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1.Competent execution of a well-conceived strategy is(
)
A.the best test of whether management has a timely strategic vision.
B.a solid indication that managers have done an excellent job of setting astute, timely
performance objectives.
C.the best test of managerial excellence.
D. evidence that managers have done an effective job of strategic planning.
E.None of these.
2.Managers devise company strategies because( )
A.a well-conceived strategy is a powerful indicator of whether management has a
timely strategic vision.
B. of a compelling need to proactively shape how a company's business will be
conducted.
C.of a compelling need to mold the independent decisions and actions initiated by
departments, managers, and employees across the company into a coordinated,
company-wide game plan.
D. it is something that is expected by employees, shareholders, and creditors.
E. Both b and c.
3. Strategic visions and company mission statements( )
A. are best stated in generic terms that could apply to any company in the industry.
B. should be a highly personalized that sets an organization apart from others in its
industry in the sense of specifying its own identity, business emphasis, and path for
development.
C. are best crafted by the CEO.
D. should be reviewed and updated every 6 to 12 months.
E. should be specific enough to indicate what industry the company is in, but not so
specific as to pin down exactly what the company's boundaries are to be.
4.Which one of the following represents the best-stated strategic objective?( )
A.Our objective is world-class quality and customer service.
B. Our objective is to be the industry's technological leader by the year 2005.
C. Our objective is total customer satisfaction.
D. Our objective is to have a better quality product than any of our competitors by the
year 2000.
E. Our objective is to become the industry's third largest-volume producer by
increasing our annual sales volume from the current 1 million tons to 5 million tons
by 2005.
5. The competitive threat that outsiders will enter a market is stronger
when(
)
A. the products of rival firms are weakly differentiated, buyers have no strong
preferences for the brands of existing producers, and buyers exhibit low brand
loyalties.
B.incumbents are not inclined to fight vigorously to prevent a newcomer from gaining
a market foothold.
C.a newcomer can expect to earn attractive profits.
D.there are interested entry candidates with sufficient expertise and resources to
hurdle prevailing entry barriers.
E. All of these.
6.The competitive threat of entry of new firms is weaker when(
)
A. buyers of the industry's products like to experiment with buying different brands of
the industry's product.
B. the products of rival firms are weakly differentiated, buyers have no strong
preferences for the brands of existing producers, and buyers exhibit low brand
loyalties.
C. incumbent firms have little ability to leverage distributors, dealers, and/or retailers
to retain their business.
D. incumbent firms are likely to be very aggressive in defending their market
positions.
E. there are more than ten firms already in the industry.
7.A potential entrant is likely to have second thoughts about actually attempting
entry when( )
A.incumbent firms are willing and able to cut prices to preserve their market shares.
B.retailers are skeptical about giving a newcomer's products ample display and shelf
space.
C. market demand for the industry's product(s) is expanding slowly.
D. it is hard for newcomers to gain access to needed technology and specialized
know-how.
E.All of these.
8.A core competence(
)
A.adds to a company's arsenal of competitive assets and is a genuine resource
strength.
B.typically resides in a company's people (skills and knowledge) and in its
capabilities, not in its assets on the balance sheet.
C.is sometimes the product of effective collaboration among different organizational
units and/or of individual resources teaming together.
D. All of these.
E. None of the above is correct; they apply to a distinctive competence, not a core
competence.
9.To be successful with a differentiation strategy, a company has to(
)
A.study buyer needs and behavior very carefully to learn what buyers consider as
important, what they think has value, and what they are willing to pay for.
B. incorporate a greater number of differentiating features into its product/service than
rivals.
C.strive to achieve strong differentiation rather than weak differentiation.
D. outspend rivals on advertising and promotion in order to inform and convince
buyers of the value of its differentiating attributes.
E.concentrate on providing a top-of-the-line product to consumers.
10.Using domestic plants as a production base for exporting goods to selected
foreign country markets( )
A.can be an excellent initial strategy to test the international waters and learn if
market positions can be established in foreign markets.
B.can be a competitively successful strategy when a company is focusing on vacant
market niches in each foreign country and does not have to compete head-to-head
against strong host country competitors.
C. works well when a firm does not have the financial resources and technical
know-how to build major plants in foreign markets.
D. is usually a weak strategy when competitors are pursuing multi-country strategies.
E. can be a powerful strategy if foreign rivals have their plants located in countries
that are not close to the world's critical markets.
11.The organizational structure of a firm pursuing a global strategy is likely to
involve( )
A.forming subsidiary companies in each host country and making sure each country
subsidiary operates in a manner tailored to fit host country conditions very closely.
B. a global organization structure where corporate headquarters retains control over
major strategic decisions and where there's extensive cross-border alignment and
coordination of strategy-related activities.
C. having manufacturing plants and sales and marketing offices in each country where
it operates.
