ma. ch 7-9
Which of the following is a major tool for managing diversification? a. Organization structure b. Ethical congruence c. Mergers d. Synergies
organization structure
Which of the following is a function of marketing and sales in an organization? a. Promoting whistle-blowing b. Controlling cash flow c. Creating products and services d. Pricing products or services
Pricing products or services
Which of the following strategies may be implemented in the decline stage of the product life cycle? a. Maintaining high costs b. Product differentiation c. Product life extension d. Prospector approaches
Product differentiation
Which of the following areas does a well-conceived strategy address?
Resource deployment
Which of the following areas does a well-conceived strategy address? a. Motivation approaches b. Resource deployment c. Management dynamics d. Financial capability
Resource deployment
refers to the set of processes involved in creating or determining the strategies of an organization. a. Strategy enunciation b. Strategy assimilation c. Strategy implementation d. Strategy formulation
Strategy formulation
which of the following is an organizational strength? a. Impersonal relations among workers b. A strong trade union c. Surplus capital d. A large number of middle-men
Surplus capital
Which of the following is a factor responsible for the rise in new businesses in the United States? a. The nature of customers b. The outsourcing of jobs to other countries c. The emergence of e-commerce d. The crossovers from small businesses
The emergence of e-commerce
According to research, which of the following is a reason for which businesses last long? a. Their starting capitals are low. b. They have a small presence in mature economies. c. They employ hundreds of employees. d. The entrepreneurs work for very little income.
The entrepreneurs work for very little income.
Harriet is very quiet by nature. Recently, she participated in a team discussion in her office to decide their monthly goal. Even though Harriet had some good suggestions and wanted to speak, she was unable to get in a word because Simon, another team member, spoke most of the time. In this scenario, which of the following drawbacks of group decision making is most evident? a. Less information is available in a group setting. b. The group may be dominated by a single person. c. Group members are less likely to accept the final decision
The group may be dominated by a single person.
Which of the following is true of nominal groups? a. The members do not see one another. b. The members represent a group in the true sense. c. The members only communicate ideas in writing. d. The members do not freely interact with each other
The members do not freely interact with each other.
Which of the following statements is true of big businesses? a. They come up with more innovations than small businesses. b. They provide small businesses with the raw materials that they require. c. They make products that are sold to consumers by small businesses. d. They are the first to lay off workers during economic downswings.
They make products that are sold to consumers by small businesses.
defender strategy
concentrates on protecting its current markets, maintaining stable growth, and serving current customers, generally by lowering its costs and improving the performance of its existing products.
Unlike multidomestic firms, global corporations: a. concentrate decision-making responsibilities in a handful of local companies. b. have home-country biases. c. produce goods that are highly diversified. d. assume that customers are the same regardless of nationality.
assume that customers are the same regardless of nationality.
Which of the following is a level at which organizations develop strategies?
business level strategy
A _____ is a document that summarizes the business strategy and structure. a. business plan b. business ethics code c. business contract d. business draft
business plan
The _____ is an international strategy in which a company manages itself as a collection of relatively independent operating subsidiaries, each of which focuses on a specific local market. a. related diversification strategy b. home replication strategy c. multidomestic strategy d. global strategy
c. multidomestic strategy
International firms can improve their efficiency by: a. improving competitive parity. b. capturing economies of scale. c. lowering their economies of scope. d. enhancing their decentralized operations.
capturing economies
Which of the following is one of the four frequently used bases of related uses for diversification? a. Common product b. Common resources c. Common supplier d. Common reputation
common reputation
An organization has a _____ when it is not implementing valuable strategies that are being implemented by competing organizations. a. competitive disadvantage b. strategic redundancy c. competitive parity d. distinctive incompetency
competitive disadvantage
The BCG matrix
helps managers develop a better understanding of how different strategic business units (SBUs) contribute to an overall organization
Any start-up or new venture may turn into
1. may succeed and grow to become a large business. 2. succeed but remain small. 3.fail and shut down. 3. be bought by an existing business.
