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Results – Course – Sitong – KnowledgEquity
GSL M3 – MODULE QUIZ 2
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Question 1  1 mark
Which of the following best describes the intent of the balanced scorecard (BSC) approach?

A. Measure performance based on non-financial data.
B. Measure performance in several areas simultaneously.
C. Assist the company to evaluate its strategic alternatives.
D. Eliminate financial controls as measures of company performance.
You selected B - This is correct
TOTAL MARKS : 1
MARKS OBTAINED
1
B is correct because the BSC is an approach to evaluating an organisation’s performance that takes into
consideration more than just the narrow interests of one stakeholder group—shareholders. Rather, it considers
the interests of a range of stakeholders. Consequently, it is an approach that measures performance from four
main perspectives simultaneously: financial, internal business, customer, and learning and growth. These four
perspectives involve both short- and longer-term considerations, internal and external, and incorporate the
interests of other stakeholders in addition to shareholders.
A is incorrect because financial measures are one of the four components of the approach.
C is incorrect because the BSC is a tool to measure internal performance, not an alternative assessment tool.
D is incorrect because the statement indicates that financial measures would be eliminated under this approach.
The BSC is about broadening the measures beyond financials alone, but financial measures are still a
component of performance measurement.
Reference: ‘Operational drivers’ > ‘The balanced scorecard’.
Question 2  1 mark
Which of the following best describes a low-cost generic strategy?

A. It is followed only by organisations in mature industries.
B. It ensures prices to the end customer are as low as possible.
C. It is necessary when an organisation is at the beginning of its life cycle.
D. It gives a competitive advantage to an organisation that has the lowest cost.
You selected D - This is correct
TOTAL MARKS : 1
MARKS OBTAINED
1
D is correct. The low-cost generic strategy applies to the organisation in the industry with the lowest cost
structure. This allows the organisation to win market share in very competitive markets through the use of
discounts and price reductions. Having the lowest cost means the organisation is more able to absorb such
price reductions, giving it a sustainable competitive advantage over competitors.
A is incorrect because a generic strategy is about how industry rivals seek to uniquely position themselves
relative to their competitors. If all organisations are following the same generic strategy, this cannot give rise to a
unique competitive position.
B is incorrect because low-cost generic strategy is about the lowest cost structure in the industry and not the
price charged to the end consumer.
C is incorrect because an organisation at the beginning of its life cycle is managing for growth, which does not
mean managing for profitability.
Reference: ‘Strategic drivers’ > ‘Competitive advantage and generic strategy‘ > ‘Generic strategy: Low
cost’.
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Question 3  1 mark
Which of the following stakeholders is most likely to be a key stakeholder who can influence the strategy of a
university?

A. The students who study at the university
B. A union that represents staff employed by the university
C. A benefactor who leaves an art collection to the university in her will
D. A government that funds the university to support teaching and research outcomes
You selected D - This is correct
TOTAL MARKS : 1
MARKS OBTAINED
1
D is correct because given that the government provides funding to the university, its expectations can influence
the strategy of the university—meaning that it is the stakeholder most likely to be a key stakeholder.
Options A, B and C are incorrect because, although the other groups are important, they are not the most
important. If the government’s expectations are not met, funding may be cut, which will impact on the
university’s strategy.
Reference: ‘Understanding key stakeholders’.
Question 4  1 mark
Which of the following is not a strategic driver for Apple?

A. Apple stores globally
B. The global music industry
C. Having a differentiation strategy
D. Retailers of music albums in the United States
You selected D - This is correct
TOTAL MARKS : 1
MARKS OBTAINED
1
D is correct because strategic drivers are what differentiates an organisation from its competitors. They include
the key markets (refer to Module 2 for this definition) in which the organisation operates as well as its key
customers, the products and services it provides, the channels in which the products or services are delivered,
and the organisation’s competitive advantage.
In Apple’s case, music retailers are not a customer group because Apple sells direct to consumers via iTunes.
Options A, B and C are incorrect because they are all examples of strategic drivers.
Reference: ‘Strategic drivers’.
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Question 5  1 mark
When is a low-cost generic strategy most likely to be appropriate?

A. If the product is critical to the operations of buyers.
B. If most rivals are also trying to pursue a low-cost strategy.
C. If buyers are other companies that buy standardised products in large volumes.
D. If buyers would incur high switching costs if they were to shift to another company’s products.
You selected C - This is correct
TOTAL MARKS : 1
MARKS OBTAINED
1
C is correct because the aim of this strategy is to operate in the most cost-effective manner and maintain a cost
advantage over rivals. This type of strategy works best when buyers want a standardised product. Further, this
is an appropriate strategy if buyers purchase in large volumes and are therefore in a position to bargain down
the price they pay for their purchases.
A is incorrect because the importance of the product in buyer operations is not of relevance in determining
generic strategy choice.
B is incorrect because generic strategy is about how the organisation plans to position itself as different to its
competitors. If most rivals are trying to pursue a low-cost strategy, this is not a differentiating factor and
therefore will not provide a competitive advantage.
D is incorrect because buyer switching costs are not related to generic strategy.
Reference: ‘Strategic drivers’ > ‘Competitive advantage and generic strategy’.
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Question 6  1 mark
Which of the following is a major challenge for big data integration into strategic planning?

