Deck 2: Strategic Management and the Entrepreneur

Question 1

________ are positive internal factors that contribute towards accomplishing the company's objectives.

A)Strengths
B)Weaknesses
C)Opportunities
D)Threats

Answer 1

A

Question 2

A mission statement should answer which of the following questions?

A)What are the needs and wants of the target customers?
B)How will we finance our growth and expansion?
C)Who are our competitors?
D)How much money will we make?

Answer 2

A

Question 3

The strategic management process:

A)is especially difficult for the small business because of its limited resources.
B)divides mass markets into smaller,less homogeneous units.
C)provides the small business owner with the tools for managing the uncontrollable elements in the external business environment.
D)helps a small business develop the game plan that guides it in creating its mission,vision,goals,and objectives.

Answer 3

D

Question 4

________ are relationships between a controllable variable-plant size,quality,packaging-and a critical factor influencing the firm's ability to compete in the marketplace.

A)Core competencies
B)The competitive advantages
C)Key success factors
D)Goals and objectives

Question 5

The primary output of the strategic management process should be:

A)a matching of its strengths and weaknesses to the opportunities and threats in the environment.
B)an enticement to outside investors and lenders to put money into the business.
C)a complete explanation of the company's product or service.
D)a description of the company's competitive situation.

Question 6

Once the vision and mission are established,the entrepreneur needs to:

A)select the target market.
B)conduct market research.
C)choose a competitive strategy.
D)assess the firm's strengths and weaknesses.

Question 7

________ focuses everyone's attention and efforts on the same target market.It is an expression of what the owner believes in.

A)The mission statement
B)The company vision
C)The strategic plan
D)The operational plan

Question 8

These are products of the interaction of various forces,trends,and events that are outside the control of the small business.

A)distinctive competencies
B)key success factors
C)opportunities and threats
D)strengths and weaknesses

Question 9

Corey notices a "backlash" against health food among people who eat out.He decides to open a restaurant that stresses "good home cooking," heavy with gravies,breads,oils,etc.Corey has identified and is trying to capitalize on a(n)________ in the market environment.

A)strength
B)weakness
C)threat
D)opportunity

Question 10

Which of the following is true about successful entrepreneurs and their vision?

A)It is created independently of their market or their customers.
B)It includes their understanding of the competition and their key market segments.
C)They are able to communicate it and their enthusiasm for it to all those around them.
D)They create it in cooperation with their employees.

Question 11

Answering the question "What business am I in?" defines the company's:

A)mission.
B)assessment of its own strengths and weaknesses.
C)external opportunities and threats.
D)goals and objectives.

Question 12

A small business's "aggregation of factors that sets it apart from its competitors" is its:

A)strategic plan.
B)competitive advantage.
C)vision.
D)competitive strategy.

Question 13

Every business is characterized by a set of controllable variables called ________ that determines the relative success (or lack of it)of market participants:

A)distinctive competencies
B)key success factors
C)opportunities and threats
D)competitive edge

Question 14

How is the strategic planning process for small companies different from that for large companies?

A)The planning horizon should cover at least five years into the future.
B)The process should begin with setting objectives and conclude with competitive analysis.
C)The process should be informal and not overly structured-"a shirtsleeve approach."
D)It should be conducted by top management and provided to lower management.

Question 15

A small firm's ability to identify and manipulate the ________ in its business determines its ability to compete effectively.

A)key success factors
B)corporate vision and mission
C)opportunities and threats
D)market environment

Question 16

When the small business owner assesses her company's strengths and weaknesses,she is dealing with the ________ business environment.

A)macro
B)external
C)competitive
D)internal

Question 17

The strategic planning process for small businesses is:

A)market-focused.
B)the same as it is for a large company.
C)generally done by top management with little or no participation by employees.
D)product-focused and similar to that for large companies.

Question 18

________ are negative external forces that inhibit the firm's ability to achieve its objectives.

A)Strengths
B)Weaknesses
C)Opportunities
D)Threats

Question 19

Which of the following best expresses the relationship of a company vision to its mission?

A)The company vision comes from the company mission.
B)The mission statement is the written expression of the company vision.
C)The company mission statement is the verbal expression of the written vision.
D)There is no relationship between the two.

Question 20

________ are negative internal factors that inhibit the accomplishment of a firm's objectives.

A)Strengths
B)Weaknesses
C)Opportunities
D)Threats

Question 21

Rather than attempting to serve the total market,the small firm pursuing a ________ strategy specializes in serving a specific target segment.

A)cost leadership
B)differentiation
C)focus
D)head-to-head

Question 22

The information-gathering process in competitive analysis:

A)is an expensive process that only established small companies can afford.
B)can be relatively inexpensive and easy for the small business owner to conduct.
C)is closely regulated by various federal laws.
D)is a process that requires expert help but is relatively inexpensive.

Question 23

The focal point of a firm's strategy is:

A)the firm's goals and objectives.
B)the firm's key success factors.
C)the customer.
D)the firm's strengths and weaknesses.

