Management Lesson 6 (Ch. 2)- External Environment and Organizational Culture

F

(T/F) A firm's competitive environment is composed of the firm, its competitors, suppliers and distributors.

T

(T/F) A more diverse workforce presents managers with challenges as well as opportunities.

T

(T/F) A strong organization culture is one in which everyone understand and believes in the firm's goals, priorities and practices.

T

(T/F) All organizations operate in a macro environment

F

(T/F) Benchmarking represents alternative combinations of different factors into a total picture of the environment and the firm.

F

(T/F) By 2012, the labor force will be even more homogenous than it is today.

F

(T/F) By 2020, men's participation in the labor force is expected to increase.

T

(T/F) Competitive intelligence is the information necessary to decide how best to compete in the competitive environment.

T

(T/F) Customer service means giving customers what they want, the way they want it, the first time.

F

(T/F) Defenders are more likely to engage in strategic maneuvering than prospectors.

F

(T/F) Environmental scanning means sorting through information available to the public to interpret what is important and what is not.

F

(T/F) External pressures on organizations usually have a negative effect.

F

(T/F) Family leave, flexible working hours and child care assistance have been introduced as a result of the re-entrance of older workers into the workplace.

T

(T/F) Firms that develop strategies that don't include technological advances will realize obsolescence and extinction.

F

(T/F) Given that unionization in the U.S. has dropped to about 10 percent of the private labor force, the power of unions has faded away from all industries.

F

(T/F) In a dynamic environment, bureaucratic organizations are more efficient than organic organizations.

T

(T/F) Organizations are open systems that affect and are affected by their external environments.

T

(T/F) Porter's Model for competitive analysis is one example of analyzing the competitive environment for adapting to and even influencing the nature of competition.

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(T/F) Stories told by employees almost never have any relevance on the true culture of the organization.

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(T/F) Successful managers must be able to do more than react to the environment; they act in ways that actually shape or change the organization's environment.

T

(T/F) The external environment includes all relevant fores outside the organization's boundaries.

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(T/F) The fastest-growing age group in the US civilian labor force is the group between 30 and 40 years old.

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(T/F) The first question in understanding competitive environments is, "who is the competition?"

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(T/F) Three general considerations that help guide management's response to the environment are: (1) change appropriate elements in the organization, (2) choose responses that focus on pertinent elements of the environment and (3) choose responses that offer the most benefits at the lowest cost.

T

(T/F) U. S. government policies both impose strategic constraints and provide opportunities for organizations.

D

Barriers to entry may include all of the following EXCEPT: A. Brand loyalty B. Capital requirements C. Governmental regulation D. Pricing practices E. Distribution channels

D

By 2014, the number of older workers (55 and above) is expected to rise to about ____ percent of the U.S. labor force. A. 42 B. 63 C. 31 D. 20 E. 4

C

Giving customers what they want or need, they way they want it, the first time is known as: A. Planned giving B. Planned obsolescence C. Customer service D. Planned service E. Any of the above

D

Government can affect business opportunities through: A. Tax laws B. Economic policies C. International trade rulings D. All of the above E. Only A. and B

C

If an organization's culture is externally oriented and focused on control with its primary objectives as productivity, planning and efficiency, it could best be described as a __________ type of culture. A. Group culture B. Hierarchical culture C. Rational culture D. Adhocracy

A

If an organization's culture is internally oriented, flexible and tends to be based on the values and normed associated with affiliation, it could best be described as a _______ type of culture. A. Group culture B. Hierarchical culture C. Rational culture D. Adhocracy

B

If your company joins forces with another to lobby for legislation important to both organizations, it is demonstrating A. Contraction B. Coalition C. Cooptation D. Domain selection E. Benchmarking

A

Methods for adapting the technical core to changes in the environment are called A. Flexible processes B. Smoothing C. Buffering D. Benchmarking E. Environmental scanning

C

New methods of communication, production and even the development of entire new industries are the results of the changes in: A. Demographics B. Societal preferences C. Technology D. The economy E. Politics

B

One firm buying another is called a(n) _____________. A. Merger B. Acquisition C. Divestiture D. Prospecting E. Defending

D

Organizations must acquire a variety of resources in order to produce a product or service of value. These resources may include materials, equipment, financing or even employees. The sources that provide these various resources are referred to as A. Resource firms B. Placement centers C. Wholesalers D. Suppliers E. None of the above

C

_______________ means identifying the best-in-class performance by a company in your area and then comparing your processes to theirs. A. Scenarios B. Forecasting C. Benchmarking D. Cooptation E. Coalition

