MGMT 3000 Simoon Cannon Exam 1, Managment test 1, intro to organizational management Ch. 4-7
ethical issue
Situation, problem, or opportunity in which an individual must choose among several actions that must be evaluated as morally right or wrong
Which of the following statements about entrepreneurs and risk is the most accurate?
Successful entrepreneurs take very careful, calculated risks.
Middle East
Supplies by far the most oil to the world's buyers. Saudi Arabia is the U.S.'s main supplier of oil from that region
egoism
An ethical system defining acceptable behavior as that which maximizes consequences for the individual
Utilitarianism
An ethical system stating that the greatest good for the greatest number should be the overriding concern of decision makers
A situational analysis should focus on which of the following?
both the internal forces in the organization and influences from the external environment
Stewardship
contributing to the long-term welfare of others
final customers
end users
Which of the following steps in the basic planning process does the CEO perform when he closely watches the sales structures in the next six months?
monitor and control
unconscious bias
most people have unconscious biases that favor themselves and their own group
concentric diversification
moves into new but related business
Offshoring
moving work to other countries
According to the BCG Matrix, a "star" is a company with a
strong competitive position in a high-growth industry.
strong culture
strong ethics climates can be a source of ethical personal actions plus pride, satisfaction, and commitment to the employer
Which of the following is an advantage of a multinational model?
subsidiaries can customize products according to local preferences
False
The most constructive type of conflict is affective conflict. (T/F)
Which of the following is included in the strategic management process?
SWOT analysis and strategy formulation
managers often....
-Hire people who are like them -Think they are immune to conflicts of interest -Take more credit than they deserve -Blame others when they deserve some blame themselves
Outline of a Business Plan
1. Executive summary 2. The industry and the company and its product(s) or service(s) 3. Market research and analysis 4. The economics of the business 5. Marketing plan 6. Design and development plans 7. Manufacturing and operations plan 8. Management team 9. Overall schedule 10. Critical risks, problems and assumptions 11. The financial plan 12. Proposed company offering 13. Appendixes
demographic trends
1) aging of the workforce 2) increasing educations and skill levels 3) immigration factors 4) increasingly diverse workforce
psychological biases
1) motivated reasoning 2) confirmation bias 3) illusion of control 4) framing effects5 5) discounting the future
Strategic Management Process
1. Establish the mission and the vision 2. Analyzing internal strengths and weaknesses 3. Analyzing external opportunities and threats 4. SWOT analysis and strategy formulation 5. strategic implementation 6. strategic control
6 Phases of Decision Making
1. Identifying and diagnosing the problem 2. Generating alternative solutions 3. Evaluating alternatives 4. Making the choice 5. Implementing the decision 6. Evaluating the decision
4 functions of management
1. Planning 2. Organizing 3. Leading 4. Controlling
3 levels of management
1. Top-level managers 2. Middle-level managers 3. Front-line managers
common management challenges
1. You might not enjoy it 2. Survival is difficult 3. Growth creates new challenges 4. It's hard to delegate 5. Misuse of funds 6. Poor controls 7. Mortality and succession
business accelerator
A 3- to 6-month intensive process designed to help entrepreneurs build and launch rapidly successful ventures
opportunity analysis
A description of the good or service, an assessment of the opportunity, an assessment of the entrepreneur, specification of activities and resources needed to translate your idea into a viable business, and your source(s) of capital.
bounded rationality
A less-than-perfect form of rationality in which decision makers cannot be perfectly rational because decisions are complex and complete information is unavailable or cannot be fully processed
tactical planning
A set of procedures for translating broad strategic goals and plans into specific goals and plans that are relevant to a distinct portion of the organization, such as a functional area like marketing.
Life Cycle Analysis (LCA)
A process of analyzing all inputs and outputs, through the entire "cradle-to-grave" life of a product, to determine total environmental impact
Situational Analysis
A process planners use to gather, interpret, and summarize all information relevant to the planning issue under consideration.
Circular Economy
A regenerative, collaborative economic system that contrasts with the linear economy described earlier by minimizing input, waste, emissions, and energy leakage.
caux principles
A regenerative, collaborative economic system that contrasts with the linear economy described earlier by minimizing input, waste, emissions, and energy leakage.
strategic planning
A set of procedures for making decisions about the organization's long-term goals and strategies
strategic control
A system designed to support managers in evaluating the organization's progress regarding its strategy and, when discrepancies exist, taking corrective action.
core capability
A unique skills and/or knowledge an organization possesses that gives it an edge over competitors.
Sarbanes-Oxley Act of 2002
An act passed by Congress to establish strict accounting and reporting rules in order to make senior managers more accountable and to improve and maintain investor confidence
Ethical Climate
Aliya and Samuel, managers from different departments at Finger Lakes Financial, are discussing the troubling behavior of an employee. Aliya says that it is the responsibility of high-level managers to take steps to prevent legal wrongdoing by punishing offenders. However, Samuel believes that every individual should take personal responsibility for his or her own behavior and that everyone needs to understand how to do the right thing. Each of the managers tends to be responsible for creating a different ________blank in their respective departments.
External Environment
All relevant forces outside a firm's boundaries, such as competitors, customers, the government, and the economy.
transnational model
An organizational model characterized by centralizing certain functions in locations that best achieve cost economies; basing other functions in the company's national subsidiaries to facilitate greater local responsiveness; and fostering communication among subsidiaries to permit transfer of technological expertise and skills
global model
An organizational model consisting of a company's overseas subsidiaries and characterized by centralized decision making and tight control by the parent company over most aspects of worldwide operations; typically adopted by organizations that base their global competitive strategy on cost considerations.
multinational model
An organizational model that consists of the subsidiaries in each country in which a company does business, and provides a great deal of discretion to those subsidiaries to respond to local conditions
International model
An organizational model that is composed of a company's overseas subsidiaries and characterized by greater control by the parent company over the research function and local product and marketing strategies than is the case in the multinational model
Which of the following would be classified as an entrepreneurial venture?
