MGMT 4850 Exam 1 (Ch 1 - 6) CU Boulder - Edward Lewis
The most significant signs of a well-managed company are
good strategy-making combined with good strategy execution.
Which of the following are characteristics of an effectively worded strategic vision statement?
graphic, directional, and focused
A company's strategy:
A company's strategy is typically a blend of proactive and reactive strategy elements.
The set of actions that its managers take to outperform the company's competitors and achieve superior profitability.
A strategy
Why are crafting and executing business strategies the foremost tasks of any organization?
Because a good strategy coupled with a good strategy execution are the most telling signs of good management and allow a company to be a standout performer in the marketplace
Why is it important to craft a business model?
Because it sets forth the key components of the enterprise's business approach, indicates how revenues will be generated, and makes a case for why the strategy can deliver value to customers in a profitable manner.
Good strategy combined with good strategy execution
is the clearest indicator of good management.
NOT one of the managerial considerations in determining how to compete successfully?
How can a company modify its entire product line to emphasize its internal service attributes?
Strategy is about
Developing lasting success that can support growth and secure the company's future over the long term.
Fit Test
How well does the strategy fit the company's situation?
Used to distinguish a winning strategy from a mediocre or losing strategy
How well does the strategy fit the company's situation?
Which of the following is the best example of a well-stated financial objective?
Increase earnings per share by 15 percent annually.
What question tests the merits of the firm's strategy and distinguishes it as a winning strategy?
Is the strategy helping the company achieve a sustainable competitive advantage and is it resulting in better company performance?
Competitive Advantage Test
Is the strategy helping the company achieve a sustainable competitive advantage?
Performance Test
Is the strategy producing good company performance?
Which of the following is the best example of a well-stated strategic objective?
Overtake key competitors on product performance or quality within three years.
NOT a frequently used strategic approach to set a company apart from rivals and achieve a sustainable competitive advantage?
Simply trying to mimic the successful strategies of rivals
A company's strategy consists of the action plan management takes to
Stake out a unique market position and achieve superior profitability.
To improve performance, there are many different avenues for outcompeting rivals such as
Strengthening competitiveness by pursuing strategic alliances and collaborative partnerships.
What is the foremost question in running a business enterprise?
What must managers do, and do well, to make a company a winner in the marketplace?
A company's mission statement typically addresses which of the following questions?
Who are we and what do we do?
It is normal for a company's strategy to end up being
a blend of proactive actions to improve the company's competitiveness and financial performance, and adaptive reactions to unanticipated developments and fresh market conditions.
LEAST bargaining power with its suppliers?
a company that offers high-cost specialized products that could be used only by customers of a certain age group
Every strategy needs
a distinctive element that attracts customers and produces a competitive edge.
The primary difference between a company's mission statement and the company's strategic vision is that:
a mission statement typically concerns a company's present business scope and purpose, whereas a strategic vision sets forth "where we are going and why."
What does NOT account for WHY a company's strategy evolves from one version to another?
a need to promote stability and retain the status quo
A company achieves sustainable competitive advantage when
a sufficiently large number of buyers have a lasting preference for its products or services as compared to the offerings of competitors.
Changing circumstances and ongoing managerial efforts to improve the strategy
account for why a company's strategy evolves over time.
A company needs financial objectives:
because without adequate profitability and financial strength, the company's ultimate survival is jeopardized.
Management's blueprint for how and why the company's business approaches will generate revenues sufficient to cover costs and produce attractive profits and returns on investment
best describes what is meant by a company's business model.
Winning a sustainable competitive edge over competitors does NOT hinge on which of the following
building products and distributing them at low prices to a broad customer base irrespective of manufacturing cost
In a single-business company, the strategy-making hierarchy consists of:
business strategy, functional strategies, and operating strategies.
Corporate strategy for a diversified or multi-business enterprise:
is orchestrated by senior corporate executives and centers around the kinds of initiatives the company uses to establish business positions in different industries.
A company's overall strategy:
is really a collection of strategic initiatives and actions devised by managers and key employees up and down the whole organizational hierarchy.
The heart and soul of a company's strategy-making effort is determining how to
come up with moves and actions that produce a durable competitive edge over rivals.
Functional-area strategies:
concern the actions, approaches, and practices to be employed in managing particular functions within a business.
Crafting a deliberate strategy involves developing strategy elements that
consist of a blend of proactive new planned initiatives plus ongoing strategy elements continued from prior periods.
