Deck 3: Planning and Strategic Management

Question 1

Venus Corp. is a large corporation with many strategic business units. The top managers and board of directors are reviewing the performance of the business units to estimate the amount of resources that each unit will require in the next few years. The plan created for allocation of resources among the business units of Venus would be a(n) _____ plan.

A) strategic
B) tactical
C) operational
D) contingency
E) recovery

Answer 1

A
Strategic plans are developed to achieve strategic goals. More precisely, a strategic plan is a general plan outlining decisions about resource allocation, priorities, and action steps necessary to reach strategic goals.

Question 2

The top managers of Dietizza, a large low-fat pizza chain, plan to increase the profitability of all its outlets by 15 percent in a period of two years. This is a(n) _____ goal.

A) tactical
B) operational
C) nonspecific
D) divestiture
E) strategic

Answer 2

E
Strategic goals are set by and for an organization's top management. They focus on broad, general issues. For example, Starbucks has a strategic goal of increasing the profitability of each of its coffee stores by 25 percent over the next five years.

Question 3

A difference between tactical and strategic plans is that:

A) tactical plans have a more concrete focus.
B) tactical plans are set for and by the board of directors.
C) tactical plans have broader time horizons.
D) strategic plans are developed by first-line managers.
E) strategic plans deal with the day-to-day operations of an organization.

Answer 3

A
A tactical plan, aimed at achieving tactical goals, is developed to implement specific parts of a strategic plan. Tactical plans typically involve upper and middle management and, compared with strategic plans, have a somewhat shorter time horizon and a more specific and concrete focus.

Question 4

The top managers at Redd Inc. are developing a plan to reduce the production costs of the company. By reducing costs, Redd wants to gain a competitive advantage of cost leadership. The plan being developed in this scenario is a(n) _____ plan.

A) strategic
B) tactical
C) operational
D) contingency
E) recovery

Question 5

Nutrimax Inc. identifies its purpose as "to produce the finest cookies in the world while upholding our principles of promoting good health and maintaining environmental sustainability." This purpose is most likely to be the _____ of Nutrimax.

A) strategic goal
B) distinctive competence
C) mission statement
D) operational goal
E) tactical goal

Question 6

A(n) ____ goal for a waste management plant could be "to develop a recycling campaign for rural communities of less than 1000 customers." It would develop naturally out of a strategic goal "to increase recycling by 10% everywhere."

A) strategic
B) departmental
C) functional
D) divestiture
E) tactical

Question 7

Goals set for and by line-managers are called _____ goals.

A) strategic
B) tactical
C) developmental
D) organizational
E) operational

Question 8

Gadgetbug Inc. is known for its extremely efficient after-purchase service. None of Gadgetbug's competitors provide the same kind of customer service. Gadgetbug's _____ is described in the scenario.

A) scope
B) divestiture strategy
C) strategic limitation
D) process loss
E) distinctive competence

Question 9

Strategic goals are set by:

A) first-line managers.
B) middle managers.
C) top managers.
D) stockholders.
E) consumers.

Question 10

Tactical goals are set by:

A) first-line managers.
B) middle managers.
C) assembly-line managers.
D) stockholders.
E) investors.

Question 11

Operational goals are set by:

A) first-line managers.
B) top-level managers.
C) the board of directors.
D) shareholders.
E) investors.

Question 12

_____ plans generally have an extended time horizon, and address questions of scope, resource deployment, competitive advantage, and synergy.

A) Operational
B) Contingency
C) Recovery
D) Tactical
E) Strategic

Question 13

Which of the following statements is true about tactical goals?

A) Their focus is on how to operationalize actions necessary to achieve strategic goals.
B) Their focus is on broad and long-term issues such as increasing the profitability of the organization over a period of time.
C) They are set for and by top managers.
D) They are set for and by the board of directors.
E) They are broad and nonspecific.

Question 14

A(n) _____ plan is a general plan outlining decisions about resource allocation, priorities, and action steps necessary to reach the goals set by the top managers.

A) recovery
B) contingency
C) operational
D) tactical
E) strategic

Question 15

_____ is a way of approaching business opportunities and challenges.

A) Supply-chain management
B) Value migration
C) Self-dealing
D) Strategic management
E) Greenwashing

Question 16

An organization's _____ is a statement of its fundamental, unique purpose that sets a business apart from other firms of its type and identifies the scope of the business's operations in product and market terms.

A) mission
B) statement of qualification
C) article of incorporation
D) operational goal
E) tactical plan

Question 17

_____ plans have a short-term focus and are relatively narrow in scope.

A) Corporate
B) Tactical
C) Operational
D) Contingency
E) Strategic

Question 18

Samantha is responsible for building the day-to-day work schedules for her subordinates. She assigns specific tasks to her subordinates and designs activities according to the objectives that she receives from her seniors. Samantha works on _____ plans.

