Deck 1: The Nature of Strategic Management

Question 1

The terms strategic management and strategic planning are synonymous in this text.

Answer 1

True

Question 2

An objective, logical, systematic approach for making major decisions in an organization is a way to describe the strategic-management process.

Answer 2

True

Question 3

The final stage in strategic management is strategy implementation.

Answer 3

False

Question 4

U.S. firms are not being challenged in the computer industry.

Question 5

Formulation, implementation, and evaluation of strategy activities occur at three hierarchical levels in a large organization: corporate, divisional or strategic business unit, and functional.

Question 6

Strategy implementation is often considered to be the most difficult stage in the strategic-management process because it requires personal discipline, commitment, and sacrifice.

Question 7

Management by intuition can be defined as operating from the "I've-already-made-up-my-mind-don't-bother-me-with-the-facts mode."

Question 8

Anything the firm does especially well compared to rival firms could be considered a competitive advantage.

Question 9

One of the fundamental strategy evaluation activities is reviewing external and internal factors that are the basis for current strategies.

Question 10

Once a firm acquires a competitive advantage, they are usually able to sustain the competitive advantage indefinitely.

Question 11

Firms, like organisms, must be "adept at adapting" or they will not survive.

Question 12

Strategic management focuses on integrating management, marketing, finance and accounting, production and operations, research and development, and information systems to achieve organizational success.

Question 13

The decision to expand or diversify operations is a strategy-formulation issue.

Question 14

Analytical and intuitive thinking should complement each other.

Question 15

A vision statement identifies the scope of a firm's operations in product and market terms.

Question 16

By occasionally monitoring external events, companies should be able to identify when change is required.

Question 17

Strategic management is an attempt to organize qualitative and quantitative information in a way that allows effective decisions to be made under conditions of uncertainty.

Question 18

Even though useful, strategic planning has been cast aside by corporate America since the early 1990s.

Question 19

Optimizing for tomorrow the trends of today is the purpose of strategic management.

Question 20

According to Albert Einstein, "Knowledge is far more important than intuition."

Question 21

A clear mission statement describes the values and priorities of an organization.

Question 22

Strengths and weaknesses are determined relative to competitors.

Question 23

While the number of people shopping online has increased, the average amount spent online has decreased.

Question 24

In a multidivisional firm, objectives should be established for the overall company but not for each division.

Question 25

All strategists have similar attitudes, values, ethics and concerns for social responsibility.

Question 26

Annual objectives are especially important in strategy formulation.

Question 27

Most traditional retailers have tried in vain to use their online sales to boost in-store sales.

Question 28

Once an effective strategy is designed, modifications are rarely required.

Question 29

The middle manager is the most visible and critical strategic manager.

Question 30

Newspaper companies in the United States provide a good example of how a company can sustain a competitive advantage over the long-term.

Question 31

One of the ways in which the Internet has transferred power from businesses to individuals is by making comparison-shopping quick and easy.

Question 32

Objectives should be measurable, challenging, reasonable, consistent, and clear.

Question 33

A vision statement answers the question, "What is our business?" whereas a mission statement answers, "What do we want to become?"

Question 34

Although e-commerce has increased in popularity, it has actually led to increases in company expenses.

Question 35

In the last five years, the position of chief strategy officer (CSO)has diminished so drastically that today it is almost unheard of for companies to have such a position on staff.

Question 36

Strategists are usually found in higher levels of management and have considerable authority for decision-making in the firm.

Question 37

In order for a firm to achieve sustained competitive advantage, a firm must continually adapt to changes in external trends and events and effectively formulate, implement, and evaluate strategies that capitalize upon those factors.

Question 38

According to research, a healthier workforce can more effectively and efficiently implement strategies.

Question 39

Identifying an organization's existing vision, mission, objectives, and strategies is the final step for the strategic management process.

Question 40

Annual objectives are long-term milestones that organizations must achieve to reach short-term objectives.

Question 41

The best thing strategists can do is develop strategic plans themselves and then present them to operating managers to execute.

Question 42

Crises and firefighting in an organization give managers the extra time needed to plan ahead.

Question 43

Firms with planning systems more closely resembling strategic-management theory generally exhibit superior long-term financial performance relative to their industry.

Question 44

The most effective strategic management is ritualistic, predictable, and formal.

Question 45

For the strategic planning process to be effective, organizations must continually strengthen the "good ethics is good business" policy.

Question 46

The lack of monetary rewards is one reason managers do not engage in strategic planning.

Question 47

Low-performing firms typically underestimate their competitor's strengths and overestimate their own firm's strengths.

Question 48

Managers must be very formal in strategic planning because formality fosters flexibility and creativity.

Question 49

Commitment and understanding are the most important benefits of strategic management.

Question 50

Superior strategy formulation is well and good, but it cannot overcome an opponent's superiority in numbers and resources.

Question 51

Strategic-management must be a self-reflective learning process that familiarizes managers and employees in the organization with key strategic issues and feasible alternatives for resolving those issues.

Question 52

The element of surprise provides great competitive advantages in both military and business strategy.

Question 53

According to Greenley, strategic management provides increased discipline, enhanced communication, and more effective allocation of time and resources.

