Question 1

What is the assessment of the external environment? What are the critical issues facing the business? Can the business execute the strategy? According to Bossidy and Charan, these are some of the questions that should be addressed in a _____.

Accepted Answer

The questions mentioned in the prompt are related to the assessment of external environment and strategy execution. Therefore, it is most appropriate to address these questions in a strong strategic plan. Options A, B, and C are important documents but they do not specifically address the questions mentioned in the prompt. A mission statement generally outlines the purpose of the organization, while a code of ethics and a diversity agenda focus on values and ethical guidelines to be followed in the organization.

Question 2

Sales this year at Donna's Pawn Shop have been high, and based on several factors, Donna projects next year's sales to also be good. However, even with her forecast of continued strong sales, Donna and her partner need to develop a plan in case sales drop unexpectedly. This type of planning for alternative future conditions is known as ____.

Accepted Answer

Contingency planning involves preparing for unexpected future events or changes in circumstances. In this case, Donna is preparing for a potential drop in sales despite her projections for continued success. The other options, including background planning, trend analysis, vision plan, and managerial pact, do not specifically involve preparing for future contingencies.

Question 3

The BCG matrix is a means of evaluating strategic business units on the basis of their _____.

Accepted Answer

The BCG matrix evaluates strategic business units based on their growth rate and market share. It categorizes them into four categories: stars, cash cows, question marks (or problem children), and dogs. Stars have a high market share and high growth rate, cash cows have a high market share and low growth rate, question marks have a low market share and high growth rate, and dogs have a low market share and low growth rate. This analysis helps companies determine which of their business units are worth investing in and which may need to be divested.

Question 4

In the BCG matrix, companies that have high growth and high market share, and are definite keepers are ____.

Accepted Answer

Stars are companies that have high growth and high market share, and they are considered to be definite keepers. The BCG matrix categorizes companies into four different categories based on their market growth rate and market share, namely stars, cash cows, dogs, and question marks/sometimes referred to as problem childs. Therefore, the answer is choice letter B.

Question 5

A company's overall ability to execute is a function of effectively executing according to three processes, but Bossidy and Charan proposed that the _____ process is the most important.

Accepted Answer

A company's overall ability to execute is a function of effectively executing according to three processes: people,strategy,and operations.Because all work ultimately entails some human interaction,effort,or involvement,Bossidy and Charan stated that the people process is the most important.

Question 6

When an organization operates several businesses to spread the risk, such as a landscaping company that offers not only landscaping services but also lawn care, snow removal, and other services, that business is utilizing a ____ strategy.

Accepted Answer

Diversification is defined as the strategy of operating multiple businesses in order to spread the risk. This is exactly the scenario described in the question where a landscaping company offers multiple services to diversify their offerings and decrease their dependence on a single service. The other answer choices are not accurate in describing this strategy.

Question 7

Successful controlling within an organization, according to Bossidy and Charan, demands that managers build a foundation of controlling using the three core processes of _____.

Accepted Answer

Bossidy and Charan identify the three core processes of successful controlling within an organization as people, strategy, and operations.

Question 8

ABC Technology makes and sells only one product, a high-quality processor for mainframe computers, within its market, Silicon Valley, California; ABC utilizes a _____ strategy.

Accepted Answer

ABC Technology utilizes a single-product strategy by only making and selling one product, which is a high-quality processor for mainframe computers.

Question 9

When organizations endeavor to keep their costs, and hence prices, of their products or services below those of competitors and to target a wide market this is a _____ strategy.

Accepted Answer

The described strategy is known as cost-leadership, where the focus is on reducing costs to offer products or services at lower prices than competitors and target a wide market. Option A (focused-differentiation) implies targeting a specific niche market with unique and differentiated products or services. Option B (differentiation) implies offering unique and high-quality products or services to justify higher prices. Option D (reinventing) is not a recognized strategy in the context of business strategy. Option E (cost-focus) is similar to cost-leadership, but with a narrower focus on a specific niche market.

Question 10

Mountain Rescue Incorporated sells emergency safety and rescue products to ski patrols and rescue workers at prices that are below those of its competitors, who offer a larger line of products and focus on broader markets. Mountain Rescue Incorporated is pursuing a ____ strategy.

Accepted Answer

The cost-focus strategy is to keep the costs,and hence prices,of a product or service below those of competitors and to target a narrow market.

