Chapter 1-6 Strategic Management
Which of the following statements is TRUE?
If a firm possesses many highly-weighted strengths, this is likely the result of effective strategies, so higher ratings in general are warranted for strengths.
The bargaining power of consumers can be the most important force affecting competitive advantage. Consumers gain increasing bargaining power under the following circumstance:
If consumers are particularly important to the seller
Under which condition can consumers gain increasing bargaining power?
If they can inexpensively switch to a substitute
Which statement below is FALSE?
In a QSPM, the range for Total Attractiveness Scores is 1not attractive, 2somewhat attractive, 3reasonably attractive, and 4highly attractive.
The chapter lists six reasons why many mergers and acquisitions fail, including which of the following?
Inability to achieve synergy
In developing an IFE Matrix, what is an important guideline?
Include factors that are actionable, quantitative, comparative, and divisional (AQCD) to the extent possible.
What ties all business functions together and provides the basis for all managerial decisions?
Information
In conducting a marketing audit, which of the following would NOT be a question to ask?
Is the organization's structure appropriate?
The Industrial Organization view of strategic planning advocates that external (industry) factors are more important than internal ones for gaining and sustaining competitive advantage. Do the authors agree?
No. Matching key external opportunities and threats with key internal strengths and weaknesses provides the basis for successful strategy formulation.
Nonprofit organizations are basically just like for-profit companies except for two major differences. What is one of the differences?
Nonprofits do not pay taxes or have shareholders.
Which of the following is an example of an appropriately stated alternative strategy in a QSPM?
Open 250 new stores in China.
If included in a mission statement, the phrase, "We follow the golden rule in all that we do" would satisfy what component?
Philosophy
______ is the process by which a person determines whether to attempt a task, works out the most effective way of reaching desired objectives, and prepares to overcome unexpected difficulties with adequate resources.
Planning
According to Michael Porter, the nature of competitiveness in a given industry includes what force?
Potential development of substitute products and bargaining power of consumers
Four companiesA, B, C, and Dhave revenues of 1, 2, 3, and 4, respectively. Company C develops a BCG Matrix. What would the RMSP be for company C if all four firms have the same net income?
0.75
According to Michael Porter, strategies allow organizations to gain competitive advantage from two different bases. What are the bases?
Cost leadership and differentiation
According to Porter, strategies allow organizations to gain competitive advantage from two different bases. What are the bases?
Cost leadership and differentiation
______ is the unique way an organization does business. It is the human dimension that creates solidarity and meaning, and it inspires commitment and productivity in an organization when strategy changes are made.
Culture
Which of the following is considered an unpublished source for external information?
Customer surveys
Which of the following is considered a published source for external information?
Directories
When a core competence evolves into a major competitive advantage, what is it called?
Distinctive competence
When comparing mission statements of rival firms, perhaps the most important component to examine is what?
Distinctive competence
The largest consumer-products company in the world, Procter & Gamble (P&G), is in the process of selling more than half of its brands (nearly 100) in order to focus on its core brands (about 80). What is this strategy called?
Divestiture
When a firm sells a division of the organization, it is utilizing which strategy?
Divestiture
The input stage of the strategy-formulation analytical framework includes the ______Matrix.
EFE
what analysis is included in the excel student template that aims to assist students in determining the extent that debt versus equity should be used to finance a set of recommendations?
EPS-EBIT analysis
What is the most widely used method for determining an organization's strengths and weaknesses in the investment, financing, and dividend areas?
Financial ratio analysis
Limitations of financial ratio analysis include all but which one of the following statements?
Financial ratios are estimates of financial condition.
The Global Capsule in Chapter 5 says perhaps the best variable to monitor and to use to decide where to begin doing business is what factor?
Gross Domestic Product
one benefit of strategic planning is that it allows a firm to be ______ in shaping its own future
proactive
to survive and prosper, a business must gain and sustain ____ major competitive advantages over rival firms
at least several
the CEO of LinkedIn is Jeff Weiner, a highly respected corporate leader. what does Weiner say is the most important philosophy of a great leader?
be clear about the organization's vision
which of the following is a pitfall of strategic planning?
being so formal in planning that flexibility and creativity are stifled
To examine the value chain activities across an industry to determine "best practices" among competing firms, an organization would use an analytic tool known as ______.
benchmarking
the Excel strategic planning template includes all the following analyses EXCEPT
benchmarking
Strategists use ______ to provide a firm with proprietary business intelligence.
business analytics
all elements of the strategic planning process can change over time except one element that almost never changes. what is that element?
core value statement
to create an excellent vision and mission, a firm needs core values. these core values ______ for the vision or mission.
create an ethical foundation
Why are both profit and vision needed to motivate a workforce effectively?
