Management Exam 2 Notes

What would be considered a disadvantage associated with being overly dependent on powerful customers?

A firm's biggest customers have the greatest negotiating power over the organization.

Of the firms listed below, which will most likely face the most intense competition?

An organic breakfast bar manufacturer is one among many manufacturers making a similar product.

Which product would be considered a complement for the Apple iPad?

Angry Birds game app

Which are economic environmental factors that affect a manager's ability to function effectively?

Changes in the value of the dollar on world exchanges Interest rates affecting the cost of capital Unemployment rates affecting labor availability

What are approaches top management can take to manage culture?

Create an inspiring vision for the organization. Communicate regularly with employees. Be visible and active throughout the organization. Lead by setting examples.

How can a merger affect two organizations with strong cultures?

Cultural differences can encourage behaviors that are harmful to the combined organization.

Which are examples of supportive policies that have resulted from societal trends?

Domestic partner benefits Child care assistance Flexible working hours Family leave

Apple, a company with a strong product line, probably has strong bargaining power of suppliers.

False

True or false: The competitive environment includes only those organizations that are direct rivals.

False

Which statements regarding customers and the use of the Internet are correct?

Internet users can create and share messages about products. The Internet has provided an easy source of information for customers seeking product information.

How does immigration affect the U.S. workforce?

It continues to make the labor force more ethnically diverse. Some immigrants have different educational and occupational backgrounds from the rest of the labor force.

Which statements are true about an organization's culture?

It is a framework that organizes and directs people's behavior at work. It is expressed and reinforced by symbols, rites, ceremonies, and stories. It includes the set of shared values and practices related to what is important and how the world works.

Which statement about organizational climate is true?

It is easier to measure than organizational culture.

How do extended periods of low unemployment challenge a manager's ability to conduct business?

Low unemployment may make it harder to find workers and open positions may lead to lost sales or poor customer service.

Companies in industries where there is little cost, including time or money, necessary to enter the marketplace are most vulnerable to the threat of

New entrants

What happens to competition when an industry's growth slows and matures?

Profits usually drop. Intense competition causes weaker companies to fail.

In what ways can managers reinforce the organizational culture?

Reward employees who embrace the desired culture. Hire and socialize newcomers. Promote employees on the basis of the new corporate values.

When everyone understands and believes in the firm's goals, priorities, and practices, the organization has a Blank______ culture.

Strong

What is the importance of choosing the right supplier?

Suppliers can affect product quality. Suppliers can affect inventory levels. Suppliers can affect manufacturing time.

______ management is the managing of the entire network of facilities and people that obtains raw materials from outside the organization, transforms them into products, and distributes them to customers.

Supply chain

Company A has proposed investing a significant amount in upgrading technologies throughout the company. Select the reasons why this is vital for the company's survival.

Technology advancements create new products and improve production techniques. Technology advancements provide better ways of managing and communicating. Technology advancements create new competitive niches.

What are the effects of the demographic factors of education and skill level on the workforce?

The increased job complexity of the modern workplace requires additional training of entry-level workers. Improved educational levels overseas can encourage exporting of skilled jobs to where labor costs are lower. It is more difficult to recruit employees for skilled trade jobs such as machinists and toolmakers.

Decisions that affect the natural environment also affect which of the following?

The political environment The legal environment Social issues

Select all the traits of a weak corporate culture.

There is confusion about corporate goals. Different people hold different values.

What is the role of suppliers in an organization?

They provide resources needed for production.

What is the purpose of Porter's model?

To help managers analyze the competitive environment To help managers influence the nature of their competition To help managers adapt to the nature of the competition

When is competition most intense?

When the product or service cannot be differentiated When industry growth is slow

Which statements are not true regarding suppliers available to a company?

When there are many suppliers, they can reduce an organization's profits by increasing prices. Organizations are at an advantage when they are dependent on one powerful supplier. The number of suppliers never affects a company, especially its supply chain.

When are customers are particularly powerful?

When they can buy from alternative sources When they make large purchases

Which person is an intermediate consumer?

a corporate buyer at Dell buying microchips from Intel

According to Porter's model of the competitive environment, successful managers do more than simply react to the environment; they ______.

act in ways that actually shape or change the organization's environment

Which competitive tactic does Coca-Cola rely on in their battle against PepsiCo?

advertising campaigns

Which are tactics used by competitors to gain advantage over their rivals?

advertising campaigns new-product introductions price reductions

In terms of business competition, a substitute is a(n) Blank______.

alternative to a product

Which are examples of intermediate customers?

an industrial buyer buying raw materials to convert to products a retailer buying clothes from wholesalers a restaurant purchasing food from a supplier

After a company identifies its competitors, it must next Blank______.

analyze how they compete

Which are examples of complements to other products?

apps to be used on an iPad insurance for automobiles chargers to be used with smartphones

Factors that make it difficult and costly for an organization to enter a particular task environment or industry are called Blank______.

barriers to entry

How do governmental laws and regulations affect organizations?

by imposing strategic constraints while also providing opportunities

Which of the following give clues about an organization's culture?

ceremonies symbols rites

The kinds of factors that might be reviewed when considering the 'Economic' aspect of the PESTEL include

changes in disposable income per capita.