Angelo expects growth and high profitability from his new business.
Middle-level manager
Bill Wessels has reviewed the strategic plan from corporate headquarters and is considering how to develop an annual business plan for his business unit that fulfills its part of the strategic plan. Bill is probably a(n)
Entrepreneur
By leaving her job and starting her own business, Jana will become a(n)
phase 3: evaluate alternatives
CRM big data analysis; contingency plans
Which of the following is true of an effective vision statement?
It inspires the members of an organization.
False
Contingency plans should be developed only after a decision has been made and implemented. (T/F)
Outsourcing
Contracting with an outside provider to produce one or more of an organization's goods or services
suppliers
Crowley Heat Exchangers, Incorporated, is the only provider of a patented high-efficiency heat exchanger. Global Construction Corporation desires to include Crowley's heat exchanger in a proposal for a major project for Global's largest client. However, Crowley charges a premium price for its patented equipment. As a result, Global's potential profit on the major project is eroded, which is an example of the high bargaining power of
False
Done properly, sustainability encourages people to live in ways that can be maintained for a short period without harming environmental resources. (T/F)
False - Situational analysis
The first formal step in the planning process is goal and plan evaluation. (T/F)
controlling
Eco Lawn Care Corporation, a company that manufacturers environmentally friendly lawn care products, has been operating as a business for a year. The CEO, Markus, started his venture by deciding on the activities that would be involved and what his goals and objectives for the business were. He then started to recruit professional chemists and other personnel and grouped them according to their responsibilities. Every month Markus conducts a meeting where he brings attention to those who are doing good work and motivates everyone to achieve organizational goals. He also checks the daily productivity of each of the workers, monitoring them and providing training to those with low productivity. Markus monitors his employees and provides training to those who are performing poorly. In this case, which of the following functions of management is Markus performing?
Triple Bottom Line
Economic, social, and environmental performance
Programmed
Ellie manages a restaurant and must decide on next week's work schedule for the employees. This is an example of a ________ decision.
affective conflict
Emotional disagreement directed toward other people
False
Emotional intelligence should be viewed as something you inherit and cannot change. (T/F)
EEOC
Equal Employment Opportunity Commission
False
Ethical decisions are NOT guided by the underlying values of the individual.
coalition model
Model of decision making in which groups with differing preferences use power and negotiation to influence decisions.
Benchmarking
Farah's Falafels, a chain of Middle Eastern restaurants, periodically compares its customer reviews and menu options to other successful restaurants in order to continually improve its own performance. This practice is known as
Inpatriates
Foreign nationals brought in to work at the parent company.
Organizng
Gerard is a general manager for Handy Dandy Corporation, a tool-manufacturing firm. He is considering some changes to the production floor, which include layout adjustments and the purchase of new equipment to improve efficiency. He also wants to promote one of his employees to team leader. Which of the following functions of management is Gerard performing?
Globalization
Gina, a sales manager, has increasing pressure from other vendors who have shifted production of their parts overseas. She calls one of his customers who normally buys at least once a month, but hasn't placed an order with Gina in three months. The customer states that they are buying from an alternate supplier based on price. Gina is competing for orders with companies who have reduced costs by shifting production overseas. Gina faces the management challenge involved with
Rivals
Haru, a new manager at an electronics company, has been asked to focus on the competitive environment of the organization. Which of the following is a factor Haru should focus on?
Raja, the CEO of Perfect Paper Products, Inc., wants to perform an assessment of the company and research ways to improve profitability. First, Raja determines that while Perfect Paper Products has skilled, dedicated workers and ample space in their production facility, the company's manufacturing equipment is inefficient and prone to breaking down. What is another step Raj might take if his focus is on the first two letters of a SWOT analysis?
He could assess Perfect Paper Products' procedures in light of efficiency and manufacturing costs.
licensing
Henry was having a few friends over for dinner, many of whom Henry knew from an international management association. Henry's company provides services to create detailed maps of world areas from satellites, which the firm then sells via the Internet to firms, countries, and others around the world. One of his guests, Tamia, bakes cakes for a living. Her recipes are so well liked that her company has grown dramatically. She has just sold the right to manufacture her cakes to a firm in eastern Alpland. Another friend, Chang, is a director at InSpiral, and his wife, Chloe, has contracted with the breakfast chain Flapjack Frank's to open a branch in their state, bearing all the preliminary expenses and development costs. Chang also announced that InSpiral and another company, McElwee's, are starting a new venture. Finally, Kamala works for New Frontier Technologies, which is headquartered in her home country, and is soon to go abroad to work in New Frontier's new facility, which is an independent company that New Frontier owns and controls in another country. The guests were discussing how their companies decided to "go global." Which of the following ways of entering into the global marketplace is Tamia's company using?
Strategic goals are
major targets related to the long-term survival, value, and growth of an organization.
ethical climate
In an organization, the processes by which decisions are evaluated and made on the basis of right and wrong
Transnational
In order to achieve cost economies, Geo Manufacturing bases its production plants in Mexico to manufacture their base product and then ship it to Japan for final assembly using higher technical skills and customizing the product to fit local needs. In this case, Geo Manufacturing is using the ________blank model of organizational structure.
cognitive conflict
Issue-based differences in perspectives or judgments
social responsibility is associated with better financial performance."
