Deck 5: Organizational Strategy

Question 1

What is an organization said to be experiencing when there is a discrepancy between upper management's intended strategy and the strategy implemented by the lower levels of management?

A)horizontal conflict  
B)character of the rivalry  
C)strategic dissonance  
D)competitive inertia

Answer 1

C

Question 2

Which type of resource is NOT controlled or possessed by many competing firms?

A)rare resources  
B)imperfectly imitable resources  
C)nonsubstitutable resources  
D)strategically dissonant resources

Answer 2

A

Question 3

To differentiate its products from other similar brands,Aveda beauty products focuses on educating its customers on general skin and hair care. Its salespeople are trained to answer questions and help customers find solutions. What has Aveda achieved with customer education and employee training?

A)synergy through relationship marketing  
B)prevention of product duplication  
C)efficient use of imitative resources  
D)a competitive advantage

Answer 3

D

Question 4

UBC student Ann Makosinski has developed a coffee mug that generates electricity to charge a cell phone. She has filed a patent for the device. What does she have from the patent on the coffee mug?

A)sustainable competitive advantage  
B)aggregate marketing strategy  
C)reliable differentiation  
D)strategic stance

Question 5

Royal Bank of Canada is the largest bank in Canada. Would this position give it a sustainable competitive advantage,and why?

A)Yes,because size would make its operations synergistic. 
B)No,because size is not a criterion for sustainable competitive advantage. 
C)Yes,because large institutions make more effective use of resources. 
D)No,because large organizations are always targeted for anti-trust activities.

Question 6

What does an organization experience when it is reluctant to change strategies or competitive practices that have been successful in the past?

A)strategic dissonance  
B)strategic inertia  
C)competitive dissonance  
D)competitive inertia

Question 7

When making travel plans,many tourists select Thomas Cook because they perceive the tour company as being superior to all others. No other tour service can duplicate the customer service and satisfaction that Thomas Cook has provided over its years of operation. What type of resources has Thomas Cook apparently used to create a sustainable competitive advantage?

A)synergistic  
B)valuable  
C)tangible  
D)nonsubstitutable

Question 8

BlackBerry struggled to adapt its once world-leading smartphones to respond to a more dynamic smartphone market dominated by Android and iOS operating systems. What is this an example of?

A)competitive apathy  
B)strategic apathy  
C)competitive inertia  
D)strategic inertia

Question 9

A sustainable competitive advantage exists for an organization when other companies have tried unsuccessfully to duplicate the advantage and when which of the following happens?

A)the other companies have been prohibited from duplicating the advantage by federal law  
B)the other companies have,for the moment,stopped trying to duplicate the advantage  
C)the organization is able to implement exclusive distribution  
D)the organization operates in the international marketplace

Question 10

What is the first step in the strategy-making process?

A)assess the need for strategic change  
B)conduct a situational analysis  
C)choose strategic alternatives  
D)evaluate the impact of changes on the internal environment

Question 11

Specialized Bicycle Components introduced the first major-production mountain bike in 1980. Two-thirds of its profits come from the sale of mountain bikes. It is recognized worldwide for its ability to design and produce superior mountain bikes. Which of the following terms best defines this ability?

A)customer sustainability  
B)organizational advantage  
C)relative competence  
D)distinctive competence

Question 12

In 2015,Target Canada filed for bankruptcy. Its parent corporation,the US-based Target Corporation,identified the need for strategic change in its Canadian operations. What is the next step Target Corporation should take in this strategy-making process?

A)finding the optimal strategic solution  
B)brainstorming  
C)assessing the need for strategic change  
D)conducting a situational analysis

Question 13

Which of the following is a problem strongly associated with top managers?

A)competitive dissonance  
B)differentiation discrepancy  
C)strategic inertia  
D)competitive inertia

Question 14

Wagyu beef sold in Canada is often a crossbreed with the Wagyu breed from Japan. Brant Lake Wagyu raises their Wagyu crossbreed cattle on a mix of pasture feeding and barley. What kind of resource is the Wagyu crossbreed cattle?

A)rare resource  
B)imperfectly imitable resource  
C)nonsubstitutable resource  
D)strategically dissonant resource

Question 15

What is an organization said to have if it has the assets,capabilities,processes,information,and knowledge used to improve its effectiveness and efficiency,to create and sustain competitive advantage,and to fulfill a need or solve a problem?

