Deck 7: Strategy Analysis and Choice

Question 1

The limitations of a BCG Matrix include all of these except

A)other variables such as size of market and competitive advantage are not considered.
B)not reflecting divisional or industry growth over time.
C)viewing every business as a star,cash cow,dog or question mark can be an oversimplification.
D)requiring at least three years' worth of data.
E)not allowing a company to be classified as somewhere in between two categories.

Answer 1

D

Question 2

The act of oversight and direction for an organization is referred to as

A)organizational direction.
B)governance.
C)centralized control.
D)establishing norms.
E)corporate lawmaking.

Answer 2

B

Question 3

According to the Grand Strategy Matrix,organizations in which quadrant have a strong competitive position but are in a slow- growth industry?

A)III
B)II
C)V
D)IV
E)I

Answer 3

D

Question 4

What type of strategy would divestiture be classified as?

A)Offensive
B)Competitive
C)Aggressive
D)Defensive
E)Conservative

Question 5

Which of the following terms is defined by the set of shared values,beliefs,attitudes,customs,norms,personalities,heroes and heroines that describe a firm?

A)QSPM
B)Strategy
C)Mission
D)Culture
E)Objectives

Question 6

A division with a high relative market share position in a low- growth industry can be described as a

A)dog.
B)star.
C)cash cow.
D)failure.
E)question mark.

Question 7

Today,what are boards of directors composed mostly of?

A)Union
B)Employees
C)Stockholders
D)Outsiders
E)Management

Question 8

Which of these is not a SPACE Matrix quadrant?

A)Offensive
B)Aggressive
C)Defensive
D)Competitive
E)Conservative

Question 9

Which strategy would be most appropriate for a company classified as a Dog?

A)Product development
B)Market development
C)Retrenchment
D)Market penetration
E)Forward integration

Question 10

When a division of an organization has a high relative market share and is in a fast- growing industry,it is called a

A)cat.
B)question mark.
C)dog.
D)cash cow.
E)star.

Question 11

Which quadrant of the Grand Strategy Matrix contains firms that are in an excellent strategic position?

A)III
B)II
C)IV
D)I
E)V

Question 12

The top row of a Quantitative Strategic Planning Matrix consists of alternative strategies derived from all of these except

A)CPM Matrix.
B)IE Matrix.
C)BCG Matrix.
D)Grand Strategy Matrix.
E)Space Matrix.

Question 13

All of the following are part of the Corporate Governance Code that was jointly isssued by the Ministry of Industry and Commerce with the Central Bank in Bahrain in 2010,except

A)the company shall remunerate directors and officers fairly and responsibly.
B)at least two directors are current or former company executives.
C)the company shall be headed by an effective,collegial and informed board.
D)the company shall disclose its corporate governance.
E)the board shall establish a clear and efficient management structure.

Question 14

Strategy analysis and choice largely involves making decisions based on information.

A)short- term; long- term
B)subjective; objective
C)objective; subjective
D)long- term; short- term
E)subjective; short- term

Question 15

Through which tactic is it possible to achieve similar results using different means or paths?

A)Satisfying
B)Specialization
C)Focus on higher- order issues
D)Equifinality
E)Generalization

Question 16

How would a division with a low relative market share position in a high growth industry be described?

A)Stuck- in- the- middle
B)Question mark
C)Star
D)Cash cow
E)Dog

Question 17

For what type of company is the BCG Matrix ideal for analyzing?

A)Companies with annual sales of less than $1 million
B)All companies
C)Companies with annual sales greater than $1 million
D)Large companies
E)Companies with more than one division

Question 18

Which strategy formulation technique reveals the relative attractiveness of alternative strategies,and thus provides an objective basis for selecting specific strategies?

A)QSPM
B)SWOT
C)IFE
D)SPACE
E)CPM

Question 19

Which of the following is a weakness associated with a SWOT Matrix?

A)Other variables besides relative market share position and industry growth rate in sales need to be considered.
B)Viewing every business as a Star,Cash Cow,Dog,or Question Mark is an oversimplification.
C)Many businesses fall right in the middle of the matrix.
D)The matrix does not reflect whether or not various divisions or their industry are growing over time.
E)The matrix has no temporal qualities.

Question 20

What tactic involves shifting focus from specific issues to more general ones?

A)Satisfying
B)Generalization
C)Equifinality
D)Focus on higher- order issues
E)none of the above

Question 21

Which of the following analytical tools consists of a nine- cell matrix?

A)Competitive Profile Matrix
B)Internal- External Matrix
C)Matching Matrix
D)Grand Strategy Matrix
E)SPACE Matrix

Question 22

Which stage of the strategy- formulation framework involves the Quantitative Strategic Planning Matrix?