A) operational
B) organizational
C) strategic
D) divestiture
E) tactical

Question 19

The _____ is the component of a strategy that specifies the range of markets in which an organization will compete.

A) divestiture
B) competency
C) scope
D) resource deployment
E) deskilling

Question 20

Which of the following statements is true about strategic goals?

A) They are set by an organization's middle managers.
B) They are set by first-line managers.
C) They provide plans for the day-to-day operations of an organization.
D) They focus on broad and general issues.
E) Their focus is on short-term issues.

Question 21

_____ strategy is the set of strategic alternatives from which an organization chooses as it operates in a particular industry or market.

A) Business-level
B) Corporate-level
C) Operational-level
D) Divestiture
E) Anti-competitive

Question 22

An organization that pursues a(n) _____ strategy seeks to stand out among competitors through the quality (broadly defined) of its products or services.

A) differentiation
B) divesting
C) anti-competitive
D) focus
E) cost-leadership

Question 23

Which of the following questions that companies consider is most closely related to the resource deployment component of a strategy?

A) How much money should we invest in our business units overseas?
B) What are the markets in which we can compete?
C) What are the preferences of our customers?
D) Who are our competitors?
E) How can we make our products more unique in a way that they stand out?

Question 24

_____ strategy is the set of strategic alternatives from which an organization chooses as it manages its operations simultaneously across several industries and several markets.

A) Corporate-level
B) Business-level
C) Operational-level
D) Divestiture
E) Anti-competitive

Question 25

A(n) _____ is an area in an organization's environment that, if exploited, may generate higher performance.

A) organizational opportunity
B) economic downswing
C) organizational strength
D) process gain
E) process loss

Question 26

A(n) _____ is a comprehensive plan for accomplishing an organization's goals.

A) scope
B) competence
C) strategy
D) article of incorporation
E) statement of qualification

Question 27

_____ include things like a deep pool of managerial talent, surplus capital, a unique reputation and/or brand name.

A) Market opportunities
B) Organizational opportunities
C) Market strengths
D) Environmental strengths
E) Organizational strengths

Question 28

A(n) _____ is an internal skill or capability that does not enable a company to choose and implement strategies that support its mission.

A) organizational weakness
B) organizational threat
C) market threat
D) process gain
E) economic downswing

Question 29

Alba Motorbikes is known for its heavyweight motorcycles. The company places emphasis on the quality of the bikes and after-sale service. The brand also enjoys customer loyalty. This scenario described Alba Motorbikes':

A) distinctive competence.
B) scope.
C) process gain.
D) competitive disadvantage.
E) related diversification.

Question 30

Which of the following will be considered as an organizational strength in the context of SWOT analysis?

A) Organizational opportunities
B) New competitors
C) Surplus capital
D) High overhead costs
E) New government policies

Question 31

In the context of SWOT analysis, which of the following would be considered as an organization's strength?

A) Exiting competitors
B) High overhead costs
C) Favorable government policies
D) Motivated employees
E) High employee turnover rate

Question 32

The choices a firm makes as to where and how much to invest reflect issues of _____.

A) value migration
B) distinctive competencies
C) resource deployment
D) deskilling
E) industrial symbiosis

Question 33

Zing Inc. is a large fashion brand that manufactures clothing and shoes. The top managers of Zing have decided to use the profits from its clothing outlets to invest in the shoes business. This scenario illustrates the _____ component of a strategy.

A) resource deployment
B) scope
C) distinctive competence
D) process loss
E) divestiture

Question 34

Hydraliscious is a juice brand that sells a wide range of fruit juices that only uses organic ingredients, which is its uniqueness when compared with other brands. Even though Hydraliscious juices are highly priced, a lot of customers buy them because of the quality of the juices. Hydraliscious is most likely to be using a(n)_____ strategy.

A) differentiation
B) cost-leadership
C) divesting
D) bundle pricing
E) anti-competitive

Question 35

Which of the following statements is true about the differentiation strategy?

A) It enables a firm to sell products at lower prices and still make profits.
B) It enables a firm to charge more for its products.
C) It is aimed at reducing production costs by using inexpensive raw materials.
D) It involves making simple, low-priced products for the mass market.
E) It cannot be used by companies that only offer services.

Question 36

The set of processes for determining the strategies that will be used by an organization is known as:

A) strategy implementation.
B) environmental scanning.
C) strategy formulation.
D) divesting.
E) deskilling.

Question 37

_____ refers to the methods by which strategies are operationalized or executed within the organization; it focuses on the processes through which strategies are achieved.

A) Strategy implementation
B) Strategy mapping
C) Strategy formulation
D) Strategy visualization
E) Strategy conceptualization

Question 38

_____ is the set of strategic alternatives that helps an organization focus its competitive efforts for each industry or market in a targeted and focused manner.