During the Great Recession, when U.S. automakers faced bankruptcy and the potential loss of an enormous amount of jobs, the federal government intervened by providing funds to allow the automakers to continue operating. This is an example of how government intervention can be a source of Blank______ for a company or an entire industry.

competitive advantage

Cindy buys a new toothbrush. She also purchases a tube of toothpaste. The tube of toothpaste is a Blank______ the toothbrush.

complement to

How can the U.S. government protect property rights and provide opportunities for businesses?

copyrights patents trademarks

Technology and its advancement are vital to a company's survival because they Blank______.

create new products and opportunities

The components of the competitive environment include rivalry among current competitors and the affect of new entrants, substitute and complementary products, suppliers, and Blank______.

customers

Age, gender, income, and family are examples of Blank______ measures.

demographic

The measures of various characteristics of the people who make up groups or other social units are called Blank______.

demographics

Which of the following are major barriers to entry?

distribution channels government policy cost disadvantages capital requirements

Managers must make strategic plans to effectively use people of Blank______ demographic backgrounds.

diverse

Interest rates and changes in the value of the dollar are examples of which macroenvironment factor?

economic

Effective use of the PESTEL framework can help us identify

emerging opportunities and threats within an industry.

The customers who purchase products in their finished form are also called Blank______.

end users

When Lori buys a McDonald's Big Mac, she is a(n) Blank______ customer.

final

Providing excellent customer service entails Blank______.

giving customers what they want, the way they want it, the first time

The goal of supply chain management is to Blank______.

have the right product in the right quantity available at the right place at the right cost

One reason that the U.S. workforce continues to become more ethnically diverse is due to Blank______.

increased immigration rates

The share of the U.S. labor force with some college education has been Blank______ over the last decade.

increasing

Which are resources generally provided by suppliers?

information people financial capital raw materials

A customer who purchases raw materials or wholesale products before selling them to others is called the Blank______.

intermediate consumer

What are ways in which the government can affect business opportunities?

international trade rulings tax laws economic policies

The Securities and Exchange Commission develops regulations intended to protect Blank______.

investors

Since suppliers have such an impact on an organization's operations, selecting the right supplier Blank______.

is an important strategic decision

Which are illegal practices for U.S. firms that are expected practices in some countries?

kickbacks bribes

Regulators are part of which macroenvironmental factor?

legal

Select those factors which are part of the economic environment.

low levels of unemployment falling interest rates

The Blank______ is characterized by the most general elements in the external environment, such as legal, political, and economic factors that can influence strategic decisions.

macroenvironment

The general environment that includes government regulations, economic conditions, social issues, and other fundamental factors that generally affect all organizations is called the Blank______.

macroenvironment

In managing a diverse workforce, managers need to Blank______.

make sure they provide equality for women and minorities in employment, advancement opportunities, and compensation

Societal trends regarding how people think and behave have major implications for ______.

management of the labor force strategic decisions about products and services corporate social actions

Which factors are commonly used to measure organizational climate?

methods for rewarding performance effectiveness of communication handling of conflicts morale

Organizations rely heavily on the Blank______ environment to provide the raw materials needed to produce products.

natural

In competition, a complement is a potential Blank______.

opportunity

The patterns of attitudes and behavior that shape people's practical, day-to-day experience of an organization is the definition of ______.

organizational climate

Differences in the way company employees interact with each other and with customers and the behavior that is expected by their managers are examples of Blank______.

organizational culture

The set of important assumptions about an organization and its goals and practices shared by members of that organization is the Blank______.

organizational culture

Which are examples of public policies that may create a competitive advantage for a company or industry?

patent laws that protect innovative products and production processes legislation passed to support industry prices policy preventing foreign competitors from entering the industry

Which are examples of how the government can be a source of competitive advantage for organizations?

price supports public policy limiting new competition federal patents government subsidies

Which actions and attitudes provide excellent customer service?

readiness to take back defective goods and resupply quickly availability of installation and repair services and parts

Which is an example of regulations imposed by the SEC?

regulations requiring fair and efficient markets

The specific government agencies that have the power to investigate company practices and take legal action to ensure compliance with laws are known as ______.

regulators

Which of Porter's forces is influenced by the other four?

rivalry among competitors

The impact of baby boomers getting older on an industry would be classified in which PESTEL factor?

sociocultural

Which are used to diagnose a company's culture?

stories people tell symbols, rites, and ceremonies mission statements and goals business practices

In a maturing industry with slow growth, Blank______ are most likely to survive.

strong companies with a competitive advantage

The Kindle and the Nook are examples of Blank______ for printed books.

substitutes

If an organization decides to change computer software suppliers after the first supplier raised prices 200 percent, the organizer will incur ______, which are the economic and psychological costs of the supplier change.

switching costs

Samir got a promotion, and in keeping with the company's traditions, he received a coveted parking spot. The parking spot is an example of Blank______ and sheds light on the organization's culture.

symbols, rites, and ceremonies

The macroenvironment includes which factors?

the economy demographics technology

Supply chain management is also known as Blank_____

the extended enterprise

In competition, a substitute is a(n) Blank______.

threat

For domestic or regional airlines or routes, there is always the option of taking a car, bus or train. This describes which of Porter's Five Competing Forces?

threats of substitution

In which ways can firms develop substitutes for existing products?

through technological advances from economic efficiencies

Why might someone want to understand an organization's culture?

to assess whether it would be a good fit as an employer

True or false: Company myths, legends, and stories about past decisions and actions provide information about a company's values.

true

What are common demands placed on organizations by customers?

unique product specifications better customer service lower prices higher quality

When managers create a culture that is inconsistent and does not support goals and useful behaviors that will make the company more effective, they have a(n) Blank______ culture.

weak

Which are examples of an organization's dependence on the natural environment?

Ford Motor Company needing steel to manufacture cars International Paper needing trees to produce paper Pepsi needing petroleum to make plastic bottles

What is the first step organizations must take in understanding the competitive environment?

Identify their competitors.

What is the effect of the number of suppliers available to a company?

If the buyer has few suppliers for essential parts, production may be delayed or halted. Suppliers become more powerful when there are few suppliers for important components.