPower's present strategy working? C. How do SunPower's value chain activities impact its cost structure and customer value proposition? D. Is SunPower competitively stronger or weaker than key rivals? E. What strategic issues and problems merit front-burner managerial attention at SunPower?

A. Which are SunPower's least and most profitable geographic market segments?

The business case behind why companies should act in a socially responsible manner does NOT include A. aggressive pursuit of market share, revenues, and profits B. reduced risk of reputation-damaging incidents C. increased buyer patronage D. shareholder benefits such as increased stock price and financial performance E. internal benefits such as improved workforce retention and operational efficiency

A. aggressive pursuit of market share, revenues, and profits

Assigning a weight to each measure of competitive strength assessment is generally analytically superior because A. all of the various measures of competitive strength are not equally important. B. weighting each company's overall competitive strength by its percentage share of total industry profits produces a more accurate measure of its true competitive strength. C. a weighted ranking identifies which competitive advantages are most powerful. D. an unweighted ranking does not discriminate between companies with high and low market shares. E. it singles out which competitor has the most competitively potent core competencies.

A. all of the various measures of competitive strength are not equally important.

The process of benchmarking SunPower's value chain activities against its rivals in the solar power industry would not entail A. constructing a company value chain and identifying which activities are primary and which are support activities. B. making cross-company comparisons of the costs of performing specific value chain activities. C. identifying the best practices in performing various value chain activities. D. taking actions to improve a company's cost competitiveness when benchmarking reveals that its costs and results of performing an activity are not as good as what other companies have achieved. E. learning how best practice companies achieve lower costs or better results in performing benchmarked activities.

A. constructing a company value chain and identifying which activities are primary and which are support activities.

A "balanced scorecard" that includes both strategic and financial performance targets is a conceptually strong approach for judging a company's overall performance because A. financial performance measures are lagging indicators that reflect the results of past decisions and organizational activities, whereas strategic performance measures are leading indicators of a company's future financial performance and business prospects. B. it forces managers to put equal emphasis on financial and strategic objectives. C. it entails putting equal emphasis on good strategy execution and good business model execution. D. it assists managers in putting roughly equal emphasis on short-term and long-term performance targets. E. a balanced-scorecard approach pushes managers to avoid strategic management that reflects the results of past decisions and organizational activities.

A. financial performance measures are lagging indicators that reflect the results of past decisions and organizational activities, whereas strategic performance measures are leading indicators of a company's future financial performance and business prospects.

An option for not remedying an internal cost disadvantage includes A. implementing the use of best practices throughout the company, particularly for high-cost activities. B. performing activities in the same way as done earlier. C. investing in productivity-enhancing, cost-saving technological improvements. D. redesigning the product or some of its components to facilitate speedier and more economical manufacture or assembly. E. eliminating some cost-producing activities altogether by revamping the value chain.

B. performing activities in the same way as done earlier.

The best example of a company resource is A. having proven technological expertise and an ability to churn out new and improved products on a regular basis. B. having higher earnings per share and a higher return on shareholders' equity investment than key rivals. C. being totally self-sufficient such that the company does not have to rely in any way on key suppliers, partnerships with outsiders, or strategic alliances. D. having a larger number of competitive assets than competitive liabilities. E. having more built-in key success factors than rivals.

A. having proven technological expertise and an ability to churn out new and improved products on a regular basis.

A strategic group A. is a cluster of industry members with similar competitive approaches and market positions in the market. B. includes all rival firms having comparable profitability. C. consists of those firms whose market shares are about the same size. D. consists of those industry members that are growing at about the same rate and have similar product line breadth. E. is made up of those firms having comparable profit margins.

A. is a cluster of industry members with similar competitive approaches and market positions in the market.

Market maneuvering among industry rivals A. is ongoing and dynamic, with moves and countermoves of rivals producing a continually evolving competitive landscape that delivers winners and losers. B. centers around collaborative efforts to overcome the bargaining power of powerful suppliers and powerful buyers. C. is usually an industry's strongest driving force. D. is usually one of the two or three weakest competitive forces because of the close familiarity that rivals have for one another's likely next moves. E. determines whether the industry's strategic group map will be static or dynamic.

A. is ongoing and dynamic, with moves and countermoves of rivals producing a continually evolving competitive landscape that delivers winners and losers.

A company's strategy is a "work in progress" and evolves over time because of the A. ongoing need of company managers to react and respond to changing market and competitive conditions. B. frequent need to modify key elements of the company's business model. C. importance of developing a fresh strategic plan every year that keeps employees from becoming bored with executing the same strategy year after year. D. ongoing need to imitate the new strategic moves of the industry leaders. E. need to make regular adjustments in the company's strategic vision.

A. ongoing need of company managers to react and respond to changing market and competitive conditions.

Common moral agreement about right and wrong actions and behaviors across multiple cultures and countries, also known as ethical universalism, gives rise to A. principles that set forth the traits and behaviors considered virtuous, that is, which a good person is supposed to believe in and display. B. standards of what's ethical and what's unethical, applicable to all businesses in all countries, irrespective of local business traditions and local business norms. C. principles of right and wrong in judging the ethical correctness of business behavior. D. principles embodied in international law that all societies and countries are obliged to practice. E. standards of what constitutes ethical and unethical behavior in business situations that are partly universal, but in the main are governed by local business norms.

A. principles that set forth the traits and behaviors considered virtuous, that is, which a good person is supposed to believe in and display

Breaking down resistance to a new strategic vision typically requires that management, on an as needed basis, A. reiterate the company's need for the new direction, while addressing employee concerns head-on, calming fears, lifting spirits, and providing them with updates and progress reports as events unfold. B. institute a balance scorecard to measuring company performance, with the balance including a mixture of both old and new performance measures. C. inform company personnel about forthcoming changes in the company's strategy. D. raise wages and salaries to win the support of company personnel for the company's new direction. E. explain all updates and merits of the company's business model to align strategy with employee concerns.

A. reiterate the company's need for the new direction, while addressing employee concerns head-on, calming fears, lifting spirits, and providing them with updates and progress reports as events unfold.

Rivalry among competing sellers is generally less intense when A. rivals are wary of making fresh moves to lower prices, introduce new products, increase promotional efforts and advertising, and otherwise gain sales and market share. B. there are relatively more industry key success factors. C. barriers to entry are moderately low and the pool of likely entry candidates is large. D. the industry's driving forces are weak and rivals have mostly commodity products. E. buyers have many alternative products or services from which to choose.