A)grand strategies  
B)distinctive competencies  
C)competitive advantages  
D)resources

Question 16

What is another term for SWOT analysis?

A)market audit analysis  
B)firm-level strategy analysis  
C)competitive advantage analysis  
D)situational analysis

Question 17

Which of the following is intangible?

A)core capabilities  
B)competitive advantages  
C)strengths and weaknesses  
D)distinctive competencies

Question 18

According to the text,valuable,rare,imperfectly imitable resources can produce a sustainable competitive advantage. What kind of resources must they also be to do so?

A)nonsubstitutable resources  
B)substitutable resources  
C)reliable resources  
D)expensive resources

Question 19

Which condition must be met if a firm's resources are to be used to achieve a sustainable competitive advantage?

A)differentiation  
B)imperfectly imitable resources  
C)related diversification  
D)unrelated diversification

Question 20

Companies in the chemical industry are struggling to attract the most talented college and university graduates. One big challenge facing these companies is attracting new talent to organizations with an old-economy image. In a situational analysis,what term would be associated with this challenge?

A)internal threat  
B)external opportunity  
C)internal weakness  
D)internal opportunity

Question 21

TD Canada Trust was formed through the merger of the Toronto-Dominion Bank and Canada Trust,both national banking entities. Considering both banking companies had similar core capabilities,what is this an example of?

A)related differentiation  
B)related diversification  
C)integrated acquisition  
D)competency acquisition

Question 22

Hector wanted to grow his business beyond the food industry and started investing in clothing,toys,and travel companies. Hector's vice president did not agree with these investments and predicted a decline in profit. Predicting this decline in profit is contrary to which strategy?

A)BCG strategy  
B)portfolio strategy  
C)related diversification strategy  
D)acquisition strategy

Question 23

What are the two major approaches to corporate-level strategy?

A)portfolio strategy and secondary strategy  
B)grand strategy and temporal strategy  
C)grand strategy and portfolio strategy  
D)temporal strategy and secondary strategy

Question 24

What is the term for a portfolio strategy that managers use to categorize their corporation's businesses by growth rate and relative market share to help them decide how to invest corporate funds?

A)investment matrix  
B)SWOT matrix  
C)BCG matrix  
D)portfolio management matrix

Question 25

What mechanism is used to examine external threats and opportunities facing a firm as well as its internal strengths and weaknesses?

A)organizational scanning  
B)internal marketing  
C)corporate strategy  
D)a situational analysis

Question 26

What type of grand strategy is McDonald's using when it increases its profits in Canada by offering uniquely Canadian products,such as poutine?

A)growth  
B)decline  
C)retrenchment/recovery  
D)repositioning

Question 27

Which of the following is an example of a common approach to corporate-level strategy?

A)positioning strategies  
B)adaptive strategies  
C)ROI strategies  
D)grand strategies

Question 28

How can the portfolio strategy be used to help managers acquire companies that fit well with the rest of their corporate portfolio?

A)The fewer businesses in which a corporation competes,the smaller its overall chances of failing. 
B)Risk can be reduced through related diversification-creating or acquiring companies with related core capabilities. 
C)Invest the profits and cash from mature,slow-growth businesses into newer,faster growing businesses. 
D)The most significant advantage of the portfolio strategy is the ability to categorize businesses as stars,exclamation points,question marks,and dogs.

Question 29

In an attempt to minimize its expenses,Toyota Canada discontinued the Scion brand in 2016. Which type of grand strategy was Toyota using?

A)retrenchment  
B)stability  
C)growth  
D)maturity

Question 30

Which term refers to the overall organizational strategy that addresses the question "What business or businesses are we in or should we be in"?

A)firm-level strategy  
B)corporate-level strategy  
C)industry-level strategy  
D)portfolio strategy

Question 31

Besides selling coffee,Starbucks markets a line of compilation CDs under the brand name Hear Music. Which term best describes this making and marketing of CDs?

A)related differentiation  
B)related diversification  
C)integrated acquisition  
D)unrelated diversification

Question 32

Specialized Bicycle Components introduced the first major-production mountain bike in 1980. Since then,the company has maintained a technological leadership in the production of bikes and bike accessories and an organizational culture that encourages innovation. Which one of the following refers to the company's technological leadership and its organizational culture?