Four factors that account for this trend
1. the emergence of e-commerce. 2.the crossovers from big business. 3. the opportunities for minorities and women 4.better survival rates.
Which of the following is the first step in evaluating alternatives in rational decision making? a. Determination of influences of the alternatives b. Determination of consequences of the alternatives c. Determination of feasibility of the alternatives d. Determination of satisfactoriness of the alternatives
Determination of feasibility of the alternatives
Which of the following accounts for most new job creation? a. Business size b. Single-product diversification c. Entrepreneurial business success d. Starting capital
Entrepreneurial business success
_____ is the process of planning, organizing, operating, and assuming the risk of a start-up or new venture. a. Assimilation b. Entrepreneurship c. Diversification d. Integration
Entrepreneurship
_ refers to an organization's beginning of the business activities formerly conducted by its customers. a. Related diversification b. Backward vertical integration c. Forward vertical integration d. Unrelated diversification
Forward vertical integration
Omar decides to buy a pair of running shoes from a store. He likes three pairs of running shoes at the store. Following the steps of rational decision-making process in deciding which pair to buy, which of the following should be Omar's next step?
He should evaluate the feasibility of each pair of running shoes
Rodney, the principal of a school, believes that the poor performance of students in economics is due to the poor quality of teaching. In order to remedy the situation, Rodney hires a new economics teacher. However, the students continue to perform poorly. Following the steps of rational decision making, which of the following steps should Rodney's take next after hiring the new economics teacher? a. He should evaluate the teaching quality of the new teacher. b. He should look for a teacher to replace the new teacher.
He should evaluate the teaching quality of the new teacher.
are decision-making groups or teams in which members openly discuss, argue about, and agree on the best alternative. a. Delphi groups b. Interacting groups c. Nominal groups
Interacting groups
Which of the following is an advantage of the interacting group decision-making method? a. Political processes can play a major role. b. Interaction among people can spark new ideas. c. Groupthink can help the group make the optimum decision.
Interaction among people can spark new ideas.
Which of the following is true of a small business? a. It has many retail outlets. b. It is publicly owned. c. It is not owned by one individual alone. d. It does not influence its environment.
It does not influence its environment.
Which of the following is true of the BCG matrix? a. It helps managers understand how strategic business units contribute to an overall organization. b. It suggests that slow-growing markets have more stable and attractive business opportunities for an organization's products. c. It divides the market into low-, medium-, and high-growth markets. d. It helps in restructuring the structure of an organization.
It helps managers understand how strategic business units contribute to an overall organization.
Which of the following is an advantage of a franchise? a. It lets franchisers grow by using the investment money provided by franchisees. b. It includes agreements that are easily changeable. c. It allows each franchise outlet to be vastly different from other franchise outlets.
It lets franchisers grow by using the investment money provided by franchisees.
Which of the following is true of satisficing? a. It suggests that decision makers use complete and perfect information to arrive at decisions. b. It suggests that decision makers go through the six steps of decision-making process before they finalize on the best option. c. It suggests that decision makers search only until they find an alternative that meets some minimum standard of sufficiency.
It suggests that decision makers search only until they find an alternative that meets some minimum standard of sufficiency.
Lana, the owner of a high-end boutique, claims she selects items for her boutique purely on a hunch. Based on Lana's claim, which of the following is true of Lana's decision-making process? a. Lana uses ethical judgment in her decision-making process. b. Lana uses the Delphi technique in her decision-making process. c. Lana uses rationality in her decision-making process. d. Lana uses intuition in her decision-making process.
Lana uses intuition in her decision-making process.
Which of the following statements is true in the context of businesses? a. Luck plays a role in the success of some businesses. b. The most important role of a control system is analyzing past failures. c. New businesses always start earning profits within six months. d. A positive outlook on life is irrelevant when starting a new business.
