Deck 4: Introduction to Strategy

Question 1

 Z-coffiz charges much higher prices for a cup of coffee than its competitors. Z-coffiz is able to do this because it positions itself to be selling an experience, rather than merely a cup of coffee. Which aspect of a firm's strategy does this describe?

A) External fit
B) Internal fit
C) Differentiation
D) Implementable

Answer 1

C

Question 2

 "Within five years, we will be the top-rated boat tour company in Central Florida, doubling the size of our fleet and achieving 100% seating capacity with every excursion." This is an example of

A) strategy.
B) mission.
C) vision.
D) tactic.

Answer 2

C

Question 3

 Identify a benefit provided by an effective mission statement.

A) It outlines the history of the organization.
B) It communicates the firm's rules and regulations.
C) It states the different levels of authority within the firm.
D) It defines a firm's reason for existence.

Answer 3

D

Question 4

 According to Milton Friedman, the primary goal of a business is to

A) satisfy customers.
B) expand globally.
C) make profits.
D) provide employment.

Question 5

 According to the Roman military strategists, strategy was considered as

A) the manager's "game plan" to attain personal gain.
B) represented by the specific moves or actions their armies performed.
C) a plan of action designed to achieve a specific goal.
D) a plan not usually aimed at creating a military advantage.

Question 6

 "To make bikes that allow riders of all ages and abilities to experience the joy of riding" is an example of

A) strategy.
B) mission.
C) vision.
D) tactic.

Question 7

 TechPark, a manufacturing company, was in the process of formulating a strategy in an attempt to improve the firm's competitive advantage. The managers began by evaluating the resources available within the organization to better understand how the firm should compete. Eventually, they decided to offer their products at a lower cost compared to that of their competitors. Identify the strategy used by the managers of TechPark.

A) Corporate-level strategy
B) Transnational strategy
C) Business-level strategy
D) Global strategy

Question 8

 According to military leaders, tactics differed from strategy in that

A) tactics were usually aimed at creating a military advantage.
B) tactics represented the specific moves their armies would perform on the battlefield.
C) tactics represented the grand plan for the war.
D) tactics referred to an individual leader's ability to marshal a large set of resources.

Question 9

 Foodies, a food manufacturing company, made plans to either open a new outlet in Berylia, a country where the majority are low-income families, or Erbia, a country where the majority of the people belong to high-income families. It finally decides to open a new outlet in Berylia by offering products with reduced cost as the demand for its product is greater in Berylia. This scenario is an example of _____ in defining a strategy.

A) making trade-offs
B) creating fit among activities
C) choosing a set of activities
D) developing objectives

Question 10

 Which of the following statements best describes a business-level strategy?

A) The determination of how a company will compete in a given business and position itself among its competitors
B) The way a company seeks to create value through the configuration and coordination of multimarket business activities
C) The process of identifying how a firm can best align its resources in a business to carve out a defensible position in the marketplace
D) The way a strategy is formed with a focus on developing global efficiency instead of catering to local tastes

Question 11

 The transnational strategy focuses on

A) efficiency, local responsiveness, and organizational learning.
B) how a company will compete in a given business.
C) being responsive and sensitive to local needs and tastes.
D) providing a standardized product to all markets.

Question 12

 Scott determines that his firm's strategy leverages its key resources. Which of the following criteria for evaluating the quality of a firm's strategy is Scott assessing?

A) External fit
B) Internal fit
C) Differentiation
D) Implementable

Question 13

 Which of the following questions is most important to the development of a firm's strategy?

A) What is the purpose of the business?
B) How will environmental forces impact the firm's business?
C) What stakeholders are important?
D) How will the firm distinguish itself from its competitors?

Question 14

 Which of the following statements is true about strategy formulation?

A) The strategy development process typically flows in a linear fashion.
B) Managers should engage in environmental scanning on an ongoing basis.
C) All aspects of a firm's strategy are more susceptible to frequent changes.
D) The formulation of strategy is the last step toward achieving profitability.

Question 15

 Which of the following statements best describes the vision of an organization?