Javi Torres, general manager of Fabricated Products, Incorporated, told his mentor, "I find it difficult to support our corporate social performance without corporate financial performance." His mentor replied, "Javi, the accumulated evidence indicates that
The manufacture of watches is standardized and the company is sufficiently well-established, making outsourcing an attractive option.
Jean-Michel is the CEO of Kronos Timepieces, a retailer and manufacturer of fashion watches and watch accessories. The company, which was founded in 1925, is based in Switzerland and employs around 1,000 people in five countries. It currently sells its watches in 27 countries, with a recent expansion into several Middle Eastern and far Eastern countries. Kronos has decided to introduce a lower-priced unisex wristwatch. Jean-Michel has been considering contracting a new factory located in Singapore to manufacture the lower-priced line of wristwatches, rather than using Kronos' older, main factory, which is located in nearby Grenchen. Which of the following factors best supports Jean-Michel's decision to outsource production of the watches?
scenario development.
Jimena works for a small company that makes nut butters from ingredients like cashews and macadamia nuts, and jams from mixtures of tropical fruits. She reports to the CFO. It is her job to predict the costs of raw materials for the next five years. She uses various research sources, including the news, to learn who the competitors are and what they have been doing. In fact, she subscribes to an analyst e-newsletter that tells her about crop availability and weather conditions all around the globe. Every month she develops a spreadsheet for her boss indicating the likely costs of fruits and nuts given the type of weather conditions expected in each area of the world and thus the availability of particular crops. She is also involved in a team that is investigating how to cut production costs. They have recently met with Spicy Sides, a company that produces jars of condiments. Spicy Sides is considered the top company in the condiment industry, especially in its knowledge of how to pack food products in jars. Jimena's team is comparing their processes to those of Spicy Sides to see how they might improve. The spreadsheet that Jimena uses gives her a chance to examine different projections, which is a form of
psychological
Joaquín, a human resources manager, has to lay off either of two department heads, Coral or Mike, because the downsizing process that is going on in the organization calls for the merging of their two departments. However, Joaquín cannot decide whom to lay off, since they are both excellent managers and he does not want to dismiss either of them. In this case, Joaquín is having a difficult time making a decision due to experiencing ________blank conflict.
switching costs.
Karl's office has always used Bentley computers. His technical people have suggested that he switch all his employees over to Best computers. Karl is reluctant because it will mean not only replacing all the computers but also buying all new software and taking the time to train everyone. Karl is worried about
many whistleblowers suffer consequences such as being ostracized.
Katherine Lilly is considering talking to the human resources director about her manager's fraudulent behavior. However, she is reluctant because she knows
tolerance of risk and uncertainty
Katya is evaluating whether she has the right personality to be an entrepreneur. Which of the following characteristics should she have if she wants to succeed?
False
Large corporations are merely passive bystanders watching entrepreneurs create new businesses. (T/F)
Satisficing
Leonardo has just been promoted to manage a staff of 10 people and wants to make a good impression on top management. He recently held his first staff meeting to solve a fairly large problem with the project, but it did not go well. All 10 staff members were there. His goal was to get buy-in from the group, but instead little progress was made. Since the first meeting did not go well, Leonardo read several management books on working with groups and thought perhaps a longer meeting would allow time to explore several points of view. He chose a Friday afternoon so everyone could go home afterward and not have to rush off to other work appointments. To his surprise, the first idea he suggested was accepted by the group, and the meeting was over in no time. The group was most likely engaging in ________so they could end the meeting and go home early.
They may realize they have not decided how to get their message out to customers.
Louise and Cecile want to start an online matchmaking service. They decide who will assume the various roles in the company, evaluate who their target customers will be, research their competitors and how they will differentiate themselves, assess the financial and regulatory issues they might expect to face, and anticipate the future risks they might encounter. Which of the following situations is most likely to happen as a result of Louise and Cecile forgetting to include certain elements in their business plan?
Mission Statement
Love Your Home is a housewares manufacturing company. The company's basic purpose is "to be the place you want to call home." The management states that the company's long-term strategic intent is "to build an empire in the housewares industry, setting the trend for people to have fashionable and affordable household goods, easily available, wherever they may be." Love Your Home's basic purpose—to be the place you want to call home—is an example of a(n)
strategic goals
Major targets or end results relating to the organization's long-term survival, value, and growth of the organization
pre-conventional level
Morality is externally controlled. This perspective involves the idea that what is right is what one can get away with or what is personally satisfying
Middle-level managers
Managers located in the middle layers of the organizational hierarchy, reporting to top-level executives. Sometimes called tactical managers, they are responsible for translating the general goals and pans developed by top level (strategic) managers into more specific objectives and activities
Goal and Plan Evaluation
Managers will evaluate the advantages, disadvantages, and potential effects of each alternative goal and plan. Must prioritize those goals and even eliminate some of them. Managers must consider carefully the implications of alternative plans for meeting high priority goals.
Goal and Plan Selection
Managers will select the option that is most appropriate and feasible The evaluation process will identify the priorities and trade-offs among the goals and plans
demographic change
Marta decided that a growing Latino population has created an opportunity to market her family's salsa recipes. Which type of opportunity is she focusing on?
Demographics
Measures of various characteristics of the people who make up groups or other social units
Mindful Maids has fallen behind in staff training over the last several years.