A. rivals are wary of making fresh moves to lower prices, introduce new products, increase promotional efforts and advertising, and otherwise gain sales and market share.

A company's strategy consists of the action plan management takes to A. stake out a unique market position and achieve superior profitability. B. concentrate on improving the existing product offering irrespective of the changing and turbulent markets. C. compete against rivals and establish a transitory competitive advantage. D. identify its strategic vision, its strategic objectives, and its strategic intent. E. develop a more appealing business model than rivals.

A. stake out a unique market position and achieve superior profitability.

A company requires a dynamically evolving portfolio of resources and capabilities to A. sustain its competitiveness and help drive improvements in its performance. B. sustain complex manufacturing systems as a strategic recall. C. transform knowledge into a management style supporting competition in a globally diverse world. D. assist the strategic planning team in overall direction. E. sustain benefits of high market share as an interest in growth strategies.

A. sustain its competitiveness and help drive improvements in its performance.

The theory of corporate social responsibility concerns A. the company's responsibility to balance between strategic actions to benefit shareholders against the duty to be a good corporate citizen. B. a company's duty to maximize shareholder value. C. the blending of shareholder interests and employee interests. D. top management's responsibility to ensure that the company's actions and decisions are in the best interest of society at large. E. a company's duty to establish socially acceptable core values and to have a strictly enforced code of ethical conduct.

A. the company's responsibility to balance between strategic actions to benefit shareholders against the duty to be a good corporate citizen.

In which of the following instances is rivalry among competing sellers not more intense? A. when there are vast numbers of small rivals so the impact of any one company's actions is spread thinly across all industry members B. when strong companies outside the industry acquire weak firms in the industry and launch aggressive moves to transform their newly acquired competitors into stronger market contenders C. when certain competitors are dissatisfied with their market position and make moves to bolster their standing D. when competitors are fairly equal in size and capability E. when the products of rivals are weakly differentiated, buyer switching costs are low, and market demand is growing slowly

A. when there are vast numbers of small rivals so the impact of any one company's actions is spread thinly across all industry members

Conducting a competitive strength assessment does not involve an analysis of A. whether a company should correct its weaknesses by adopting best practices and/or revamping the makeup of its value chain B. which rival company is competitively weakest and the areas where it is most vulnerable to competitive attack. C. which of the rated companies is competitively strongest and what size competitive advantage it enjoys. D. whether a company has a net competitive advantage or a net competitive disadvantage relative to key rivals (with the size of the advantage/disadvantage being indicated by the differences among the companies' competitive strength scores). E. factors on which a company is competitively strongest and weakest vis-à-vis key rivals.

A. whether a company should correct its weaknesses by adopting best practices and/or revamping the makeup of its value chain

Whether buyer bargaining power poses a strong or weak source of competitive pressure on industry members depends in part on A. whether demand-supply conditions represent a buyer's market or a seller's market. B. how many buyers are engaged in collaborative partnerships with sellers. C. the degree to which buyers have any bargaining preferences and the extent to which buyers are price sensitive. D. whether the overall quality of the items being furnished by industry members is rising or falling. E. whether entry barriers are high or low and the size of the pool of likely entry candidates.

A. whether demand-supply conditions represent a buyer's market or a seller's market.

Ben Weprin is founder and CEO of Graduate Hotel, a growing chain of boutique hotels situated near college campuses and designed to cater to the nostalgia and local boosterism that are part of the culture of university towns. (Room keys are imprinted with the names of famous alumni, and public spaces are decorated with historical photos of campus life, vintage art and other collegiate artifacts.) Mr. Weprin and his company are trying to create a brand that will find year-round business by catering to more than just alumni coming back for once-a-year football weekends or 10-year anniversaries of their graduating classes. What is the major question that Mr. Weprin and his team need to ask about his company's strategy? A. What do suppliers do, and how to get supplies at the lowest cost to build a profitable business? B. What must managers do, and do well, to make a company a winner in the marketplace? C. What do customers do, how to profile customers who buy a company's product, and tailor sales strategy around them? D. What can shareholders do, and do well, to ensure a profitable company? E. What can employees do, and do well, to ensure customer satisfaction?

B. What must managers do, and do well, to make a company a winner in the marketplace?

The three dimensions of performance are often referred to in terms of the "three pillars" and include all of the following EXCEPT A. the economic impact (value and costs) that the company has on society. B. a company's efforts to reduce research and development funding to boost profits. C. a company's efforts to improve the lives of its internal and external stakeholders. D. a firm's ecological impact and environmental practices. E. the various social initiatives that make up the CSR strategies.

B. a company's efforts to reduce research and development funding to boost profits.

A much-used and potent managerial tool for determining whether a company performs particular functions or activities in a manner that represents "the best practice" when both cost and effectiveness are taken into account is A. competitive strength analysis. B. activity-based costing. C. resource cost mapping. D. SWOT analysis. E. benchmarking.

B. activity-based costing.

The payoff of good scouting reports on rivals is an improved ability to A. figure out how many key success factors a rival has. B. anticipate what moves rivals are likely to make next. C. determine which rivals are in the best strategic group. D. determine whether a rival is gaining or losing market share. E. determine whether a rival has the best strategy and is the industry leader.

B. anticipate what moves rivals are likely to make next.

From the ethical relativism perspective, which action is most likely to be considered morally valid? A. agreeing to a country's policy of prohibiting the education of females B. bribing a government official in an underdeveloped country to obtain a permit to build a hospital C. performing genital mutilations on non-consenting female teens D. bribing a government official to allow you to transfer gambling winnings to a tax haven E. employing as laborers children under the age of nine

B. bribing a government official in an underdeveloped country to obtain a permit to build a hospital

Winning a sustainable competitive edge over competitors does not hinge on which of the following? A. building competitively valuable expertise and capabilities not readily matched, and offering distinctive products B. building products and distributing them at low prices to a broad customer base irrespective of manufacturing cost C. building experience, know-how, and specialized capabilities that have been perfected over a long period of time D. having hard-to-beat capabilities and impressive product innovation E. having a distinctive competitive product offering

B. building products and distributing them at low prices to a broad customer base irrespective of manufacturing cost

In a single-business company, the strategy-making hierarchy consists of A. business strategy, divisional strategies, and departmental strategies. B. business strategy, functional strategies, and operating strategies. C. business strategy and operating strategy. D. managerial strategy, business strategy, and divisional strategies. E. corporate strategy, divisional strategies, and departmental strategies.