A)customer sustainabilities  
B)organizational advantages  
C)relative competencies  
D)core capabilities

Question 33

Specialized Bicycle Components introduced the first major-production mountain bike in 1980. Specialized bikes have a large share of a fast-growing market. According to the BCG matrix,what would the company Specialized Bicycle Components be classified as?

A)problem child  
B)cash cow  
C)exclamation point  
D)star

Question 34

Clorox Corporation,the manufacturer of bleach and bleach-based cleaning products,acquired Kingsford Charcoal and Prime Choice brand steak sauce. What is this action an example of?

A)internal growth  
B)a stability strategy  
C)a pioneering strategy  
D)external growth

Question 35

What term could be used to describe Coca-Cola's acquisition of a water-treatment and bottling plant so it could produce and market Dasani brand bottled water?

A)a repositioning strategy  
B)growth  
C)niche marketing  
D)a retrenchment strategy

Question 36

Which of the following might an internal situational analysis for a pet food manufacturer reveal?

A)a growing dog and cat population in Canada  
B)an indication that dogs need less calcium in their diet  
C)a less expensive,more nutritious imported brand of pet food  
D)a need for management that understands the trends in pet care

Question 37

Clorox Corporation,the manufacturer of bleach and bleach-based cleaning products,acquired Kingsford Charcoal and Prime Choice brand steak sauce. What is this action an example of?

A)related differentiation  
B)related diversification  
C)integrated acquisition  
D)unrelated diversification

Question 38

What is the term for the less visible,internal decision-making routines,problem-solving processes,and organizational cultures that determine how efficiently inputs can be turned into outputs in any organization?

A)imperfectly imitable resources  
B)valuable resources  
C)distinctive competencies  
D)core capabilities

Question 39

Which type of strategy,manifested in three ways,is a broad corporate-level strategic plan used to achieve strategic goals and guide the strategic alternatives that managers of individual businesses or subunits may use?

A)grand strategy  
B)growth strategy  
C)stability strategy  
D)retrenchment/recovery strategy

Question 40

Which of the following is probably the best approach to diversification in portfolio management?

A)related differentiation  
B)related diversification  
C)unrelated diversification  
D)unrelated differentiation

Question 41

Which of the following is one of the five industry forces that determine an industry's overall attractiveness and potential for long-term profitability?

A)character of management  
B)existing complementary products  
C)level of government subsidies  
D)threat of substitute products

Question 42

When The Home Depot opened stores in Canada,it ran a series of ads featuring an animated hammer that was busily reducing prices to show the U.S.-based home improvement store had the lowest prices. According to Michael Porter's ideas,which positioning strategy did The Home Depot adopt to deal with existing Canadian stores that sold similar products?

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

Question 43

What are the positioning strategies identified by Michael Porter?

A)entrepreneurial,growth,and stability  
B)diversification,acquisition,and divestment  
C)defender strategy,diversification,and cost leadership  
D)focus,cost leadership,and differentiation

Question 44

What strategy is characterized by significant cost reductions,the layoffs of employees,the closing of poorly performing stores,offices,or manufacturing plants,or the closing or selling of entire lines of products or services?

A)portfolio  
B)retrenchment  
C)stability  
D)firm-level

Question 45

Apple and Samsung lead the cellphone industry and usually one or the other company leads the industry in phone sales. Which of Porter's five industry forces is this an example of?

A)character of the culture  
B)competitive barrier  
C)character of the rivalry  
D)benchmarked rivalries

Question 46

Which of the following is determined by Michael Porter's five industry forces?

A)potential for long-term change  
B)potential for short-term profitability  
C)potential for short-term change  
D)potential for long-term profitability

Question 47

Which type of strategy do companies often choose when their external environment doesn't change much or when they have struggled with periods of explosive growth?

A)stability  
B)growth  
C)pioneering  
D)portfolio

Question 48

Ads for the Hudson's Bay Company are highlighting the company's longevity and symbiotic relationship with Canada's history. Which type of positioning strategy is Hudson's Bay more than likely using?

A)differentiation  
B)retrenchment  
C)diversification  
D)focus

Question 49

Which strategy,if successful,is often followed by a growth strategy?