Mindful Maids Incorporated, a housecleaning services firm, has completed a SWOT analysis as part of its ongoing strategic planning process. Management has uncovered the following information through extensive research: New regulations have been passed limiting the number of hours per week the company's employees can work without receiving benefits. Mindful Maids is a company that uses environmentally friendly products; its competitors do not. More and more homeowners are concerned about the environment; it is expected that this trend will continue for decades. Compared to its competitors, its management team is by far the best in the industry. It has fallen behind in staff training over the last few years. The company has adequate financial resources to invest in its operations. The percentage of people hiring cleaning services has fallen off due to a difficult recession. Which of the following findings is a weakness for Mindful Maids?
is frequent, repetitive, and routine.
Michelle Caldwell, finance manager, told her president, "David, I have determined appropriate revenue recognition for each of the 16 projects this month, based upon company policy and our standard procedures. Each of the projects has routine revenue accrual. I have prepared the monthly financial affidavits for each of these 16 projects, and I recommend that you approve the revenues by signing the affidavits." David's decision to approve the revenues is an example of a programmed decision because the underlying problem
feel satisfaction in creating something from nothing.
Most entrepreneurs start their own firms because they
inshoring
Moving work from other countries back to the headquarters country
The Americas
NAFTA- an economic pact between the U.S., Canada, and Mexico; currently renegotiated as the U.S-Mexico-Canada Agreement (USMCA)
franchisee
Nadia wants to open and run her own sandwich shop. However, she wants to leverage an existing, proven model so she can focus on managing. Which of the following should Nadia consider being, based on her desires?
Incremental
Nasim's employees have requested that he switch the office to flextime so that they can better manage their childcare and commuting schedules. Nasim is reluctant to make a drastic change all at once, so he agrees to experiment with staggering the starting and ending times of the workday over a 90-minute period for three months. If, at the end of that time, productivity does not decline, he will consider implementing a more extreme version of flextime. What model of decision making is Nasim using?
NLRB
National Labor Relations Board
Based on Scenario C, which of the following findings is likely to present a threat for Mindful Maids?
New regulations have limited the hours employees can work without benefits.
host-country national.
Nurul is a native of Malaysia where Regal Menswear is building its new plant. If Nurul goes to work at Regal's factory, she will be considered a(n)
OSHA
Occupational Safety and Health Administration
OFCCP
Office of Federal Contract Compliance Programs
True
One of the consequences of an increasingly integrated global economy is that imports are penetrating deeper into the world's largest economies.
contigency
Perfect Pasta plans to open five new stores before 2021. However, if the economy does not improve and if consumer confidence does not rise as hoped, it might open just two stores. This backup plan is an example of a(n) ________ plan.
Virtue Ethics
Perspective that what is moral comes from what a mature person with "good" moral character would deem right
egoism
Phil Colley, a project manager, finds an envelope in his office mailbox. The return address indicates that it was sent by a salesman for HiTek Instruments, a long-time supplier to Phil's firm. Inside the envelope is a "thanks for the business" note and $2,000 in cash. Afraid that he will be perceived as receiving a "kickback," Phil immediately takes the envelope and cash to his manager to report what he found. Phil uses ________blank as an ethical system in his decision making.
relativism
Philosophy that bases ethical behavior on the opinions and behaviors of relevant other people
_____ is the conscious, systematic process of making decisions about goals and activities that a person, group, work unit, or organization will pursue in the future.
Planning
phase 1: identify and diagnose the problem
Porter's 5 forces macroenvironment
business incubators
Protected environments for new, small businesses
gain competitive intelligence through environmental scanning, develop business scenarios, forecast sales, and benchmark the technology.
Randall, senior product development manager at WasteTech Corporation, is considering the acquisition of a new waste treatment technology from a small development firm. The asking price is $10 million. However, the environmental uncertainty of the waste treatment marketplace is both complex and dynamic. Randall wants to acquire the new technology but seeks to manage the risk associated with his decision, or "hedge his bets." Key elements of his risk management strategy might be to
conduct an opportunity analysis.
Renaldo is creating a business plan. His first formal step should be to
low innovation/low risk.
Scenario B: Two entrepreneurs, Fred and Ming, were discussing the potential for success or failure of their ventures. They described their startups in the following manner: Fred stated that he had very little money invested, but he was the first in the market with his product. Ming stated that her investment in the business was very small and that her product was similar to those already in the market. According to the entrepreneurial strategy matrix, Ming's scenario can be described as involving
SEC
Securities and Exchange Commission
Top-level managers
Senior executives responsible for the overall management and effectiveness of the organization
doing the right thing regardless of what the law says
Senior management at Value Products is attending a corporate retreat, and the first item for discussion is corporate social responsibility (CSR). The group has discussed this before and then shot it down because it generally costs Value Products' shareholders in the form of reduced distributions. But the new VP, Isabella, is about to explain why she believes CSR will actually benefit the shareholders and Value Products management alike. Her team begins the presentation with a discussion of CSR, both its current definition and reconciliation of past views. Jessica then discusses the importance of being a good global corporate citizen by supporting the local school system. Valentina takes the floor to make the case for doing what is expected by global stakeholders even though there are no laws requiring those actions. Finally, Scott wraps up the discussion by defining why Value Products should take legal responsibility for the firm's performance. Valentina's presentation most likely centered on taking which of the following actions?