Question 54

Both military and business strategy are formulated, implemented, and evaluated with an assumption of competition.

Question 55

In most respects, business strategy is very different than military strategy.

Question 56

Military success is usually the happy result of accidental strategies, but business success is the product of continuous attention to changing conditions and insightful adaptations to those conditions.

Question 57

All firms have a strategy, even if it is informal, unstructured, and sporadic.

Question 58

Application of the strategic-management process is typically more formal in larger and well-established organizations.

Question 59

Many organizations mistakenly spend more time and effort on the implementation of a plan, than on the formulation of the plan itself.

Question 60

Making many intuitive decisions that conflict with the formal plan is one pitfall to avoid in strategic planning.

Question 61

What step in the strategic development process involves mobilizing employees and managers to put strategies into action?

A) Strategy formulation
B) Strategy evaluation
C) Strategy implementation
D) Strategic advantage
E) Competitive advantage

Question 62

Which phase of strategic management is called the action phase?

A) Strategy formulation
B) Strategy implementation
C) Strategy evaluation
D) Competing advantages
E) Measuring performance

Question 63

What types of skills are especially critical for successful strategy implementation?

A) Interpersonal
B) Marketing
C) Technical
D) Conceptual
E) Visionary

Question 64

The goal of strategic management is to

A) achieve competitive advantage.
B) maintain competitive advantage.
C) achieve and maintain competitive advantage.
D) eliminate competitive advantage.
E) eliminate and abolish competitive advantage.

Question 65

________ allows firms to sell products, advertise, purchase supplies, bypass intermediaries, track inventory, and eliminate paperwork.

A) Social networking
B) E-commerce
C) Blogging
D) Viral video
E) "Trading down"

Question 66

In recent years, the speedy flow of information through technology has

A) made it harder for people worldwide to see how others work and live.
B) strengthened national boundaries and made countries more self-contained.
C) created a borderless world with global competitors, customers, and citizens.
D) ensured that the U.S. is unrivaled by other companies in all industries.
E) made the real flow of financial activity align with political boundaries between countries.

Question 67

________ is NOT a strategy-implementation activity.

A) Taking corrective actions
B) Establishing annual objectives
C) Devising policies
D) Allocating resources
E) Motivating employees

Question 68

What can be defined as the art and science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives?

A) Strategy formulation
B) Strategy evaluation
C) Strategy implementation
D) Strategic management
E) Strategic leading

Question 69

During what stage of strategic management are a firm's specific internal strengths and weaknesses determined?

A) Formulation
B) Implementation
C) Evaluation
D) Feedback
E) Goal-setting

Question 70

Anything that a firm does especially well compared to rival firms is referred to as

A) competitive advantage.
B) comparative disadvantage.
C) opportunity cost.
D) unsustainable advantage.
E) an external opportunity.

Question 71

The fact that Apple has no manufacturing facilities of its own

A) has caused it to build up massive debt on its balance sheet.
B) has enabled it to remain financially lean with virtually no long-term debt.
C) has been problematic for Apple in terms of debt.
D) illustrates that having more fixed assets than rival firms can provide major competitive advantages in a global recession.
E) means that it is in the same position as Sony.

Question 72

Firms can be more proactive with strategic management.

Question 73

The Internet has transferred power from ________ to ________.

A) businesses, individuals
B) governments, businesses
C) individuals, businesses
D) businesses, governments
E) individuals, governments

Question 74

Strategy evaluation is necessary because

A) internal and external factors are constantly changing.
B) the SEC requires strategy evaluation.
C) success today is a guarantee of success tomorrow.
D) the IRS requires strategy evaluation.
E) firms have limited resources.

Question 75

Sometimes ________ is used to refer to strategic formulation, implementation and evaluation, with ________ referring only to strategic formulation.

A) strategic planning; strategic management
B) strategic planning; strategic processing
C) strategic management; strategic planning
D) strategic management; strategic processing
E) strategic implementation; strategic focus

Question 76

There is a dramatic shift in mass retailing to

A) "trading up" and taking customers from more exclusive stores.
B) selling only the most expensive merchandise.
C) opening dramatically larger supercenters.
D) operating stores with less square footage.
E) cutting back on their online presence.

Question 77

Strategic management focuses on integrating management, ________, and information systems to achieve organizational success.

A) marketing
B) finance and accounting
C) production and operations
D) research and development
E) all of the above

Question 78

In mass retailing, big-box companies like Walmart, Best Buy, and Sears are

A) gaining competitive advantage over smaller stores.
B) participating in a dramatic shift to becoming bigger.
C) increasing the square-footage of their retail locations.
D) finding that less brick and mortar is better.
E) noticing a sharp decline in online purchases.

Question 79

An important activity in ________ is taking corrective action.

A) strategy evaluation
B) strategy implementation
C) strategy formulation
D) strategy leadership
E) all of the above

Question 80

Which statement best describes intuition?

A) It alone should be used in decision-making.
B) It represents a minor factor in decision-making integrated with analysis.
C) It should be coupled with analysis in decision-making.
D) It is better than analysis in decision-making.
E) It is management by ignorance.