Deck 8: The Manager As a Planner and a Strategist

Question 1

The divisional head of an organization decides to set up the division's technical support center in another country in order to lower costs. This is an example of a functional-level strategy.

Answer 1

False

Question 2

Scenario planning is also known as contingency planning.

Answer 2

True

Question 3

A written set of instructions that describes the series of actions that a manager should take in a specific situation is called the standing operation procedure (SOP) of an organization.

Answer 3

True

Question 4

The second and intermediate step in an organization's planning process is to analyze the current situation and develop a strategy which is also called strategy formulation.

Question 5

In a typical organization, corporate-level planning is the primary responsibility of divisional heads.

Question 6

The set of decisions that managers make to assist the organization in the attainment of its goals is called the strategy of the organization.

Question 7

Programs and projects are examples of standing plans.

Question 8

A business plan that is updated every year depending on the changes in the organization and in the external environment that have taken place in the previous year is known as a rolling plan.

Question 9

A specific action plan created to complete various aspects of a program is called a project.

Question 10

Functional goals and strategies should be independent of divisional and corporate goals and strategies.

Question 11

Single-use plans are intended to be used primarily in nonprogrammed decision making in unusual situations.

Question 12

A business-level plan details the short-term divisional goals that will allow the division to meet corporate goals.

Question 13

Implementing is a process managers use to identify and select appropriate goals and courses of action for an organization.

Question 14

According to Henri Fayol, continuity means that planning is an ongoing process in which managers build and refine previous plans and continually modify plans at all levels so they fit together into one broad framework.

Question 15

Corporate, business, and functional-level plans can all be applied over the same time horizon.

Question 16

The mission statements of organizations in the same market will typically be the same.

Question 17

Planning is important for an organization since a plan can be used as a device for controlling managers within an organization.

Question 18

According to Henri Fayol, unity means that managers need to make every attempt to collect and use all available information in the planning process.

Question 19

Standing plans are useful in situations that are unusual or situations that are one-of-a-kind.

Question 20

The final step in the planning process of an organization is to determine the organization's mission and goals.

Question 21

A brand of cereal attracts customers by offering the lowest prices among other brands of cereals. The company uses a differentiation strategy in this situation.

Question 22

Permanent, ongoing, intense competition brought about in an industry by advancing technology or changing customer tastes is called hypocompetition.

Question 23

Focused low-cost strategy serves a major segment of the overall market and tries to be the lowest-cost organization in the entire market.

Question 24

Entering a new industry or buying a company in a new industry that is not related in any way to an organization's current businesses or industries is called unrelated diversification.

Question 25

The possibility of expanding into a global market is a potential weakness of an organization.

Question 26

The level of foreign involvement and investment and degree of risk is least in wholly owned foreign subsidiaries.

Question 27

Synergy is obtained when the value created by two divisions operated separately and independently is greater than the value that would be created by two divisions cooperating.

Question 28

The ability of the CEO and top managers to convey a compelling vision of what they want the organization to achieve to their subordinates is called strategic leadership.

Question 29

It is impossible for an organization to have both, low-cost as well as differentiated products.

Question 30

The first step in defining an organization's mission is to define its business.

Question 31

A beverage manufacturer enters the snack food business with the purchase of a popular potato chip company. This is an example of diversification.

Question 32

A winery decides to manufacture its own packaging bottles instead of purchasing them from a bottle manufacturing company to reduces costs. The winery is employing a forward vertical integration strategy.

Question 33

A computer operating system software manufacturer invests its profits in creating newer versions of its operating system software to make best use of the continuous changes in computer hardware. This is called diversification.

Question 34

SWOT analysis is a planning exercise in which managers identify external environmental strengths and weaknesses.

Question 35

Though a company's netbook prices are higher than other netbooks with the same configuration, the company offers features that are exclusive only to its netbooks. The company is following a differentiation strategy.

Question 36

An agreement in which managers pool or share their organization's resources and know-how with a foreign company, and the two organizations share the rewards and risks of starting a new venture is called a strategic alliance.

Question 37

Holding specific individuals or groups responsible for the attainment of corporate, divisional, and functional goals is the last step in implementing strategy.

Question 38

When establishing goals, setting a completion time acts as a demotivator.

Question 39

Selling the same standardized product and using the same basic marketing approach in each national market is called multidomestic strategy.

Question 40

When considering vertical integration as a strategy to add value, managers must be careful because sometimes it may reduce a company's ability to create value when the environment changes.

Question 41

Plans that are developed to handle nonprogrammed decision making in unusual or one-of-a-kind situations are called _____.

