Chapter 6

Which of the following analytical tools consists of a nine-cell matrix? A) Matching Matrix B) Competitive Profile Matrix C) SPACE Matrix D) Grand Strategy Matrix E) Internal-External Matrix

E

Today, boards of directors are composed mostly of A) outsiders. B) management. C) union members. D) company employees. E) company stockholders.

A

What are the two external dimensions of the SPACE Matrix? A) Stability position and industry position B) Stability position and competitive position C) Industry position and competitive position D) Competitive position and financial position E) Financial position and industry position

A

Strategy analysis and choice largely involves making ________ decisions based on ________ information. A) long-term; short-term B) subjective; objective C) short-term; long-term D) subjective; short-term E) objective; subjective

B

What includes the set of shared values, beliefs, attitudes, customs, norms, personalities, heroes and heroines that describe a firm? A) Strategy B) Culture C) Mission D) Objectives E) QSPM

B

What type of strategies would you recommend when a firm's SPACE Matrix directional vector has the coordinates (-2, +3)? A) Aggressive B) Conservative C) Competitive D) Defensive E) Integrative

B

Which matrix is included in the decision stage of the strategy formulation framework? A) Internal Factor Evaluation Matrix B) Quantitative Strategic Planning Matrix C) Boston Consulting Group Matrix D) Grand Strategy Matrix E) Strategic Position and Action Evaluation Matrix

B

Which strategies aim at improving internal weaknesses by taking advantage of external opportunities? A) SO B) WO C) SW D) ST E) WT

B

Which of these is a limitation of QSPM? A) Only a few strategies can be evaluated simultaneously. B) It is prohibitively expensive. C) It requires intuitive judgments and educated guesses are required. D) Sets of strategies must be examined in reverse order. E) It requires equal participation from the entire organization

C

Which stage of the strategy-formulation framework involves the Quantitative Strategic Planning Matrix? A) Stage 1 B) Stage 2 C) Stage 3 D) Stage 4 E) Stage 5

C

Which strategy-formulation technique reveals the relative attractiveness of alternative strategies and thus provides an objective basis for selecting specific strategies? A) SWOT B) SPACE C) QSPM D) IFE E) CPM

C

Each of the nine techniques included in the strategy formulation framework rely on the use of A) strictly factual data. B) luck. C) financial formulas and statistics. D) intuition and analysis. E) synergy.

D

The top row of a QSPM consists of alternative strategies derived from all of the following except: A) Grand Strategy Matrix. B) BCG Matrix. C) SPACE Matrix. D) CPM Matrix

D

The two internal dimensions represented on the axes of the SPACE Matrix are A) stability position and industry position. B) industry position and internationalization. C) internationalization and competitive position. D) competitive position and financial position. E) financial position and stability position.

D

A division that has a low relative market share position and competes in a slow-growth industry is referred to as a A) Dog. B) Question Mark. C) Star. D) Cash Cow. E) Cowboy.

A

According to the Grand Strategy Matrix, which strategy is recommended for a firm with rapid market growth and a strong competitive position? A) Market penetration B) Unrelated diversification C) Joint venture D) Retrenchment E) Liquidation

A

Firms located in which quadrant of the Grand Strategy Matrix are in an excellent strategic position? A) I B) II C) III D) IV E) V

A

For companies located in Quadrant III of the Grand Strategy Matrix, the first strategy recommended is A) extensive cost and asset reduction. B) asset expansion. C) employee expansion. D) immediate liquidation of assets. E) divestiture.

A

How would a division with a low relative market share position in a high growth industry be described? A) Question Mark B) Cash Cow C) Star D) Stuck-in-the-middle E) Dog

A

In the SPACE analysis, what does a (+6, +3) strategy profile portray? A) A strong industry position B) An unstable environment C) A stable environment D) A weak industry position E) A weak financial position

A

The BCG Matrix is designed specifically to enhance which type of firm's efforts to formulate strategies? A) Companies with more than one division B) Large companies C) Companies with annual sales greater than $1 million D) Companies with annual sales of less than $1 million E) All companies

A

What term is defined as the product of multiplying the weights by the Attractiveness Scores in each row of the QSPM? A) Total Attractiveness Scores B) Sum Total Attractiveness Scores C) Weighted Scores D) Total Weighted Scores E) Factors

A

When a division of an organization has a high relative market share and is in a fast-growing industry, it is called a A) Star. B) Cash Cow. C) Cat. D) Question Mark. E) Dog.

A

Which stage of the strategy-formulation framework contains the Internal-Factor Evaluation Matrix? A) Input stage B) Analysis stage C) Matching stage D) Decision stage E) Output stage

A

Which stage of the strategy-formulation framework includes an Internal-Factor Evaluation Matrix and a Competitive Profile Matrix? A) Input B) Matching C) Decision D) Penetration E) Research

A

A division with a high relative market share position in a low-growth industry can be described as a A) Star. B) Cash Cow. C) Question Mark. D) Dog. E) Failure.

