Deck 8: The Manager As a Planner and a Strategist

Question 1

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

Answer 1

True
Explanation:A strategy is a cluster of related managerial decisions and actions to help an organization attain one of its goals.

Question 2

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

Answer 2

False
Explanation:The first step is determining the organization's mission and goals.

Question 3

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

Answer 3

True
Explanation:The second step in the planning process is formulating strategy. Managers analyze the organization's current situation and then conceive and develop the strategies necessary to attain the organization's mission and goals.

Question 4

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 5

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 6

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

Question 7

Programs and projects are examples of standing plans.

Question 8

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

Question 9

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

Question 10

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

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

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

Question 15

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 16

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

Question 17

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.

Question 18

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

Question 19

Scenario planning is also known as contingency planning.

Question 20

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

Question 21

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 22

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 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

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

Question 25

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 26

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

Question 27

It is impossible for an organization to have both low-cost and differentiated products.

Question 28

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

Question 29

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

Question 30

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

Question 31

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

Question 32

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

Question 33

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 34

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

Question 35

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

Question 36

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

Question 37

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

Question 38

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 39

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 40

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 41

_____ 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 42

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 43

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 44

_____ 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 45

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 46

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 47

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 48

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 49

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 50

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 51

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 52

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 53

Top management's decisions pertaining to the organization's mission, overall strategy, and structure constitute 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

The SUV division of a major automobile corporation decides to release a new model a month ahead of its stated release and notifies 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 55

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 56

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

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

Question 57

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 58

There has been a rapid increase in the percentage of the 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 set up an 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 59

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 60

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 61

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 62

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 63

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 essential 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 64

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 65

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

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

Question 66

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 67

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

Question 68

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 69

A firm has a formal, written guide regarding its zero-tolerance attitude toward 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 70

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 71

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

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

Question 72

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 cooperation between the organization's various divisions.

Question 73

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 74

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 75

A furniture company is trying to keep the costs of the company low by switching its suppliers and ordering materials in larger quantities 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 76

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

A) The company can probably take over 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 77

Which of the following can be defined as 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) There are a 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 78

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 79

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 80

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