Profit is viewed negatively by some stakeholders of a firm.
Which statement below is FALSE?
Successful strategists are commonly difficult to get along with in social settings.
Which statement below is FALSE?
Successful strategists are generally iridescent.
As common positions in firms today, chief information officers (CIOs) reflect the growing importance of the impact of which external force?
Technological
What is a major limitation of the BCG Matrix?
The BCG Matrix does not reflect whether various divisions or their industries are growing over time.
Hobby Lobby CEO David Green says, "The secret to being a great manager is to manage by the book." To what book is he referring?
The Bible
Which matrix is based on the two evaluative dimensions of competitive position and market (industry) growth?
The Grand Strategy Matrix
Which statement below is FALSE?
The average IFE Matrix score is 2.0.
Which of the following is NOT true of the SPACE Matrix?
The axes represent four internal dimensions.
Which of the following is a condition that leads firms to "borrow" capabilities through joint ventures or strategic alliances?
The costs and risks of merging are too high.
An example of an economic variable is "value of the dollar" which is currently high compared with the Yen, Euro, and the Australian dollar. The high dollar results in what economic factor(s)?
The high dollar makes U.S. goods more expensive in overseas markets.
According to James Van Horne, the basic activities of finance/accounting consist of three decisions. What are the three?
The investment decision, the financing decision, and the dividend decision
Historically, where did strategic planning originate?
The military
Backward integration can be an especially effective strategy under which of the following conditions?
The number of suppliers is small and the number of competitors is large.
Retrenchment may be an especially effective strategy to pursue under which of the following conditions?
The organization is being pressured by stockholders to improve performance.
There are four important differences between the BCG Matrix and the IE Matrix. Which statement below is NOT a difference between the two matrices?
The sizes of the circles and pie slices can vary.
Which of the following is NOT a risk of pursuing a cost leadership strategy?
The unique product may not be valued highly enough by customers to justify the higher price.
A meta-analysis of 20 years of empirical research on mission statements came to what conclusion?
There is a positive relationship between mission statements and measures of financial organizational performance.
Which of the following statements is TRUE?
There is no one best mission statement for a particular organization.
Which of the following statements is FALSE?
The resource-based view (RBV) approach to competitive advantage contends that internal resources are equally important for a firm as external factors in achieving and sustaining competitive advantage.
The dollar amounts of alternative strategies should all be added to reveal a total amount of new capital needed over what time period?
Three years
Which of the following is a reason for a firm to initiate a leveraged buyout (LBO)?
To avoid a hostile takeover
What is the most important part of an external audit?
To develop a finite list of opportunities that could benefit a firm as well as threats that should be avoided or mitigated
King and Cleland recommend that organizations carefully develop a written mission statement in order to reap which benefit?
To provide a basis for the allocation of resources
What is the difference between the Type 3 and Type 4 levels of a differentiation strategy?
Type 3 has a broad target market and Type 4 has a narrow target market.
Amazon.com is planning to enter the $412 billion pharmacy business. Which type of diversification does this represent?
Unrelated diversification
What strategy may be best under the following conditions? The organization competes in a highly competitive or a no-growth industry, as indicated by low industry profit margins and returns. The organization's present channels of distribution can be used to market new products to current customers. New products have countercyclical sales patterns compared with an organization's present products. The organization's basic industry is experiencing declining annual sales and profits.