A)Stage 1
B)Stage 5
C)Stage 3
D)Stage 4
E)Stage 2

Question 23

Which stage of the strategy formulation framework contains the Internal- Factor Evaluation Matrix?

A)Decision
B)Output
C)Input
D)Matching
E)Analysis

Question 24

Which strategies,defined by the SWOT matrix,use a firm's strengths to avoid or reduce the impact of external threats?

A)WO
B)SW
C)ST
D)WT
E)SW

Question 25

Which of the following is the first step in developing the QSPM?

A)Examine the Stage 2 matrices and identify the alternative strategies which the organization should consider implementing.
B)Make a list of the firm's key external opportunities/threats and internal strengths/weaknesses in the left column of the QSPM.
C)Compute the Total Attractiveness Scores.
D)Determine the Attractiveness Scores.
E)Assign weights to each key external and internal factor.

Question 26

Which stage in the strategy- formulation framework focuses on generating feasible alternative strategies?

A)Input
B)Throughput
C)Matching
D)Decision
E)Output

Question 27

Each of the nine techniques included in the strategy formulation framework rely on the use of

A)strictly factual data.
B)intuition and analysis.
C)luck.
D)synergy.
E)financial formulas and statistics.

Question 28

An organization that has a low relative market share position and competes in a slow- growth industry is referred to as a

A)star.
B)dog.
C)cash cow.
D)cowboy.
E)question mark.

Question 29

Which of the following is not a step of a SWOT Matrix?

A)List the firm's external opportunities.
B)Match internal weaknesses with external threats and record the resultant WT strategies.
C)List the firm's external weaknesses.
D)List the firm's key external threats.
E)Match strengths with external opportunities and record the resultant SO strategies in the appropriate cell.

Question 30

How many cells are in a SWOT Matrix?

A)Eight
B)Four
C)Six
D)Two
E)Nine

Question 31

Which analytical tool determines the relative attractiveness of various strategies based on the extent to which key external and internal critical success factors are capitalized?

A)QSPM
B)SPACE
C)TOWS
D)BCG
E)IE

Question 32

The match an organization makes between its internal resources and skills,and the opportunities and risks created by its external factors,can be defined as

A)SWOT.
B)an opportunity.
C)input.
D)concept formulation.
E)strategy.

Question 33

In the BCG Matrix,which element represents the industry growth rate in sales,measured in percentage terms?

A)First quadrant
B)x- axis
C)Third quadrant
D)y- axis
E)Second quadrant

Question 34

According to the Grand Strategy Matrix,although Quadrant companies are growing,they are unable to compete effectively,so they need to determine why the firm's current approach is ineffective and how the company can best change to improve its competitiveness.

A)II
B)V
C)IV
D)I
E)III

Question 35

Which matrix is included in the decision stage of the strategy formulation framework?

A)Grand Strategy Matrix
B)Internal Factor Evaluation Matrix
C)BCG Business Portfolio Matrix
D)SPACE Matrix
E)Quantitative Strategic Planning Matrix

Question 36

Which strategies,defined by the SWOT matrix,aim at improving internal weaknesses by taking advantage of external opportunities?

A)SW
B)WT
C)SO
D)ST
E)WO

Question 37

Which section of the SWOT Matrix involves matching internal strengths with external opportunities?

A)The WO cell
B)The ST cell
C)The SO cell
D)The WT cell
E)The SW cell

Question 38

The two internal dimensions represented on the axes of the SPACE Matrix are

A)industry strength and internationalization.
B)competitive advantage and financial strength.
C)environmental stability and industry strength.
D)internationalization and competitive advantage.
E)financial strength and environmental stability.

Question 39

What analytical tool has four quadrants based on two dimensions: competitive position and market growth?

A)Competitive Profile Matrix
B)QSPM
C)Internal- External Matrix
D)Grand Strategy Matrix
E)SPACE Matrix

Question 40

Which stage of the strategy formulation framework includes an Internal Factor Evaluation Matrix and a Competitive Profile Matrix?

A)Input
B)Matching
C)Research
D)Penetration
E)Decision

Question 41

Which of the following is likely to have been a cash cow in the past?

A)Star
B)Dog
C)Failure
D)Question mark
E)Cat

Question 42

What term is defined as the product of multiplying the weights by attractiveness scores in each row of the QSPM?

A)Weighted scores
B)Factors
C)Sum total attractiveness scores
D)Total attractiveness scores
E)Total weighted scores

Question 43

The firm should pursue aggressive strategies if the coordinates of a SPACE directional vector are (5,4).

Question 44

The Grand Strategy Matrix is based on two evaluative dimensions,market share and market growth.

Question 45

For companies located in Quadrant III of the Grand Strategy Matrix,the first strategy recommended is

A)asset expansion.
B)extensive cost and asset reduction.
C)divestiture.
D)immediate liquidation of assets.
E)employee expansion.