A) standing plans
B) single-use plans
C) general plans
D) global plans
E) rolling plans

Question 42

According to Henry Fayol an effective plan should have four qualities, namely unity, continuity, accuracy, and _____.

A) sustainability
B) flexibility
C) accountability
D) consistency
E) synergy

Question 43

_____ are used in situations in which programmed decision making is appropriate.

A) Single-use plans
B) Functional plans
C) Rolling plans
D) Scenario plans
E) Standing plans

Question 44

In large organizations the functional level of management is also known as the _____ of management.

A) business level
B) corporate level
C) divisional level
D) departmental level
E) top level

Question 45

Typically ______-level goals and strategies require intermediate- and short-term plans.

A) functional
B) business
C) divisional
D) corporate
E) global

Question 46

The managers of an organization develop a single, well-researched, and effective plan to complete a set of tasks. Which of the following qualities, according to Henry Fayol, does this plan have?

A) Unity
B) Flexibility
C) Continuity
D) Accuracy
E) Synergy

Question 47

Divisional managers' decisions pertaining to divisions' long-term goals, overall strategy, and structure is called an organization's _____ plan.

A) business-level
B) corporate-level
C) functional-level
D) departmental-level
E) global-level

Question 48

A(n) _____ broadly defines an organization's purpose, what it is seeking to achieve from its activities, identifies what is unique or important about its products to its employees and customers, and also distinguishes or differentiates the organization in some ways from its competitors.

A) business plan
B) mission statement
C) SWOT analysis
D) general advertisement
E) strategic plan

Question 49

The SUV division of a major automobile corporation decides to release a new model a month ahead of its stated release and notifies the decision to all the departments associated with the division. The departmental managers must alter their _____ to accommodate the earlier release date.

A) functional-level plan
B) business-level plan
C) divisional-level plan
D) corporate-level plan
E) strategic-level plan

Question 50

According to Henry Fayol, _____ means that managers need to make every attempt to collect and use all available information in the organization's planning process.

A) unity
B) flexibility
C) continuity
D) accuracy
E) synergy

Question 51

The first step in planning for an organization is:

A) procuring raw materials and human resources.
B) analyzing situations and formulating strategies.
C) expanding the organization's business globally.
D) determining the organization's missions and goals.
E) allocating resources and responsibilities to achieve strategies.

Question 52

A(n) _____ strategy indicates how a division intends to compete against its rivals in an industry.

A) corporate-level
B) business-level
C) functional-level
D) departmental-level
E) international-level

Question 53

Top management's decisions pertaining to the organization's mission, overall strategy, and structure constitutes an organization's _____.

A) corporate-level plan
B) divisional-level plan
C) functional-level plan
D) business-level plan
E) departmental-level plan

Question 54

A _____ enables managers to make midcourse corrections if environmental changes warrant or to change the thrust of the plan altogether if it no longer seems appropriate?

A) standing plan
B) long-term plan
C) rolling plan
D) contingency plan
E) general plan

Question 55

There has been a rapid increase in the percentage of population of a third-world nation switching to cellular technology in recent years. A major multinational telecommunication services company decides to take advantage of this change and plans to setup industry in the country with the intention of dominating the country's telecommunication market. This is an example of a _____.

A) divisional-level strategy
B) departmental-level strategy
C) functional-level strategy
D) corporate-level strategy
E) business-level strategy

Question 56

Because of the hostile external environment, AKY Consulting, treats its multiyear corporate-level plan as a _____ plan in order to maintain flexibility without losing sight of the need to plan for the long term.

A) fixed
B) general
C) standing
D) rolling
E) business

Question 57

A(n) _____ is a cluster of decisions about what goals to pursue, what actions to take, and how to use resources to achieve goals.

A) strategy
B) objective
C) motto
D) allocation
E) accomplishment

Question 58

A functional-level plan states the goals that the managers of each function will pursue to help their division attain its ______ goals, which, in turn, will allow the entire company to achieve its ______ goals.

A) departmental-level; functional
B) business-level; department
C) divisional-level; divisional
D) business-level; corporate
E) functional-level; corporate

Question 59

_____ is a plan of action to improve the ability of each of an organization's functions to perform its task-specific activities in ways that add value to an organization's goods and services.

A) Business-level strategy
B) Divisional-level strategy
C) Corporate-level strategy
D) Departmental-level strategy
E) Top-level strategy

Question 60

The duration over which a plan is intended to be applied or endured is called _____.

A) an event compass
B) goal duration
C) plan endurance
D) target visibility
E) a time horizon

Question 61

Another name for contingency planning is _____.