Unrelated diversification
which of the following activities is included in strategy implementation?
develop a strategy-supportive culture and create an effective organizational structure
what is often considered the first step in strategic planning?
developing a vision statement
In generating the list of critical success factors in a CPM, a firm should strive to include factors that ______.
differentiate firms within the industry
For nonprofit and governmental organizations, strategic management is an important means to develop and justify requests for needed ______.
financial support
one specific skill students can gain from this course is ______
formulating strategies using a SWOT analysis
Gaining ownership or increased control over distributors or retailers is called _____.
forward integration
An effective means of implementing forward integration is ______.
franchising
a mission statement should be written
from a customer perspective
The resource-based view emphasizes the importance of ______.
internal resources
the strategic-management process can be described as an objective, logical, systematic approach for making major decisions in an organization. however, it is generally recognized that _____ is essential to making good strategic decisions
intuition
The decision stage of the strategy-formulation analytical framework ______.
involves a single technique, the QSPM
Which of the following is NOT a pitfall of strategic planning?
involving key employees in all phases of planning
warby parker's vision to, "Give access to the 1 billion people on Earth without access to glasses" is particularly effective because
it is written from the customer perspective
what is the primary benefit for professors when students use the Excel student template?
it makes interacting with students easier
which of the following is a characteristic of a good mission statement?
it reveals that the firm is socially responsible
what is the primary benefit for students of using the Excel student template?
it take the mechanics, such as drawing circles and multiplying weights by ratings, out of the project
A classic study of strategic management found that successful strategists ______.
kept a low political profile on unacceptable proposals
which of the following is listed in the chapter as a reason often given for poor or no strategic planning in a firm?
laziness
Research indicates that strategic management in small firms is most likely ______.
less formal than in large firms.
official business failure calculations include
liquidations and court mandated receiverships
External forces can be divided into five broad categories and ten subareas EXCEPT in which of the following?
marketing
a meta-analysis of 20 years of empirical research on mission statements concluded there is a positive relationship between mission statements and
measures of financial performance
Does including the word "customer" in a mission statement ensure the statement includes the customer component?
no
some firms view planning as a waste of time because ____
no product or service is produced
Empirical indicators, or characteristics of resources that enable a firm to implement strategies, include ______.
not easily substitutable
The IFE Matrix is an evaluation of the effectiveness of a firm's current strategies, but it does not take into account ______.
opportunities and threats
Which two management functions are most important at the strategic-management process stage of strategy implementation?
organizing and motivating
guidelines, rules, and procedures established to support implementation efforts are called
policies
For industries and firms that depend heavily on government contracts or subsidies, which forecasts can be the most important part of an external audit?
political
according to the chapter, the worst thing strategists can do is to develop strategic plans and then
present the plans to operating managers to execute
a fundamental strategy evaluation activity includes
reviewing external and internal factors that are the bases for current strategies, measuring performance, and taking corrective actions
Target recently joined Best Buy in offering to match online prices of rival retailers. Both companies are seeking to combat ______ by shoppers who check out products in their stores but buy them on rival's websites.
showrooming
It is important that both the internal and external factors and the SO, ST, WO, and WT strategies are stated in ______ terms.
specific
According to the BCG Matrix, forward, backward, and horizontal integration; market penetration; market development; and product development are appropriate strategies to consider for ______.
stars
which of the following is NOT identified as a component of mission statements?
stock price
the term strategic planning is used synonymously in this text with what other term?
strategic management
when warby parker's founders formulated, implemented, and evaluated cross-functional decisions that enabled them to meet their organizational objectives of providing less expensive eyeglasses, they engaged in
strategic management
____ is the science of planning and directing large scale military operations, of maneuvering forces into the most advantageous position prior to actual engagement with the enemy
strategy
building four new manufacturing plants in Europe is an example of a(n)
strategy
at first, warby parker sold eyeglasses online; then it sold eyeglasses with a "virtual try-on" option. Finally, it offered a "try on at home" approach. Each of these changes were precipitated by the founders engaging in which of the following?
strategy evaluation
in which stage of the strategic management process is an organization likely to develop a mission statement?
strategy formulation
the strategic management process begins with
strategy formulation
warby parker established a vision and mission that included selling at lower price points than other sources and helping those who could not afford lower price points. this process was part of the company's exercise in
strategy formulation
Warby parker underwent as it devised policies, motivated employees, and allocated resources so that formulated strategies could be executed efficiently
strategy implementation
perhaps the best way to develop a skill for writing and evaluating mission statements is to _____
study actual company missions
VCA is the process whereby a firm determines the value (price minus cost) of each and all activities ______.
that went into producing and marketing a product
What does the y-axis of the IE matrix represent?
the EFE total weighted scores
The strategy-formulation tool that summarizes and evaluates the major strengths and weaknesses in the functional areas of a business is ______.
the Internal Factor Evaluation Matrix
recent research by rose and cray examined the strategic management process and concluded that perhaps the most important "activity" is what?
the feedback loop
the focus of strategic management is
the integration of all the functional areas of the business to achieve its organizational success
quality mission statements identify the ____ of a firm's products to its customers
utility
in a business, which of the following should be established first?
vision statement
a mission statement reveals _____
what an organization wants to be and whom it wants to serve
the vision statement answers which of the following questions?
what do we want to become?
warby parker's mission statement, "to be a force for good world" answers which of the following pivotal questions that is essential for objectives and formulating strategies effectively?
what is our business?