Luck plays a role in the success of some businesses
In the context of implementing an overall cost leadership strategy, which of the following statements is true? a. Production and sales focus on complex product attributes. b. Accounting and finance focus on profit margins from first-tier brands. c. Manufacturing helps maintain a large run of highly standardized products. d. Organizational culture emphasizes development of new products.
Manufacturing helps maintain a large run of highly standardized products.
which of the following must occur for an organization to support differentiation? a. Marketing and sales must emphasize the high-value image of an organization's products. b. Organizational culture must limit creativity and innovation. c. Accounting and finance must control funds to discourage the need to develop new products. d. Manufacturing must emphasize the reduction of costs.
Marketing and sales must emphasize the high-value image of an organization's products
Which of the following is a difference between the classical model and the administrative model of decision making? a. Unlike the classical model of decision making, the administrative model assumes that managers are logical and rational in their decision making process. b.Unlike the administrative model of decision making, the classical model explains how managers can at least attempt to be more rational and logical in their approaches to decisions.
Unlike the administrative model of decision making, the classical model explains how managers can at least attempt to be more rational and logical in their approaches to decisions.
___ are groups of small investors seeking to make profits on companies with rapid growth potential. a. Money lenders b. Joint-stock companies c. Venture capital companies d. Financial representatives
Venture capital companies
A theoretical advantage of unrelated diversification is that: b. corporate managers will have a great understanding of a business. c. a business will have a stable performance over time. d. a business will have high performance at the outset.
a business will have a stable performance over time
Which of the following is part of Porter's five forces model of the competitive environment?
a threat of substitutes
Strategic Management
a way of approaching business opportunities and challenges.
A(n) _____ is the purchase of a firm by a firm that is considerably larger. a. acquisition b. merger c. union d. arbitration.
acquisition
A company that uses a defender strategy: a. orients toward risk taking and growth in new markets. b. concentrates on protecting its current markets. c. increases the costs of its products. d. concentrates on a specific regional market and product line.
concentrates on protecting its current markets.
The G.E. Business Screen.: a. considers industry attractiveness and competitive position. b. focuses solely on market growth and market share. c. operates on the idea that the smaller the capital requirement the more the competitive intensity.
considers industry attractiveness and competitive position
helps an organization perceive, or even generate, new opportunities in its environment. a. Creativity b. Parity c. Flexibility d. Integration
creativity
A transnational company: a. focuses little attention on integration and coordination among its subsidiaries . b. decentralizes research and development. c. decentralizes human resource management. d. rarely locates the responsibility for one product line to one country.
decentralizes human resource management.
A programmed
decision is one that is relatively structured or recurs with some frequency
Selena fractures the radial bone in her forearm. Her surgeon advises her to undergo a surgery in which a steel plate would be inserted to support the bone. He explains to her that after the surgery there would be only a 70 percent chance of regaining complete movement in the arm and a 30 percent chance of completely losing arm functionality. Selena decides to proceed with the surgery. In this scenario, Selena's decision making process is an example of
decision making under a state of risk
Nonprogrammed
decisions are relatively unstructured and occur much less often in comparison with programmed decisions.
Hot Cup Inc. examines the potential of a new tea product. It engages a panel of experts to individually and anonymously state their opinions. It then averages the opinions and asks the experts for another prediction or justification. It takes the average prediction to represent the decision of the group of experts. Hot Cup Inc. uses a(n) _____ for decision making in this scenario. a. interacting group b. nominal group c. brainstorming group d. Delphi group
delphi group
A company can implement a diversification strategy by: a. revamping current services. b. developing new products. c. increasing the number of suppliers. d. using forward horizontal integration.
developing new products
A(n) _____ is a strategy in which an organization seeks to distinguish itself from competitors through the quality of its products or services.
different strategy
A main purpose of SWOT analysis is to: a. discover an organization's distinctive competencies. b. exploit an organization's common strengths. c. instigate an organization's quest for competitive parity. d. enumerate an organization's competitive disadvantages.
discover an organisation's distinctive competencies
__ refers to the number of different businesses that an organization is engaged in and the extent to which these businesses are related to one another. a. Functionalization b. Integration c. Decentralization d. Diversification
diversification
A(n) _____ is a pattern of action that develops over time in an organization in the absence of mission and goals or despite mission and goals. a. assimilative strategy b. recursive strategy c. emergent strategy d. deliberate strategy
emergent strategy
The final step in the decision-making process requires that mangers:
evaluate the effectiveness of their decision.
