Deck 9: Strategic Management

Question 1

Strategic management is important because it helps coordinate the activities in complex organisations.

Answer 1

True

Question 2

The ________ is a six-step process that encompasses strategic planning, implementation and evaluation.

A)business strategy continuum
B)SBU analysis
C)strategic management process
D)competitive strategies framework
E)total quality management process

Answer 2

C

Question 3

Strategies include plans for how the organisation will attract and satisfy customers in order to achieve goals.

Answer 3

True

Question 4

Strategic management does not occur in the public sector due to its dependence on tax dollars.

Question 5

The first step in the strategic management process is analysing the external environment.

Question 6

A successful strategy will be one that tells managers how to succeed in spite of an organisation's environment.

Question 7

In the strategic management process, the ________ defines the organisational purpose and answers the question: 'What is our reason for being in business?'.

A)objective
B)evaluation
C)strategy
D)mission
E)values statement

Question 8

SWOT analysis focuses on an analysis of an organisation's environmental opportunities and threats.

Question 9

Strategic management uses the management function(s)________.

A)planning and leading
B)organising
C)controlling
D)both A and B
E)all of the above

Question 10

Which of the following is NOT an example of an organisation's mission?

A)We believe our first responsibility is to doctors, nurses and patients, to mothers, and all others who use our products and services (Johnson & Johnson).
B)AMAX's principal products are molybdenum, coal, iron ore, copper, lead, zinc, petroleum and natural gas, potash, phosphates, nickel, tungsten, silver, gold and magnesium.
C)We at Xeren want to increase market share by 10 per cent during the next fiscal year.
D)We are dedicated to the total success of Corning Glass Works as a worldwide competitor.
E)Hoover Universal is a diversified, multi-industry corporation with strong manufacturing capabilities, entrepreneurial policies and individual business unit autonomy.

Question 11

In a short essay, describe three reasons for the importance of strategic management.

Question 12

Activities that an organisation does well or resources that it has available are called assets.

Question 13

A strong culture is easier to change than a weak culture.

Question 14

Evaluating employee skill level at each position is part of analysing the organisation's resources in the strategic management process.

Question 15

Which of the following is an accurate statement concerning strategic management?

A)It is effective in both the private and not-for-profit organisations.
B)It does not lead to better organisational performance.
C)It has been around for more than 40 years.
D)It grew out of the Western Electric studies.
E)It was first developed by Peter Drucker.

Question 16

The final step in the strategic management process is implementing the objectives.

Question 17

Which of the following is a reason that strategic management is important?

A)Stockholders demand long-term planning of profits from a stable economic market.
B)Management realised the only way to beat competitors in a static environment is to develop long-term planning.
C)The 1950s and 1960s left a powerful economic machine that needed strategic control.
D)Organisations that use strategic management do have higher levels of performance.
E)The liberal political policies of the early 1970s forced companies to incur tax increases.

Question 18

The strategic management process is divided into which of the following sections?

A)planning, implementation and evaluation
B)problem identification, planning and implementation
C)implementation, evaluation and restructuring
D)mission statement, environmental evaluation and specific goals
E)mission statement, environmental scoping and evaluation

Question 19

In the strategic management process, Snowy Hydro statement that it intends: 'To deliver superior financial returns by being the preferred flexible supplier of energy and related products' is an example of what aspect?

A)statement of objectives
B)mission
C)fundamental objective
D)goals
E)strategy

Question 20

Within an industry, an environment can present opportunities to one organisation and pose threats to another.

Question 21

One method of implementing a growth strategy is by increasing production capacity.

Question 22

Which of the following is one of the drawbacks to a strong organisational culture that a manager should consider when completing the strategic management process?

A)It can be more difficult to change.
B)Employees have less understanding of the planning process.
C)Employee attitudes tend to be strong but their organisational values are weak.
D)It cancels out any organisational distinctive competence.
E)It makes new strategies too easy and simplistic.

Question 23

What is the step in the strategic management process that follows analysing the organisation's resources?

A)mission statement
B)implementing strategies
C)identifying opportunities and threats
D)analysing the external environment
E)formulating strategies

Question 24

Which of the following in the strategic management process is part of the step 'analysing the organisation's resources'?

A)identifying opportunities and threats
B)formulating strategy
C)mission statement
D)implementing strategy
E)identifying strengths and weaknesses

Question 25

________ are positive external factors; ________ are negative.

A)Strengths; weaknesses
B)Opportunities; threats
C)Competencies; competitors
D)Strategies; objectives
E)SWOTs; SBUs

Question 26

In the strategic management process, what step comes prior to evaluating results?

A)identifying strengths and weaknesses
B)formulating strategies
C)identifying opportunities and threats
D)implementing strategies
E)analysing the organisation's resources

Question 27

Which of the following is NOT part of the organisation's external environment?

A)what the competition is doing
B)pending legislation that might affect the organisation
C)consumer trends
D)employees' education level
E)labour supply

Question 28

What is the final step in the strategic management process?

A)mission statement
B)identifying opportunities and threats
C)implementing strategies
D)analysing the organisation's resources
E)evaluating results

Question 29

A stability strategy is developed when management decides it will remain profitable by maintaining the status quo in a rapidly changing external environment.

Question 30

In a short essay, list and discuss the six steps in the strategic management process.

Question 31

Relative to an organisation's culture, managers must be aware that ________.

A)strong and weak cultures have different effects on the strategy
B)the content of a culture has a major effect on the strategies that can be pursued
C)the content of a culture has a minor effect on the strategies that can be pursued
D)unimportant factors can support escalation of commitment to strategies
E)both A and B

Question 32

________ are the organisation's major value-creating skills, capabilities and resources that determine the organisation's competitive advantage.

