Deck 8: Strategic Management

Question 1

Formal strategic planning is implemented in most Arab organizations.

Answer 1

False

Question 2

Strategic management is the set of managerial decisions and actions that determines the short-term performance of an organization.

Answer 2

False

Question 3

SWOT analysis includes an analysis of an organization's environmental opportunities and threats.

Answer 3

True

Question 4

Activities that an organization does well or resources that it has available are called capabilities.

Question 5

Evaluating an organization's intangible assets is part of doing an internal analysis in the strategic management process.

Question 6

The trend for formal strategic planning in the Arab world is increasing.

Question 7

"Strategic model" is a term that is often used in conjunction with strategic management and strategies.

Question 8

A stability strategy is developed when management decides it will remain profitable by maintaining the status quo in a rapidly changing external environment.

Question 9

A trucking company that grows by purchasing a chain of gasoline stations is engaged in horizontal integration.

Question 10

Turnaround is one type of renewal strategy.

Question 11

Diversification is an example of a corporate retrenchment strategy.

Question 12

Exceptional or unique organizational resources are known as core capabilities.

Question 13

A retrenchment strategy is a shortrun renewal strategy designed to address organizational weaknesses that are leading to performance declines.

Question 14

The final step in the strategic management process is implementing the objectives.

Question 15

Corporate-level strategies are developed for organizations that run more than one type of business.

Question 16

Stars, one of the four business groups in the corporate portfolio matrix, are characterized by low growth and low market share.

Question 17

Within an industry, an environment can present opportunities to one organization and pose threats to another.

Question 18

If Burger King were to buy out other burger restaurants, Burger King would be growing by vertical consolidation.

Question 19

The first step in the strategic management process is analyzing the external environment.

Question 20

The BCG matrix evaluates an organization's various businesses to identify which ones offer high potential and which drain organizational resources.

Question 21

When managers "manage strategically" by following the strategic management process, the chosen strategies will always lead to positive outcomes.

Question 22

Corporate reputation is an organization's ________ resource.

A) intangible
B) human
C) physical
D) financial

Question 23

The third step in strategic management is related to analysis of ________.

A) the external environment
B) the alternatives the firm faces
C) the internal environment
D) time pressures involved in serving the customer

Question 24

________ and ________ are outcomes from a study of the external environment.

A) Strengths; weaknesses
B) Opportunities; threats
C) Threats; weaknesses
D) Weights; measures

Question 25

What provides clues as to what an organization sees as its purpose?

A) The organization's strategies.
B) The organization's mission.
C) The organization's goals.
D) The organization's business model.

Question 26

When an organization is analyzing its labor supply, it is studying its ________.

A) internal environment
B) external environment
C) organizational culture
D) organizational structure

Question 27

________ are the organization's major value-creating skills, capabilities, and resources that determine the organization's competitive weapons.

A) Opportunities
B) Weaknesses
C) Core competencies
D) Strengths

Question 28

In analyzing the environment, managers should know ________.

A) the goals currently in place and the strategies currently being used
B) the competition's stock price
C) the organization's purpose
D) about pending legislation that might affect the organization

Question 29

In the first step of strategic management, the mission of the firm answers the question, ________

A) "who are our customers?"
B) "what is our reason for being in business?"
C) "what business should we be in?"
D) "who are our creditors?"

Question 30

What are an organization's financial, physical, human, and intangible assets that are used to develop, manufacture, and deliver products or services to its customers?

A) its resources
B) its capabilities
C) its core competencies
D) its opportunities

Question 31

In the first step of strategic management, identifying the current strategies and goals provides ________.

A) an understanding of what the competition is doing
B) important information about an organization's specific resources and capabilities
C) a basis to determine if the goals need to be changed
D) an idea of what trends and changes are occurring

Question 32

Studies of the factors that contribute to organizational performance have shown ________ relationship between strategic planning and performance.

A) a negative
B) a positive
C) no
D) a mixed

Question 33

The final step in strategic planning answers the question, ________

A) "what business have we been in?"
B) "how effective have our strategies been?"
C) "how much money have we lost?"
D) "what business should we have we been in?"

Question 34

Why is strategic management important?

A) Most organizations do not change.
B) It has little impact on organizational performance.
C) Organizations are composed of similar divisions and functions.
D) It is involved in many of the decisions that managers make.

Question 35

If a bank estimates the capabilities of its training and development department employees prior to implementing a new training program designed to change their method of providing customer service, it is completing what step in the strategic management process?