Question 24

________ are specific measurable targets to be accomplished in a defined time period.

A)Core competencies
B)Objectives
C)Goals
D)Key success factors

Question 25

________ are the broad,long-range attributes the small business seeks to accomplish;________ are the specific,measurable milestones the company wants to achieve.

A)Goals;objectives
B)Goals;strategies
C)Objectives;goals
D)Strategies;goals

Question 26

An effective strategic plan does which of the following?

A)Identifies a complete set of success factors-financial,operating,and marketing,that yield a competitive advantage for the company
B)Focuses on one generic strategy to the exclusion of all other strategies
C)Always seeks a high profile in the specific markets chosen
D)Is always cost based

Question 27

Small firms pursuing a cost leadership strategy have an advantage in reaching customers whose primary purchase criterion is:

A)quality.
B)constant innovation.
C)price.
D)customer service.

Question 28

Cost leadership has several inherent dangers such as:

A)choosing to distinguish the product that does not boost its performance.
B)an overfocus on the physical characteristics of the product.
C)the identified niche is not large enough to be profitable.
D)an overfocus on costs to the elimination of other strategies.

Question 29

A small company following a ________ strategy seeks to build customer loyalty by positioning its goods and services in a unique fashion.

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

Question 30

A competitive profile matrix:

A)identifies a firm's core competencies.
B)permits the small business owner to divide a mass market into smaller,more manageable segments.
C)compares the firm's and its competitors' key success factors.
D)creates a road map of action for the entrepreneur in order to fulfill his/her company's mission,goals,and objectives.

Question 31

A differentiation strategy:

A)seeks to find and defend an identifiable market niche.
B)is built on a company's distinctive competence.
C)must create the perception of value in the customer's eyes through the lowest possible price.
D)focuses solely on making the physical characteristics of the product as unique as possible.

Question 32

Purchasing rival companies' products,taking them apart,and analyzing them is:

A)industrial espionage.
B)illegal due to federal regulation.
C)benchmarking.
D)cataloguing.

Question 33

Joan is seeking to answer a series of questions such as: How do competitor's cost structures compare to ours,what new competitors are entering the industry,what do our customers say about competitors,etc.By asking these questions,Joan is:

A)conducting a SWOT analysis.
B)identifying her company's key success factors.
C)formulating strategic options for her company.
D)performing a competitive analysis.

Question 34

The small firm's "master plan" is its:

A)objectives.
B)goals.
C)competitive edge.
D)strategy.

Question 35

The most successful strategic plans make the ________ focal.

A)competitive analysis
B)customer
C)product
D)control process

Question 36

A ________ strategy tends to be ideally suited to the small business.

A)differentiation
B)focus
C)cost leadership
D)product quality

Question 37

Tyson Foods' practice of adding value to its chicken products by deboning,skinning,bite-sizing,or pre-cooking them is an example of a:

A)cost leadership strategy.
B)differentiation strategy.
C)focus strategy.
D)concentration strategy.

Question 38

Which of the following is a danger in choosing a differentiation strategy?

A)Charging a price so high that the company prices itself out of the market
B)Choosing a basis for price leadership that is essentially unimportant to the customer
C)Choosing a market that is not large enough to be profitable
D)An overfocus on overhead costs

Question 39

A small business owner would conduct a competitive analysis in order to:

A)influence customers' perceptions of the company and products' image.
B)avoid surprises from existing competitors and to identify potential new competitors.
C)divide the market into smaller,homogeneous units.
D)scan the environment for weaknesses and strengths on which to capitalize.

Question 40

The principle behind a ________ strategy is to select one or more market segments,identify customers' special needs,and approach them with a good or service designed to excel in meeting these needs.

A)cost-leadership
B)differentiation
C)focus
D)concentration

Question 41

The ________ is a set of measures unique to the company that gives managers a quick and comprehensive view of how the business is doing and includes both financial and operational factors.

A)core competencies
B)key success factors
C)balanced scorecard
D)action plan

Question 42

________ are a unique set of capabilities that a company develops in key areas,such as superior quality,customer service,innovation,team-building,flexibility,speed,responsiveness,and others that allow it to vault past competitors.

A)Core Competencies
B)Focus strategy
C)Cost leadership strategy
D)None of the above

Question 43

________ is not a primary goal of a competitive intelligence program

A)Avoiding surprises from existing competitors' new strategies and tactics
B)Identifying potential new competitors
C)Improving reaction time to competitors' actions
D)All these are primary goals of a competitive intelligence program.

Question 44

It is important for the small business owner to remember that the strategic planning process is:

A)an ongoing process that must be repeated.
B)a top management process completed only once every two years.
C)a process which involves all the employees once every five years.
D)one that should produce a detailed,elaborate plan for running the business over the next 3-5 years.

Question 45

Strategic management is a process that involves:

A)developing a vendor list.
B)developing a vision and mission statement.
C)developing goals and objectives.
D)Both B and C

Question 46

Small businesses have a natural advantage over large competitors when it comes to developing a strategy for competitive advantage because small businesses have all these except:

A)fewer product lines.
B)better-defined customer base.
C)access to more capital.
D)specific geographic market area.