A) Anti-competitive strategy
B) Divestiture strategy
C) Corporate-level strategy
D) Business-level strategy
E) Operational-level strategy

Question 39

The starting point in formulating strategies is usually:

A) SWOT analysis.
B) resource deployment.
C) divesting.
D) deskilling.
E) contingency analysis.

Question 40

Which of the following is an organizational strength?

A) High employee turnover
B) High production costs
C) Well-established distribution channels
D) High purchasing power of customers
E) New competitors

Question 41

During the maturity stage of a product life cycle:

A) demand is maximum.
B) companies must sacrifice product quality.
C) sales are the highest.
D) demand comes to a halt.
E) product differentiation concerns are still important.

Question 42

During the introduction phase of the product life cycle _____.

A) companies must sacrifice product quality
B) most companies tend to downsize
C) demand may be very high
D) competition is at its peak
E) sales volume is the highest

Question 43

Supertech Inc. is a large firm that manufactures gadgets and mobile phones. The company sells a line of inexpensive mobile phones exclusively targeted at youth and teenagers in Selenasia. Which of the following strategies is illustrated in the scenario?

A) Differentiation strategy
B) Focus strategy
C) Restraint of trade strategy
D) Anti-competitive strategy
E) Divesting strategy

Question 44

Aries Inc. manufactures dairy products and detergents.This is an example of _____ diversification.

A) horizontal
B) unrelated
C) single-product
D) concentric
E) related

Question 45

Virtually all larger businesses in the United States use a(n) _____ strategy.

A) related-diversification
B) single-product
C) divestiture
D) unrelated diversification
E) single-service

Question 46

Strategies to slow the entry of competitors are important if an organization is entering an industry during the _____ stage of the product life cycle.

A) growth
B) introduction
C) decline
D) maturity
E) recovery

Question 47

Which of the following strategies can help companies during the maturity stage of a product life cycle?

A) Manufacturing products in small quantities intermittently than in bulk
B) Drastically increasing product prices
C) Focusing on keeping costs low
D) Sacrificing the quality of products
E) Focusing more on strategies to slow the entry of competitors

Question 48

During the growth stage of a product life cycle, companies should focus on:

A) creating product differentiation.
B) increasing overhead costs.
C) sacrificing product quality.
D) using anti-competitive strategies.
E) divesting.

Question 49

Alpha Inc. is a large shoe manufacturer that caters to a large customer base. In addition to the high volume of shoes it manufactures, the company sells simple-designed sneakers for low prices. Many customers buy Alpha shoes because they are durable and inexpensive. Which of the following strategies is illustrated in the scenario?

A) Overall cost leadership strategy
B) Market diversification strategy
C) Differentiation strategy
D) Divesting strategy
E) Market development strategy

Question 50

An organization that pursues a single-product strategy:

A) clusters relayed products in a single strategic business unit.
B) manufactures a range of products that are related to each other in some way.
C) uses a single marketing strategy for all its products.
D) operates in a single geographic market.
E) creates a separate business unit for each product it sells.

Question 51

Which of the following will help a company achieve an overall cost leadership?

A) Manufacturing customized products in small quantities
B) Increasing after-purchase services
C) Using simple inexpensive product packaging
D) Selling products at very high prices
E) Increasing overhead costs

Question 52

_____ describes the number of different businesses that an organization is engaged in and the extent to which these businesses are related to one another.

A) Entropy
B) Diversification
C) Divestiture
D) Competency
E) Economy of scale

Question 53

During the maturity stage of the product life cycle,:

A) most companies start hiring more employees.
B) managers need to focus their efforts on "getting product the out the door" without sacrificing quality.
C) the sales volume is the highest.
D) more competitors enter the industry.
E) the overall demand growth for a product begins to slow down.

Question 54

Which of the following strategies can help companies survive during the decline stage of the product life cycle?

A) Increasing production costs
B) Manufacturing the products frequently and in smaller quantities
C) Avoiding differentiation strategies
D) Developing new products or services
E) Focusing on strategies to slow the entry of competitors

Question 55

Which of the following strategies will help companies succeed during the growth stage of a product cycle?

A) Increasing overhead costs
B) Focusing on developing new products or services
C) Sacrificing product quality
D) Focusing on creating product differentiation
E) Increasing product prices significantly

Question 56

During the growth stage of the product life cycle,:

A) most companies downsize.
B) the demand is the lowest.
C) competitors start exiting the industry.
D) more firms begin producing the product.
E) sales rapidly decline.

Question 57

A firm pursuing a(n) _____ strategy concentrates on a specific regional market, product line, or group of buyers.

