Question 1

In the top-down strategic planning approach, all strategic intelligence and decision-making responsibilities rest primarily on the

Accepted Answer

Top-down strategic planning is a rational, top-down process through which executives attempt to program future success. In this approach, all strategic intelligence and decision-making responsibilities are concentrated in the office of the CEO.

Question 2

Which of the following functions do the general managers in strategic business units primarily perform?

Accepted Answer

General managers in strategic business units must answer business strategy questions relating to how to compete in order to achieve superior performance. Within the guidelines received from corporate headquarters, they formulate an appropriate generic business strategy (cost-leadership, differentiation, or integration) in their quest for competitive advantage.

Question 3

Who among the following is responsible for making business strategies in a large conglomerate?

Accepted Answer

General managers in strategic business units (SBUs) must answer business strategy questions relating to how to compete in order to achieve superior performance.

Question 4

To implement specific business strategies, general managers of strategic business units rely on

Accepted Answer

To implement specific business strategies, regional and product leaders (general managers) rely on functional managers, who are responsible for a particular business function such as bottling, supply chain management, marketing, retail, or customer service.

Question 5

As a part of strategy formulation, a firm's functional strategy primarily concerns questions relating to

Accepted Answer

As a part of strategy formulation, functional strategy concerns the question of how to implement business strategy.

Question 6

Mercurial Foods is the parent company of several chain restaurants offering a variety of cuisines. The top management at Mercurial has decided to enter the frozen foods industry based on its assessment of the profit potential in that industry. Which of the following strategies does this best illustrate?

Accepted Answer

Corporate executives at headquarters formulate corporate strategy. They need to formulate a strategy that can create synergies across business units that may be quite different, and determine the boundaries of the firm by deciding whether to enter certain industries and markets and whether to sell certain divisions.

Question 7

Strategies developed at the departmental level, such as the accounting, human resources, production, and marketing departments, within a strategic business unit are referred to as ________ strategies.

Accepted Answer

Within each strategic business unit are various business functions: accounting, finance, human resources, product development, operations, manufacturing, marketing, and customer service. Each functional manager is responsible for decisions and actions within a single functional area.

Question 8

Ida has been tasked with formulating the business strategy for Contour Cosmetics' new line of lipsticks. Which of the following ideas would Ida be likely to include in her proposal?

Accepted Answer

Business strategy concerns the question of how to compete. Three generic business strategies are available: cost leadership, differentiation, or value innovation. By suggesting that Contour market its new products as the longest-lasting, Ida is pursuing a differentiation strategy.

Question 9

A traditional top-down strategic planning process typically begins with

Accepted Answer

In a traditional top-down strategic planning process, strategic planners first provide careful analyses of internal and external data and apply it to all quantifiable areas: prices, costs, margins, market demand, head count, and production runs. Based on a careful analysis of these data, top managers reconfirm or adjust the company's vision, mission, and values before formulating corporate, business, and functional strategies.

Question 10

Which of the following strategies best illustrates a generic business strategy?

Accepted Answer

A decision to niche market the jewelry sold by a company while the apparel division under the same company sells its products through mass marketing is an example of a generic business strategy. Business strategy occurs within strategic business units, or SBUs, the stand-alone divisions of a larger conglomerate, each with its own profit-and-loss responsibility. Within the guidelines received from corporate headquarters, they formulate an appropriate generic business strategy (cost-leadership, differentiation, or integration) in their quest for competitive advantage.

Question 11

In a large company, who is most responsible for devising the corporate strategy?

Accepted Answer

Corporate executives at headquarters formulate corporate strategy. Corporate executives need to decide in which industries, markets, and geographies their companies should compete.

Question 12

Blue Billion Inc. is a large company that sells a variety of products such as cosmetics, jewelry, frozen foods, navigation electronics, and airplanes. Apart from this, the company also has a strong presence in the service industry through its chain of dance studios, casinos, and nightclubs. Each of its product divisions operates as an individual business and is responsible for its own profits and losses. Thus, these product divisions under Blue Billion can be referred to as

Accepted Answer

These product divisions under Blue Billion can be referred to as strategic business units (SBUs). Business strategy occurs within strategic business units, the stand-alone divisions of a larger conglomerate, each with its own profit-and-loss responsibility. General managers in SBUs must answer business strategy questions relating to how to compete in order to achieve superior performance.

Question 13

The CEO of Chyron Media has decided to enter the markets of emerging nations like China and Brazil. This means that the books, magazines, and websites published under the Chyron Media banner would be made available in these nations. Which of the following strategies does this scenario best illustrate?