B

All of the following are limitations of the BCG Matrix except: A) viewing every business as a star, cash cow, dog or question mark can be an oversimplification. B) the Matrix requires at least three years worth of data. C) the Matrix does not reflect divisional or industry growth over time. D) the Matrix does not allow a company to be classified as somewhere in between two categories. E) variables such as size of market and competitive advantages are not considered in the Matrix.

B

Although Quadrant ________ companies are growing, according to the Grand Strategy Matrix they are unable to compete effectively, and they need to determine why the firm's current approach is ineffective and how the company can best change to improve its competitiveness. A) I B) II C) III D) IV E) V

B

In the BCG Matrix, which element represents the industry growth rate in sales, measured in percentage terms? A) x-axis B) y-axis C) first quadrant D) second quadrant E) third quadrant

B

What type of strategy would divestiture be classified as? A) Aggressive B) Defensive C) Competitive D) Offensive E) Conservative

B

The match an organization makes between its internal resources and skills and the opportunities and risks created by its external factors can be defined as A) input. B) concept formulation. C) strategy. D) SWOT. E) weakness.

C

The two positive-rated dimensions on the SPACE Matrix are A) FP and CP. B) CP and SP. C) FP and IP. D) IP and SP.

C

What tactic involves shifting focus from specific issues to more general ones? A) Equifinality B) Focus on Higher-Order Issues C) Generalization D) Satisfying E) None of the above

C

Which of the following is a limitation associated with a SWOT Matrix? A) Viewing every business as a Star, Cash Cow, Dog, or Question Mark is an oversimplification. B) Many businesses fall right in the middle of the matrix. C) The matrix has no temporal qualities. D) Other variables besides relative market share position and industry growth rate in sales need to be considered. E) The matrix does not reflect whether or not various divisions or their industry are growing over time.

C

80) Which strategy would be most appropriate for a division classified as a Dog? A) Market penetration B) Market development C) Product development D) Retrenchment E) Forward integration

D

According to the Grand Strategy Matrix, organizations in which quadrant have a strong competitive position but are in a slow-growth industry? A) I B) II C) III D) IV E) V

D

All of the following are principles of good organizational governance, as established by Business Week, except: A) no directors do business with the company or accept consulting or legal fees from the firm. B) the audit, compensation and nominating committees are made up solely of outside directors. C) each director owns a large equity stake in the company, excluding stock options. D) at least two directors are current or former company executives. E) the CEO is not also the Chairperson of the Board.

D

What analytical tool has four quadrants based on two dimensions: competitive position and market growth? A) Competitive Profile Matrix B) Internal-External Matrix C) SPACE Matrix D) Grand Strategy Matrix E) QSPM

D

Which of the following is not one of the steps involved in constructing a SWOT Matrix? A) List the firm's key external threats. B) Match internal strengths with external opportunities and record the resultant SO strategies in the appropriate cell. C) Match internal weaknesses with external threats and record the resultant WT strategies. D) List the firm's external weaknesses. E) List the firm's external opportunities.

D

Which of these is not a SPACE Matrix quadrant? A) Aggressive B) Defensive C) Competitive D) Offensive E) Conservative

D

Which strategies use a firm's strengths to avoid or reduce the impact of external threats? A) SW B) WO C) SW D) ST E) WT

D

Which tactic emphasizes that a successful outcome is more important than imposing the method of achieving it? A) Generalization B) Satisfying C) Focus on higher-order issues D) Equifinality E) Specialization

D

Forward integration would be an appropriate strategy for which of the following types of divisions? A) Dogs B) Failures C) Question Marks D) Cat E) Star

E

How many cells are in a SWOT Matrix? A) Two B) Four C) Six D) Eight E) Nine

E

The act of oversight and direction for an organization is referred to as A) corporate lawmaking. B) centralized control. C) organizational direction. D) establishing norms. E) governance.

E

What is the highest number of strategies that can be examined at one time with the QSPM? A) 1 B) 2 C) 5 D) 10 E) There is no limit.

E

Which analytical tool determines the relative attractiveness of various strategies based on the extent to which key external and internal critical success factors are capitalized? A) BCG Matrix B) SPACE Matrix C) SWOT Matrix D) IE Matrix E) QSPM

E

Which of the following is the first step in developing a QSPM? A) Compute the Total Attractiveness Scores. B) Examine the Stage 2 matrices and identify alternative strategies the organization should consider implementing. C) Assign weights to each key external and internal factor. D) Determine the Attractiveness Scores. E) Make a list of the firm's key external opportunities/threats and internal strengths/weaknesses in the left column of the QSPM.

E

Which section of the SWOT Matrix involves matching internal strengths with external opportunities? A) The WT cell B) The SW cell C) The WO cell D) The ST cell E) The SO cell

E

Which stage in the strategy-formulation framework focuses on generating feasible alternative strategies? A) Input B) Output C) Decision D) Throughput E) Matching

E

Which strategies are defensive tactics directed at reducing internal weaknesses and avoiding external threats? A) SO B) WO C) SW D) ST E) WT

E