Deck 5: Environment Analysis

Question 1

Key questions that help define an organization's relevant environment include

A) managerial preferences and stakeholder interests
B) market forces of supply and demand
C) goals and objectives of the organization
D) mission and organizational capabilities

Answer 1

B

Question 2

Product market focus is important for evaluating

A) demographic forces
B) economic conditions
C) consumer demand
D) government regulation

Answer 2

C

Question 3

If a firm's value proposition is based on price then

A) consumer price sensitivity is of interest
B) cost cutting is a priority
C) long term supply agreements are common
D) operational efficiency is a key goal

Answer 3

A

Question 4

Environmental forces can be classified as

A) market structure, consumer preferences, technology, and supplier base
B) supply, demand, competition, and governmental
C) time horizon, break-even point, barriers to entry, pace of change
D) product market focus, governmental, organizational boundaries, and demand

Question 5

One of the considerations when evaluating the fit between a strategic proposal and supply is

A) competition for raw materials
B) customer bargaining power
C) threat of new entrants
D) likelihood of competitive response

Question 6

Strategic proposals requiring significant up-front investment would benefit from

A) a lengthy implementation period
B) worst case scenario planning
C) strong leadership
D) price stability in the marketplace

Question 7

One of the considerations when evaluating the fit between a strategic proposal and demand is the

A) preferences of the management team
B) likelihood of competitive reaction
C) response of the regulators
D) bargaining power of the buyers

Question 8

A macro-environment scan is a search for

A) short-term changes in the external environment
B) economic forces with competitive implications
C) long-term social, economic, and technical trends
D) alignment of strategy with environment

Question 9

Market intruders have the potential to

A) create barriers to exit
B) increase competition
C) reduce profitability for marginal firms
D) change the industry

Question 10

Organization's that are outperforming their industry have aligned

A) operations with efficiency
B) strategy with environment
C) managerial preferences with mission
D) strategy with competitors

Question 11

One of the considerations when testing the strategic proposal competition link is

A) break-even point
B) technology
C) bargaining power of suppliers
D) industry attractiveness

Question 12

The relevant environment for strategic analysis is the organization's

A) competitive sphere
B) political jurisdiction
C) boundaries
D) industry or market segment

Question 13

The critical issue with technology is often

A) timing
B) volume
C) ratio of fixed to variable costs
D) break-even point

Question 14

Variable costs are tied to

A) exchange rate fluctuations
B) the price of raw materials
C) supplier margins
D) changes in volume

Question 15

Elements of the profit model used to evaluate strategic proposals include

A) projected revenues, estimated costs, and time line for implementation
B) sales target, projected revenues, and potential profits
C) investment, projected revenues, and estimated costs
D) gross margin, net earnings, and debt/equity ratio

Question 16

If an organization's fixed costs are relatively high, then the strategic focus is on

A) minimizing variable costs
B) maximizing through-put
C) reducing fixed costs
D) increasing leverage

Question 17

One of the factors that influences the scale and timing of market development is the

A) priorities of the Board of Directors
B) likelihood of competitive reaction
C) product market life cycle
D) threat of new entrants

Question 18

Strategic goals establish

A) managerial preferences
B) performance expectations
C) operation efficiency targets
D) organizational boundaries

Question 19

An organization's value proposition is based on

A) managerial preferences and organizational capabilities
B) competitive pressures and organizational response
C) customer appeal and competitive differentiation
D) consumer demand and technological solutions

Question 20

If an organization's variable costs are relatively high then the strategic focus is on

A) input costs
B) interest rates
C) contribution
D) technology

Question 21

Environmental scans and recycling are two mechanisms used to prevent strategic myopia in the analysis process.

Question 22

Trade policy is one of the considerations associated with the linkage between strategy and

A) environment
B) import
C) government
D) export

Question 23

The timing of investment commitments creates differing levels of risk for the firm.

Question 24

A proposal to enter a new geographic region requires the analyst to consider short-term market conditions.

Question 25

Research grants are an example of

A) industrial support
B) entry barriers
C) wage subsidies
D) government support

Question 26

The purpose of forecasting the performance of a strategic proposal is to ensure

A) management is committed to the initiative
B) sustainability of the enterprise
C) stakeholder priorities have been addressed
D) consistency with the strategic goals

Question 27

A strong performance record suggests the fit between strategy and the environment is marginal.

Question 28

The firm's current performance assessment will determine the time horizon for the environment analysis.

Question 29

A key priority in the early stages of analysis of the strategy/environment linkage is

A) data collection
B) break-even analysis
C) goal setting
D) focus

Question 30

If the strategic goal is revenue growth, then the focus of the environmental analysis should be on testing customer appeal.

Question 31

In organizations with high fixed costs, operating volumes are a key consideration.

Question 32

On-going environmental scans are used to reduce the risk of missing threats arising from unconventional sources on the fringe of the business environment.

Question 33

Testing the strategy-environmental linkage requires a rigorous assessment of the potential costs and benefits of each proposal.

Question 34

If the environmental analysis is too narrow in scope, new market opportunities could be overlooked.

Question 35

The time horizon for strategic proposals that require significant organizational change for success is relatively short.

Question 36

Where the strategy/environment linkage is marginal, the proposal should be

A) reserved for scenario planning
B) retained for comparison purposes
C) re-evaluated
D) subjected to rigorous cost- benefit analysis

Question 37

The firm's ability to achieve the target market share is not a consideration when evaluating the break-even point.

Question 38

New technology is often the mechanism used by outsiders to overcome barriers to entry in traditional industries.

Question 39

The impact of shortening the product life cycle is to compress the time horizon for planning purposes.

Question 40

In organizations with high variable costs, the assumptions associated with key input costs are of critical importance.

Question 41

The consequences of not implementing the strategic proposals as planned should be considered a part of the test of strategy-environment linkages.

Question 42

In service-intensive industries, employee recruitment is a consideration when evaluating the strategy-supply linkage.

Question 43

Strategic goals for revenue growth need to be evaluated based on projected operating costs.

Question 44

New product failures can be viewed as an example of a strategy that was not well aligned with the demand conditions of the environment.

Question 45

Growth in demand should be considered when evaluating cost performance goals.

Question 46

The internet has reduced the bargaining power for both buyers and suppliers.

Question 47

Of the four strategic-environmental linkages that are used to evaluate strategic proposals, the strategy-competition linkage is the least important.

Question 48

In evaluating the strategy/demand linkage one of the concerns for analysts is: How quickly will the market develop?

Question 49

In retailing, the ability of suppliers to support the firm's strategic initiatives is a consideration when evaluating the strategy/demand linkage.

Question 50

Regulatory oversight and governmental investments have changed the business environment since 2008.