A) overall cost leadership
B) divesting
C) restraint of trade
D) anti-competitive
E) focus

Question 58

During the decline stage of the product life cycle:

A) demand peaks.
B) new competitors enter the industry.
C) sales drop.
D) managers need to focus their efforts on "getting the product out the door" without sacrificing quality.
E) managers must increase production costs.

Question 59

In the maturity stage of the product life cycle,:

A) the demand is extremely high.
B) product sales rapidly increase.
C) compeition is at its peak.
D) managers need to focus their efforts on "getting the product out the door" without sacrificing quality.
E) the number of new firms producing the product begins to decline.

Question 60

Which of the following is most closely associated with an overall cost leadership strategy?

A) Manufacturing highly-customized products
B) Manufacturing products in bulk
C) Providing highly efficient customer service that is better than any other competitor
D) Selling products at high prices
E) Using expensive raw materials

Question 61

In a BCG matrix, _____ are businesses that have a large share of a market that is not expected to grow substantially.

A) stars
B) cash cows
C) entropies
D) question marks
E) dogs

Question 62

A(n) _____ is a single-use plan for a large set of activities. It might consist of identifying procedures for introducing a new product line, opening a new facility, or changing the organization's mission.

A) policy
B) entropy
C) regulation
D) project
E) program

Question 63

In a Boston Consulting Group (BCG) matrix, _____ are businesses that have only a small share of a quickly growing market.

A) stars
B) question marks
C) entropies
D) dogs
E) cash cows

Question 64

_____ techniques are methods that diversified organizations use to determine in which businesses to engage and how to manage these businesses to maximize corporate performance.

A) Divestiture
B) Portfolio management
C) Process gain
D) Deskilling
E) Entropy

Question 65

In the GE Business Screen portfolio management technique, businesses that have good competitive position in an attractive industry are known as:

A) losers.
B) winners.
C) profit producers.
D) question marks.
E) cash cows.

Question 66

In a BCG matrix, _____ are businesses that have a very small share of a market that is not expected to grow.

A) question marks
B) cows
C) stars
D) dogs
E) rate busters

Question 67

Which of the following statements is true about a tactical plan?

A) It is an organized sequence of steps designed to execute strategic plans.
B) It is exclusively developed by the board of directors.
C) It is more broad and nonspecific when compared to a strategic plan.
D) It is developed independently of the external business environment.
E) It does not specify time frames and resources.

Question 68

_____ planning refers to the determination of alternative courses of action to be taken if an intended plan is unexpectedly disrupted or rendered inappropriate.

A) Divestiture
B) Deskilling
C) Synergy
D) Contingency
E) Entropy

Question 69

In the context of the GE Business Screen, a determinant of an organization's competitive position is:

A) capital requirements.
B) market growth.
C) government policies.
D) market size.
E) product quality.

Question 70

Pursuing a strategy of _____ reduces an organization's dependence on any one of its business activities and thus reduces economic risk.

A) single-product
B) single-service
C) divestiture
D) related diversification
E) trade restraint

Question 71

In the context of the GE Business Screen, a determinant of industry attractiveness would be:

A) capital requirements.
B) product quality.
C) service network.
D) price competitiveness.
E) market share.

Question 72

In contrast to strategic plans, tactical plans must:

A) specify resources and time frames.
B) be developed independently of the internal business environment.
C) be developed independently of the external business environment.
D) be more general and broadly based.
E) focus on resources, environment, and mission.

Question 73

In the GE Business Screen matrix, which of the following is a determinant of industry attractiveness?

A) Market share
B) Market size
C) Product quality
D) Operating costs
E) Service network

Question 74

A _____ is the most general form of standing plan that specifies the organization's general response to a designated problem or situation.

A) project
B) standard operating procedure
C) policy
D) program
E) single-use plan

Question 75

In the GE Business Screen matrix, which of the following determines the competitive position of the company?

A) Market size
B) Market growth
C) Price competitiveness
D) Capital requirements
E) Competitive intensity

Question 76

In the context of the BCG matrix, _____ are businesses that have the largest share of a rapidly growing market.

A) question marks
B) stars
C) cows
D) dogs
E) entropies

Question 77

Which of the following is a determinant of an organization's competitive position in the context of the GE Business Screen?

A) Government policies
B) Market size
C) Technological know-how
D) Capital requirements
E) Market growth

Question 78

In the context of the GE Business Screen matrix, _____ is a determinant of the competitive position of a company.

A) intensity of competition
B) government policies
C) market size
D) market growth
E) market share

Question 79

The _____ is a portfolio management technique that considers industry attractiveness and competitive position rather than focusing solely on market growth and market share.

A) Black-Litterman model
B) modern portfolio theory
C) growth-share matrix
D) BCG matrix
E) GE Business Screen

Question 80

Firms that implement a strategy of _____ operate multiple businesses that are not logically associated with one another.

A) single-business unit
B) unrelated diversification
C) entropy
D) nondiversification
E) synergy