Question 1

Changing business models can contribute to:&#10;A)Strategic clarity and purpose&#10;B)Innovation and increased competitiveness&#10;C)Strategy implementation and assessment&#10;D)Increased risk portfolio

Accepted Answer

Changing business models can lead to innovative approaches and increased competitiveness in the marketplace. It allows businesses to adapt to changing consumer preferences and technological advancements, which can enhance their ability to meet market demand and increase profitability. While changing business models may carry some level of risk, it can also provide strategic clarity and purpose for the organization, and serve as a means for assessing and implementing strategy. Therefore, the best choice is B.

Question 2

Resistance to taking action comes from all of the following except:&#10;A)Global and national cultures&#10;B)Industrial clusters&#10;C)Individual mindset&#10;D)Organizational factors

Accepted Answer

Industrial clusters are not typically cited as a source of resistance to taking action. Global and national cultures, individual mindsets, and organizational factors can all contribute to resistance to change or action.

Question 3

An example of a tactic for being flexible is to:&#10;A)Focus employees on specific projects with explicit directions&#10;B)Eliminate partnership with fellow industry members&#10;C)Increase versatility and quality of employees' skills and experience&#10;D)Invest in non-redeployable assets

Accepted Answer

Increasing the versatility and quality of employees' skills and experience allows for more flexibility in their roles and ability to adapt to changes in the industry. The other options do not promote flexibility.

Question 4

Critical criteria for scenario planning include:&#10;A)Plausible and consistent&#10;B)Indicators sensitive to current market&#10;C)Long term perspective&#10;D)All of the above

Accepted Answer

All three criteria mentioned are critical for effective scenario planning. The scenarios created must be plausible and consistent, taking into account a range of potential factors that could impact the market. Indicators that are sensitive to current market trends should be considered to ensure that the scenarios created are relevant to the current economic environment. Lastly, a long-term perspective must be taken to ensure that the scenarios created are not limited to short-term considerations.

Question 5

All of the following increase the value of real options EXCEPT:&#10;A)Increase the present value of expected operation cash flows&#10;B)Decrease uncertainty of expected cash flows&#10;C)Reduce value lost by waiting to make full investment&#10;D)Use a signaling device to various industry players

Accepted Answer

Decreasing the uncertainty of expected cash flows actually reduces the value of real options. Real options value increases with higher uncertainty, as they provide the flexibility to make decisions based on future outcomes which are uncertain.

Question 6

Which of the following is an example of a real option?&#10;A)Futures contract for commodity goods&#10;B)Service partnership established to develop new potential products&#10;C)Option to expand a manufacturing plant's capacity&#10;D)Extending a supplier's contract for 3 years

Accepted Answer

The option to expand a manufacturing plant's capacity is an example of a real option, as it involves an investment in the future with the possibility to exercise the option based on the market conditions at that time. The other options listed are not specific examples of real options.

Question 7

Scenario planning involves:&#10;A)Identifying plausible futures that affect firm's success&#10;B)Projecting the past into the future to assess risk&#10;C)Developing rigid plan to identify risk&#10;D)Identifying best real option and creating solutions

Accepted Answer

Scenario planning is the process of identifying plausible future scenarios that could impact a firm's success. It involves developing a range of possible future outcomes and assessing their likelihood and potential impact on the business. This allows the firm to prepare for and adapt to different possible futures, increasing their strategic flexibility and resilience.

Question 8

Processes that constrain the development of more efficient and effective approaches are :&#10;A)Bottleneck Process&#10;B)Stagnant Process&#10;C)Path dependent&#10;D)Path Ambivalent

Accepted Answer

Path dependence refers to the idea that decisions and processes are constrained by historical paths or past decisions, limiting the development of more efficient and effective approaches.

Question 9

Open business models are used by firms to:&#10;A)Rely on at least one customer group benefiting from free offer&#10;B)Reduce inventory costs and focus on niche markets&#10;C)Bring together separate, interdependent customers&#10;D)Create and capture value by systematic collaboration

Accepted Answer

Open business models allow firms to create and capture value by working collaboratively with external partners, such as customers, suppliers, and other companies. This can lead to increased innovation, reduced costs, and improved market share. Option A relates more to a freemium business model, while option B is more aligned with a focused differentiation strategy. Option C could potentially be a benefit of an open business model, but it is not the primary purpose.

Question 10

Which of the following is TRUE:&#10;A)Top dog strategy firms must realize risk of over-utilization&#10;B)Strategic decisions are easily altered, expensive and rare&#10;C)Strategic limits that appear to limit options can actually benefit firms.&#10;D)Individuals most often use explicit, controlled thinking about environmental issues.

Accepted Answer

Strategic limits that appear to limit options can actually benefit firms. This is true because well-defined strategic limits can provide focus and direction to a firm, allowing it to allocate resources more efficiently and effectively. By having clear boundaries, a firm can avoid wasting resources on opportunities that do not align with its overall strategy. Additionally, having clear strategic limits can help a firm avoid getting distracted by short-term opportunities that may not be in its long-term interests.

Deck 11: Keeping Focus