Chapter 6 Management

The managerial tools for _____ include SWOT analysis, forecasting, and VRIO analysis

organizational assessment

in a SWOT analysis, organizational strengths are

skills and capabilities that give a company advantages in executing its strategies

In order, the steps of the strategic management process are

Establish the mission, vision, and values statements, assess the current reality, formulate the grand strategy, implement the strategy, and maintain strategic control

_____ is the process by which a company compares its performance with that of high-performing organizations

Benchmarking

According to Porter, the cost-focus and focused-differentiation strategies have what in common?

Both focus on narrow markets

The BCG matrix is a means of evaluating strategic business units based on their

Business growth rates and share of the market

In the BCG matrix, Kroger would be in the category of ____ due to being the largest retailer in the relatively stable grocery market.

Cash cows

Executive Office supply, a small family-owned company, sells high-priced desks, some as expensive as $10,000 to executives in its area. Very few companies have chosen to market this product, and Executive Office Supply has enjoyed record profits over the last 25 years. Because Executive Office Supply is a small, successful company, you would advise them not to utilize strategic planning.

False Many small business owners do not engage in strategic planning. It is suspected that the cause is short term rather than long term focus. Strategic planning requires a long term orientation.

Breyona keeps a close eye on her company's internal and external environments to identify better ways of doing business and to discover possible opportunities for new products. In which activity is Breyona engaged?

SWOT analysis

Mateo, a Florist, recently learned about strategic management and wants to implement this process for his flower shop. Mateo should begin by establishing mission, vision, and values statements.

True Establishing the mission, vision, and values statements is the first step in the strategic management process.

Executives, often referred to as the "c-suite" should focus on their decision making on which of the following?

What products and services shall we offer? What business are we in?

________ is another term for a defensive strategy

a retrenchment strategy

A SWOT analysis is

a search for the Strengths, Weaknesses, Opportunities, and Threats affecting the organization

Managers can use the VRIO framework to

analyze a firm's competitive potential

Bruno knows that one of the reasons people do not return to his home appliance store is because of the slow service. How would a SWOT analysis classify the slow service at Bruno's store?

as a weakness *organizational weaknesses are the drawbacks that hinder an organization and executing strategies in pursuit of its vision

Zene is a chef and owner of a popular restaurant. Zene frequently visits competing restaurants to observe how they are doing things. He told one of his managers, "I eat dinner at a lot of restaurants because I want to know what is going on. I am always concerned that one of our competitors will surprise us with a new service or menu item, like ours but better." In which activity is Zene engaging?

assessing current reality

When organizations endeavor (1) to keep their costs and (hence the prices of their products or services) below those of competitors and (2) to target a wide market; they are utilizing a _____ strategy

cost-leadership

To maximize profitability and competitiveness, firms must

create alignment across all levels of strategy *strategic management takes place at ALL THREE levels, each supporting the other, Though each level is distinct, there needs to be alignment across them.

A local gymnastics studio offers dance, tumbling, trampolines, and competitive cheer training for kids of all ages, To recruit students for these lessons, the studio also hosts birthday parties, afterschool care, and swim lessons. These offerings interact to

create fit among the activities

Over the course of 40 years, Bradley grew his company to six package shipping stores. With his retirement approaching and increased competition from national brands, he decided to reduce the number of locations to two. Bradley's closing of four locations represents a

defensive strategy *a defensive strategy is a grand strategy that involves reduction in the company's efforts

Duracell, a company well-known for manufacturing alkaline batteries, derives its strategic position from which source?

few needs, many customers *strategic position can be derived from serving the few needs of many customers

Growth, stability, and defensive strategies are common ____ strategies

grand

A forecast is a

projection of the future

Michael Porter proposed that business-level strategies originate with the primary competitive forces in the firm's environment, these forces are the threats of

new entrants, substitute products or services, bargaining power of suppliers and buyers, and competitive rivalries

In the BCG matrix, ____ are companies that have high growth and high market share, and are definite keepers.

stars

The three key principles of _____ are the creation of a unique and valuable position, trade offs in competing, and creating a "fit" among activities.

strategic positioning

the CEO of Alliance Manufacturing said to her new vice present of Finance, "In the past, I had resistance to new ideas by employers who felt that our plans threatened their influence or their jobs. So, when you tell your collections department that we just hired a collections agency to handle bad debt, you may have to sell your collections manager and his associates on using the agency. You should emphasize the fact that nobody is going to be laid off" selling middle and supervisory managers on changes to overcome their resistance is often a necessary part of

strategy implementation

Managers who redo budgets, rethink processes, or revise policies are

taking corrective action, which will constitute a feedback loop.

With the holiday season approaching, Denelle reviews holiday sales from the last five years to determine how much inventory to purchase and how many employees to schedule during peak sales times. Denelle is conducting a

trend analysis *a trend analysis is a hypothetical extension of a past series of events into the future

Jami's Diner is a popular cafe that specializes in home-cooked meals, friendly service, and a menu that contains vegan and vegetarian dishes (menu items that no other restaurant in the area offers). Jamir's diner is engaging in strategic positioning by offering the unique menu items of vegan and vegetarian dishes

true Strategic positioning attempts to achieve sustainable competitive advantage by preserving what is distinctive about a company. Jamir's Diner is meeting the broad needs of relatively few customers, vegan and vegetarian.