B. business strategy, functional strategies, and operating strategies.

One of the important benefits of a well-conceived and well-stated strategic vision is to A. clearly delineate how the company's business model will be implemented and executed. B. clearly communicate management's aspirations for the company to stakeholders and help steer the energies of company personnel in a common direction. C. set forth the firm budgetary objectives in clear and fairly precise terms. D. help create a balanced scorecard approach to objective setting and not stretch the company's resources too thin across different products, technologies, and geographic markets. E. indicate what kind of sustainable competitive advantage the company will try to create in the course of becoming the industry leader.

B. clearly communicate management's aspirations for the company to stakeholders and help steer the energies of company personnel in a common direction.

FaberRoad, a respected courier brand, is fast losing its market share to competitors who do overnight deliveries of packages or offer lower prices. The company's research department has found that many customers care more about knowing exactly when a package will arrive than getting it the next day. Which strategy would best address the current state of FaberRoad and help it regain its market? A. diversifying the different types of packages that can be transported and enabling booking through calls B. developing radio tags that could be attached to packages to allow for real-time tracking by customers' PCs and mobile phones C. employing night delivery drivers at a high cost and maintenance charges D. acquiring small transportation companies with cheaper trucks and tempos, rebranding, and using them for deliveries E. engaging in expensive advertising with new tag lines and famous celebrities to enhance its brand image in the market

B. developing radio tags that could be attached to packages to allow for real-time tracking by customers' PCs and mobile phones

A winning strategy is one that A. results in a company becoming the dominant industry leader. B. fits the company's internal and external situation, builds sustainable competitive advantage, and improves company performance. C. builds strategic fit, is socially responsible, and maximizes shareholder wealth. D. can pass the ethical standards test, the strategic intent test, and the profitability test. E. is highly profitable and boosts the company's market share.

B. fits the company's internal and external situation, builds sustainable competitive advantage, and improves company performance.

The pattern of actions and business approaches that would not define a company's strategy include actions to A. strengthen market standing and competitiveness by acquiring or merging with other companies. B. gain sales and market share with lower prices despite increased costs. C. strengthen competitiveness via strategic coalitions and partnerships. D. upgrade competitively important resources and capabilities. E. strengthen the firm's bargaining position with suppliers and distributors.

B. gain sales and market share with lower prices despite increased costs.

Characteristics of an effectively worded strategic vision statement are most likely to include A. achievable, profitable, and ethical. B. graphic, directional, and focused. C. realistic, customer-focused, and market-driven. D. challenging, competitive, and "set in concrete. E. "balanced, responsible, and rational.

B. graphic, directional, and focused.

Potential entrants are more likely to be deterred from actually entering an industry when A. incumbent firms are complacent. B. incumbent firms are willing and able to be aggressive in defending their market positions against entry. C. buyer switching costs are moderately low because of strong product differentiation among incumbent firms. D. the relative cost positions of incumbent firms are about the same, such that no one incumbent has a meaningful cost advantage. E. buyers are not particularly price-sensitive and the industry already contains a dozen or more rivals.

B. incumbent firms are willing and able to be aggressive in defending their market positions against entry.

The strength of the beliefs underlying ethical universalism is that A. ethical standards are objectively determined by religious and moral experts. B. it draws upon the collective views of multiple societies and cultures to put some clear boundaries on what constitutes ethical business behavior and what constitutes unethical business behavior no matter what country or culture a company is operating in. C. it leaves room for thinking that concepts of right and wrong can be varying shades of gray. D. ethical universalism recognizes significant variation in basic moral standards according to local cultural beliefs, local religious beliefs, and social mores. E. what is deemed right or wrong, fair or unfair, moral or immoral, ethical or unethical is (or should be) grounded in religious doctrine and applied strictly to all business situations.

B. it draws upon the collective views of multiple societies and cultures to put some clear boundaries on what constitutes ethical business behavior and what constitutes unethical business behavior no matter what country or culture a company is operating in.

Which of the following pairs of variables are least likely to be useful in drawing a strategic group map? A. brand name reputation and distribution channel emphasis B. level of profitability and size of market share C. price/perceived quality and image range and the extent of buyer appeal D. geographic market scope and degree of vertical integration E. product quality and product-line breadth

B. level of profitability and size of market share

Strategy-making is A. primarily the responsibility of key executives rather than a task for a company's entire management team. B. more of a collaborative group effort that involves all managers and sometimes key employees, as opposed to being the function and responsibility of a few high-level executives C. first and foremost the function and responsibility of a company's board of directors. D. first and foremost the function of a company's chief executive officer, who formulates strategic initiatives and submits them to the board of directors for approval. E. first and foremost the function and responsibility of a company's strategic planning staff.

B. more of a collaborative group effort that involves all managers and sometimes key employees, as opposed to being the function and responsibility of a few high-level executives

Which of the following is not an example of a complementor? A. gyms and fitness equipment B. newspapers and Internet news providers C. theme parks and hotels D. automobiles and gasoline stations E. microprocessors and laptops

B. newspapers and Internet news providers

An industry's key success factors can always be deduced by asking what factors A. can be determined from studying the winning strategies of the industry leaders and ruling out as potential key success factors the strategy elements of those firms considered to have losing strategies. B. such as product attributes and service characteristics are crucial, and what resources and competitive capabilities are needed, and what shortcomings are evident to put a company at a competitive disadvantage. C. vary according to whether an industry has high or low long-term attractiveness. D. depend on the relative competitive strengths of the industry leaders and how vulnerable they are to competitive attack. E. are a function of market share, entry barriers, and economies of scale, degree of vertical integration, and industry profitability that are advantageous.

B. such as product attributes and service characteristics are crucial, and what resources and competitive capabilities are needed, and what shortcomings are evident to put a company at a competitive disadvantage.

Integrated social contracts theory DOES NOT apply A. to principles or norms that provide some "moral free space" for the people in a particular country (or local culture or even a company) to make specific interpretations of how certain actions may or may not be permissible within the bounds defined by universal ethical principles. B. to the slippery slope of ethical relativism. C. to the principle that universal ethical norms take precedence over local ethical norms. D. to those situations where most all societies—endowed with rationality and moral knowledge—have common moral agreement on what is wrong and thereby place limits on which actions and behaviors fall inside the boundaries of what is right, and which ones fall outside. E. to commonly held views about what is morally right and wrong that constitute a "social contract" (contract with society) that is binding on all individuals, groups, organizations, and businesses in terms of establishing the line between ethical and unethical behaviors.