A) Carrying out an external analysis.
B) Carrying out an internal analysis.
C) Identifying the organization's current mission, goals, and strategies.
D) Formulating strategies.

Question 36

An example of a core competency of a firm is ________.

A) communicating with customers in their own languages worldwide
B) the corporate reputation
C) evaluating tangible and intangible assets
D) developing least-squared exemptions within its accounting system

Question 37

The merging of the analyses of internal and external factors influencing an organization's strategy is known as ________.

A) SWOT analysis
B) organizational behavior and theory
C) complete studies
D) definitional analysis

Question 38

What is a strategic design for how a company intends to profit from its strategies, work processes, and work activities?

A) A strategic management model.
B) A strategic model.
C) A business model.
D) A competitive model.

Question 39

Which of the following statements about strategic planning in Arab organizations is not true?

A) Formal strategic planning exists but is rather limited.
B) There is lack of confidence in the impact of formal strategic planning.
C) Informal strategic planning exists in most small and medium-sized organizations.
D) The trend for formal strategic planning is on the rise.

Question 40

The first ________ steps of the strategic management process describe the planning that must take place.

A) four
B) three
C) five
D) two

Question 41

In the Boston Consulting Group (BCG) matrix, a business unit that exists in a low anticipated growth rate and a high market share is known as a ________.

A) cash cow
B) question mark
C) dog
D) star

Question 42

In the BCG matrix, a business unit that exists in a high anticipated growth rate and a low market share is known as a ________.

A) cash cow
B) question mark
C) star
D) dog

Question 43

An organization that is diversifying its product line is exhibiting what type of growth strategy?

A) Growth
B) Retrenchment
C) Stability
D) Maintenance

Question 44

Middle-level managers are typically responsible for ________ strategies.

A) organizational
B) operational
C) competitive
D) corporate

Question 45

When an organization attempts to combine with other organizations in different and disassociated industries, the strategy is known as a(n) ________ strategy.

A) stability
B) unrelated diversification
C) horizontal integration
D) vertical integration

Question 46

When PepsiCo seeks to integrate the strategies of Pepsi, 7-Up International, and Frito-Lay, it is developing what level of business strategy?

A) Corporate
B) System
C) Functional
D) Management

Question 47

In the BCG matrix, a ________ does not consume or produce much cash and holds little or no improved performance.

A) dog
B) cash cow
C) question mark
D) star

Question 48

Heavy investment in ________ will help take advantage of the market's growth and help maintain high market share.

A) dogs
B) stars
C) cash cows
D) question marks

Question 49

What are the three main types of corporate strategy?

A) Concentration, integration, and diversification.
B) Retrenchment, turnaround, and clicks-and-bricks.
C) Cost leadership, differentiation, and focus.
D) Growth, stability, and renewal.

Question 50

What type of strategy is a renewal strategy for times when the organization's performance problems are more critical?

A) Differentiation
B) Retrenchment
C) Focus
D) Turnaround

Question 51

Growth through ________ is achieved when an organization chooses to grow by increasing its own business operations.

A) horizontal integration
B) vertical integration
C) related diversification
D) concentration

Question 52

When an organization attempts to combine with other organizations in the same industry, the strategy is known as ________.

A) horizontal integration
B) concentration
C) a stability strategy
D) vertical integration

Question 53

A(n) ________ strategy addresses organizational weaknesses, helps stabilize operations, and revitalizes organizational resources and capabilities.

A) retrenchment
B) unrelated diversification
C) vertical integration
D) horizontal integration

Question 54

There are three main types of growth strategies: ________.

A) concentration, integration, and exfoliation
B) integration, diversification, and infiltration
C) concentration, integration, and focus
D) concentration, integration, and diversification

Question 55

In ________, the organization gains control of its outputs by becoming its own distributor.

A) forward horizontal integration
B) backward horizontal integration
C) backward vertical integration
D) forward vertical integration

Question 56

Managers should "milk" cash cows for as much as they can, limit any new investment in them, and use the large amounts of cash generated to invest in ________ and ________.

A) stars; question marks
B) more cash cows; question marks
C) question marks; dogs
D) stars; dogs

Question 57

When an organization attempts to combine with other organizations in different, but associated industries, the strategy is known as a ________ strategy.