A)retrenchment  
B)portfolio  
C)focus  
D)differentiation

Question 50

Which of the following strategies is analogous to pruning roses?

A)growth strategy  
B)stability strategy  
C)retrenchment/recovery strategy  
D)portfolio strategy

Question 51

What type of strategy are companies most likely following when they are trying to improve the way in which they sell the same goods or services to the same customers?

A)growth  
B)pioneering  
C)retrenchment/recovery  
D)stability

Question 52

Which of the following will most likely be characteristic of companies when the bargaining power of suppliers and buyers is high?

A)Companies will find it more difficult to be profitable. 
B)Companies will most likely use a growth strategy. 
C)Companies will divest themselves of all of their cash cows. 
D)Companies will engage in organizational restructuring.

Question 53

By which of the following actions can companies achieve growth?

A)by shrinking the scope of their business  
B)through direct expansion of their operations  
C)by deleting all cash cows from their portfolios  
D)by maintaining only stars in their portfolios

Question 54

What strategy is used to turn around very poor company performance by shrinking the size or scope of the business?

A)growth strategy  
B)stability strategy  
C)retrenchment strategy  
D)repositioning strategy

Question 55

Which of the following is one of the five forces Michael Porter identified as being the ones to determine an industry's overall attractiveness and potential for long-term profitability?

A)existence of complementary products  
B)organizational structure  
C)existing benchmarks  
D)bargaining power of suppliers

Question 56

Cost leadership,differentiation,and focus are discussed in the text. Which of the following defines these three types of strategies?

A)grand  
B)niche  
C)positioning  
D)restructuring

Question 57

Clorox Corporation controls 60 percent of the bleach market. Imagine you are an entrepreneur who is considering developing and marketing a new brand of bleach. Which one of Michael Porter's five industry forces should you be most concerned about?

A)bargaining power of buyers  
B)threat of substitute products or services  
C)threat of new entrants  
D)character of the rivalry

Question 58

Calgary-based recruiting firm S.i. Systems specializes in information technology staffing in key markets across Canada. Which type of positioning strategy does S.i. use?

A)adaptive  
B)growth  
C)diversification  
D)focus

Question 59

In an attempt to minimize its expenses,Toyota Canada discontinued the Scion brand in 2016. Which type of strategy will Toyota Canada more than likely implement in the near term as it continues to integrate the Scion brand into its Canadian operations?

A)harvesting  
B)revitalization  
C)revival  
D)recovery

Question 60

Which corporate strategy addresses the question "How should we compete in this industry"?

A)corporate-level  
B)industry-level  
C)firm-level  
D)niche-specific

Question 61

Narrative 5-1
The Rolling Stones are the most successful act in the music industry largely because they run the band as a business-Rolling Stones Inc. Since 1989,the band has generated more than $1.5 billion in gross revenues. That total includes sales of records,song rights,merchandising,sponsorship money,and touring. Unlike some other groups,the Stones carry no antibusiness baggage. The company licenses over 50 products from underwear to formalwear. Its record earnings from one tour came from the Voodoo Lounge tour in 1994,which grossed $121.2 million. Over the past decade,the group's song writing has made about $56 million. The next time you see Mick Jagger,think of him as the highly successful CEO of a mid-sized corporation. The goal of the corporation is to continue providing products that differ from its competitors' offerings so that fans will continue to pay a premium price for what it sells.
Refer to Narrative 5-1. Which kind of positioning strategy does Rolling Stones Inc. use?

A)accommodation  
B)consultation  
C)differentiation  
D)prospector

Question 62

Infinity Inc. makes a paperweight with real flowers preserved within a solid clear crystal polymer. Independent gift stores sell Infinity's paperweights to collectors of nature-related keepsakes. The larger gift companies find this market too niche for them. What kind of strategy has Infinity adopted?

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

Question 63

Which course of action is most appropriate for top managers when their firm has achieved a sustainable competitive advantage?