B. to the slippery slope of ethical relativism.

Managing the strategy-execution process involves A. tying rewards and incentives directly to profit. B.organizing the company along the lines of best practice. C. surveying employees on how they think costs can be reduced and how employee morale and job satisfaction can be improved. D. exerting the external leadership needed to drive stabilization. E. describing the strategic course that will help the company prepare for the future.

B.organizing the company along the lines of best practice.

Managerial considerations in determining how to compete successfully do not normally include A. How should a company position itself in the marketplace? B. How should a company be competitive against rivals? C. How can a company modify its entire product line to emphasize its internal service attributes? D. How should a company respond to changing economic and market conditions?E. How can a company attract, keep, and please customers?

C. How can a company modify its entire product line to emphasize its internal service attributes?

To distinguish a winning strategy from a mediocre or losing strategy, a strategic manager should ask which question? A. Is the company putting too little emphasis on behaving in an ethical and socially responsible manner? B. Is the company a technology leader? C. How well does the strategy fit the company's situation? D. Does the company have low prices in comparison to rivals? E. How good is the company's business model?

C. How well does the strategy fit the company's situation?

Ethical relativism implies that A. Concepts of right and wrong as applied to business situations are always a function of each company's own set of values, beliefs, and ethical convictions (as stated in the company's code of ethical conduct). B. Standards of what is ethically right and ethically wrong as applied to business behavior are determined solely by whatever business norms prevail in a particular company's home country and are applicable to its operations in all other countries. C. There are important occasions when local cultural norms and morality and the circumstances of the situation determine whether certain behaviors are right or wrong, for there are no absolutes when it comes to business ethics. D. Concepts of ethically right and ethically wrong are relative across countries and cultures but are universal within countries or cultures. E. Individuals and businesses have a basic right to "moral free space" and it is inappropriate to specify ethically permissible and ethically impermissible actions and behaviors.

C. There are important occasions when local cultural norms and morality and the circumstances of the situation determine whether certain behaviors are right or wrong, for there are no absolutes when it comes to business ethics.

A search engine giant specializes in all types of search items; provides a free translation feature for 80 different languages; stores all passwords for commonly visited sites in encrypted form; allows users to view ads on previously made related searches; provides suggestive search items to assist the user; allows users to view a collection of related web pages users might want to visit; and provides a faster load time and more accurate hits than its rivals. This search engine company uses a profit formula that primarily consists of A. providing a free translation feature for 80 different languages. B. providing suggestive search items based on history of sites visited. C. allowing users to view ads on previously made related searches. D. allowing users to view a collation of related web pages users might want to visit. E. providing a faster load time and more accurate hits than its rivals.

C. allowing users to view ads on previously made related searches.

Internal administrative costs which are incurred by companies for ethical wrongdoing include all of the following EXCEPT A. administrative costs associated with future compliance. B. costs of remedial education and ethics training to company personnel. C. costs attached to adverse effects on employee productivity. D. costs incurred in taking corrective actions. E. legal and investigative costs.

C. costs attached to adverse effects on employee productivity.

Competitive pressures associated with the threat of entry are greater in all of the following situations except when A. entry barriers are relatively low and buyer demand for the product is growing rapidly, and newcomers can expect to earn attractive profits without inviting a strong reaction from incumbents. B. a large pool of potential entrants exists, some of which have the capabilities to overcome high entry barriers. C. customers have low brand preferences and low degrees of loyalty to seller. D. incumbent firms are willing to strongly contest the entry of newcomers with moves designed to make entry unprofitable. E. existing industry members are looking to expand their market reach by entering product segments or geographic areas where they currently do not have a presence.

C. customers have low brand preferences and low degrees of loyalty to seller.

Understanding where a company is competitive requires A. analyzing whether a company is well positioned to gain market share and be the industry's profit leader. B. developing quantitative measures of a company's chances for future profitability. C. developing quantitative strength ratings for the company and key rivals on each industry key success factor and each pivotal resource, capability, and value chain activity. D. determining whether a company has a cost-effective value chain. E. identifying a company's core competencies and distinctive competencies (if any).

C. developing quantitative strength ratings for the company and key rivals on each industry key success factor and each pivotal resource, capability, and value chain activity.

Adopting a set of "stretch" financial and stretch strategic objectives A. pushes the company to strive for lesser but adequate profitability levels, because the stretch objectives are considered unattainable. B. is a widely held method for creating a "scorecard" for monitoring company performance. C. is an effective tool for pushing the company to perform at its full potential and deliver the best possible results. D.challenges company personnel to execute the strategy with greater enthusiasm, proficiency, and understanding. E. helps convert the mission statement into meaningful company values.

C. is an effective tool for pushing the company to perform at its full potential and deliver the best possible results.

The external market opportunities which are most relevant to a company are the ones that A. are relevant for defending against the external threats to its well-being. B. qualify to correct its internal weaknesses and resource deficiencies. C. match up well with the firm's competitive assets, offer the best prospects for growth and profitability, and present the most potential for competitive advantage. D. are reinforced by the overall business strategy and reflect the business model. E. can increase market share.

C. match up well with the firm's competitive assets, offer the best prospects for growth and profitability, and present the most potential for competitive advantage

The primary difference between a company's mission statement and the company's strategic vision is that A. mission statement deals with how to please customers, whereas a strategic vision deals with how to please shareholders. B. mission statement deals with "where we are headed," whereas a strategic vision provides the critical answer to "how will we get there?" C. mission statement typically concerns a company's present business scope and purpose, whereas a strategic vision sets forth "where we are going and why." D. mission statement explains why it is essential to make a profit, whereas the strategic vision explains how the company will be a moneymaker. E. mission statement addresses "how we are trying to make a profit today," while a strategic vision concerns "how will we make money in the markets of tomorrow?"

C. mission statement typically concerns a company's present business scope and purpose, whereas a strategic vision sets forth "where we are going and why."

The difference between the concept of a company mission statement and the concept of a strategic vision is that a A. mission statement deals with what to accomplish on behalf of shareholders, while a strategic vision concerns what to accomplish on behalf of customers. B. mission statement focuses on the methods needed to make a profit, whereas a strategic vision concerns what business model to employ in striving to make a profit. C. mission statement typically concerns a company's purpose and its present business scope, whereas the principal concern of a strategic vision is a company's aspirations for its future. D. mission statement deals with "where we are headed," whereas a strategic vision provides the critical answer to "how will we get there?" E. mission concerns what to do to achieve short-term objectives, while a strategic vision concerns what to do to achieve long-term performance targets.