A) The activities a firm performs for its customers
B) An illustration of how a firm can align its resources to get a position in the marketplace
C) A concept that defines a firm's reason for existence
D) A concept or picture of what a firm wants to achieve 

Question 16

 The first step to create competitive advantage through a strategy is to

A) generate better information than the rivals.
B) make choices based on the available information.
C) convert strategic choices into decisive actions.
D) analyze the information that is available.

Question 17

 In the formulation of strategy, managers must create a solid fit among the activities to

A) make a competitive strategy that is different from others.
B) offer a service that cannot be easily copied by competitors.
C) decide what the company will not be doing.
D) operate more effectively than its competitors.

Question 18

 Strategies that combine elements of multinational and global strategies by using foreign subsidiaries to produce and distribute products are known as

A) business-level strategies.
B) international strategies.
C) corporate-level strategies.
D) transnational strategies.

Question 19

 The process of identifying how a firm can best align its resources to carve out a defensible position in the marketplace is known as

A) scenario building.
B) strategy formulation.
C) contingency planning.
D) stakeholder mapping.

Question 20

 Which of the following refers to a network of unique activities that strategically fit together and are difficult to replicate?

A) Conglomeration
B) Core competencies
C) Virtue ethics
D) Global strategies

Question 21

 Define vision, mission, and objectives. What are the benefits provided by effective mission statements?

Question 22

 Green Health Supplements, Inc. (GHS) produces all of its products in the United States. It is trying to expand globally by shipping its products to foreign distributors. GHS has which of the following market entry strategies?

A) Exporting
B) Licensing and franchising
C) Joint venture
D) Wholly owned subsidiaries

Question 23

 For a fee, Green Health Supplements, Inc. (GHS) allowed another company in Britain to use its formula for a men's tonic. In this case, GHS is using which of the following market entry strategies?

A) Exporting
B) Licensing and franchising
C) Joint venture
D) Wholly owned subsidiaries

Question 24

 Two low-cost methods that firms entering foreign markets can use are licensing and franchising agreements.

Question 25

 Briefly describe the use of strategy by the Roman military leaders.

Question 26

 In B&T Company, all product development occurs within the United States, but the company has manufacturing and distribution facilities in several countries. B&T has a(n)

A) multinational strategy.
B) global strategy.
C) international strategy.
D) transnational strategy.

Question 27

 Objectives provide a series of quantifiable milestones or benchmarks by which a firm can assess its progress.

Question 28

 The transnational strategy is a cross between global and multinational strategies.

Question 29

 What are the three elements a manager should consider when developing a strategy?

Question 30

 Corporate-level strategy entails "how a company will compete in a given business and position itself among its competitors."

Question 31

 Which of the following statements is true about licensing and franchising?

A) They involve setting up a fully operational, independent entity in a foreign country to conduct business.
B) Unlike franchising, licensing is used by service firms such as hotels and fast-food chains.
C) Like franchising, licensing is a high-cost means of market entry.
D) The most important risk involved with licensing is the potential loss of proprietary advantage.

Question 32

 In developing a strategy, a manager must realize that competitive strategy is primarily about operational efficiency.

Question 33

 In considering a strategy for a firm, its leaders must decide on how they seek to position the firm within the marketplace.

Question 34

 Z-Technologies, a manufacturing company in Berylia, is a global organization. The company owns a manufacturing unit in Erbia and another one in Rhodia, where there is high demand for its products. Though it is an expensive and risky proposition, the parent company has full control of the manufacturing units in the foreign countries. Which of the following market entry strategies has been used by Z-Technologies?

A) Licensing and franchising
B) Joint venture and alliances
C) Wholly-owned subsidiaries
D) Exporting

Question 35

 According to Tzu, the process of gathering information was an integral component of developing strategy.

Question 36

 Describe the business-level strategy.

Question 37

 In Greece, McDonald's introduced the "Greek Mac" using pita bread and yogurt sauce. This is an example of a(n)

A) multinational strategy.
B) global strategy.
C) international strategy.
D) transnational strategy.

Question 38

 For a firm's strategy to be effective and defensible, a manager must create fit and alignment among its chosen activities.

Question 39

 XYZ Company sells the same standard product in all nations throughout the world. This is an example of a(n)

A) multinational strategy.
B) global strategy.
C) international strategy.
D) transnational strategy.

Question 40

 Outline the features of exporting.