Exam 1: What Is Strategy and the Strategic Management Process

In many ways, the difference between traditional economics research and strategic management research is that the former attempts to explain why ________, while the latter attempts to explain ________

Mission statements often contain so many common elements that even if a firm's mission statement does not influence behavior throughout an organization, it is likely to have a significant impact on a firm's actions.

________ strategies are theories of how to gain competitive advantage in an industry that emerge over time or that have been radically reshaped once they are initially implemented.

If the average ROE in the heating and cooling industry is 10.1%, and Thermacorp's ROE is 17.3%, Thermacorp is said to have

Objectives are the specific measurable targets a firm can use to evaluate the extent to which it is realizing its mission.

The greater the extent to which a firm's assumptions and hypotheses accurately describe how the competition in the industry is likely to evolve, and how that evolution can be exploited to earn a profit, the more likely it is that a firm will gain a competitive advantage from implementing its strategies.

Ratios that focus on the level of a firm's financial flexibility, including its ability to obtain more debt, are known as

________ measures of competitive advantage compare a firm's level of return to its cost of capital instead of to the average level of return in the industry.

High quality objectives are tightly connected to the elements of a firm's mission but tend to be relatively difficulty to measure and track over time.

Identify two approaches to estimating a firm's competitive advantages and discuss the strengths and weaknesses of each.

Emergent strategies are only important when a firm fails to implement the strategic management process effectively.

Firms whose mission statement is central to all they do are known as missionary firms.

One of the central questions that all strategic managers must address, regardless of the industry they work in, is "What is our competition going to do next?"

Define the term "strategy," discuss the set of assumptions and hypotheses that a strategy is based on and discuss what makes a good strategy.

All firms have almost entirely emergent strategies.

The two types of measures of competitive advantage include

Define the term "mission" and discuss how a firm's mission can both positively and negatively impact a firm's performance.

Green Frog is an environmentally friendly firm in the cosmetics industry. If Green Frog were considering expanding beyond the cosmetics industry into pharmaceuticals in order to gain competitive advantages by operating in multiple markets and industries, this would be an example of which type of strategy?

By conducting a(n) ________, a firm identifies the critical threats and opportunities in its competitive environment.

Strategy implementation occurs when a firm adopts organizational policies and practices that are consistent with its strategy.