What a company's top executives are saying about where the company is headed long term with respect to its future product-market-customer-technology mix:
constitutes the strategic vision for the company.
Which of the following is a seldom used strategic approach to setting a company apart from rivals and achieving a sustainable competitive advantage?
copying the attributes of a popular product or service
In a diversified company, the strategy-making hierarchy consists of:
corporate strategy, business strategies, functional strategies, and operating strategies.
A creative, distinctive strategy that delivers a sustainable competitive advantage is important because
crafting a strategy that yields a competitive advantage over rivals is a company's most reliable means of achieving above-average profitability and financial performance.
Operating strategies are primarily concerned with:
how to manage initiatives of strategic significance within each functional area, and adding detail and completeness in ways that support functional strategies and the overall business strategy.
A company needs performance targets or objectives:
for its operations as a whole and also for each of its separate businesses, product lines, functional departments, and individual work units.
The pattern of actions and business approaches that would NOT define a company's strategy include actions to
gain sales and market share with lower prices despite increased costs.
Management is obligated to monitor new external developments, evaluate the company's progress, and make corrective adjustments in order to
decide whether to continue or change the company's strategic vision, objectives, strategy and/or strategy execution methods.
Business strategy, as distinct from corporate strategy, is chiefly concerned with:
deciding how to build competitive advantage and improve performance in a particular line of business.
The leadership challenges that top executives face in making corrective adjustments when things are not going well include:
deciding when adjustments are needed and what adjustments to make.
The primary role of a functional strategy is to:
determine how to support particular activities in ways that support the overall business strategy and competitive approach.
What are integral parts of the managerial process of crafting and executing strategy?
developing a strategic vision, Strategic Management, and crafting a strategy
Masterful strategies come from:
doing things differently from competitors where it counts rather than running with the herd.
The task of stitching together a strategy:
entails addressing a series of hows: how to grow the business, how to please customers, how to outcompete rivals, how to respond to changing market conditions, and how to achieve strategic and financial objectives.
Effectively communicating the strategic vision down the line to lower-level managers and employees has the value of:
explaining "where we are going and why" and, more importantly, inspiring and energizing company personnel to unite to get the company moving in the intended direction.
The strategy-making, strategy-executing process is shaped by:
external factors such as the industry's economic and competitive conditions and internal factors such as the company's collection of resources and capabilities.
The task of top executives when the company faces disruptive changes in its environment is to not only raise questions about the appropriateness of its direction and strategy, but also to:
ferret out the causes and decide when adjustments are needed and what adjustments are needed for improved performance and operating excellence.
A winning strategy is one that
fits the company's internal and external situation, builds sustainable competitive advantage, and improves company performance.
The managerial task of developing a strategic vision for a company:
involves deciding upon what strategic course a company should pursue in preparing for the future and why this directional path makes good business sense.
A creative and distinctive strategy that sets a company apart from rivals and that gives it a sustainable competitive advantage
is a company's most reliable ticket to above-average profitability.
Adopting a set of "stretch" financial and "stretch" strategic objectives:
is an effective tool for pushing the company to perform at its full potential and deliver the best possible results.
A company that pursues and achieves strategic objectives:
is frequently in a better position to improve its future financial performance because of the increased competitiveness that flows from the achievement of strategic objectives.
A company's business model
is management's blueprint for how it will generate revenues sufficient to cover costs and yield an attractive profit.
Crafting and executing a strategy is a top-priority managerial task because
it is management's prescription for doing business, its roadmap to competitive advantage, a game plan for pleasing customers, and its formula for improving performance.
A company's strategy stands a better chance of succeeding when
it is predicated on competitive moves aimed at appealing to buyers in ways that set the company apart from rivals.
A company's strategic plan:
lays out its future direction and business purpose, performance targets and strategy.
When trade-offs have to be made between achieving long-term and achieving short-term objectives:
long-term objectives should take precedence unless the short-term performance targets have unique importance.
What separates a powerful strategy from a run-of-the-mill or ineffective one?
management's ability to forge a series of actions, both in the marketplace and internally, that sets the company apart from rivals and produces sustainable competitive advantage
Not an element of a company's business strategy?
management's actions to revise the company's financial and strategic performance targets
Managers of every company should be willing and ready to modify the strategy because
market conditions and circumstances are changing over time or the current strategy is clearly failing.
Strategy-making is:
more of a collaborative group effort that involves all managers and sometimes key employees, as opposed to being the function and responsibility of a few high-level executives.
Company objectives:
need to be broken down into performance targets for separate businesses, product lines, functional departments, and individual work units.