C. mission statement typically concerns a company's purpose and its present business scope, whereas the principal concern of a strategic vision is a company's aspirations for its future.

The key duties of a company's board of directors in the strategy-making, strategy-executing process include A. coming up with compelling strategy proposals of their own to debate against those put forward by top management. B. taking the lead in developing the company's business model and strategic vision. C. overseeing the company's financial accounting and financial reporting practices and evaluating the caliber of senior executives' strategy-making/strategy-executing skills. D. approving the company's operating strategies, functional-area strategies, business strategy, and overall corporate strategy. E. taking the lead in formulating the company's strategic plan but then delegating the task of implementing and executing the strategic plan to the company's CEO and other senior executives.

C. overseeing the company's financial accounting and financial reporting practices and evaluating the caliber of senior executives' strategy-making/strategy-executing skills.

A deliberate strategy is best exemplified by a(n) A. online jewelry reseller that discontinues its line of turquoise rings due to lack of demand. B. airline company that cuts frills in order to cope with increasing fuel prices. C. popular downtown theater that has been staging plays and showing films decides to begin booking rock and roll acts. D. IT firm that trims jobs during a recession. E. smartphone manufacturer that divests its tablet production branch after not gaining market share.

C. popular downtown theater that has been staging plays and showing films decides to begin booking rock and roll acts.

Valid business reasons for why companies should act in a socially responsible manner DO NOT include A. generating internal benefits (such as improved employee recruiting, workforce retention, training, and worker productivity). B. acting in the best interest of shareholders in terms of increased stock price and financial performance. C. reducing the triple bottom line. D. reducing the risk of reputation-damaging incidents. E. increasing buyer patronage and customer loyalty.

C. reducing the triple bottom line.

Whole Foods has invested heavily into a system for gathering competitive intelligence about the strategic direction and likely moves of key rivals in the supermarket industry. Doing so allows Whole Foods to determine which rivals are pursuing all of the following, except A. the best strategy. B. strong performance objectives. C. similar competitive approaches. D. reliable resources and capabilities. E. flawed or weak strategies.

C. similar competitive approaches.

Tangible resources include A. reputational assets, which can include the company's reputation for quality, service, and reliability as well as its reputation for fair dealings with suppliers. B. company culture and incentive system, which includes the norms of behavior and business principles. C. technological assets such as patents, copyrights, and innovation technologies. D. relationships such as alliances that provide access to technologies, specialized know-how, or geographic markets. E. human assets and intellectual capital, which can include the talent of the work force and the creativity and innovativeness of certain personnel.

C. technological assets such as patents, copyrights, and innovation technologies.

One of the things that can be gleaned from a strategic group map of industry rivals is A. which rivals have newer manufacturing facilities and thus have achieved greater product quality. B. which strategic groups are currently being shunned by customers because of high prices and relatively low product quality. C. that some strategic groups are more favorably positioned than others because they confront weaker competitive forces and/or because they are more favorably impacted by industry driving forces. D. which rivals have been in business longer and thus have greater access to experience curve effects. E. which strategic groups have the highest profit margins and the highest customer switching costs and thus represent key operating characteristics.

C. that some strategic groups are more favorably positioned than others because they confront weaker competitive forces and/or because they are more favorably impacted by industry driving forces.

Choose the indicator that is not relevant in identifying a company's present strategy A. moves to respond and react to changing conditions in the macro-environment and in industry and competitive conditions B. the key functional strategies (R&D, supply chain management, production, sales and marketing, HR, and finance) a company is employing C. the company's mission, strategic objectives, and financial objectives D. the strategic role of its collaborative partnerships and strategic alliances with others E. management's planned, proactive moves to outcompete rivals (via better product design, improved quality or service, wider product lines, and so on)

C. the company's mission, strategic objectives, and financial objectives

An evolving strategy for a ride-share business like Uber or Lyft is not likely to be triggered by A. their need to abandon some strategy features that have been faltering or are no longer working well. B. their need to respond to the newly initiated actions and competitive moves of manufacturers of autonomous vehicles. C. their need to respond to short-term swings in the stock market that impact timing of an initial public offering (IPO). D. the proactive efforts of their managers to fine-tune and improve one or more pieces of the strategy. E. their need to keep strategy in step with changing circumstances, market conditions, and changing customer needs and expectations.

C. their need to respond to short-term swings in the stock market that impact timing of an initial public offering (IPO).

The spotlight in analyzing a company's resources, internal circumstances, and competitiveness includes such questions/concerns as A. what new acquisitions the company would be well advised to make in order to strengthen its financial performance and overall balance sheet position. B. whether the company's key success factors are more dominant than the key success factors of close rivals. C. what the company's resource strengths and weaknesses are in relation to the market opportunities and external threats. D. whether the company has the industry's most efficient and effective value chain. E. whether the company is located all over the globe.

C. what the company's resource strengths and weaknesses are in relation to the market opportunities and external threats.

Why is it important to craft a business model? A. Because it sets forth management's game plan for maximizing profits for shareholders B. Because it is a part of an operating model that focuses on delivering excellence and creating value for external shareholders and internal labor force C. Because it sets forth management's long-term action plan to match the business standards set by formidable rivals D. Because it sets forth the key components of the enterprise's business approach, indicates how revenues will be generated, and makes a case for why the strategy can deliver value to customers in a profitable manner E. Because it details exactly how management's strategy will result in the achievement of the company's strategic intent

D. Because it sets forth the key components of the enterprise's business approach, indicates how revenues will be generated, and makes a case for why the strategy can deliver value to customers in a profitable manner

What is the function of the Global Reporting Initiative? A. It promotes and establishes mutual funds investment opportunities comprised of companies that excel on the basis of the triple bottom line. B. It promotes corporate governance, climate change, and labor practices. C. It promotes greater awareness of the Dow Jones World Index, which comprises companies that are engaged in environment sustainability. D. It promotes greater transparency and facilitates benchmarking CSR efforts across firms and industries. E. It is a nonprofit reporting organization that ranks companies on habitat protection.