Question 47

The final step of the strategic planning process is:

A)establishing accurate controls.
B)translating the strategic plan into operational plans.
C)evaluating the competitive environment.
D)choosing a marketing strategy to pursue.

Question 48

The strategic management procedure for a small business should include the following features:

A)Use a relatively short planning horizon easy
B)Encourage the participation of employees moderate
C)Be informal and not overly structured difficult
D)All of the above

Question 49

A strategic plan should not:

A)be relatively small.
B)begin with extensive objective setting.
C)encourage participation by employees.
D)be informal and not structured.

Question 50

When translating strategic plans into action plans,the small business owner should:

A)not delegate authority or responsibility at this point.
B)not assign priorities to the action plans,but manage the process from the conceptual level.
C)not adjust or change the plan but commit to implementing as it stands.
D)remember that no strategic plan is complete until it's put into action.

Question 51

Which strategy recognizes that not all markets are homogenous?

A)Focus
B)Differentiation
C)Cost Leadership
D)Price sensitive

Question 52

The final step in creating a knowledge management program is:

A)to organize the essential knowledge and disseminate it throughout the company to those who need it.
B)to take an inventory of the special knowledge a company possesses that gives it a competitive advantage.
C)to continue to add to the knowledge base the company has assembled.
D)to create company goals and objectives

Question 53

Intellectual capital of a company is comprised of which components?

A)Talent and skills of its workforce
B)Software,patents,copyrights
C)Experience of the people in the company
D)Customer base,reputation and goodwill

Question 54

A small business owner needs to remember that when it comes to employee involvement in the strategic planning process:

A)involvement is a prerequisite for the achievement of total employee commitment.
B)his/her employees look to him/her for leadership and do not want to be involved.
C)the delegation of authority is not as important as communicating a clear vision.
D)employees do not need to be involved in the strategic process but do need to be involved in the operational process.

Question 55

Small bookstores have a giant killer of a competitive advantage in their:

A)lower costs.
B)better locations.
C)customer service.
D)large selection.

Question 56

To be effective,these competencies should be ________ for competitors to duplicate,and they must provide customers with a valuable perceived benefit.

A)easy
B)moderate
C)difficult
D)None of the above

Question 57

A company may have a powerful competitive advantage,but it is wasted unless:

A)the owner has communicated that advantage to workers.
B)the customers are recommending the company to their friends.
C)the workers communicate who,in turn,work hard to communicate it to customers and potential customers.
D)All of the above

Question 58

The idea behind strategic planning is to give the business owner a way to match his/her company's strengths and weaknesses to the opportunities and threats in the business environment.

Question 59

Competitive advantage is:

A)to be easily duplicated by competitors.
B)to have a super idea.
C)the aggregation of factors that sets the small business apart from its competitors and gives it a unique position in the market.
D)None of the above

Question 60

In the creation of the balanced scorecard,the entrepreneur needs to:

A)assess competitor's strengths and weaknesses and set measures against them.
B)establish goals for each critical factor of company performance.
C)think about the resource requirements necessary to implement the action plans.
D)do all of these.

Question 61

An established customer base is an example of structural capital

Question 62

Setting seemingly impossibly high objectives,those outside the likely reach of employees,helps managers to create and maintain a high motivation level.

Question 63

Key success factors are simply relationships between controllable factors and critical elements that permit a firm to compete in its industry.

Question 64

One of the goals of competitive analysis is to improve a firm's reaction time to competitor's actions.

Question 65

Most small business owners believe it is relatively unimportant to monitor their competitors' activities.

Question 66

Small firms pursuing a cost leadership strategy have an advantage in reaching customers whose primary purchase criterion is high quality.

Question 67

It is possible for a small business owner to gather competitive data inexpensively,even data on other companies' financial condition.

Question 68

Before a business owner can build any strategies,he/she must have clear goals and objectives in order to have an appropriate target to aim his/her strategies toward.

Question 69

"What business am I in?" This is a question the entrepreneur needs to answer when creating the mission statement.

Question 70

After a company's strengths and weakness are assessed,the strategic planning process should identify opportunities and threats facing the company and should isolate the key factors for success in the business.

Question 71

The best way to build a cost leadership competitive advantage is to focus entirely on manufacturing costs.

Question 72

Sound strategies increase the likelihood that business objectives will be achieved.

Question 73

Goals and objectives provide the direction for the small firm and are essential to the strategic planning process.

Question 74

A well-conceived and defined vision can be a competitive weapon in the marketplace by helping everyone understand and focus on the same target.

Question 75

A strategy is a road map of action for fulfilling a firm's mission,goals and objectives.

Question 76

A danger of cost leadership is that a company may misunderstand what processes actually drive its true costs.

Question 77

Their narrower product lines,smaller customer bases and more limited geographic areas give small companies a natural advantage over large businesses when preparing a strategic plan.

Question 78

The competitive profile matrix matches the firm's core competencies with those of selected competitors.

Question 79

The strategic planning process for small companies should begin with setting goals and objectives.

Question 80

Goals indicate how the small firm's resources will be allocated to specific ventures or activities.