C

A customer who purchases raw materials or wholesale products before selling them is called a: A. Final customer B. Middle customer C. Intermediate consumer D. Final advocate E. Preliminary customer

A

A firm's current competition, suppliers, customers and the threat of new entrants or of substitutes are all elements in the A. Porter Model for competitive analysis B. Task environment C. Macro environment D. Peters Model for organizational excellence E. Industry environment

C

A low-cost airline described as one of the excellent companies in the bestseller of the early 1980's, In-Search Of Excellence is no longer in business. Industry analysts state that although the service and price provided by the airline was what customers wanted, the larger airlines were able to drive out of business through an aggressive price war. This scenario is illustrative of which aspect of the competitive environment? A. Customers B. Regulators C. Competitors D. The economy E. Politics

B

A narrative that describes a particular set of future conditions is called a: A. Benchmarking B. Scenario C. Forecasting D. Managerial outcomes analysis

C

ABC Bank utilizes the janitorial services of Bob's Scrub-A-Dub-Dub to keep their buildings clean. Bob's provides all the necessary cleaning supplies, training of crews, background security checks (since the crews work after hours) and all other associated expenses. The other available janitorial services do not typically provide security checks and a client such as a bank would have to hire guards to watch the work of the janitors. This expense effectively limits the bank to utilizing only Bob's services. This illustrates the concept of: A. High employment costs B. Unfavorable supplier status C. High switching costs D. Unfavorable buyer status E. None of the above

A

Advances in genetic engineering and biotechnology are expected to produce some food products that will become available year-round even in northern climates. These changes will provide grocers with an opportunity to reduce their shipping costs while at the same time, offering fresher produce to their customers. These advances are an example of changes in the: A. Technological environment B. Economic environment C. Political environment D. Demographic environment E. International environment

D

All of the following can be useful clues about organization culture EXCEPT: A. Corporate mission statement and official goals B. Business practices C. Symbols, rites and ceremonies D. Information printed in the media from sources outside the company E. All of the above are correct

C

Amy Jane, a new manager at C & D Grooming, has been asked to focus on the competitive environment of the organization. Which of these factors is among those that Amy Jane should focus on? A. Government policies B. Demographics C. Suppliers D. Technology E. Social factors

A

Conditions which may prevent new firms from entering an industry (i.e., the use of patents) are referred to as A. Barriers to entry B. Roadblocks C. Unfair trade practices D. Insider trading E. Trade protectionism

A

Creating supplies of excess resources in case of unpredictable needs is called: _________. A. Buffering B. Smoothing C. Flexible processes D. Empowerment E. None of the above is correct

C

Domain selection, diversification, mergers/acquisitions and divestiture are all examples of: A. Illegal boundary management B. Maneuvering the competition C. Strategic maneuvering D. Independent strategies E. Portfolio maneuvering

E

Environmental uncertainty results from: A. Complexity B. Simplicity C. Dynamism D. Cooperation E. Both A and C

B

Fixed costs buyers face if they change suppliers are called: A. Change costs B. Switching costs C. Supply chain management D. Supplier costs E. Sunk costs

B

In an attempt to improve upon customer service, Monkey Toys decided to assign a team to investigate what kinds of services competing companies offered. The team discovered that a smaller company, Tiger, Inc., seemed to have outstanding customer service. The team then determined the major differences between the two companies and developed a plan to incorporate the best elements of Tiger, Inc into Monkey Toys. This illustrates: A. Environmental dynamism B. Benchmarking C. Strategic maneuvering D. Cooperative action E. Forecasting

C

In determining how interest rates will change, a manager would use A. Budgeting B. Scenario development C. Forecasting D. Benchmarking E. None of the above

E

In environmental scanning, managers must address: A. Suppliers B. Entry barriers C. Competitors D. Substitute products E. All of the above

A

In the decade from 2004 to 2014, the U.S. civilian labor force is expected to: A. Grow 10% B. Grow 20% C. Stay the same D. Shrink 10% E. Shrink 20%

D

Interest rates, inflation, the federal deficit and unemployment levels are all elements in which aspect of the macroenvironment? A. The social environment B. The international environment C. The regulatory environment D. The economy E. Demographics

D

It was recently announced that Monster Meats was selling off its turkey division in order to realign itself more competitively in the marketing of its other products. This is an example of managing the task environment through A. Diversification B. Acquisition C. Merger D. Divestiture E. Domain selection

B

Leveling normal fluctuations at the boundaries of the environment is called: _______________. A. Buffering B. Smoothing C. Flexible processes D. Empowerment E. None of the above

