Test 2 study guide

In conducting its SWOT analysis, a baseball team notes that most of its players are among the best in the world and that their coach was a distinguished major-league player. Which part of the SWOT analysis is this information pertinent to? a. Strengths b. Weaknesses c. Opportunities d. Threats

a

Which of the following best describes an organization's artifacts? a. Day-to-day behaviors that can be observed b. The underlying essence of why members of an organization act as they do c. Relational factors between an organization's culture and its performance d. Aspects deemed important by members of an organization

a

Which of the following firms is most likely to benefit from the clan approach? a. A firm with highly uncertain working conditions b. A firm with work activities that can be easily measured c. A firm which lacks diverse working styles d. A firm operating in a price-competitive industry

a

Which of the following is an advantage of a strong culture? a. A strong culture has been linked to better levels of performance. b. Strong cultures increase performance even in turbulent environments. c. Organizations with strong cultures only encourage ethical behavior. d. It is a simple and easy task to change the strong culture of an organization.

a

Which of the following statements is true of the levels of organizational culture? a. Assumptions are deeply embedded in an organization's culture. b. It is quite difficult to note the artifacts present in an organization. c. Assumptions are the meanings that members of an organization attach to artifacts. d. Values are visible organizational structures, processes, and languages.

a

Fine Electronics is a corporation that controls all aspects of its business such as extracting raw materials, manufacturing the products, distributing them, and finally marketing to customers. It manages these activities through several business units, where one unit provides inputs to the other. This is an example of _____. a. unrelated diversification b. vertical integration c. strategic flexibility d. franchising

b

John signed a two year contract with Z-Gadget to get a subsidized price on his new iPhone. He had Z-Gadget's service for only 6 months and has been dissatisfied with its service and wanted to cancel the contract. However, he did not do so because he will have to spend a lot for canceling his Z-Gadget contract and signing up for another alternative. Which of the following characteristics of a powerful supplier group does Z-Gadget have with respect to its contract with John? a. The supplier industry is more concentrated than the industry it sells to b. Industry participants face switching costs in changing suppliers c. Suppliers offer differentiated products d. No substitutes exist for what the supplier group provides

b

Which of the following forces of the five-forces model will exemplify Wal-mart's ability to buy products from its suppliers at rock-bottom prices? a. Bargaining power of suppliers b. Bargaining power of customers c. Rivalry among existing competitors d. Threat of substitutes

b

Which of the following helps organizations to socialize employees? a. The intermediaries used to reach customers b. Role modeling, leader examples, and coaching c. Technologies used in manufacturing a firm's product d. Employee characteristics such as age and experience

b

Which of the following is a disadvantage of a strong culture? a. A strong culture seldom influences an organization's performance. b. A strong culture tends to be difficult to change. c. In a strong culture, the goals are unclear. d. A strong culture requires more coordination and monitoring.

b

Which of the following statements is an advantage of related diversification strategy? a. Related diversification strategy allows a firm to maintain several businesses that are not connected in any way. b. The sharing of resources is a key component of developing economies of scope and often increases a firm's competitive advantage. c. Related diversification strategies often achieve financial economies through the restructuring of business units. d. It can allow a sick or dying company to use capital generated in a profitable division to prop it up for a short period of time.

b

Which of the following statements is true about Porter's five-forces model? a. The level of threat of entry from competition is generally the same across all industries. b. Every industry is different in terms of who maintains the power in the firm-supplier relationship. c. The buyer or customer has no power to force down prices in an industry. d. Not all companies face the threat of substitutes.

b

Z-Furn is an organization that manufactures and sells office furniture. It maintains a good name in this business and has strong capital resources. The organization decides to purchase a failing food product business in order to tap into the market of that company. Which of the following types of diversification is the firm pursuing? a. Related diversification b. Unrelated diversification c. International diversification d. Single-product diversification

b

Rivalry among existing competitors is more when: a. fixed costs are low, and marginal costs are high. b. exit barriers are low. c. industry growth is slow. d. the product is not perishable.

c

The scope of a corporate-level strategy focuses on: a. the manner in which activities of the firm will be coordinated. b. the relationship between business units. c. the markets and businesses the firm will compete in. d. the internal environment affecting a firm's business.