According to Drucker, the most important time to ask seriously, "What do we want to become?" and "What is our business?" is ______.
when a company has been successful
according to the model used in this text, what should be answered when developing a strategic plan?
where are we now, where do we want to go, and how are we going to get there?
In multidivisional organizations, should divisional units perform strategic-management tasks, including the development of their own statement of vision and mission?
yes
Is the following statement TRUE? A benefit of developing a comprehensive mission statement is that divergent views among managers can be revealed and resolved through the process.
yes
In 2018, global data analytics software is expected to reach ______ billion, a ______ percent increase from 2012.
$21.7; 64
If a company has high customer loyalty (like Harley-Davidson does), what rating would be appropriate for that factor in a SPACE Matrix?
-1 on CP axis
An industry can be stable or unstable on SP, yet high or low on IP. The smartphone industry, for instance, would be unstable (_____) on SP yet high-growth on IP, whereas the canned food industry would be stable (_____) on SP yet low-growth on IP.
-6; -2
In an EFE Matrix, how much more important is a rating of 4 than a rating of 3?
33%
In an EFE Matrix, how much more important is a weight of 0.20 than a weight of 0.15?
33%
Human resource (HR) management includes activities such as:
Disciplining, promoting, transferring, and demoting
Going clockwise beginning with the top axis, what are the four axes of a SPACE Matrix?
FP, IP, SP, and CP
Objectives should include which of the following characteristics?
Measurable, challenging, and hierarchical
What are the four basic activities that comprise management?
Planning, organizing, motivating, and controlling
What are the four types of strategies generated by a SWOT analysis?
SO, WO, ST, and WT
Which of the following is NOT true concerning forecasts?
Sometimes, wild guesses are acceptable as forecasts.
A mission statement should include the following components:
Survival/growth/profitability, philosophy, self-concept, and public image
When identifying and prioritizing key external factors in strategic planning, four criteria should be met to the extent possible. What are these four criteria?
actionable, quantitative, comparative, and divisional
Which of the following are the 5 characteristics of objectives?
quantitative, understandable, challenging, compatible, obtainable
In both the BCG and IE Matrices, the size of each circle represents the percentage of _______ contribution of each division, and pie slices reveal the percentage of _____ contributed of each division to the company.
revenues; operating profits
What characteristic(s) are included among the 5 out of 5 test for vision statements to be exemplary?
Clear and unique
Which of the following is NOT a benefit of establishing clear objectives?
Clear objectives provide the basis for creativity.
Which SPACE Matrix quadrant implies staying close to the firm's basic competencies and not taking excessive risks?
Conservative
strategic management is based on the idea that organizations should monitor internal and external trends
continually
The management function of _______ is particularly important for strategy evaluation.
controlling
Firms should use Value Chain Analysis (VCA) to develop and nurture a ______ competence and convert that into a distinctive competence.
core
An advantage of a strong dollar includes which of the following item(s)?
Companies importing goods have greater buying power because their dollars now go further overseas.
Which statement below is FALSE?
Companies should pay dividends regardless of changes in their revenue.
What would be an appropriate SP axis number for Apple Inc.?
-6
In an IFE Matrix, the weights of all factors included must add up to ______.
1.0
The weight column in an EFE Matrix must add up to what number?
1.0
The range of total weighted scores in a CPM Matrix is ______.
1.0 to 4.0
Which of the following EFE scores indicates that a firm is weak at responding to external factors?
1.2
The recommended length of a mission statement is fewer than _____ words.
100
In Step 1 of developing an EFE Matrix, how many opportunities and threats should be included in the full and narrow lists, respectively?
100, 20
In an IFE Matrix, how much more important is a weight of 0.16 than a weight of 0.07?
129 percent
In an EFE Matrix, the average total weighted score is:
2.5
How many key external factors should be included in an EFE Matrix?
20
Spending on digital advertising recently surpassed television advertising and is expected to reach nearly ______ billion dollars in 2020.