A)adjusting or changing strategic reference points  
B)taking advantage of opportunities  
C)developing a "red ocean" strategy  
D)developing a retrenchment strategy

Question 64

Narrative 5-1
The Rolling Stones are the most successful act in the music industry largely because they run the band as a business-Rolling Stones Inc. Since 1989,the band has generated more than $1.5 billion in gross revenues. That total includes sales of records,song rights,merchandising,sponsorship money,and touring. Unlike some other groups,the Stones carry no antibusiness baggage. The company licenses over 50 products from underwear to formalwear. Its record earnings from one tour came from the Voodoo Lounge tour in 1994,which grossed $121.2 million. Over the past decade,the group's song writing has made about $56 million. The next time you see Mick Jagger,think of him as the highly successful CEO of a mid-sized corporation. The goal of the corporation is to continue providing products that differ from its competitors' offerings so that fans will continue to pay a premium price for what it sells.
Refer to Narrative 5-1. Which of the following can the Rolling Stones be said to have,since other music groups cannot duplicate the value the band is providing to customers?

A)contingency management style  
B)sustainable competitive advantage  
C)resource diversity  
D)resource munificence

Question 65

Resource similarity determines the extent to which firms will be in direct competition with one another. What other factor does the same?

A)market commonality  
B)resource quality  
C)related diversification  
D)product differentiation

Question 66

Firms in direct competition can take which of the following actions?

A)grand strategies and corporate-level strategies  
B)strategic choices and tactical choices  
C)attacks and responses  
D)divestment and investment

Question 67

Narrative 5-1
The Rolling Stones are the most successful act in the music industry largely because they run the band as a business-Rolling Stones Inc. Since 1989,the band has generated more than $1.5 billion in gross revenues. That total includes sales of records,song rights,merchandising,sponsorship money,and touring. Unlike some other groups,the Stones carry no antibusiness baggage. The company licenses over 50 products from underwear to formalwear. Its record earnings from one tour came from the Voodoo Lounge tour in 1994,which grossed $121.2 million. Over the past decade,the group's song writing has made about $56 million. The next time you see Mick Jagger,think of him as the highly successful CEO of a mid-sized corporation. The goal of the corporation is to continue providing products that differ from its competitors' offerings so that fans will continue to pay a premium price for what it sells.
Refer to Narrative 5-1. Before 1989,the Stones and all other touring bands would hire a tour director who would cut individual deals with local promoters in each city to set up the shows. In 1989,the Stones were the first group to book their tours themselves,dealing with the venues directly and eliminating the local promoters. The band's income increased from about $400,000 per show to $1 million per show. If the Stones had instead remained with the same strategy,what would they have been guilty of?

A)competitive autonomy  
B)resource substitution  
C)resource lethargy  
D)competitive inertia

Question 68

Which of the following organizations are most directly in competition with each other?

A)Walmart and Gap  
B)a local flower shop and Sobeys  
C)FedEx and UPS  
D)an independent bookstore and a library

Question 69

In which circumstance is an attack on a rival more likely?

A)market commonality is strong  
B)market commonality is weak  
C)resource similarity is strong  
D)resource similarity is weak

Question 70

Under situations of low resource similarity,which of the following is the most probable outcome of an attack?

A)market commonality is likely to be strengthened  
B)market commonality is likely to be weakened  
C)sustained competitive advantage is not likely to be achieved  
D)sustained competitive advantage is likely to be achieved

Question 71

Under which of the following conditions is a competitive attack by the stronger of two rivals more likely to produce sustained competitive advantage for that rival?

A)high market commonality  
B)high competitive autonomy  
C)high resource similarity  
D)low resource similarity

Question 72

Which tools are most useful to implement a strategy?

A)balanced scorecards,early responses,and Gantt charts  
B)Gantt charts,retaliation,and early responses  
C)retaliation,PERT diagrams,and balanced scorecards  
D)Gantt charts,balanced scorecards,and PERT diagrams

Question 73

In which circumstance is a company more likely to respond to an attack?

A)market commonality is strong  
B)market commonality is weak  
C)resource similarity is strong  
D)resource similarity is weak

Question 74

What has been Canadian Tire's strategic response to Walmart's entry into the retail landscape?