A) single-use planning
B) ad-hoc planning
C) business planning
D) divisional-level planning
E) scenario planning

Question 62

There is constant, fierce competition between telecommunication companies due to the continuous advances in mobile technology and a wide range of customers tastes. This is called _____.

A) ultracompetition
B) hypocompetition
C) supercompetition
D) hypercompetition
E) extracompetition

Question 63

An organization attempting to succeed by distinguishing its products from those of the competition is most likely to use a(n) _____.

A) differentiation strategy
B) low-cost strategy
C) diversification strategy
D) stuck-in-the-middle strategy
E) association strategy

Question 64

A firm has a formal, written guide regarding its zero-tolerance attitude towards sexual harassment and the consequences of its violation. By definition, this is a _____ of the firm.

A) standing plan
B) mission statement
C) policy
D) rule
E) norm

Question 65

Which of the following will most likely be an opportunity according to an organization's SWOT analysis?

A) The company can probably takeover one of its bankrupt competitors.
B) The sales of the organization's products are the highest in the industry.
C) The organization is growing rapidly without any direction.
D) The government has passed a law which will increase labor costs.
E) The organization faces increased competition in its market.

Question 66

Though not formally written, an organization allows its employees to dress casually on Fridays. This is a(n) _____ of the organization.

A) policy
B) rule
C) standard operating procedure
D) standing plan
E) ethical code

Question 67

In performing a SWOT analysis, a furniture company realized that the number of competing firms in its industry was increasing. The company would classify this as a(n) _____.

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

Question 68

As a part of its yearly planning activities, PDQ Financial Services, generates a list of possible future scenarios and creates a plan to respond to each of these forecasts. PDQ Financial Services is practicing _____.

A) single-use planning
B) ad-hoc planning
C) divisional-level planning
D) contingency planning
E) functional planning

Question 69

Policies, rules, and standard operating procedures (SOPs) are all types of _____ plans.

A) single-use
B) functional
C) rolling
D) standing
E) scenario

Question 70

A furniture company is trying to keep the costs of the company low by switching its suppliers and ordering materials in larger quantities in order to reduce overall costs. The company is employing a _____.

A) focused differentiation strategy
B) low-cost strategy
C) high-cost strategy
D) unifying strategy
E) hypercompetition strategy

Question 71

To determine an organization's missions and goals, managers must first _____.

A) perform a SWOT analysis
B) apply the Five Forces Model
C) define its business
D) develop a long-term plan
E) develop a short-term plan

Question 72

A written set of instructions which describes the series of actions that a manager should take in a specific situation is known as a:

A) policy.
B) standard operating procedure.
C) heuristic.
D) rolling plan.
E) rule.

Question 73

In the Five Forces Model, the _____ that companies compete against one another for customers, the _____ the level of profits is likely to be for that industry.

A) more; lower
B) more; higher
C) less; lower
D) less; equal
E) more; equal

Question 74

Employees tend to be motivated and perform better if they are taken in by the vision of the top managers of their organizations. It therefore becomes essentials for top managers to develop a strong sense of _____.

A) goal orientation
B) strategic leadership
C) strategy formulation
D) business planning
E) organizational affluence

Question 75

In performing a SWOT analysis, a firm realized that its managers were untrained to handle the requirements of its new division. The firm would classify this as a(n) _____.

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

Question 76

A standing plan that acts as a general guide to action that applies to the employees of an organization is called a _____.

A) belief
B) rule
C) policy
D) standard operating procedure
E) scenario

Question 77

According to an organization's SWOT analysis, which of the following would be a potential strength?

A) The organization has the potential to break the barriers of entry to a new market.
B) The organization has the highest profit margin in its market.
C) The organization's research and development sector is on the decline.
D) The organization's customer preferences are rapidly changing.
E) There is a lack of co-operation between the organization's various divisions.

Question 78

Which of the following can be defined a threat according to the five forces model?

A) The level of rivalry among organizations in an industry is low
B) Brand loyalty is very high
C) Large number of suppliers
D) Only a few large customers are available to buy an industry's output
E) Products are unique and cannot be substituted

Question 79

A group of managers analyze both, the internal strengths and weaknesses of their organization as well as the opportunities and threats of the external environment. What type of analysis is this?

A) Mission analysis
B) SWOT analysis
C) Functional analysis
D) Diversification analysis
E) Competition analysis

Question 80

The pharmaceutical industry is extremely dynamic. A company that releases a product to the general public with the intention of keeping prices high may see quick competition arising from other products made from different compounds that perform the same functions as the company's product. According to the five forces model, this type of threat is called _____.

A) the level of rivalry among organizations in an industry
B) the potential for entry into an industry
C) the power of large suppliers
D) the power of large customers
E) the threat of substitute products