In crafting a company's strategy, managers
need to come up with a sustainable competitive advantage that draws in customers and produces a competitive edge over rivals.
A company's strategy is a "work in progress" and evolves over time because of the
ongoing need of company managers to react and respond to changing market and competitive conditions.
What principal should be included in managing the strategy execution process?
organizing the company along the lines of best practice
A company's strategic plan
outlines the competitive moves and approaches to be used in achieving the desired business results.
In the strategy-making, strategy-executing process, effective corporate governance requires a company's board of directors to:
oversee the company's strategic direction, evaluate the caliber of senior executives' skills, handle executive compensation, and oversee financial reporting practices.
The key duties of a company's board of directors in the strategy-making, strategy-executing process include:
overseeing the company's financial accounting and financial reporting practices and evaluating the caliber of senior executives' strategy-making/strategy-executing skills.
The faster a company's business environment is changing, the more critical it becomes for its managers to:
pay attention to early warnings of future change and be willing to experiment to establish a market position in the future.
A company achieves a competitive advantage when it
provides buyers with superior value compared to rival sellers or offers the same value at a lower cost.
Managers must not be prepared to modify their strategy in response to
public pronouncements from rivals about monthly profit margins.
Well-stated objectives are:
quantifiable, or measurable, and contain deadlines for achievement.
Perhaps the most reliable way for a company to improve its financial performance over time is to:
recognize that the achievement of strategic objectives signals that the company is well positioned to sustain or improve its performance.
Breaking down resistance to a new strategic vision typically requires that management, on an as needed basis:
reiterate the company's need for the new direction, while addressing employee concerns head-on, calming fears, lifting spirits, and providing them with updates and progress reports as events unfold.
Strategic objectives:
relate to strengthening a company's overall market standing and competitive position.
Strategic intent refers to a situation where a company:
relentlessly pursues an ambitious strategic objective.
The customer value proposition lays out the company's approach to
satisfying customer wants and needs at a price customers will consider a good value.
In evaluating proposed or existing strategies managers should
scrutinize the company's existing strategies on a regular basis to ensure they offer a good strategic fit, create a competitive advantage, and result in above-average performance.
The real purpose of the company's strategic vision:
serves as management's tool for giving the organization a sense of direction.
In the course of crafting a strategy, what is NOT a common management function
sharing the strategy with the public to gain additional customer and shareholder support
Company's strategy is NOT concerned with management's choices about how to
stake out the same market position as successful rival companies.
What does a company specifically exhibit when it relentlessly pursues an ambitious strategic objective, concentrating the full force of its resources and competitive actions on achieving that objective?
strategic intent
The difference between a company's strategy and a company's business model is that
strategy relates broadly to a company's competitive moves and business approaches while its business model relates to whether the revenues flowing from the strategy are sufficient to cover costs and realize a profit.
Business strategy concerns:
strengthening the market position and building competitive advantage for a single line of business.
Managers can deliberately set challenging performance targets at levels high enough to promote outstanding company performance by establishing:
stretch objectives which challenge the organization to deliver stretch gains in performance.
A "balanced scorecard" for measuring company performance:
strikes a "balance" between financial and strategic objectives.
NOT a frequently used strategic approach to set a company apart from rivals and achieve a sustainable competitive advantage?
striving to be the industry's high-price provider
A winning strategy must pass which three tests?
the Fit Test, the Competitive Advantage Test, and the Performance Test
A company's values or core values concern:
the beliefs, traits, and behavioral norms that company personnel are expected to display in conducting the company's business and pursuing its strategic vision and mission.
Excellent execution of an excellent strategy is
the best test of managerial excellence and the best recipe for making a company a standout performer.
A company's realized strategy evolves from one version to the next due to
the proactive efforts of company managers to improve the current strategy, a need to respond to changing customer requirements and expectations, and a need to react to fresh strategic maneuvers on the part of rival firms.
Strategy is about competing differently than rivals, thus strategy success is about
the sources of sustained advantages and superior profitability.
Which of the following ARE common shortcomings of company vision statements?
too broad, vague or incomplete, bland/uninspiring, not distinctive, and too reliant on superlatives
Perhaps the most important benefit of a vivid, engaging, and convincing strategic vision is:
uniting company personnel behind managerial efforts to get the company moving in the intended direction.
The defining characteristic of a well-conceived strategic vision is:
what it says about the company's future strategic course—"the direction we are headed and what our future product-market-customer focus will be."