D

Managers at Apex Clothing, Inc. engage in an annual organizational assessment as part of an attempt to predict changes as well as possible opportunities and threats. They look at issues such as who their competitors are, how many entry barriers there are in the industry and what substitutes exist for their products. This assessment could be called: A. Scenario development B. Forecasting C. Benchmarking D. Environmental scanning E. SWOT analysis

D

Managing the network of facilities and people that obtains materials from the outside, transform them into products and distribute them to customers are called _______________. A. Collaboration B. Switching costs C. Cooptation D. Supply chain management E. Customer service

C

Organizations that are affected by and that affect, their environment are called: ____________. A. Inputs B. Outputs C. Open systems D. External environment E. Macroenvironment

A

Prospectors are: A. Companies that aggressively alter the boundaries of their competitive environment B. Companies that monitor and protect the established boundaries of their competitive environment C. Financially sound D. A and c, but not b E. B and c, but not a

E

Robert was recently hired as the workplace safety compliance officer at ABC Power Company. Robert will have the responsibility to monitor regulations from which of these government agencies? A. FCC B. EPA C. SEC D. NLRB E. OSHA

A

Sid's Siding traditionally provides sub-contracting services to construction firms. Sid's does about 85% of their work for Bob's Building. Bob typically negotiates quite heavily, which reduces Sid's profits. This situation is indicative of the high bargaining power of A. A customer B. A supplier C. A substitute D. Competitors E. New entrants

C

Specific government organizations in a firm's immediate task environment are called ______________. A. Substitutes B. New entrants C. Regulators D. Economic indicators E. Demographics

A

Statistically describing the population in terms of age, gender, education, income and occupation is referred to as: A. Demographics B. Market placing C. Categorization D. Population consensus E. None of the above

C

Strategies that an organization acting on its own uses to change some aspect of its current environment are called: A. Flexible processes B. Buffering C. Independent action D. Smoothing E. None of the above is correct

B

The SEC recently proposed regulations requiring companies to disclose more details about executive compensation. This illustrates an important interaction between organizations and their relevant A. Demographics B. Regulators C. Lawyers D. Labor officials E. Suppliers

B

The best advice for using forecasts might include all of the following EXCEPT: A. Average the predictions of multiple forecasts B. Remember that forecasts become more accurate the further into the future you predict C. Forecasts are no better than the data used to construct them D. Use simple forecasts when possible E. All of the above are correct

A

The competitive environment consists of A. Those specific organizations with which the organization directly interacts B. Those organizations which the organization relies upon to provide supplies and materials C. Those people who comprise the workers of the organization that complete the organization's activities D. Those organizations that hold the firm accountable to their stakeholders E. Those broader influences that affect a firm's competitive advantage

D

The competitive environment includes all of the following EXCEPT: A. Suppliers B. Customers C. Competitors D. Financial status

A

The development of new products that may replace sales of existing products is referred to as the threat of A. Substitutes B. New entrants C. Diminished supply D. Technology E. Evil forces

D

The economy is a crucial component of the macroenvironment. The challenge presented by this component is A. The impact of changes in the economy is predictable to competitors B. The lack of awareness most managers have of economic indicators C. Changes in the economy are difficult to quantify D. Ascertaining the interconnectedness of various countries' economies E. All of the above present challenges to management

D

The entrance by a company into another suitable market or industry is called: A. Cooperative strategies B. Strategic maneuvering C. Strategic alliances D. Domain selection E. Cooptation

E

The entry of many long distance companies into the long distance telephone service industry was only possible after the court system "broke up" the monopoly previously held by AT&T. This is an example of: A. Enhancing barriers to entry B. Eliminating trade protectionism C. Unfair competition D. Enhancing trade protectionism E. Eliminating barriers to entry

B

The growing movement of companies introducing more supportive human resource policies is reflective of the ______ aspect of the macroenvironment. A. Social and natural B. Demographic C. Economic D. International E. Technology

C

The growth of contingent workers in the U.S. labor force due to unpredictable labor demand is an illustration of A. Adapting at the core B. Flexible processes C. Buffering D. Smoothing E. Both A and B

B

The introduction of microwave ovens posed a potential threat to the producers of conventional ovens. Over time, the effect of microwaves on the sales of conventional ovens has been minimal; most homes utilize BOTH appliances. In this instance A. The threat of new entrants was high B. The threat of substitutes was low C. The threat of new entrants was low D. The threat of substitutes was high E. Suppliers realized a landslide profit

E

The macroenvironment includes all of the following EXCEPT: A. Demographics B. Technology C. Government policies D. International developments E. New entrants