Accepted Answer

The given scenario of Chyron Media describes a corporate strategy. Corporate strategy concerns questions relating to where to compete (industry, markets, and geography). Corporate executives at headquarters formulate corporate strategy.

Question 14

What is the strategic management process?

Accepted Answer

The strategic management process is a method put in place by strategic leaders to formulate and implement a strategy.

Question 15

The former CEO of Sam's Club, a division with its own profit-and-loss responsibility, Rosalind Brewer, reported to Walmart's CEO, C. Douglas McMillon, who as corporate executive oversees Walmart's entire operations. Sam's Club, therefore, is a ________ of Walmart.

Accepted Answer

Strategic business units, or SBUs, are the stand-alone divisions of a larger conglomerate, each with its own profit-and-loss responsibility. Sam's Club is the SBU of Walmart.

Question 16

Which of the following statements is true of corporate strategy?

Accepted Answer

Corporate executives at headquarters formulate corporate strategy. They need to formulate a strategy that can create synergies across business units that may be quite different, and determine the boundaries of the firm by deciding whether to enter certain industries and markets and whether to sell certain divisions.

Question 17

The distribution department at Golden Grains Wheat Company has decided to adopt the FIFO (first in, first out) method of inventory to dispatch its bags of wheat. Which of the following strategies does this scenario best illustrate?

Accepted Answer

The distribution department of Golden Grains has decided to implement a functional strategy. Within each strategic business unit are various business functions: accounting, finance, human resources, product development, operations, manufacturing, marketing, and customer service. Each functional manager is responsible for decisions and actions within a single functional area.

Question 18

Which of the following is an assumption that top-down strategic planning rests on?

Accepted Answer

Top-down strategic planning rests on the assumption that the future can be predicted from the past. The approach works reasonably well when the environment does not change much.

Question 19

Due to political instability in the country of East Gerdon, the strategic leaders at the headquarters of Mako Manufacturing have decided to close all production facilities in the country until stability returns. Mako's managers have formulated a ________-level strategy.

Accepted Answer

Corporate executives at headquarters formulate corporate strategy. They need to formulate a strategy that can create synergies across business units that may be quite different, and determine the boundaries of the firm by deciding whether to enter certain industries and markets and whether to sell certain divisions.

Question 20

Pear Tree Electronics is a large conglomerate that operates in 17 different countries. The corporate executives at the headquarters have decided that the company's objective for the next two years will be to increase its customer equity, or the value of potential future revenues generated by all its customers in a lifetime. Based on this guideline received from the top management team, the product leader of the home audio division has decided to adopt a cost-leadership strategy in all his 17 units. Thus, the decision made by the product leader best illustrates a ________ strategy.

Accepted Answer

The given decision made by the product leader best illustrates a business strategy. General managers in strategic business units must answer business strategy questions relating to how to compete in order to achieve superior performance. Within the guidelines received from corporate headquarters, they formulate an appropriate generic business strategy (cost-leadership, differentiation, or integration) in their quest for competitive advantage.

Quiz 2: Strategic Leadership: Managing the Strategy Process

In the top-down strategic planning approach, all strategic intelligence and decision-making responsibilities rest primarily on the

Which of the following functions do the general managers in strategic business units primarily perform?

Who among the following is responsible for making business strategies in a large conglomerate?

To implement specific business strategies, general managers of strategic business units rely on

As a part of strategy formulation, a firm's functional strategy primarily concerns questions relating to

Strategies developed at the departmental level, such as the accounting, human resources, production, and marketing departments, within a strategic business unit are referred to as ________ strategies.

Ida has been tasked with formulating the business strategy for Contour Cosmetics' new line of lipsticks. Which of the following ideas would Ida be likely to include in her proposal?

A traditional top-down strategic planning process typically begins with

Which of the following strategies best illustrates a generic business strategy?

In a large company, who is most responsible for devising the corporate strategy?

What is the strategic management process?

The former CEO of Sam's Club, a division with its own profit-and-loss responsibility, Rosalind Brewer, reported to Walmart's CEO, C. Douglas McMillon, who as corporate executive oversees Walmart's entire operations. Sam's Club, therefore, is a ________ of Walmart.

Which of the following statements is true of corporate strategy?

The distribution department at Golden Grains Wheat Company has decided to adopt the FIFO (first in, first out) method of inventory to dispatch its bags of wheat. Which of the following strategies does this scenario best illustrate?

Which of the following is an assumption that top-down strategic planning rests on?

Due to political instability in the country of East Gerdon, the strategic leaders at the headquarters of Mako Manufacturing have decided to close all production facilities in the country until stability returns. Mako's managers have formulated a ________-level strategy.