A. Using structured quantitative data to assist in organisational decision-making.
B. Ignoring internal data in the development of future objectives and decision-making.
C. Developing a data management plan that acknowledges external data and codes it for decision-making.
D. Recognising and integrating internal and external data into the strategic planning process and using it for the
development of future objectives and decision-making.
You selected D - This is correct
TOTAL MARKS : 1
MARKS OBTAINED
1
D is correct because a major challenge to the organisation is to recognise what big data exists and ascertain the
relevance to the organisation and the planning process. Just using any data internal to the organisation and
external to the organisation to make decisions will not assist in rigorous decisions that are founded in data.
Much organisational data could be informal and of no use.
A is incorrect because in the new era of big data, data comes in many forms that can add value to the
organisation and how it makes decisions. Learning how to analyse both unstructured and structured data and
how to combine them to make decisions is vital to big data decision- making, business intelligence and data
analytics.
B is incorrect because all data needs to be considered, including internal data, when developing strategic plans.
C is incorrect because a key challenge in the use of big data in decision-making is to develop a data
management plan that informs and manages the vast amount of both internal and external data and how it is to
be used, not only external data.
Reference: ‘Big data—deeper and faster analysis’.
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Question 7  1 mark
Which of the following statements is the best reason why it is important to understand the different types of
customers to whom an organisation’s products or services are sold or provided?

A. Sociocultural trends in the industry can be obtained.
B. Analysing customer trends may identify products to be discontinued.
C. Different customers may have different needs and require different sales models.
D. Customers are responsible for the generation of sales obtained by an organisation.
You selected C - This is correct
TOTAL MARKS : 1
MARKS OBTAINED
1
C is correct. It is important to understand the different types of customers to whom the organisation’s products
or services are sold or provided. Different customers may have different needs and require different sales
models or distribution channels.
It is important to be able to collect and display data in order to show customer trends and profitability. Issues
with customers can be identified, and target areas for growth can be pursued based on the findings.
A is incorrect as external environment analysis through use of the PESTEL model is how sociocultural trends in
the industry can be obtained.
B is incorrect as analysing customer trends may identify areas of growth to be targeted.
D is incorrect as customers are responsible for profits generated by an organisation, not sales.
Reference: ‘Strategic drivers’.
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Question 8  0 marks
Which of the following statements is the best reason for an organisation to use competitive business
environment benchmarks?

A. Judgement about performance is made against budgets.
B. Performance needs to be evaluated over periods of time.
C. Benchmarks can explain why performance differs from that of competitors.
D. Organisations can use benchmarking to improve performance and set goals.
You selected C - This is incorrect. The correct answer is D
TOTAL MARKS : 1
MARKS OBTAINED
0
D is correct because once the organisation has decided on the metrics to use to measure performance, the
issue arises as to how to assess the organisation’s performance. Whenever a judgment is made about some
aspect of performance, it is done against a benchmark or reference point.
For example, when an organisation’s profit for the year is assessed as ‘disappointing’, that assessment is made
against certain criteria. It could be against prior expectations, or perhaps with respect to general buoyant trading
and corporate results, or possibly against the profit announcements of its closest rival. The point is that any
judgment about performance must be made relative to a separate, comparable performance benchmark or
standard.
A is incorrect because judgment about performance is done against a benchmark or reference point.
B is incorrect because performance needs to be evaluated in context.
C is incorrect as benchmarking often tells the organisation how it is performing compared with competitors but
does not explain the reasons for the difference.
Reference: ‘Operational drivers’.
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Question 9  0 marks
Which of the following options best describes a way through which innovation and learning can occur?

A. Learning at the organisational level
B. Allowing people in the organisation to learn individually
C. Finding ways to copy leading organisations in the industry
D. Following industry trends to stay on top of competitive changes
You selected D - This is incorrect. The correct answer is C
TOTAL MARKS : 1
MARKS OBTAINED
0
C is correct because while an organisation attempts to follow its particular strategy, competitors will try to find
other ways to be successful or to copy leading organisations in the industry. Therefore, even leading
organisations must seek to continually improve their operations. Two capabilities that are critical for this
continual improvement are innovation and learning.
A is incorrect as learning should occur at both individual and organisational levels.
B is incorrect as organisations should expand their capacity of thinking, communication and leading to allow all
people within the organisation to learn together.
D is incorrect as this is an example of remote environment analysis.
References
Drucker, P. 1986, Innovation and Entrepreneurship, HarperCollins, New York. Senge, P. 1990; The Fifth
Discipline, Harper & Row, New York.
Reference: ‘People and organisational drivers’.
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Question 10  0 marks

Which of the following is part of the intent of using big data for better forecasting and decision-making?
A. Identifying marketing opportunities after the customer has been instore.
B. Performing internal analysis and understanding customers more effectively.
C. Capturing, recording and analysing data with an organisation’s normal systems.
D. Swamping managers and their ability to make quick decisions due to the volume of data.
You selected C - This is incorrect. The correct answer is B
TOTAL MARKS : 1
MARKS OBTAINED
0
B is correct because managers now have the opportunity to take advantage of a much greater level of data to
perform internal analysis and understand their customers more effectively.
For example, this analysis is being extended by the use of real-time data to provide targeted marketing to
individual shoppers when they are in the store. Advertising linked to special deals that are instantly triggered by
a customer’s presence (identified by their smartphone) provides even greater opportunities to generate
revenues (but also raises concerns about privacy and annoying the customer).
A is incorrect as big data is used to identify marketing opportunities to present to the customer while they are
instore.
C is incorrect as big data means that there is more data than an organisation can capture, record and analyse
with its normal systems.
D is incorrect because the aim of big data is to avoid overwhelming managers.
Reference: ‘Big data—deeper and faster analysis’.
Total Marks
7 / 10
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