B

The main difference between a final consumer and an intermediate consumer is: A. The final consumer usually pays cash for the purchase B. An intermediate consumer will utilize the purchase in order to sell their product/service to other consumers C. Final consumers purchase more (in dollar value) than do intermediate consumers D. Intermediate consumers are usually more flexible than final consumers E. Final consumers have more bargaining power

C

The method for predicting how variables will change the future is called: A. Budgeting B. Scenario development C. Forecasting D. Benchmarking E. Collaboration

A

The process of sharing power with employees is called: A. Empowerment B. Job sharing C. Benchmarking D. Power creation E. Power leveling

A

The set of important assumptions about the organization and its goals and practices that members of the company share is called: A. Organization culture B. Organization norms C. Industrial environment D. None of the above is correct

A

The two dimensions upon which the competing values model of culture is defined are: A. Flexibility vs. control AND internal vs. external focus B. Internal focus vs. control AND external focus vs. flexibility C. Flexibility vs. control D. Internal vs. external focus

B

The two types of proactive strategies for influencing an organizations environment include: A. Dependent strategies, independent strategies and cooperative strategies B. Independent strategies, cooperative strategies and strategic maneuvering C. Cooperative strategies, strategic maneuvering and dependent strategies D. Strategic maneuvering, dependent strategies and independent strategies E. None of the above

A

Top managers can utilize all of the following approaches to managing culture effectively EXCEPT: A. Executives must not give too much attention to the mundane details of daily affairs B. Executives should espouse lofty ideas and visions for the company C. CEOS and other executes should celebrate and reward those who exemplify the values of the culture D. Hire and promote employees on the basis of the organization's corporate values E. All of the above are correct

A

When Davis Company advertises its soap products as better than Wilson Company's products, Davis Co. is demonstrating A. Competitive aggression B. Competitive pacification C. Benchmarking D. Political action E. Cooptation

B

When McMillan Yogurt Company acts on its own to promote the yogurt industry as a whole, the company is practicing: A. Competitive aggression B. Competitive pacification C. Public relation D. Voluntary action E. Cooperative action

B

When an organization's leadership invites its harshest critics to join its board of directors, the organization is demonstrating A. Contraction B. Cooptation C. Coalition D. Political action E. Voluntary action

E

When employees at Nordstrom receive the employee handbook shown in the text, they could tell a great deal about their company's ______________. A. Organizational goals B. Business practices C. Organization culture D. A and B only are correct E. A, B and C are correct

C

When two or more companies work together to alter their current environment, we say that they are using: A. Monopolistic strategies B. Unethical trade strategies C. Cooperative strategies D. Dependent strategies E. Codependent strategies

E

Which of the following is NOT a competitor which a department store chain like K-mart must identify and anticipate the actions of? A. Non-store retailers like Avon or Tupperware B. Firms focusing on smaller, premium markets C. Wholesale outlets like Sam's or Price Club D. Companies entering new markets E. All of the above are potential competitors

F

Which of the following is NOT a question asked in environmental scanning? A. Who are our current competitors? B. Are there few or many exit barriers to our industry? C. What substitutes exist for our product or service? D. Is the company too dependent on powerful suppliers? E. Is the company too dependent on powerful customers? F. All the above

E

Which of the following is NOT an element of Michael Porter's model for analyzing the competitive environment? A. Threat of new entrants B. Power of customers C. Rivalry among current competitors D. Threat of substitutes E. All of the above are correct

D

Which of the following is NOT an example of a potential substitute product? A. Polyester for cotton B. DVDs for movie theaters C. Internet sites for print magazines or newspapers D. Sony for Magnavox E. Cellular phone for local telephone

D

Which of the following might be considered a customer? A. Shoppers at a mall B. Students at a University C. Neiman-Marcus stores D. All of the above E. A and B; but not C

C

Which of the following would NOT be consistent with an attractive environment for an organization? A. Few competitors and high industry growth B. Many barriers to entry C. Many available substitutes D. Low bargaining power of suppliers E. Low bargaining power of customers

E

Which of the following would NOT be consistent with an unattractive environment for an organization? A. Low industry growth with many competitors B. Few barriers to entry C. Many substitutes available D. High bargaining power of suppliers and customers E. All of the above are consistent with an unattractive environment

E

_______ trends regarding how people think and behave have major implications for management of the labor force, corporate social actions and strategic decisions about products and markets. A. Political B. International C. Economic D. Technological E. Societal

A

_____________ create(s) alternative combinations of different factors into a total picture of the environment and the firm. A. Scenarios B. Forecasting C. Benchmarking D. Cooptation E. Coalition

D

_____________ refers to the degree of discontinuous change that occurs within the industry. A. Environmental complexity B. Environmental contracting C. Cooptation D. Environmental dynamism E. None of the above