Question 11

Porter's competitive strategies of cost-leadership and differentiation focus on ____ markets, and the cost-focus and focused-differentiation strategies focus on ____ markets.

Accepted Answer

Porter's four competitive strategies (also called four generic strategies)are (1)cost leadership (wide markets), (2)differentiation (wide markets), (3)cost-focus (narrow markets),and (4)focused-differentiation (narrow markets).(See Figure 6.3. )

Question 12

ABC Office Supply in Dayton sells high-quality, unique pens that are a real value to executives in the area. No other company in its area markets pens of such quality and value. By offering this type of product, ABC Office Supply is an example of a company utilizing a _____ strategy.

Accepted Answer

ABC Office Supply is using a focused-differentiation strategy, as they are targeting a specific market segment (executives in the area) and offering a unique, high-quality product that is not available from competitors in the same area.

Question 13

Organic Market sells high-quality products and grocery items that are unique to their area; in addition it offers delivery for customers who are unable to leave their home and a number of regular workshops regarding eating healthy. By offering these types of products and services, Organic Market is pursuing a _____ strategy.

Accepted Answer

The description of Organic Market selling high-quality and unique products, offering delivery, and hosting healthy eating workshops indicates a differentiation strategy, which emphasizes creating a unique and valuable product or service for customers.

Question 14

Doug is the CEO of Johnson Motors, a business consisting of Chevrolet, Buick, Cadillac, and Mercedes-Benz dealerships. He also sells Fleetwood and American Coach RVs. Doug mentioned to his sales manager that "there is economic value in having many related businesses managed by one ownership group. They are worth more than if they are separate companies." This is an example of ____.

Accepted Answer

The statement made by Doug is referring to the concept of synergy, where the combined value of the businesses is greater than the sum of their individual values. This is because the businesses can share resources, reduce costs, and increase efficiency when managed together as a group.

Question 15

The process by which a company compares its performance with that of high-performing organizations is known as ___.

Accepted Answer

The process of comparing a company's performance with high-performing organizations is known as benchmarking. Benchmarking enables companies to learn from the best practices of other companies and improve their own processes and operations.

Question 16

More important than profit growth, stimulating innovation, customer loyalty, and finding qualified employees, global CEOs desire ____.

Accepted Answer

How important is execution to organizational success in today's global economy? A survey of 769 global CEOs from 40 countries revealed that "excellence in execution" was their most important concern,more important than "profit growth," "customer loyalty," "stimulating innovation," and "finding qualified employees."

Question 17

Quality Services is an organization that operates several companies that market food products, restaurant equipment, and paper and plastic products, and it even has a division that counsels restaurant owners, helping them become established. Quality Services is involved in a _____ strategy.

Accepted Answer

Quality Services is involved in more than one industry, namely food products, restaurant equipment, and paper and plastic products, as well as offering counseling services. This indicates a diversification strategy.

Question 18

Tom and his family have developed a successful business selling fertilizer to other farmers in his area, consisting of rich, organic compost material. Recently ABC Seed, a national seed company, has been marketing a chemical fertilizer to his customers that is less expensive than Tom's product. ABC's efforts are an example of ___ in Porter's model for industry analysis.

Accepted Answer

ABC Seed's marketing of a less expensive chemical fertilizer is a substitute product, which is a factor in Porter's model for industry analysis under the threats of substitute products and services category.

Question 19

Michael Porter proposed that business-level strategies originate with the primary competitive forces in the firm's environment; these forces are _____.

Accepted Answer

Porter's Five Forces model includes the following primary competitive forces: threats of new entrants, substitute products or services, bargaining power of suppliers and buyers, and competitive rivalries. Therefore, option C is the correct one as it includes all of these primary competitive forces. Option A only includes three out of five forces, option B includes only two, and option D is not relevant. Option E only mentions one force.

Question 20

In the BCG matrix, organizations that have slow growth but high market share, and income from them often finances stars and question marks, are ____.

Accepted Answer

The description given in the question aligns with the characteristics of Cash Cows in the BCG matrix. Cash Cows refer to the products or services that have a high market share in a low-growth market. They typically generate a steady and significant cash flow for the organization which can be used to finance other products in the portfolio. Dogs have low market share and low growth, while Sleeping Giants and Sleepers are not categories in the BCG matrix. Turtles may refer to slow-moving products, but it is not a recognized category in the matrix.

Quiz 6: Strategic Management: How Exceptional Managers Realize a Grand Design