Question 1

All of the following reflect criticisms of the SWOT analysis EXCEPT

Accepted Answer

The SWOT analysis has been criticized for its lack of weighted prioritization, limited depth in analysis, use of ambiguous language, and generation of lengthy lists. However, it is generally recognized as a valuable tool for generating insights and ideas towards strategy development and implementation. The one option that does not reflect a criticism of the SWOT analysis is C, as it suggests that the SWOT analysis provides a rational link to strategy implementation.

Question 2

A corporation's specific competitive role which is so well-suited to the firm's internal and external environment that other corporations are NOT likely to challenge or dislodge it.

Accepted Answer

A propitious niche refers to a specific segment within the market where a company has a unique competitive advantage and is likely to succeed due to its internal and external environment. Other companies are less likely to challenge or dislodge it because it is so well-suited to the firm's strengths and capabilities. This is different from a strategic fit, which refers to how well a company's strategy matches its external environment, and an implicit strategy, which is a company's unstated but understood approach to doing business. Common thread and business screen are not relevant to this concept.

Question 3

Those companies using cooperative strategies are generally not able to gain a competitive advantage.

Accepted Answer

Companies using cooperative strategies can gain a competitive advantage by collaborating with other companies to share resources, capabilities, and knowledge, which can lead to increased efficiency, reduced costs, and improved innovation.

Question 4

One skill required of the cost leadership strategy is a strong marketing ability.

Accepted Answer

While marketing is still important for any business, the cost leadership strategy focuses more on reducing production costs and offering products/services at a lower price than competitors. It is more about operational efficiency than marketing prowess.

Question 5

The particular capabilities and resources a firm possesses and the superior way in which they are used is called

Accepted Answer

The answer of The particular capabilities and resources a firm...

Question 6

The T in SWOT represents

Accepted Answer

The answer of The T in SWOT represents
...

Question 7

Tight cost control is an organizational requirement for a cost leadership strategy.

Accepted Answer

Cost leadership strategy focuses on keeping the costs of production low to offer products or services at a lower price than competitors. Hence, tight cost control is essential to achieve this objective.

Question 8

In the development of a SFAS matrix, the first step is to

Accepted Answer

The first step in the development of a SFAS matrix is to list the most important external (EFAS) and internal (IFAS) factors. This provides the foundation for the matrix, which is used to analyze and prioritize company strategies based on their impact on these factors. Once the EFAS/IFAS factors are identified, they can be rated and weighted to create the SFAS matrix. Therefore, options A, B, D, and E are incorrect as they refer to steps that come after the identification of EFAS/IFAS factors.

Question 9

A value chain partnership is a loose alliance with several distributors for the short term.

Accepted Answer

A value chain partnership is a long-term strategic alliance between different entities in the supply chain, such as suppliers, manufacturers, distributors, and retailers, to improve the efficiency and effectiveness of the entire value chain. It involves shared resources, skills, and knowledge to achieve common goals and objectives.

Question 10

The concept that advocates management's attempt to find a strategic fit between external opportunities and internal strengths while working around external threats and internal weaknesses is called

Accepted Answer

The concept described in the question is known as situation analysis. Situation analysis involves assessing both the external environment (opportunities and threats) and the internal environment (strengths and weaknesses) in order to find the best strategic fit for the organization. A, B, C, and D are not accurate descriptions of this concept.

Question 11

An acronym for the assessment of the external and internal environments of the business corporation in the process of strategy formulation/strategic planning is

Accepted Answer

SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. It is a tool used to analyze both the external (opportunities and threats) and internal (strengths and weaknesses) factors that affect a business. It helps in the process of strategy formulation and strategic planning by identifying areas where the company can excel and areas where improvements are needed. PET refers to a type of plastic, MBO stands for Management by Objectives, SBU stands for Strategic Business Unit, and ROI stands for Return on Investment, none of which relate to the assessment of the external and internal environments of a business corporation.

Question 12

Collusion is the active cooperation of firms within an industry to reduce output and raise prices in order to get around the normal economic law of supply and demand.

Accepted Answer

Collusion involves firms working together to manipulate market prices by restricting supply, which goes against the normal economic principles of supply and demand.

Question 13

The text authors note that the essence of strategy is

Accepted Answer

The answer of The text authors note that the essence...

Question 14

A licensing arrangement is an agreement in which the licensing firm grants rights to another firm in another country or market to produce and/or sell a product.

Accepted Answer

A licensing arrangement involves granting rights to another firm in another country or market to produce and/or sell a product.

Question 15

Too much partnering experience with the same strategic partners generates diminishing returns over time and leads to reduced performance.

Accepted Answer

Over time, partnering with the same strategic partners can lead to over-reliance, complacency, and a lack of innovation, causing reduced performance and diminishing returns. It is important to periodically review and assess partnerships, as well as pursue new strategic partnerships to stay competitive and drive growth.

Question 16

In tacit collusion, there is no direct communication among competing firms.

Accepted Answer

In tacit collusion, firms coordinate their actions without explicit communication or agreements. They may do this through observing each other's behavior, following industry norms, or through other implicit signaling mechanisms.

Question 17

Alliances take more financial resources and involve more risk than do acquisitions and going it alone.

Accepted Answer

The answer of Alliances take more financial resources and involve...

Question 18

One success factor to a strategic alliance is the ability to identify likely partnering risks and deal with them when the alliance is formed.

Accepted Answer

Identifying and addressing potential risks is critical to the success of a strategic alliance. By understanding and planning for potential risks, partners can work together to mitigate those risks and ensure the alliance remains successful.

Question 19

The two general types of cooperative strategies are collusion and strategic alliances.

Accepted Answer

Collusion involves firms working together to reduce competition and increase profits, often through illegal means. Strategic alliances, on the other hand, involve firms collaborating in a mutually beneficial way while still competing in other areas.

Question 20

The only way to gain competitive advantage within an industry is to use a competitive strategy.

Accepted Answer

While using a competitive strategy can certainly help a company gain a competitive advantage, there are other ways to differentiate oneself within an industry, such as through unique products or services, superior customer service, or innovative marketing techniques.

Quiz 6: Strategy Formulation: Situation Analysis and Business Strategy