Ethnocentrism
Sophie was very excited to be on a one-month project in Japan. While at work, Sophie's Japanese coworkers rarely tell their boss what they are thinking. Because she thinks the actions of her coworkers are not making the company as efficient as it would be back in Germany, Sophie is exhibiting
6 step planning process
Step 1: Situational analysis Step 2: Generate alternative goals & plans Step 3: Evaluate goals & plans Step 4: Select goals & plans Step 5: Implementation Step 6: Monitor & Control
Power of Suppliers
Steven is marketing manager for Abrams Technologies, a firm that sells environmental control systems to the coal-fired power industry. Steven's business is highly competitive, with many existing rivalries and new players. However, coal-fired power plants are being shut down in favor of substitute forms of energy, e.g., wind and natural gas. Thus, opportunities to sell environmental control systems to coal-fired power plants are rare, and his clients have many choices of providers and technologies. Steven's firm has long-term pricing agreements with its equipment suppliers, so Steven knows what external costs Abrams will incur on potential new projects for environmental control systems. The competitive force that appears to represent the lowest risk to Steven's firm is
organization culture
Strong culture: majority of people within the organization agree on organizational goals Weak culture: different people hold different values and there is confusion about corporate goals
Which of the following statements about planning is accurate?
Tactical plans may have a time horizon of a year or two, whereas operational plans may cover a period of less than a year.
universalism
Talia, store manager for Best Value Foods, learned that the store's commercial freezer failed overnight, and, for several hours, the frozen foods reached temperatures that were potentially unsafe. She decided to discard the food, at a cost of many thousands of dollars, because she believed it was the right thing to do; the health of consumers was at stake. Talia used ________blank as an ethical system to make her decision.
A method used for aligning an organization's operational and strategic goals is a
strategy map.
monitor and control
The Ascent, a mountain bicycle manufacturer, has been in the bicycle industry for a year now. The CEO wishes to better the company. He starts by looking at the sales records of the year that they have been in business and notices that the company's sales have been declining at a steady pace for the past six months and that at present they are selling only half as many bicycles as they want to. In an attempt to increase sales, he either wants to bring down the prices of his bicycles or expand the company by opening a new branch in another area. The CEO shares his views with the sales manager and finance managers. Together they decide that reducing the prices would definitely increase sales, although the profits would come down. They also determine that opening a new branch would only increase expenses. They conclude that they will reduce the prices of the bicycles. The plan is implemented and the CEO keeps a record of the sales every month to make sure the change is effective. Which of the following steps in the basic planning process does the CEO perform when he closely watches the sales reports each month?
requires strict adherence to accounting rules.
The Sarbanes-Oxley Act
Which country has received the most foreign direct investment in recent years?
The United States
risk society
The creation and distribution of wealth generate by-products that can cause injury, loss, or danger to people and the environment
Marko is the CEO of the advertising department at Foster-Ghent, a company that encompasses a variety of personal hygiene brands, including Lush Soap and New Gleem toothpaste. Foster-Ghent does business in 65 countries through one or more operating companies, with a total of about 50 companies in the Foster-Ghent group. Tanvi is the advertising and marketing manager for the Indian market. Based on your knowledge of the transnational model, which of the following best describes how Marco and Tanvi would divide responsibilities?
The general guidelines for the new Clearly Clean contact solution advertising comes from Marco's team, but Tanvi is allowed to design campaigns that will appeal to the local market.
Which of the following statements about missions and strategic visions is true?
The mission details the organization's ongoing purpose, while the strategic vision focuses on the future.
identify the problem.
The manager of the Silver Sands Hotel noticed a tremendous decrease in the number of convention bookings. He promptly ordered the redecoration of the hotel's meeting rooms. Customer feedback later indicated that the problem had not been the meeting facilities but poor service from the cleaning staff. In this scenario, to try and solve the problem, the manager should have first tried to
Jean-Michel is the CEO of Kronos Timepieces, a retailer and manufacturer of fashion watches and watch accessories. The company, which was founded in 1925, is based in Switzerland and employs around 1,000 people in five countries. It currently sells its watches in 27 countries, with a recent expansion into several Middle Eastern and far Eastern countries. Kronos has decided to introduce a lower-priced unisex wristwatch. Jean-Michel has been considering contracting a brand new factory located in Singapore to manufacture the lower-priced line of wristwatches, rather than using Kronos' older, main factory, which is located in nearby Grenchen. Which of the following factors best supports Jean-Michel's decision to outsource production of the watches?
The manufacture of watches is standardized and the company is sufficiently well-established, making outsourcing an attractive option.
operational planning
The process of identifying the specific procedures and processes required at lower levels of the organization.
Entrepreneurship
The pursuit of lucrative opportunities by enterprising individuals
True
To be successful, entrepreneurs should be innovators and also have good knowledge and skills in management, business, and networking. (T/F)
entrepreneurial orientation
The tendency of an organization to identify and capitalize successfully on opportunities to launch new ventures by entering new or established markets with new or existing goods or services
multinational and international.
The two strategic models that have relatively high manufacturing costs are
After years of hearing about how much he hates his job at a grill and bar, Raja's friends all tell him he should strike out on his own and start his own restaurant. Raja is unsure, however, and needs some convincing. What is one truthful statement they might use to entice him into becoming an entrepreneur?
Think of how satisfying it will feel to watch the restaurant grow in popularity.
Controlling
Through careful monitoring of the financial budgets of a firm, managers can detect potential problems in reaching their financial goals and take actions to reverse the problem. This is an example of the ________blank function of management.
raises the standards of living.
Trade allows each country to obtain products and produce products more efficiently, which
SWOT analysis and strategy formulation
strengths, weaknesses, opportunities, threats
True
Using host-country nationals at an overseas subsidiary is generally less expensive than using expatriates. (T/F)
the greatest good for the greatest number of people.
Utilitarianism directly seeks
False
When investors bid up stock prices, companies have less capital to fuel their strategies. (T/F)
Chipotle Burrito Bowl for a Chick-fil-A meal
Which of the following is an example of a potential substitute product?