D. It promotes greater transparency and facilitates benchmarking CSR efforts across firms and industries

How do ethical principles apply to businesses? A. They are generally less stringent than the ethical principles for society at large. B. They are generally more stringent than the ethical principles for society at large. C. They chiefly deal with the actions and behaviors required to operate companies in a socially responsible manner. D. They are not materially different from ethical principles in general. E. They chiefly deal with the rules each company's top management and board of directors make about "what is right" and "what is wrong."

D. They are not materially different from ethical principles in general.

The four tests of a resource's competitive power are often referred to as the A. organizational capability metric analysis. B. competitive advantage sustainable method test. C. reliability resources simulation. D. VRIN test, which asks if a resource is valuable, rare, inimitable, and nonsubstitutable. E. SCIR test, which asks if a resource is sustainable, competitive, internalized, and reproducible.

D. VRIN test, which asks if a resource is valuable, rare, inimitable, and nonsubstitutable.

A well-conceived and communicated strategic vision ordinarily does not result in A. assisting the organization in preparing for the future. B. minimizing the risk of rudderless decision making. C. solidifying senior executives' view of the firm's long-term direction. D. protests from stakeholders that the business is rudderless. E. galvanizing organizational members in support of internal changes that will help make the vision a reality.

D. protests from stakeholders that the business is rudderless.

The strategically relevant factors outside a company's industry boundaries—economic conditions, political factors, sociocultural forces, technological factors, environmental factors, and legal/regulatory conditions—are known as A. general economic conditions plus the factors driving change in the markets where a company operates. B. the dominant economic features of a company's industry. C. the industry and the competitive arena in which the company operates. D. a company's macro-environment. E. the competitive market environment that exists between a company and its competitors.

D. a company's macro-environment.

In evaluating how well a company's strategy is working, the best place to start is with a A. financial ratio analysis. B. SWOT analysis. C. value chain analysis. D. clear view of what that strategy entails E. competitive strength analysis.

D. clear view of what that strategy entails

An effectively worded strategic vision statement is not likely to be A. easy to communicate (is explainable in 5-10 minutes, and can be reduced to a memorable slogan). B. graphic (paints a picture of the kind of company management is trying to create and the market position(s) the company is striving to stake out). C. directional (is forward-looking, describes the strategic course that management has charted that will help the company prepare for the future). D. consensus-driven (commits the company to a "mainstream" directional path that almost all stakeholders will enthusiastically support). E. focused (provides guidance to managers in making decisions and allocating resources).

D. consensus-driven (commits the company to a "mainstream" directional path that almost all stakeholders will enthusiastically support).

Which of the following is not one of the principal components of strategic significance in the PESTEL analysis? A. political factors including the extent to which government intervenes in the economy B. technological factors that include the pace of change and technical developments that have the potential for impacting society C. economic conditions that include the general economic climate and specific factors such as interest rates, inflation rate, and unemployment rate, as well as conditions in the stock and bond markets that can affect consumer confidence D. environmental forces that include the competitive structure, the degree of industry fragmentation, and the mobility barriers that inhibit business E. sociocultural forces that include societal values, attitudes, cultural factors, and lifestyles that impact business

D. environmental forces that include the competitive structure, the degree of industry fragmentation, and the mobility barriers that inhibit business

A winning strategy is one that A. can pass the ethical standards test, the strategic intent test, and the profitability test. B. is highly profitable and boosts the company's market share. C. builds strategic fit, is socially responsible, and maximizes shareholder wealth. D. fits the company's internal and external situation, builds sustainable competitive advantage, and improves company performance. E. results in a company becoming the dominant industry leader.

D. fits the company's internal and external situation, builds sustainable competitive advantage, and improves company performance.

The benefit of a vivid, engaging, and convincing strategic vision is NOT its ability to A. crystallize top management's own view about the company's long-term direction. B. reduce the risk of rudderless decision making by managers at all levels of the organization. C. unite company personnel behind managerial efforts to get the company moving in the intended direction. D. help company personnel understand the logic of the company's business model. E. help an organization prepare for the future.

D. help company personnel understand the logic of the company's business model.

External threats may pose various degrees of adversity upon the company and can surface from many sources and examples, except for A. the advent of cheaper or better technologies. B. rising prices on key inputs (such as energy costs). C. new burdensome regulations. D. higher overall unit costs relative to those of key competitors. E. the entry of lower-cost foreign competitors and restrictive foreign trade policies.

D. higher overall unit costs relative to those of key competitors.

A company's overall strategy A. determines whether its strategic intent is proactive or reactive. B. is customarily reviewed and approved level-by-level by the company board of directors. C. should be based on a flexible strategic vision and strategic intent. D. is really a collection of strategic initiatives and actions devised by managers and key employees up and down the whole organizational hierarchy. E. is subject to being changed much less frequently than either its objectives or its mission statement and thus serves as the base of its strategy-making pyramid.

D. is really a collection of strategic initiatives and actions devised by managers and key employees up and down the whole organizational hierarchy

When a company's social responsibility initiatives become part of the way it operates its business every day, these initiatives are A. implausible to advance a positive, high-energy workplace environment. B. heavily dependent on encouraging employee morality. C. normally based on a corporate social agenda. D. likely to be fully effective in creating a competitive advantage. E. ambiguous and rarely make a difference in the way the company does business.

D. likely to be fully effective in creating a competitive advantage.

If you were asked to develop a low-cost provider strategy for a startup passenger air carrier business, what would you most likely not recommend? A. offer low prices on short-distance flights and pay flight attendants a minimum wage B. offer low prices on short-distance flights and eliminate meals during flights C. offer low prices on short-distance flights and improve airplane capacity by reducing the distance between existing seats to permit adding more rows of seating D. offer low prices on long-distance flights and maintain long service times for aircraft between flights E. offer low prices on long-distance flights and charge fees for both carry-on and checked luggage

D. offer low prices on long-distance flights and maintain long service times for aircraft between flights

Remedying a supplier-related cost disadvantage would not entail A. integrating backward into the business of high-cost suppliers in an effort to reduce the costs of the items being purchased. B. collaborating closely with suppliers to identify mutual cost-saving opportunities. C. negotiating more favorable prices with suppliers. D. persuading forward channel allies to implement best practices. E. switching to lower-priced substitute inputs.

D. persuading forward channel allies to implement best practices.

A company's strategy is increasingly effective the more it can match the company strategy to competitive conditions, so the firm can A. pursue avenues that promote strategic thinking about how to contest competitor strengths and weaknesses and to create a checklist of potential profitability preferences. B. pursue avenues that expose the firm to as many of the different competitive pressures as possible. C. shift societal concerns, attitudes, and lifestyles by altering the pattern of competition. D. shift the competitive battle in favor of the firm by altering the underlying factors driving the five forces. E. pursue ways to identify and complement the five forces' contradictions and inferences to attract competitive growth opportunities.