280
The time frame for long-term objectives and strategies should be consistent, usually from ______ to ______ years.
2; 5
The strategy-formulation analytical framework consists of how many stages and how many matrices?
3 and 9
Regarding the AQCD criteria, strive to include all high quality factors in an external assessment for a firm. A high quality factor will meet ______ of the AQCD criteria; a low quality factor will meet ______ of the AQCD criteria.
3 or 4; 2 or fewer
If a corporation's profits are $120, and its three divisions have $30, $80, and $10 of profits respectively, and equal revenues, what percent is the pie slice in Division 3?
33.3
Any industry whose annual growth in sales exceeds ______ percent could be considered to have rapid growth.
5
Most practitioners and academicians of strategic management feel that an effective statement should include ______ mission statement components.
9
Divestiture could be an effective strategy under which of the following conditions?
A division is responsible for an organization's overall poor performance.
The process of generating and selecting strategies should include which of the following?
A manageable set of the most attractive strategies
Secondary buyouts occur when what happens?
A private equity firm buys a firm from another private equity firm
What are two major types of bankruptcy?
Chapters 7 and 11
What do strategy analysis and choice seek to determine?
Alternative courses of action
When should a vision statement reveal the type of business in which the firm engages?
Always
Which of the following is a guideline for indicating that product development may be an effective strategy?
An organization competes in a high-growth industry.
Which statement FALSE?
An outside person with expertise in developing vision and mission statements who has unbiased views should always manage the statement-development process.
Aspects of organizational culture listed in Table 4-4 include all but which of the following?
Analyze interest rate trends
Which of the following statements is FALSE?
Apple Computer's mission statement should open the possibility for diversification by Apple into pesticides.
If an organization's present suppliers are especially expensive, unreliable, or incapable of meeting the firm's needs for parts, components, assemblies, or raw materials, what strategy is best?
Backward integration
Boeing's decision to build 80% of its wing flap motors in-house is an example of which strategy?
Backward integration
Which of the following is NOT one of Porter's five forces?
Barriers to entry
According to Vern McGinnis, a mission statement should do what?
Be limited enough to exclude some ventures and broad enough to allow for creative growth
Why is it important to consider a firm's culture in strategy and choice analysis?
Because success can rest on the degree of support received from the firm's culture.
The text states that perhaps the most important page in a student's strategic planning case project is his/her Recommendations Page. Why is this?
Because the recommendations page will include the estimated dollar amount of the costs (or savings) of each alternative
What type of strategy aims to target a new market where competition is not yet present instead of going where many firms are already competing on price and the gains of one firm are often at the expense of another?
Blue ocean
______ is a popular strategy that occurs when two or more companies form a temporary partnership or consortium for the purpose of capitalizing on some opportunity.
Joint venture
Which of the following statements is TRUE?
Just because one firm receives a 3.20 overall rating and another receives a 2.80 in a CPM, it does not necessarily follow that the first firm is precisely 14.3% better than the second, but it does suggest that the first firm is better in some areas.
When an organization has pursued both a retrenchment strategy and a divestiture strategy and neither has been successful, then perhaps the best strategy is ______.
Liquidation
Lorsch found that executives in successful companies are emotionally committed to the firm's culture, but he concluded that culture can inhibit strategic management in the following way:
Managers frequently miss the significance of changing external conditions because they are blinded by strongly held beliefs.
The old adage, "If it ain't broke, don't fix it" pertains to which of the following?
Managing by extrapolation
What are the two dimensions used by the Grand Strategy Matrix?
Market growth and competitive position
What strategy seeks to increase market share for present products or services in present markets through greater marketing efforts?
Market penetration
The basic activities that comprise marketing include the following:
Marketing research and target market analysis
Which of the following best describes the vision, "To become the best retailing firm in the USA"?
Much too broad
In terms of growing globally by adding new customers, what company does the global Capsule 3 suggest may be the fastest growing company?
Netflix
In developing an IFE Matrix, when can both internal and external factors be included?
Never
Which of the following is a good guideline for indicating when market development may be an especially effective strategy?
New channels of distribution are available that are reliable, inexpensive, and of good quality.
The ______ Matrix determines the relative attractiveness of various strategies based on the extent that key external and internal factors are capitalized on or improved.
QSPM
Which matrix determines the relative attractiveness of feasible alternative strategies?