Question 46

The Sarbanes- Oxley Act put an end to the "country- club" atmosphere of most boards,and has shifted power from CEOs to directors.

Question 47

What type of strategies would you recommend when a firm's SPACE Matrix directional vector has the coordinates (- 2,+3)?

A)Conservative
B)Aggressive
C)Defensive
D)Integrative
E)Competitive

Question 48

Which of these is a limitation of QSPM?

A)Only a few strategies can be evaluated simultaneously.
B)It requires equal participation from everyone.
C)Sets of strategies must be examined in reverse order.
D)Intuitive judgments and educated guesses are required.
E)The cost of doing the analysis.

Question 49

On the x- axis of the IE Matrix,an internal factor evaluation score of 2.5 represents a weak internal position.

Question 50

The first stage of the strategy- formulation framework (the input stage),is followed by the decision stage.

Question 51

The two positive- rated dimensions on SPACE Matrix are

A)FS and CA.
B)CA and ES.
C)FS and ES.
D)FS and IS.
E)IS and ES.

Question 52

According to the Grand Strategy Matrix,which strategy is recommended for a firm with rapid market growth and a strong competitive position?

A)Conglomerate diversification
B)Retrenchment
C)Market penetration
D)Joint venture
E)Liquidation

Question 53

The ES and CA dimension variables in a SPACE Matrix are assigned a numerical value ranging from - 1 (best)to - 6 (worst).

Question 54

The midpoint on the x- axis of a BCG Matrix is typically set at 0.05.

Question 55

What is the highest number of strategies that can be examined at one time with the QSPM?

A)10
B)2
C)1
D)5
E)There is no limit.

Question 56

What are the two external dimensions of the SPACE Matrix?

A)Competitive advantage and financial strength
B)Industry strength and competitive advantage
C)Financial strength and industry strength
D)Environmental stability and industry strength
E)Environmental stability and competitive advantage

Question 57

To objectively evaluate feasible alternative strategies identified in Stage 2,the QSPM uses input information derived from Stage 1.

Question 58

Which strategies,defined by the SWOT matrix,are defensive tactics directed at reducing internal weaknesses and avoiding environmental threats?

A)SW
B)WO
C)WT
D)SO
E)ST

Question 59

According to the Grand Strategy Matrix,Quadrant III organizations compete in rapid- growth industries and have weak competitive positions.

Question 60

In a SPACE analysis,what does a (+6,+3)strategy profile portray?

A)A weak financial position
B)A strong industry
C)A weak industry
D)A stable environment
E)An unstable environment

Question 61

Shifting focus from specific issues to more general ones may increase strategists' options for gaining organizational commitment.

Question 62

Relative market share position is given on the x- axis of the BCG Matrix.

Question 63

The four strategies of the SPACE Matrix are aggressive,conservative,offensive and defensive.

Question 64

Boards of directors are composed mostly of outsiders who are becoming more involved in an organization's strategic management.

Question 65

BCG Matrix requires more information about the divisions than the IE Matrix.

Question 66

The IE Matrix can be divided into three major regions that have different strategy implications: grow and build,hold and maintain,and harvest or divest.

Question 67

A SWOT Matrix is composed of four cells for the four types of strategies it creates.

Question 68

The major overall benefit of the BCG Matrix is that it draws attention to the cash flow,investment characteristics and needs of an organization's various divisions.

Question 69

Focusing on Higher- Order Issues means it is often possible to achieve similar results using different means or paths.

Question 70

When completing the matching stage of the strategy- formulation framework,the SWOT Matrix needs to be completed before the SPACE Matrix.

Question 71

Star,question mark,cash cow and dogs are the four quadrants exhibited by the SPACE Matrix.

Question 72

An organization's present strategies,objectives and mission provide a basis for generating and evaluating feasible alternative strategies,coupled with the external and internal audit information.

Question 73

A positive feature of QSPM is that sets of strategies can be examined sequentially or simultaneously.

Question 74

Total attractiveness scores are defined as the sum of the attractiveness scores in a given column of the QSPM and are computed in the second step of the QSPM.

Question 75

Both IE and BCG Matrices are called portfolio matrices.

Question 76

The size of the circle in a BCG Matrix corresponds to the proportion of corporate revenue generated by that business unit.

Question 77

The BCG Matrix does not reflect whether or not various divisions or their industries are growing over time.

Question 78

Having no temporal qualities,the BCG Matrix is a snapshot of an organization at a given point in time.

Question 79

The firm should pursue conservative strategies if the coordinates of a SPACE directional vector are (1,4).

Question 80

One of the steps of the SWOT Matrix is to list the firm's key external opportunities.