D. shift the competitive battle in favor of the firm by altering the underlying factors driving the five forces

A "balanced scorecard" for measuring company performance A. entails putting equal emphasis on financial and strategic objectives. B. prevents the drive for achieving strategic objectives from overwhelming the pursuit of financial objectives. C. entails putting balanced emphasis on profit and nonprofit objectives. D. strikes a balance between financial and strategic objectives. E. prevents the drive for achieving financial objectives from overwhelming the pursuit of strategic objectives.

D. strikes a balance between financial and strategic objectives.

Which of the following is most. likely to qualify as a driving force? A. decisions by one or more outsiders not to attempt to enter the industry B. decisions on the part of industry's three biggest competitors not to pursue a strategy of striving to be the industry's low-cost leader C. an increase in the prices of substitute products D. successful introduction of innovative new products or new ways to market products E. increases in price cutting by rival sellers and the launch of major new advertising campaigns by one or more rivals

D. successful introduction of innovative new products or new ways to market products

The competitive battles among rival sellers striving for better market positions, higher sales and market shares, and competitive advantage, suggest the rivalry force A. is often weak when rivals have emotional stakes in business or face high exit barriers. B. is stronger when firms strive to be low-cost producers than when they use differentiation and focus strategies. C. is weaker when more firms have weakly differentiated products, buyer demand is growing slowly, and buyers have moderate switching costs. D. tends to intensify when strong companies with sizable financial resources, proven competitive capabilities, and respected brand names hurdle entry barriers looking for growth opportunities and launch aggressive, well-funded moves to transform into strong market contenders. E. is largely unaffected by whether industry conditions tempt rivals to use price cuts or other competitive weapons to boost unit sales.

D. tends to intensify when strong companies with sizable financial resources, proven competitive capabilities, and respected brand names hurdle entry barriers looking for growth opportunities and launch aggressive, well-funded moves to transform into strong market contenders.

A company's CSR and sustainability strategies is NOT characterized by A. the strategies and actions of all socially responsible companies that have sameness in the sense of drawing on the same categories of socially responsible behavior, with each company's version of being socially responsible being unique. B. social responsibility strategies linked to a company's customer value proposition or key value chain activities that may help build competitive advantage. C. corporate social agendas that address generic social issues that may help boost a company's reputation but are unlikely to improve its competitive strength in the marketplace. D. the company's demonstration of an adequate degree of social responsibility or efforts to be a model corporate citizen unless it spends 5 percent (or more) of pretax profits on social responsibility initiatives. E. cost savings and improved profitability that can be drivers of corporate sustainability strategies.

D. the company's demonstration of an adequate degree of social responsibility or efforts to be a model corporate citizen unless it spends 5 percent (or more) of pretax profits on social responsibility initiatives.

Short-termism is defined as A. weighing the short-term costs of regulatory compliance with the long-term costs of noncompliance. B. making assessments of the moral character of a company's managers. C. assessing the costs and damages to the company's reputation as a result of ethical violations. D. the tendency for managers to focus on immediate performance objectives at the expense of longer-term strategic objectives. E. assessing the short-term costs of complying with government regulations.

D. the tendency for managers to focus on immediate performance objectives at the expense of longer-term strategic objectives.

Common shortcomings of company vision statements include A. unrealistic, unconventional, and unbusinesslike. B. not customer-driven, out of step with emerging technological trends, and too ambitious. C. too specific and too flexible. D. too broad, vague or incomplete, bland/uninspiring, not distinctive, and too reliant on superlatives. E. too graphic, too narrow, and too risky.

D. too broad, vague or incomplete, bland/uninspiring, not distinctive, and too reliant on superlatives.

In evaluating whether the industry and competitive environment presents sufficiently attractive prospects for both competitive success and attractive profits usually does not involve a consideration of which of the following factors? A. whether the industry's future profitability will be favorably or unfavorably affected by the prevailing driving forces B. the severity of the macro-environment problems confronting the industry C. the industry's growth potential and whether competitive pressures will likely grow stronger or weaker, and whether strong competitive forces are squeezing industry profitability to subpar levels D. whether the industry's product is strongly or weakly differentiated E. whether the company occupies a stronger market position than rivals

D. whether the industry's product is strongly or weakly differentiated

In which of the following instances are industry members not subject to stronger competitive pressures from substitute products? A. The costs to buyers of switching over to the substitutes are low. B. The quality and performance of the substitutes are well-matched to what buyers need to meet their requirements. C. Substitutes are readily available at competitive prices. D. Buyer brand loyalty is weak. E. Buyers are dubious about using substitutes.

E. Buyers are dubious about using substitutes.

______________ is/are (a) set(s) of linked and closely integrated competitive assets centered around one or more cross-functional capabilities. A. A functional method compilation B. An integrated asset advantage C. Resource capabilities D. Organizational assets E. Resource bundles

E. Resource bundles

Changing circumstances and ongoing managerial efforts to improve the strategy A. make it very difficult for a company to have concrete strategic objectives. B. explain why a company's strategic vision undergoes almost constant change. C. are consistent with a planned strategy approach. D. make it very hard to know what a company's strategy really is. E. account for why a company's strategy evolves over time.

E. account for why a company's strategy evolves over time.

According to integrative social contracts theory, the ethical standards a company should try to uphold A. are governed by the school of ethical universalism. B. should be determined by the company's board of directors. C. should never be absolute but rather always provide some wiggle room according to the circumstances of the situation. D. are governed by each country's Code of Required Ethical Conduct, which sets forth that each individual/group/business/organization has a "social contract" to observe the ethical and moral standards that the country has adopted. E. are governed both by (1) a limited number of universal ethical principles that are widely recognized as putting legitimate ethical boundaries on actions and behavior in all situations and (2) the circumstances of local cultures, traditions, and shared values that further prescribe what constitutes ethically permissible behavior and what does not—but universal norms always take precedence over local ethical norms.

E. are governed both by (1) a limited number of universal ethical principles that are widely recognized as putting legitimate ethical boundaries on actions and behavior in all situations and (2) the circumstances of local cultures, traditions, and shared values that further prescribe what constitutes ethically permissible behavior and what does not—but universal norms always take precedence over local ethical norms.