SWOT analysis and strategy formulation
Which of the following is one of the six major components of the strategic management process?
a manager focusing on quarterly profits instead of the long-term vision
Which of the following is the best example of a manager discounting the future?
Team Leader
Which of the following job titles indicates that a person is a frontline manager?
international
Yolanda is a consultant for four companies with international operations. Each of them has selected a different global strategy. Acme Gaskets uses its established skills in producing gaskets that it will sell in foreign markets. Krunchers Chips produces locally targeted snacks for which it has built specialized plants in each local region. It customizes its snacks according to the tastes and preferences of the local consumers. Harman Motors offers a standardized economy automobile and has a single worldwide corporate headquarters from which it centrally manages the entire company's operations. Finally, Gold Medal Industries is located in Tajikistan where wages are quite low. The company produces machine housings that are fairly easy to manufacture and require little employee skill. These pieces are then sent to its locations abroad to be finished by a more skilled workforce, taking into account the customs and benefits desired by each of those particular populations. Which of the following global strategies is Acme Gaskets using?
illusion of control
a belief that one can influence events even when one has no control over what will happen
discounting the future
a bias weighting short-term costs and benefits more heavily than longer-term costs and benefits
Most strategic control systems include which of the following in order to monitor and control major financial expenditures?
a budget
business plan
a formal planning step that focuses on the entire venture and describes all the elements involved in starting it
scenario
a narrative that describes a future set of conditions
strategy
a pattern of actions and resource allocations designed to achieve organization goals
devil's advocate
a person who has the job of criticizing ideas to ensure that their downsides are fully explored
Skunkworks
a project team designated to produce a new, innovative product
low-cost business strategy
a strategy an organization uses to build competitive advantage by being efficient and offering a standard no-frills product
differentiation business strategy
a strategy an organization uses to build competitive advantage by being unique in in its industry or market segment along one or more dimensions
dialectic
a structured debate comparing two conflicting courses of action
Which of the following methods of entering global competition best allows a company to have operations in other countries and maintain tight control over them?
a wholly owned subsidiary
technical skills
ability to perform a specialized task involving a particular method or process
confirmation bias
accepting incoming information that fits what one already believes and rejecting what doesn't confirm what one thinks
Microenvironment
affects all organizations and includes economic, technological, legal and political, demographic, social, and natural environments factors
Substitutes
alternative products or services. potential threat
The Earl of Sandwich is a fast food venture that offers healthy, whole-food, and vegetarian alternatives to traditional sandwiches. The company, which was founded in 2000, had expanded to 45 locations in the United States by 2010. Between 2010 and 2017, the company expanded to the international market, with 10 locations in Western Europe. Now Anjali, the CEO, is considering expanding into the Latin American market, with a new location in Santamaria. Anjali meets with her team to discuss researching the Santamarian market. What do you think is the first task the team should complete when making a decision about the viability of opening a location in Santamaria?
an investigation into how NAFTA and CAFTRA will affect the process of opening a franchise in Santamaria
A differentiation strategy is best defined as a strategy
an organization uses to build competitive advantage by being unique in its industry or market segment along one or more dimensions.
During which step of strategy implementation would an executive evaluate his or her company's ability to implement strategic tasks?
assessing organization capabilities
Strategic goals should
be accessible to everyone who comes in contact with the organization.
Farah's Falafels, a chain of Middle Eastern restaurants, periodically compares its quality and service levels to other successful restaurants in order to continually improve its own performance. This practice is known as
benchmarking.
organizing
building a dynamic organization: assembling and coordinating resources needed to achieve goals
Keiko prepares a document that outlines her plan to open a new essential oils company, including descriptions of the product, the market, her strategies, and the future direction she envisions for the company. This document is a(n)
business plan.
human dignity
concerns the value of each person as an end, not a means to the fulfillment of others' purposes
The first step to building organizational support for an intrapreneur's idea that involves explaining the idea to his or her boss and seeking approval to look for wider support is called
clearing the investment.
Philippe wants to make sure of the success of his new doggy day care, PAWS, by employing the steps in the basic planning process. To initiate the process, what kinds of activities should we expect Philippe to be performing?
collecting data about competition, his financial position, and needs of local dog owners
An entrepreneur who is decisive, tenacious, disciplined, and willing to make sacrifices demonstrates which of the following characteristics?
commitment and determination
Integrity-based ethics programs
company mechanisms designed to instill in people a personal responsibility for ethical behavior
Compliance-based ethics programs
company mechanisms typically designed by corporate counsel to prevent, detect, and punish legal violations
A _____ strategy involves adding new businesses that produce related products or are involved in related markets and activities.
concentric diversification
For the past two decades, Nonna Luciana's has focused only on producing various pasta sauces in jars. The company is now considering entering the market for jarred pickles and olives as well. If Nonna Luciana's decides to enter this arena, it would be using a _____ strategy.
concentric diversification
barriers to entry
conditions that prevent new companies from entering an industry. Government policy, capital requirements, brand identifications, cost disadvantages, and distribution channels
conventional level
conformity to social rules remains important to the individual. However, the emphasis shifts from self-interest to relationships with other people and social systems
If a bicycle manufacturer purchases a travel agency chain, which type of corporate strategy would this exemplify?
conglomerate diversification
Athletic Pursuits specializes in sporting equipment. Recently, it has decided to add to its business units by opening a steakhouse near a convention center. This strategy is an example of
conglomerate diversification.
Strong pressures for local responsiveness emerge when
consumer tastes and preferences differ significantly.
On-Time Delivery has a unique software program that tracks packages in real time and maps every step of their journey. Such a technology, which gives the company an edge over competitors, would be called a
core capability.
globalization
corporations operate worldwide, transcending national borders by tapping international markets
Companies that adopt the global model tend to base their global competitive strategy on
cost considerations.