A)to aggressively reduce costs  
B)to develop multiple approaches to retail presence  
C)to develop a "red ocean" strategy  
D)to reinforce its focus on tire and automotive sales

Question 75

Narrative 5-1
The Rolling Stones are the most successful act in the music industry largely because they run the band as a business-Rolling Stones Inc. Since 1989,the band has generated more than $1.5 billion in gross revenues. That total includes sales of records,song rights,merchandising,sponsorship money,and touring. Unlike some other groups,the Stones carry no antibusiness baggage. The company licenses over 50 products from underwear to formalwear. Its record earnings from one tour came from the Voodoo Lounge tour in 1994,which grossed $121.2 million. Over the past decade,the group's song writing has made about $56 million. The next time you see Mick Jagger,think of him as the highly successful CEO of a mid-sized corporation. The goal of the corporation is to continue providing products that differ from its competitors' offerings so that fans will continue to pay a premium price for what it sells.
Refer to Narrative 5-1. When it comes to operating as a business,what characteristics have the Rolling Stones demonstrated compared to other musicians?

A)distinctive competence  
B)marginal advantage  
C)contingency style  
D)synergistic hierarchy

Question 76

Narrative 5-1
The Rolling Stones are the most successful act in the music industry largely because they run the band as a business-Rolling Stones Inc. Since 1989,the band has generated more than $1.5 billion in gross revenues. That total includes sales of records,song rights,merchandising,sponsorship money,and touring. Unlike some other groups,the Stones carry no antibusiness baggage. The company licenses over 50 products from underwear to formalwear. Its record earnings from one tour came from the Voodoo Lounge tour in 1994,which grossed $121.2 million. Over the past decade,the group's song writing has made about $56 million. The next time you see Mick Jagger,think of him as the highly successful CEO of a mid-sized corporation. The goal of the corporation is to continue providing products that differ from its competitors' offerings so that fans will continue to pay a premium price for what it sells.
Refer to Narrative 5-1. What kind of grand strategy has Rolling Stones Inc. been using in recent years?

A)retrenchment  
B)accommodative  
C)participative  
D)stability

Question 77

Narrative 5-1
The Rolling Stones are the most successful act in the music industry largely because they run the band as a business-Rolling Stones Inc. Since 1989,the band has generated more than $1.5 billion in gross revenues. That total includes sales of records,song rights,merchandising,sponsorship money,and touring. Unlike some other groups,the Stones carry no antibusiness baggage. The company licenses over 50 products from underwear to formalwear. Its record earnings from one tour came from the Voodoo Lounge tour in 1994,which grossed $121.2 million. Over the past decade,the group's song writing has made about $56 million. The next time you see Mick Jagger,think of him as the highly successful CEO of a mid-sized corporation. The goal of the corporation is to continue providing products that differ from its competitors' offerings so that fans will continue to pay a premium price for what it sells.
Refer to Narrative 5-1. Which kind of diversification have the Rolling Stones used to grow their business?

A)unrelated  
B)investment-specific  
C)autonomous  
D)relative

Question 78

What is it called when the strategic actions that your company takes can probably be matched by your direct competitors,from a competitive standpoint?

A)market commonality  
B)resource similarity  
C)character of the rivalry  
D)competitive inertia

Question 79

Which statement best describes the status of Tim Hortons and Second Cup as direct competitors?

A)They have a low degree of resource variability. 
B)They have a high degree of market commonality. 
C)They have a low degree of competitive inertia. 
D)They have a low degree of market commonality.

Question 80

Narrative 5-2
The traditional image of a public library is one that is full of books on shelves,librarians shushing patrons,and is dark,cut off from the light outside. The Calgary Public Library's CEO,Bill Ptacek,would like to change this image. He's cut back on the book collection by 13 percent,eliminated the $12 annual membership fee,and reconceptualized the library as a place for social gathering. He's done all this despite the Calgary Public Library circulating more items than any other library in Canada except Toronto's. The library is largely funded by the City of Calgary with some grants from senior levels of government. Under Ptacek's tenure,many staff have shifted to working out of more than one branch. Calgary's new downtown library is designed with semi-private nooks,more gathering spaces,and is focused on a community hub. On any given night,you're as likely to find a rock concert as you are a community group in a meeting room or children playing in their new play areas. Some patrons and staff miss their "quiet library," though,and have complained.
Refer to Narrative 5-2. Use the VRIO framework to determine which component Ptacek felt was lacking in the library's value proposition.

A)Is it valuable?  
B)Is it rare?  
C)Is it costly or difficult to imitate?  
D)Is the firm organized to capture the value of the resources?