Volta Motors, a manufacturer of self-driving delivery trucks, is working on developing its next-generation electric vehicles. It has decided on a strategy of focusing on a narrow buyer segment and outcompeting rivals by offering buyers customized autonomous, self-driving electric vehicles at a lower cost than rivals. What basic strategic approach has Volta Motors decided upon? A. focused low-cost B. low-cost provider C. broad differentiation D. focused differentiation E. best-cost provider

E. best-cost provider

A company's value-creating activities can offer a competitive advantage in one of these ways. A. contribute to competitive assets and discontinue distinctive competencies. B. contribute expense savings and enhance product exclusivity. C. contribute customer experience value and conserve operating functionality. D. reduce cost disadvantages and market price anomalies. E. contribute to greater efficiency and lower costs and provide a basis for differentiation.

E. contribute to greater efficiency and lower costs and provide a basis for differentiation.

In a diversified company, the strategy-making hierarchy consists of A. its diversification strategy, its line of business strategies, and its operating strategies. B. business strategies, functional strategies, and operating strategies C. corporate strategy and a group of business strategies (one for each line of business the corporation has diversified into). D. corporate or managerial strategy, a set of business strategies, and divisional strategies within each business. E. corporate strategy, business strategies, functional strategies, and operating strategies.

E. corporate strategy, business strategies, functional strategies, and operating strategies.

An integral part of the managerial process of crafting and executing strategy includes A. deciding how much of the company's resources to employ in the pursuit of sustainable competitive advantage. B. communicating the company's values and code of conduct to all employees. C. developing a proven business model. D. deciding on the company's strategic intent. E. developing a strategic vision.

E. developing a strategic vision.

The task of stitching together a strategy A. is mainly an exercise that should be dictated by what is comfortable to management from a risk perspective and what is acceptable in terms of capital requirements. B. requires trying to copy the strategies of industry leaders as closely as possible. C. is primarily an exercise in deciding which of several freshly emerging market opportunities to pursue. D. is mainly an exercise in good planning. E. entails addressing a series of hows: how to grow the business, how to please customers, how to outcompete rivals, how to respond to changing market conditions, and how to achieve strategic and financial objectives.

E. entails addressing a series of hows: how to grow the business, how to please customers, how to outcompete rivals, how to respond to changing market conditions, and how to achieve strategic and financial objectives.

A regional electric scooter manufacturer sells its scooter at a lower price than other manufacturers of two-wheeler scooters. What will make the product most attractive for customers? A. high cost B. low profit C. low cost D. low value E. high value

E. high value

If you were asked to conduct a SWOT analysis for Procter & Gamble, you would not be able to assess A. which of Procter & Gamble's resource weaknesses and deficiencies need to be corrected so as to better enable the pursuit of important market opportunities and to better defend against certain external threats B. whether any of Procter & Gamble's resource strengths can be used to help lessen the impact of external threats C. which market opportunities are best suited to Procter & Gamble's strengths and capabilities D. how to improve Procter & Gamble's strategy by building on its strengths and capabilities E. how Procter & Gamble could turn a core competence into a distinctive competence

E. how Procter & Gamble could turn a core competence into a distinctive competence

In July 2018, the Papa John's pizza chain decided to distance itself from John Schnatter, its founder and pitchman, after it was reported that he had used a racial slur in a comment about black people. Mr. Schnatter apologized and resigned as chairman. The company said Mr. Schnatter's image, a fixture on its marketing materials, would be removed as the "first of several key steps to rebuild trust from the inside-out." Papa John's suddenly faced the tricky task of disentangling itself from its founder and convincing its customers and investors to move on, and also began considering whether or not to rebrand itself. Papa John's strategy needs to be ethical because A. of the dangers that Papa John's top management will become embarrassed if the company does not take action. B. everyone in the media is an ethics watchdog and somebody is sure to blow the whistle on the company's unethical behavior. C. of the inevitable risks of being boycotted by customers of major corporate affiliates including Major League Baseball and the National Football League if an unethical strategy is used. D. unethical strategies boost long-termism in corporate culture. E. it is good business and in the best interest of shareholders.

E. it is good business and in the best interest of shareholders

The effect of ethical standards on a company's strategy does NOT A. encompass what is unethical in whole or in part as morally wrong. B. always reflect badly on the character of the company personnel involved. C. automatically result in damage to a company's reputation and have costly consequences. D. constitute good business and pursue the best interest of shareholders. E. lead to lower employee morale and higher employee turnover.

E. lead to lower employee morale and higher employee turnover.

A "repeatedly evolving strategy" best applies to a A. nationalized bank that lends at a lower interest rate but offers a zero-processing fee in a market crowded with privatized banks running at high cost. B. firearms regulatory agency, set up by the government, that publishes industry standards for safety, reliability, and quality of arms and ammunition. C. startup cosmetics manufacturer that replicates the products of rivals but at a comparable quality and lower price. D. government housing agency that formulates urban redevelopment plans during a four-year window of time and implements them phase by phase over that period of time. E. mobile phone company, established in a saturated market, that plans its research and development activities to allow for quarterly releases of new products that match or overtake features of rivals' mobile phones.

E. mobile phone company, established in a saturated market, that plans its research and development activities to allow for quarterly releases of new products that match or overtake features of rivals' mobile phones.

Unethical managerial behavior tends to be driven by such factors as A. confusing differences between what is ethical behavior in one's personal life and what is ethically permissible in business. B. widespread managerial belief in the ethical relativism school of thinking. C. widespread managerial belief in the ethical universalism school of thinking. D. a lack of training in what is ethical and what is not. E. overzealous or obsessive pursuit of personal gain, wealth, and other self interests; a company culture that puts the profitability and good business performance ahead of ethical behavior; and heavy pressures on company managers to meet or beat performance targets.

E. overzealous or obsessive pursuit of personal gain, wealth, and other self interests; a company culture that puts the profitability and good business performance ahead of ethical behavior; and heavy pressures on company managers to meet or beat performance targets.

Managers must be prepared to modify their strategy except when A. encountering stagnating market conditions and increasingly restrictive new customer acquisition opportunities. B. evidence is mounting that the current strategy is becoming less effective. C. changing circumstances affect performance and the desire to improve the current strategy. D. rivals make or adjust moves in the market due to the shifting needs of buyers. E. rivals announce their monthly profit margins in public.

E. rivals announce their monthly profit margins in public.