Once a situational analysis has been completed, the next step for organizations is to use what they have learned to
create alternative goals and alternative actions for attaining each goal.
social enterprises
create social value
strategy implementation
define strategic risks, assess organization capabilities, develop an implementation agenda, create an implementation plan
planning
delivering strategic value: systematically making decisions about goals and activities to be pursued
When Kumquat, a contemporary sportswear company, tries to open its clothing stores in a new country, it learns that local rules require a certain percentage of its products be manufactured locally. This example fits into which category of pressures for local responsiveness?
economic and political demands
sustainable growth
economic growth and development that meet present needs without harming the needs of future generations
Bootlegging
informal work on projects, other than those officially assigned, of employees' own choosing and initiative
technology change
engagement in artificial intelligence and machine learning, data protections, 5G, etc. The internet can be a threat and business opportunity. AI can interfere between humans, technology, and society
Franchising
entrepreneurial alliance between a franchisor and a franchisee
Using his own money and resources, Shawnee—who had recently been laid off from his job—started a new business based on the innovative ideas that he himself had generated. This is an example of a(n)
entrepreneurship.
Nicola is exhibiting _____ by expressing her disapproval of her Urlandian co-workers' conversations.
ethnocentrism
Vertical Integration
expands company domain to include suppliers and distributors: reduces cost and uncertainty
conglomerate diversification
expands into unrelated businesses
In order for family-managed businesses to survive and prosper, management guru Peter Drucker advises them to
fill at least one key position with a nonfamily member.
stages of team development
forming, storming, norming, performing
phase 5: implement the decision
gantt chart
moral judgement
knowing what actions are morally defensible
FreshFaced, a cosmetics manufacturer, assumes that people all over the world will view and use its products in the same way. Therefore it produces exactly the same makeup products, using the same color palettes, in several countries with attractive labor rates, and offers them to all of its markets around the world. FreshFaced uses the _____ model of international competition.
global
Challenges that characterize the current business landscape
globalization, technology change, collaboration, knowledge management
Which of the following steps in the basic planning process do the managers of The Assent perform by deciding to reduce prices?
goal and plan selection
Alternative goals and plans
goals: the targets or ends that management desires to reach plans: the actions or means managers intend to use to achieve organizational goals
social capital
goodwill stemming from your social relationships
norming
group members agree on their shared goals, and norms and closer relationships develop
forming
group members attempt to lay the ground rules for what types of behavior are acceptable
Nurul is a native of Malaysia where Regal Menswear is building its new plant. If Nurul goes to work at Regal's factory, she will be considered a(n)
host-country national.
storming
hostilities and conflict arise, and people jockey for positions of power and status
framing effect
how problems or decision alternatives are phrased or presented and how these subjective influences can override objective facts
Benchmarking
identifying the best in-class performance by one or more companies in a given area and comparing your processes to their processes
weak culture
ignoring ethics often causes unethical behavior or dissatisfaction and quitting
functional strategy
implemented by each functional area of the organization to support the business strategy
crisis management
includes identifying cause of serious disruption, preventing or preparing for potential damage, and bringing a damaged organization back to normal functioning
competitive environment
includes the firm and its rivals, suppliers, buyers, new entrants, and substitute or complementary products
To be competitive in a global economy, Europeans must
increase their level of productivity.
People who have an entrepreneurial orientation tend to
innovate.
resources
inputs to a system that can enhance performance
For the past several years, CloudComm has hired a firm in India to handle its technical customer support. Recently, CloudComm hired a California-based company to do those services instead. This change is an example of
inshoring.
Mykal's company used to have one of its clothing lines manufactured by an outside supplier. That line is now manufactured at a new factory built by Mykal's company. This change is an example of
insourcing.
analyzing internal strengths and weaknesses
internal resource analysis: financial analysis, marketing audit, operations analysis, other internal resource analysis, human resources assessment
LEAP Communications Technology has subsidiaries in each country in which it does business. As the parent company, LEAP runs its research and development department from its home country. As a result, each foreign subsidiary remains dependent on it for new products, processes, and ideas. This illustrates the _____ model for global strategy.
international
Nora works for a corporation and is using the company's resources to build a new line of business for her employers. Nora is a(n)
intrapreneur.
While working at Advance Corp., Samantha has created a new venture based solely on her idea and Enterprisers' proprietary technology. Samantha can be described as a(n)
intrapreneur.
China
is one of the world's largest consumers of basic raw materials and the largest exporter of goods into the U.S.
controlling
learning and changing: monitoring performance and making needed changes
Kholberg's theory
level 1: Pre-conventional level level 2: conventional level level 3: post-conventional
An advantage of licensing as a method of entering global competition is that the
licensee bears most of the costs and risks associated.