c

Which of the following firm's can be referred to as being "stuck in the middle"? a. A firm that masters both low-cost and differentiation focused approach b. A firm that employs only a single strategy to achieve competitive advantage c. A firm that engages in numerous strategies but fails to master any one d. A firm that is in the second stage of strategy formulation

c

Which of the following is a characteristic of an organization's culture? a. Culture is unchangeable b. It is unrelated to performance c. Culture is dynamic d. It can be easily copied by competitors

c

Which of the following statements best describes competitive advantage? a. It refers to the pressure a supplier or buyer can exert on a company. b. It is the advantage that occurs when a firm offers products to all customers at higher prices. c. It derives from a firm's ability to create value for its customers that exceeds the cost of producing the product or service. d. It is the capability to identify and react to changes in the external environment and to mobilize internal resources to deal with those changes.

c

Which of the following statements is true of the organizational design and the life-cycle of a firm? a. Once a firm reaches maturity, the emphasis on coordination generally increases. b. The nature of leadership should remain stable as the firm keeps evolving. c. As a firm matures, it tends to emphasize division of labor. d. Start-up firms are characterized by more job specialization.

c

In a differentiation focused approach, a firm attempts to target: a. cost-conscious customers who have been underserved historically. b. customers of a firm's competitors in an attempt to increase sales. c. loyal customers who have been buying a company's products regularly. d. customers with special needs who have been underserved historically.

d

Primary activities of a firm's value chain refers to: a. the activities completed to improve a firm's product and the processes used to manufacture it. b. the activities involved with recruiting, hiring, training, developing, and compensating all personnel. c. the activities such as general management, planning, finance, accounting, legal support, and governmental relations. d. the activities involved in the physical creation of a product and its sale and transfer to the buyer.

d

Supply-side economies of scale arise: a. when a buyer's willingness to pay for a product increases. b. when the demand for a firm's product keeps fluctuating. c. when the number of buyers for a firm's product decreases. d. when a firm manufactures products in high volumes.

d

The factor that distinguishes functional organizational structure from divisional is that: a. a functional structure is organized around the outputs a firm produces. b. a functional structure is best suited to deal with environmental change. c. a functional structure groups diverse functions into separate divisions. d. a functional structure is organized in terms of main activities performed.

d

Thomas, the head of the marketing department in an organization, has structured his department in such a way that the roles and responsibilities of his workers are loosely defined. Moreover, he does not exert too much control over his workers and encourages two-way communication. His workers tend to be highly satisfied with their jobs when compared to those in the finance department, headed by John who exerts more control. From this scenario it can be inferred that Thomas has adopted a _____ mechanism for coordinating. a. bureaucratic b. authoritative c. centralized d. behavioristic

d

Which of the following firms is most likely to benefit from a bureaucratic approach? a. A firm with constantly changing, dynamic markets b. A start-up firm with less complexity c. A firm involving creativity and innovation d. A firm with high turnover and a diverse workforce

d

Which of the following is a disadvantage of a divisional structure? a. It is not suited to competitive situations where coordinated action is needed for innovation. b. This structure does not allow for much accountability. c. It is not suited to business environments marked by high degrees of uncertainty. d. Core functions are duplicated, preventing the development of economies of scale.

d

Which of the following is a weakness of the matrix structure? a. In matrix structure, the divisional managers have more authority than the functional managers, which causes an imbalance of power. b. A manager cannot use a matrix structure when resources need to be shared and optimized across divisions and within functions. c. When a firm's internal interrelationships are complex, it is not possible for managers to adopt a matrix structure. d. It often creates confusing and inefficient scenarios for managers working in a functional group as well as across divisions.

d

Which of the following is the main motive for international diversification? a. Support failing businesses b. Understand social values c. Create strategic flexibility d. Achieve economies of scale

d

Which of the following questions should a manager address while acquiring a company in terms of culture? a. Which culture is the best? b. How socialized are the employees? c. Is culture linked to performance? d. Where are the similarities and differences?

d

Which of the following statements is a downside of unrelated diversification strategy? a. It does not allow a dying company to use capital generated in a profitable division to prop it up for a short period of time. b. A firm cannot manage multiple businesses without any reasonable connections. c. It is not possible to achieve financial economies. d. It can open a firm to higher levels of risk and uncertainty.

d