Organizations that implement unrelated diversification usually: a. have corporate managers who provide strategic guidance. b. display increased performance over time. c. fail to exploit important synergies.
fail to exploit important synergies
A weakness of the single-product strategy is that the: a. firm using it will require excessive capital. b. marketing of a product is poor. c. cost of production is high. d. firm using it will suffer if its product is replaced by a new one.
firm using it will suffer if its product is replaced by a new one
Organizations that implement the analyzer strategy: a. avoid innovation in new businesses. b. sell their products at high prices. c. promote rigidity in services. d. focus on selling customized products.
focus on selling customized products
A _____ is a strategy in which an organization concentrates on a specific regional market, product line, or group of buyers. a. overall cost leadership strategy b. reactor strategy c. prospector strategy d. focus strategy
focus strategy
Satisfactoriness refers to: a. how well an alternative fulfills the conditions of a decision situation. b. what extent a particular alternative influences an organization. c. how much a particular alternative will cost an organization. d. what extent a particular alternative is within the realm of probability and practicality
how well an alternative fulfills the conditions of a decision situation.
An entrepreneur
in turn, is someone who engages in entrepreneurship.
Charlotte was asked to select a suitable material supplier for her boutique over the weekend. Since Charlotte had plans of meeting her friends during the weekend, she did not choose the best supplier for her boutique. Instead, she selected the first supplier who met the minimum standards. Charlotte's decision-making strategy is an example of _____. a. satisficing b. integrating
integrating
The first stage of the product life cycle is the _____. a. maturity stage b. growth stage c. introduction stage d. decline stage
introduction stage
Buying an existing business is beneficial because: a. it does not require a large initial capital. b. it has an established relationship with lenders. c. it does not need to be nurtured. d. it has financial support from the government.
it has an established relationship with lenders
Which of the following is true of bounded rationality?
it suggests that decision makers are limited by their values and unconscious reflexes, skills, and habits.
Which of the following is true of an emergent strategy?
its implementation involves resource allocation even without explicitly
It is difficult to imitate a distinctive competence because: a. its application will lead to competitive parity. b. it might not be applicable to a competing firms' products. c. its nature might not be understood by competing firms.
its nature might not be understood by competing firms.
The classical model of decision making assumes that: a. decisions are not always made with rationality and logic. b. most problems are unclear and ambiguous. c. all the information necessary to make a decision is not available. d. managers are rational and logical in their thought processes
managers are rational and logical in their thought processes.
Decentralizing power in the hands of a local subsidiary: a. may make it difficult to transfer learning from one subsidiary to another. b. allows single units of a firm to accept lessons from other units. c. prevents the subsidiary from rejecting outside information. d. promotes the unbridled pursuit of global efficiency and multimarket flexibility.
may make it difficult to transfer learning from one subsidiary to another.
Any start-up or new venture: a. may remain a small business. b. will always become a large business. c. will always influence its environment. d. may be publicly owned.
may remain a small business.
Unlike the Delphi method, in the nominal group decision-making method, _____. a. members communicate ideas only in writing b. members talk to each other freely to exchange ideas c. a panel of experts constitutes the group making the decision d. members are brought together in a face-to-face setting
members are brought together in a face-to-face setting
Marina has been working as a waitress at a restaurant for the past ten years. For the first time, she was falsely accused of robbery by her manager. Feeling humiliated, Marina decides to quit her job. Marina's decision to quit her job is an example of a(n) _____ decision. a. routine b. nonprogrammed c. programmed d. organizational
nonprogrammed
During the maturity stage of the product life cycle, the: a. product differentiation concerns are negligible. b. overall demand for the product increases. c. number of established firms producing the product declines. d. number of new firms producing the current product increases.
number of established firms producing the product declines.