Helga believes there is an opportunity to start up a business that produces sports equipment using greener technologies, thereby keying into two consumer trends. Into which category does this opportunity best fit?
lifestyle and taste changes
Kyosei
living and working together for the common good, allowing cooperation and mutual prosperity to coexist with healthy and fair competition
Africa
long been seen only as a place of dire poverty and many unstable political situations
With which of the following business strategies do large companies that try to take advantage of economies of scale in production often succeed?
low-cost
frontline managers
lower-level managers who supervise the operational activities of the organization. These managers have titles such as supervisor, team leader, or assistant manager
The three levels of planning coordinate with the three levels of
management.
implementing
managers and employees must understand the plan and have the resources and motivation to implement it
monitoring and controlling
managers must continually monitor the actual performance of their work units against the unit's goals and plans. also develop control systems to measure that performance and allow them to take corrective action
Supply Chain Management
managing the acquisition of materials, their transformation into products, and the distribution of products to customers
Social Realities
many decisions are the result of intensive social interactions, bargaining, and politicking
Which of the following is a major component of an internal analysis?
marketing audits
phase 4: make the choice
maximizing, satisficing, optimizing
forecasting
method for predicting how variables will change the future
leading
mobilizing people: efforts to stimulate high performance by employees
garbage can model
model of organizational decision making depicting a chaotic process and seemingly random decisions
incremental model
model of organizational decision making in which major solutions arise through a series of smaller decisions
Crest Craft is a speedboat manufacturing company based in California. The company operates a subsidiary in Australia, marketing products that are customized to appeal to Australian tastes. In this case, Crest Craft is following the _____ model.
multinational
The two strategic models that have relatively high manufacturing costs are
multinational and international.
third-country nationals
natives of a country other than the home country or the host country of an overseas subsidiary
host-country nationals
natives of the country where an overseas subsidiary is located
phase 6: evaluate the decision
negative and positive feeeback
phase 2: generate alternative solutions
new ideas of meeting customers need
intrapreneur
new venture creators working inside big companies
mission
organization's basic purpose and scope of operations
Corporate Social Responsibility
obligation toward society assumed by business
Bad economic times can
offer more opportunities to expand.
ethical leader
one who is both a moral person and a moral manager influencing others to behave ethically
expatriates
parent-company nationals who are sent to work at a foreign subsidiary
interpersonal and communication skills
people skills that represent the ability to lead, motivate, and communicate effectively with others
Moral Philosophy
principles, rules, and values people use in deciding what is right or wrong
Insourcing
producing in-house one or more of an organization's goods or services
complements
products or services that increase purchases of other products. potential opportunity
collaboration
requires productive communications among different departments, divisions, or subunits of the organization
switching costs
provide resources or inputs needed for production. Fixed costs buyers face if they change suppliers
Slim Sips manufactures a variety of sugar-free beverages and is widely known in the country of Venture. Slim Sips plans to acquire a small firm named Slim Cow that makes low-fat cheese. Because of concerns about obesity in Venture, the market for low-fat cheese is increasing at a growing rate. However, Slim Cow's poor popularity in the market has caused it to go into loss. Slim Cow is most likely a _____ according to the BCG Matrix
question mark
According to the BCG Matrix, a high-growth, weak-competitive-position business is called a
question mark.
moral awareness
realizing the issue has ethical implications
Successfully fostering and managing intrapreneurship requires the company to
reward risk taking.
motivated reasoning
seeing what one wants to see, and making decisions based more on desire than evidence
concentration
single business competing in single industry
Juanita, a manager of a glassware company, is in the process of deciding what items to add to next year's line of merchandise. For research purposes, she analyzed the past and present conditions of the market and also forecasted future trends. Which of the following steps of the formal planning process has Juanita performed?
situational analysis
Conceptual and decision skills
skills related to abilities that help identify and resolve problems
Dr. Elbridge began helping women in Bajukistan obtain microloans for small business start-ups. This act is a typical example of
social entrepreneurship.
analyzing external opportunities and threats
stakeholders- groups and individuals who affect and are affected by the achievement of the organization's mission, goals, and strategies
India
still developing and has the second-largest population in the world
e-commerce
storefront, subscription, business-to-business
ethics
system of rules that governs the ordering of values
Must-Have Management Skills
technical, conceptual and decision, interpersonal and communication
technology
technological advances create new products and services, advanced and production techniques, and better ways of managing and communicating
NAFTA combined the economies of _____ into one of the world's largest trading blocs.
the United States, Canada, and Mexico
culture shock
the disorientation and stress associated with being in a foreign environment
universalism
the ethical system stating that all people should uphold certain values that society needs to function
power distance
the extent to which a society accepts the fact that power in organizations is distributed unequally
Masculinity/Femininity
the extent to which a society values quantity of life over quality of life
Individualism/Collectivism
the extent to which people act on their own or as a part of a group
uncertainty avoidance
the extent to which people in a society feel threatened by uncertain and ambiguous situations
performing
the group channels its energies into performing its tasks
post-conventional level
the individual moves beyond the perspective of his or her own society. The individual attempts to take the perspective of all individuals
Which of the following best describes strategic vision?
the long-term direction and strategic intent of a company
strategic vision
the long-term direction and strategic intent of a company
Business Ethics
the moral principles and standards that guide behavior in the world of business
time pressures
the most conscientiously-made business decisions can become irrelevant and even disastrous if managers take too long to make them
knowledge management
the set of practices at discovering and harnessing an organization's intellectual resources - finding, unlocking, sharing, and capitalizing on people's expertise, skills, wisdom, and relationships
emotional intelligence
the skills of understanding yourself, managing yourself, and dealing effectively with others
moral character
the strength and persistence to act in accordance with your ethics despite the challenges
ethnocentrism
the tendency to judge others by the standards of one's group or culture, which are seen as superior
Which of the following nonfinancial resources is crucial to the success of a new business?
top management teams
organizations are open systems
they are affected by and in turn affect their external environment
In order to achieve cost economies, Apogee Manufacturing bases its production plants in Mexico and gets its engineering services from skilled workers in Japan. In this case, Apogee is using the _____ model of organizational structure.
transnational
Which of the following corporate strategies is being employed when a large grocery store purchases a dairy farm to supply all of the store-brand milk, yogurt, butter, and cheese?
vertical integration
intermediate customers
wholesalers and retailers
customers
without customers to purchase its goods or services, a company won't survive