D. giving country managers full responsibility and authority over the firm's operations
in their assigned country.
E.All of the above except b.
12.Cross subsidization is a particularly powerful competitive weapon when used
by(
)
A. a global firm with multiple profit sanctuaries.
B.a domestic-only competitor with a protected profit sanctuary in its home market.
C. firms with strong strategic alliances in several different national markets.
D. competitors pursuing global strategies as opposed to multi-country strategies.
E.firms whose primary strategic objective is achieving or maintaining domestic
dominance in their home market.
13.Which one of the following is not a source of cost-saving and/or collaborative
sharing opportunities associated with operating types of strategic fit?(
)
A.Shared manufacturing and assembly facilities
B.Shared inbound or outbound shipping and materials handling
C.Using a common network of dealers and retailers to access buyers of the product
D. Joint procurement of purchased inputs
E. Shared process technologies and/or collaborative technology development
14.One of the chief advantages of unrelated diversification is that it(
)
A.expands a firm's competitive advantage opportunities to include a wider array of
businesses.
B. spreads the stockholders' risks across a greater number of lines of business.
C. increases strategic fit opportunities.
D. helps achieve greater economies of scope.
E. All of these.
15.One of the principal strategic disadvantages of decentralized business units is
that(
)
A.profit/loss measurement by line of business is made more difficult.
B.it raises questions about how much authority over each business unit to retain at
corporate headquarters and how much to delegate to business-unit managers.
C. it increases internal rivalry, conflict, and empire-building.
D. it discourages entrepreneurial thinking and encourages the formation of corporate
bureaucracy.
E. such a structure makes it difficult to build dominating depth
16. Which of the following is not a means of flattening organizational hierarchies
and removing middle management layers?(
)
A.Reengineering
B.Empowerment
C. Use of self-directed work teams
D. Special project teams and new venture teams
E. Outsourcing non-critical value chain activities
17. Which of the following is the most important aspect of developing a
strategy-supportive reward structure?(
)
A. Motivating organizational units and individuals to work energetically to execute
the strategy effectively and achieve the organization's vision
B. Creating a results-oriented work climate and a spirit of high performance
C. Boosting employee morale and job satisfaction
D. Boosting worker productivity and lowering labor costs
E.Making sure that individuals' rewards are tightly linked to meeting or beating
strategically-relevant performance targets
18. Which of the following is not a desirable feature of a well-designed
compensation and reward system?(
)
A. Linking incentives tightly to performance targets that are critical to successful
execution of the company's strategy
B. Keeping the time between performance reviews and payment of the rewards short
C. Making sure that the performance targets that each individual is expected to
achieve involve outcomes that the individual can affect
D. Generous rewards for people who turn in outstanding performances
E. A reward system that involves 50 percent non-monetary rewards and a work
environment that avoids placing pressure on managers and employees to achieve high
performance levels
19.Implementing a values statement and/or a code of ethics entails( )
A. word-of-mouth indoctrination.
B. strong endorsements by the CEO.
C. communicating the values and the ethics code to all employees and explaining
compliance procedures.
D. giving explicit attention to values and ethics in recruiting, hiring, and training
people.
E. All of the above.
20. A well-developed program to ensure compliance with ethical standards
typically includes(
)
A.having a committee of senior managers direct and monitor the ongoing training,
implementation, and compliance effort.
B. periodically requiring people to sign documents certifying compliance with ethical
standards.
C. audits of managerial efforts to uphold ethical standards.
D. having managers file formal reports on the actions they take to discipline known
violators or otherwise remedy deficient ethical conduct.
E. All of the above.
21Why does an organization need both financial and strategic objectives?
22 What is the difference between a strategic objective and a financial objective?
Give three examples of each type of objectives to illustrate the difference.
23. Can an industry be attractive to one company and unattractive to another company?
Why or why not?
24 The ability of a company to perform competitively crucial value chain activities
better than rivals is one of the keys to sustainable competitive advantage. True or
False? Explain and defend your answer.
25. What are the merits of cooperative strategies? Under what circumstances do they
make sense? How do they contribute to competitive advantage?
26. Identify and briefly discuss any three of the strategic approaches that are
well-suited for runner-up companies.
27. Once a company achieves diversification, what are the post-diversification
strategic moves that it can employ to improve the performance of its business
portfolio?
28. Values and ethical standards not only must be explicitly stated but they also must
be deeply ingrained into the corporate culture. True or False.Explain.
29. Why is a functional organization structure susceptible to fragmentation of
strategy-critical business processes across traditional departmental lines? How can
reengineering help correct the problem?
30. Why does it make sense to create some job anxiety, insecurity, and stress as part of
the motivational and reward scheme for promoting competent strategy execution?
31. What does the industry attractiveness test involve in evaluating a diversified
company's business portfolio? Why is it relevant?