QSPM
Which statement below is FALSE?
QSPM analysis should be performed after EPS/EBIT analysis.
The AQCD test refers to the need for key external factors to exhibit what attributes?
Quantitative and divisional
Which of the following statements is FALSE?
Regarding weights in a CPM or EFE Matrix, be mindful that 0.08 is mathematically 25 percent higher than 0.06, so even small differences can reveal important perceptions regarding the relative importance of various factors.
Which of the following statements is TRUE?
Regardless of the number of key opportunities and threats included in an EFE Matrix, the highest possible total weighted score for an organization is 4.0 and the lowest possible total weighted score is 1.0.
Which region of the IE matrix would prescribe a hold and maintain strategy?
Region 2
What are the two dimensions represented on the BCG matrix axes?
Relative market share and industry growth rate
What is the name of the strategy that involves selling off land and buildings to raise needed cash, pruning product lines, closing marginal businesses, closing obsolete factories, automating processes, reducing the number of employees, and instituting expense control systems?
Retrenchment
According to Michael Porter, the nature of competitiveness in a given industry can be viewed as a composite of the forces. Which force is usually the most powerful?
Rivalry among competing firms
which of the following four types of strategies are developed in a SWOT analysis?
SO, WO, ST, WT
In developing a SPACE Matrix, what term (axis) refers to the volatility of profits and revenues for firms in a given industry?
SP
Which statement is a limitation of the SWOT?
SWOT does not show how to achieve a competitive advantage, so it must not be an end in itself.
Which of the following is NOT a benefit of being a first mover?
Secure access to widely available resources
In developing an IFE Matrix, do not allow more than 30 percent of the key factors to be financial ratios. Why?
Since financial ratios are generally the result of many factors, knowing what particular strategies should be considered based on financial ratios is difficult.
What source provides excellent online information and advice on approximately 1,700 stocks, more than 90 industries, the stock market, and the economy, including company income statements and balance sheets?
Value Line Investment Survey
Which of the following statements is FALSE?
Value chain analysis and benchmarking are opposite ways to address the management of resources.
who said, "perfection is not attainable. but if we chase perfection, we can catch excellence"?
Vince Lombardi, head coach green bay packers (1959-67)
Which statement is FALSE?
Vision statements are more important than mission statements.
Regarding vision statements, which statement below is FALSE?
Vision statements should answer the question "What is our mission?"
A defensive strategy of the SWOT Matrix directed at reducing internal weaknesses and avoiding external threats is ______.
WT
what question does a mission statement answer?
What is our business or reason for being?
Asking the question, ______ is synonymous with asking, "What is our mission?"
What is our business?
What is Rudin's Law?
When a crisis forces choosing among alternatives, most people choose the worst possible one.
Which of the following statements is TRUE?
When assigning weights and ratings in developing an IFE Matrix, focus on a narrow industry perspective.
The two general types of diversification strategies are related diversification and unrelated diversification. When are businesses said to be related?
When their value chains possess competitively valuable cross-business strategic fits
When is it especially important to evaluate and consider culture-strategy linkages?
When two firms merge
Which of the following statements is TRUE?
Wild guesses should never be made in formulating strategies, but reasonable assumptions based on available information must always be made.
Are the interpretations of the weights in a CPM and EFE Matrix the same?
Yes
In a QSPM analysis, would it ever be appropriate or useful for a company not to include a weight column at all, but rather total the AS columns to determine the relative attractiveness of six strategies?
Yes
Which of the following statements is FALSE?
You may assign the same rating to firms included in a CPM analysis if the firms are similar on the respective factor.
Marketers can best use their strategic toolbox to ensure that their firm's offering delivers value to target customers when there is ______.
a clearly defined target market
strengths and weaknesses can be determined by elements of being rather than performance. For example,
a strength may involve ownership of natural resources
What element of strategic management answers the question "What do we want to become?"
a vision statement
To the extent possible, internal strength/weakness factors should meet the four AQCD criteria. Two of these criteria are _____.
actionable and comparative
Internal politics ______.
affect the choice of strategies in all organizations
chapter 11 bankruptcy
allows organizations to retrench, reorganize, and come back after filing a petition for protection
in great companies, core values
almost never change
Related diversification may be an effective strategy when ______.
an organization competes in a no-growth or slow-growth industry
The extent to which a manufacturing plant's output reaches its potential output is called ______, a key strategic variable.
