chapter 3

A recommended procedure for formulating strategy is for top-level managers to a. form a small committee to do most of the work. b. gather inputs from large numbers of people. c. perform the task themselves during a retreat. d. base strategy on fixing customer complaints.

b

When two pharmaceutical firms get together to market a drug, their strategy is referred to as a. high speed. b. cost leadership. c. product differentiation. d. a strategic alliance.

d

A frequent decision-making error during a crisis is to a. methodically search for alternatives b. become less rational and more emotional. c. become more rational and less emotional. d. welcome differences of opinion.

b

A functional strategy for becoming and remaining a successful organization is to a. form a strategic alliance. b. find and retain competent people. c. get to market faster than others. d. export products

b

A key difference between a vision and a mission is that a. the mission relates more to today's realities. b. a mission is set farther into the future. c. a vision does not deal with products or services. d. a vision deals more with operations.

a

Billy is usually heavily influenced by the first information he receives on a topic. He is under the influence of a process called a. anchoring. b. rationalizing. c. trial and error. d. emotional intelligence.

a

Emotional intelligence generally deals with the ability to a. connect with people and understand their emotions. b. stay in control while taking tests. c. knowing how to throw a tantrum for effect. d. using common sense to earn a living

a

Policies serve as guidelines to action a. that still allow for some interpretation. b. that must be followed quite strictly. c. for workers below the top-management level. d. mostly in the areas of finance and human resources.

a

The purpose of a SWOT analysis is to assess a. strengths, weaknesses, opportunities, and threats. b. strategy, weaknesses, options, and time. c. satisfactions, worst options, and trade-offs. d. successes, winners, and ominous threats.

a

The purpose of a heuristic in decision making is to a. simplify the decision-making process. b. find a rapid way to explore more alternatives. c. obtain input from a large number of people. d. evaluate whether a decision was effective

a

The purpose of the strategic inventory is to help the manager a. size up the environment accurately.b. determine how much inventory is on hand. c. involve workers at all levels in formulating strategy. d. develop operating plans.

a

The purpose of visualization for making better decisions under crisis is to a. rehearse in your mind how you will react to the crisis. b. think of all the times you have failed in the past. c. engage in a pleasant fantasy to reduce your stress. d. imagine how angry your boss will be if your fail.

a

Which one of the following is not one of the five competitive forces that business strategists are supposed to take into account? a. competition among business units within the firm b. the power of customers to affect pricing and reduce profit margins c. the threat of similar or substitute products d. the power of suppliers to influence the company's pricing

a

Assume that Motorola developed a cell and camera phone so small it comes with a strap to wear on the wrist like a watch. Which strategy does this product launch most likely fit? a. cost leadership b. product differentiation c. focus d. high speed

b

In making a decision, the alternative should be chosen that most clearly a. is favored by top management. b. achieves the goal of the decision. c. saves the organization money. d. leads to innovation.

b

Julio was going to recommend a new billing system for the hospital where he works. However, he does not want to upset the executive who installed the system, so he does not make the recommendation. Julio has fallen into the a. overconfidence trap. b. status quo trap. c. anchoring trap. d. creativity rut.

b

Krispy Kreme donuts, a well-known donut retailer (but much smaller than Dunkin Donuts), most likely emphasizes which one of the following business strategies? a. cost leadership b. product differentiation c. strategic alliances d. high speed

b

McDonald's states that it would like "to satisfy the world's appetite for good food, well-served, at a price people can afford." The preceding reflects McDonald's a. cost-leadership strategy. b. mission. c. annual goal statement. d. advertising campaign.

b

Suppose that Starbucks opens a nation-wide chain of carwashes, called Starbucks Car Wash. After two years, the executive team sells of the car washes, and invests the cash back into building more Starbucks stores. The strategy illustrated is referred to as a. high speed. b. sticking to core competencies. c. product diversification. d. a strategic alliance.

b

The purpose of decision making is to a. analyze a problem. b. solve a problem. c. collaborate.. d. involve people in the decisions.

b

A recommendation for becoming more adept at making decisions under crisis conditions is a. to establish a special committee. b. to avoid taking risks. c. to anticipate crises d. to avoid speaking to the media

c

The firm's purpose and where it fits into the world is identified by the a. strategy. b. policy. c. mission. d. objective.

c

Which one of the following is a component of true business strategy? a. a high level of operational effectiveness b. a set of activities common to other firms c. giving customers trade-offs d. having quite different activities to make similar products for different markets

c

Which one of the following strategies should be classified as a business-level strategy? a. strategic alliances b. diversification of goods and services c. product differentiation d. sticking to core competencies

c

A major reason that decision making is often not such a rational process is that there are a. too many stages in decision making for most people to cope with. b. natural biases against diagnosing problems. c. few bounds to human decision-making capability. d. limits to how much information people can process and recall.

d

A problem is technically defined as a discrepancy between the a. past and present. b. future and present. c. person's wishes and desires. d. ideal and actual conditions

d

Management by objectives (MBO) includes a. reviewing group members' proposals. b. creating action plans to achieve objectives. c. establishing unit objectives. d. all of the choices

d

Part of Domino's Pizza's original success was based on getting pizzas delivered more quickly than competitors. This strategy is called a. strategic planning b. cost leadership c. focus. d. high speed

d

Save-A-Lot has become one of the most successful grocery chains by serving the poor and offering low prices. This is an example of a. focus strategy. b. premium pricing. c. product differentiation d. cost leadership

d

To say that a decision is based on political considerations means that it is not based on a. alliances with others. b. thoughts of acquiring power.c. both sides of an issue. d. the objective merits of the situation

d