. Entrepreneurship is the process of
planning, organizing, operating, and assuming the risk of a start-up or new venture
A group of laborers decide to form a union to demand higher wages. This is an example of the behavioral element of _____ in decision making. a. escalation of commitment b. intuition c. political force
political force
The decision to have regular meals during the day is an example of a(n) _____ decision. a. strategic b. nonprogrammed c. programmed d. organizational
programmed
An organization that implements a defender strategy focuses on: a. increasing costs to improve the performance of its current products. b. enhancing creativity and innovation. c. taking numerous risks to enhance sales. d. protecting its market from new competitors.
protecting its market from new competitors.
A manager with a ________ decision-making style often regrets having made a decision.
reflexive
Unlike programmed decisions, nonprogrammed decisions are: a. relatively structured and recur with high frequency. b. used for standard organizational transactions. c. based on predetermined rules regarding the decision-making process. d. relatively unstructured and occur much less often.
relatively unstructured and occur much less often.
_ businesses are the fastest-growing segment of small-business enterprise. a. Service b. Retailing c. Construction d. Finance
service
A _____ is a business that is privately owned by one individual or a small group of individuals and has revenues and assets that are not large enough to influence its environment. a. public enterprise b. small business c. global business d. joint venture
small business
Which of the following is true of trends in small businesses? a. Minorities and women are starting fewer small businesses. b. The failure rate among small businesses has been increasing. c. Small businesses suffer a higher mortality rate than larger concerns. d. The percentage of online retail sales is decreasing.
small businesses suffer a higher mortality rate than larger concerns
A condition in which a decision maker knows with reasonable surety what the alternatives are and what conditions are associated with each alternative is called a _____. a. state of certainty b. state of uncertainty c. state of threat
state of certainty
a__ is a comprehensive plan for accomplishing an organization goal a. strategy b. theory c. hypothesis d. contract
strategy
SWOT is an acronym that stands for: a. stimulants, weaknesses, operations, and tribulations. b. strengths, weaknesses, opportunities, and threats. c. schisms, windfalls, organisms++, and tiers. d. securities, waivers, outlays, and torts.
strengths weaknesses opportunities and threats
_ exists among a set of businesses when the businesses' economic value together is greater than their economic value separately. a. Parity b. Integrity c. Synergy d. Congruence
synergy
Decision making is defined as: a. the set of processes used to get members of an organization to work together. b. creating problems for which a set of solutions can be generated. c. monitoring an organization's progress toward its goals. d. the act of choosing one alternative from among a set of alternatives.
the act of choosing one alternative from among a set of alternatives
Venture capital companies
these firms do not lend money: They invest it, supplying capital in return for stock
Which of the following is true of managers with a reflective decision-making style? They do not procrastinate. They analyze several alternatives. They tend to have the best record for making good decisions. They often overlook the best possible alternatives.
they analyze several alternatives
a well-conceived strategy addresses three areas:
three areas: distinctive competence, scope, and resource deployment.
The BCG Matrix helps businesses decide how to
to allocate resources
Forward vertical integration refers
to an organization's beginning the business activities formerly conducted by its customers. (internet to market)
The _____ is an international strategy in which a company attempts to combine the benefits of global scale efficiencies with the benefits and advantages of local responsiveness. a. transnational strategy b. global strategy c. home replication strategy d. multidomestic strategy
transnational strategy
True entrepreneurs: a. are professional managers whose job is running someone else's business. b. undergo the process of planning and operating a business venture. c. assume less-than-total personal risk for the success or failure of the business. d. hire professional managers to run their businesses.
undergo the process of planning and operating a business venture.
A _____ business buys products from manufacturers or other producers and then sells them to retailers. a. financial b. wholesale c. service d. transportation
wholesale