capacity utilization
First mover advantages refers to the benefits a firm may achieve by entering a new market or developing a new product or service prior to rival firms. An advantage of being a first mover is ______.
carving out market share and a position that is easy to defend and costly for rival firms to overtake
In a BCG Matrix, divisions in Quadrant III (lower left) have a high relative market share position but compete in a low-growth industry. They are called ______.
cash cows
Financial ratio analysis should be conducted on three separate fronts, which include ______.
change over time, comparison to industry norms, and comparison to key competitors
an effective vision statement should exhibit 5 characteristics. what are they?
clear, futuristic, concise, unique, inspiring
according to chapter 1, _____ may be the most important word in management
communication
Dale McConkey said, "Plans are less important than planning." What does this statement mean?
communication, understanding, and commitment are vitally important in strategic planning
Apple's financially lean position with regard to manufacturing facilities provides the firm with a _____ over Sony, which invests heavily in manufacturing facilities.
competitive advantage
analytical thinking and intuitive thinking
complement each other
Business strategy is based on the assumption of competition. Upon which assumption is military strategy based?
conflict
according to the authors of the text, what is the most important component of a mission statement?
distinctive competence
Strengths that cannot be easily matched or imitated by competitors are called _____.
distinctive competencies
Strengths that cannot be easily matched or imitated by competitors are called ______.
distinctive competencies
When an organization splits into two or more parts, this type of strategy is a _____.
divestiture
according to the chapter, a pitfall to watch for and avoid in strategic planning is
doing strategic planning only to satisfy accreditation or regulatory requirements
a firm can achieve sustained competitive advantage by
effectively formulating, implementing, and evaluating strategies that capitalize on changes in trends and internal capabilities
_______ is the act of strengthening employees' sense of effectiveness by encouraging them to participate in decision making and to exercise initiative and imagination, and then rewarding them for doing so
empowerment
three primary intrinsic benefits of strategic planning include
enhanced communication, deeper understanding, and greater commitment
warby parker's founders hated paying $500 or more for eyeglasses and knew the eyeglass market was dominated by a few multinational companies. when they developed their $95 strategy for eyeglasses and accompanying technology solution as well as a strategy for providing eyeglasses for those in need they were
establishing their competitive advantage
The EFE Matrix provides an empirical assessment of how well a firm is handling ______.
external factors overall
Being a(n) _______ can be an effective strategy in industries where technology is rapidly advancing.
fast follower
An excellent source of industry information, including industry profiles and trade statistics for many industries, is provided at what website?
http://globaledge.msu.edu/industries/
the logical starting point for strategic management is to
identify the existing vision, mission, objectives, and strategies
One difference between a Competitive Profile Matrix and an EFE is that critical success factors ______.
in a CPM include both internal and external issues
In forecasting, strategists identify future occurrences that could have a major effect on the firm, and, based on that make __________.
reasonable assumptions
The "markets" component of mission statements refers to the_____.
regions in which the company operates
In a BCG Matrix, ______ is defined as the ratio of a division's own market share (or revenues) in a particular industry to the market share (or revenues) held by the largest rival firm in that industry.
relative market share position
even when students use the excel student template, they still must do the _____ in preparing a strategic plan.
research and thinking
what should a vision statement reveal?
the type of business a firm conducts
the principal benefit of vision and mission statements as tools of strategic management is derived from
their specification of the ultimate aims of a firm
which of the following is a reason some firms do not engage in strategic planning?
they receive no formal training in strategic management
unskilled leaders work out their conflicts in courtrooms and battlefields. brilliant strategists rarely go to battle or to court. How do they usually achieve their objectives?
through tactical positioning well in advance of any confrontation
one broad skill students can gain by taking this course is
to define and solve problems and make decisions about a particular situation
generally, in war, the best policy is to take a state intact rather than to ruin it. likewise, the best objective is to capture the enemy's army, regiment, company, or squad intact rather than destroy them. winning 100 victories in 100 battles is not the epitome of skill. what is the epitome of skill?
to subdue the enemy without fight
according to recent research by Caddy, Fiske, and Glick, what ethics variable(s) is most important in doing business?
trustworthiness
chapter 7 bankruptcy
used only when a corporation sees no hope of being able to operate successfully or to obtain the necessary creditor agreement. all assets are sold in part for their tangible worth