A) vertical integration
B) horizontal integration
C) growth
D) related diversification

Question 58

________ strategy determines what businesses an organization should be in.

A) Operational
B) Corporate
C) Business
D) Organizational

Question 59

If Jazeera Airways were to merge with Ettihad Airways, this would be an example of what kind of growth strategy?

A) Vertical integration.
B) Acquisition.
C) Expansion.
D) Horizontal integration.

Question 60

Air Arabia's motto "Pay Less, Fly More" is indicative of which type of strategy?

A) Value Cost
B) Low Cost
C) Differentiated Cost
D) Best Cost

Question 61

The ________ should be sold off or liquidated as they have low market share in markets with low growth potential.

A) stars
B) cash cows
C) dogs
D) question marks

Question 62

A firm that is "stuck in the middle" cannot develop ________.

A) strategic flexibility
B) long-term success
C) an effective strategy
D) a cost or differentiation advantage

Question 63

Cost leadership as a strategy requires a firm to ________.

A) aggressively search out efficiencies to maintain the lowest cost structure
B) be unique in its product offering
C) aim to be similar to its competition in most operations
D) aim at a cost advantage in a niche market

Question 64

Who targets a narrow market segment with customized products?

A) A first mover.
B) A differentiator.
C) A focuser.
D) A clicks-and-bricks firm.

Question 65

What can challenge managers' attempts at creating a long-term, sustainable competitive advantage?

A) Predictable changes.
B) Competitive strategies.
C) Old technologies.
D) Market instabilities.

Question 66

What can provide a framework for understanding diverse businesses and help managers establish priorities for making resource allocation decisions?

A) A corporate portfolio matrix.
B) A strategic business unit.
C) A competitive advantage.
D) A competitive strategy.

Question 67

________ is the ability to recognize major external environmental changes, to quickly commit resources, and to recognize when a strategic decision is not working?

A) Strategic management
B) Strategic flexibility
C) Competitive advantage
D) An opportunity

Question 68

Differentiation as a strategy requires a firm to ________.

A) aim at a cost advantage in a niche market
B) be unique in its product offering
C) aim to be similar to its competition in all operations
D) aggressively search out efficiencies to maintain the lowest cost structure

Question 69

An example of ________ is when an organization possesses a characteristic that sets itself apart from competitors and gives the firm a distinctive edge.

A) competitive advantage
B) legal propriety
C) core competency
D) competitive power

Question 70

Practically any successful consumer product or service can be identified as an example of the ________.

A) differentiation strategy
B) focus strategy
C) cost leadership strategy
D) breadth strategy

Question 71

When following the focus strategy, a ________ can be based on product variety, type of end buyer, distribution channel, or geographic location of buyers.

A) cost focus
B) segment
C) unique product
D) differentiation advantage

Question 72

To a degree, an organization's commitment to quality and continuous improvement can differentiate it from competitors, but constant improvement and reliability of an organization's products and/or services may result in a competitive advantage that is ________.

A) uncertain
B) weighted
C) sustainable
D) conservative

Question 73

What e-business strategy uses both online and traditional stand-alone locations?

A) Differentiation
B) Focus
C) Functional
D) Clicks-and-bricks

Question 74

Functional-level strategy directly supports ________.

A) differentiation strategy
B) corporate strategy
C) competitive strategy
D) focus strategy

Question 75

How can a cost leader use e-business to reduce costs?

A) By using web-based inventory control systems that reduce storage costs.
B) By using stand-alone locations only.
C) By adding a sales phone line and a sales force.
D) By personally testing and evaluating job applicants.

Question 76

For a small organization in only one line of business, the competitive strategy simply describes ________.

A) how the company will compete in its main market
B) the customers it wants to reach
C) its competitive advantage
D) what products or services it will offer

Question 77

An internet-based knowledge management system that resulted in shorter customer response times would be one e-business technique that contributes to the competitive advantage of a ________.

A) star
B) differentiator
C) cost leader
D) focuser

Question 78

How can a company create strategic flexibility?

A) Encourage employees to be open about disclosing negative information.
B) Never make mistakes.
C) Get old ideas from senior employees.
D) Know what has happened with strategies in the past.

Question 79

An organization is said to have ________ when it has several different businesses that are independent and that formulate their own strategies.

A) competitive advantages
B) operational units
C) strategic business units
D) legal subunits

Question 80

What generic competitive strategy involves a cost advantage or a differentiation advantage in a narrow segment or niche?

A) focus
B) breadth
C) differentiation
D) cost leadership