A)Core competencies
B)Opportunities
C)Cash cows
D)Stars
E)Strengths

Question 33

In the strategic management process, step 4 (formulating strategies)requires that strategies be established for the ________.

A)corporate level
B)business level
C)functional level
D)corporate and business levels
E)corporate, business and functional levels

Question 34

What step in the strategic management process follows analysing the external environment?

A)identifying opportunities and threats
B)mission statement
C)evaluation
D)identifying internal strengths and weaknesses
E)formulating strategies

Question 35

An example of a core competence of a firm is ________.

A)an ability to serve the needs of a particular target market on a large scale
B)communicating with customers in their own languages worldwide
C)developing break-even point analysis in reviewing product contribution
D)both A and B
E)all the above

Question 36

A trucking company that grows by purchasing a chain of service stations is engaged in horizontal integration.

Question 37

The ________ is an important constraint on a manager's actions.

A)internal environment
B)organisation's industry
C)manager's entrepreneurial talent
D)organisation's history
E)external environment

Question 38

Corporate-level strategies are developed for organisations that run more than one type of business.

Question 39

What step in the strategic management process follows the mission statement?

A)identifying opportunities and threats
B)analysing the internal environment
C)analysing the external environment
D)identifying strengths and weaknesses
E)evaluating the process

Question 40

If a bank estimates the capabilities of its training and development department employees prior to implementing a new training program designed to change their method of providing customer service, it is completing what step in the strategic management process?

A)identifying opportunities and threats
B)identifying strengths and weaknesses
C)analysing the organisation's resources
D)threat analysis
E)formulating strategy

Question 41

According to the textbook, which of the following managers typically are responsible for the competitive strategies?

A)supervisors
B)lower-level managers
C)middle-level managers
D)top-level managers
E)outside consultants

Question 42

As mentioned in your textbook, the Bakers Delight bread and pastry shops engages in what type of growth strategy?

A)merger
B)acquisition
C)vertical integration
D)horizontal integration
E)concentration

Question 43

Lower-level managers in an organisation are typically responsible for which of the following types of strategies?

A)functional-level strategies
B)business-level strategies
C)corporate-level strategies
D)mergers and acquisitions
E)unique competitive advantage

Question 44

Which of the following describes a company growing by combining with other organisations in the same industry?

A)forward vertical integration
B)backward vertical integration
C)horizontal integration
D)related diversification
E)unrelated diversification

Question 45

Which of the following are the two approaches that help answer the corporate-level question, 'What business(es)do we want to be in?'

A)general and specific strategies
B)systems strategies and general inquiry
C)corporate portfolio matrix and corporate-level strategies
D)general strategies and corporate portfolio matrix
E)corporate-level strategies and general strategies

Question 46

The corporate-level strategy termed a stability strategy is characterised by a(n)________ of significant change.

A)slight increase
B)moderate increase
C)absence
D)slight decrease
E)moderate decrease

Question 47

When Wesfarmers seeks to integrate the strategies of Bunnings stores, supermarkets and various insurance businesses, it is developing what level of business strategy?

A)functional
B)system
C)management
D)business
E)corporate

Question 48

In ________, the organisation attempts to gain control of its inputs by becoming its own supplier.

A)forward vertical integration
B)backward vertical integration
C)horizontal integration
D)related diversification
E)unrelated diversification

Question 49

An organisation that is diversifying its product line is exhibiting what type of grand strategy?

A)stability
B)retrenchment
C)growth
D)maintenance
E)division

Question 50

Which of the following is one level of strategic planning in large companies?

A)management level
B)financial level
C)staff level
D)corporate level
E)systems level

Question 51

A trucking company that grows by purchasing a chain of service stations is engaged in what type of growth?

A)merger
B)acquisition
C)vertical integration
D)horizontal integration
E)concentration

Question 52

If the food service company Jollibee Foods Corporation (JFC)acquires the fast-food restaurant QuickSoup, this would be an example of what kind of grand growth strategy?

A)related diversification
B)acquisition
C)expansion
D)vertical integration
E)retrenchment

Question 53

According to the textbook, ________ is when a company grows by merging with or acquiring firms in different, but related, industries.

A)forward vertical integration
B)backward vertical integration
C)horizontal integration
D)related diversification
E)unrelated diversification

Question 54

________ strategy is a corporate-level strategy that seeks to increase the level of the organisation's operations.

A)Retrenchment
B)Stability
C)Production
D)Growth
E)Unrelated diversification

Question 55

Which of the following is associated with corporate-level strategies?

A)They are needed if your organisation is in more than one type of business.
B)They answer, 'How should our business compete?'
C)They represent a single business.
D)They are a method of support for the business-level strategies.
E)They determine the operations of a single business unit.

Question 56

If McDonald's were to buy out KFC, McDonald's would be growing by vertical consolidation.

Question 57

According to the textbook, ________ determines the direction that the organisation is going and the roles that each business unit in the organisation will play in pursuing that direction.

A)functional-level strategy
B)business-level strategy
C)corporate-level strategy
D)management by objectives
E)the BCG matrix

Question 58

When should management pursue a stability strategy?

A)Organisational performance is slipping.
B)The environment is changing.
C)The organisation's performance is satisfactory and the environment is stable.
D)The firm has valuable strengths.
E)There are abundant environmental opportunities.

Question 59

Examples of a corporate-level stability strategy include all of the following EXCEPT ________.

A)continuing to serve the same clients by offering the same product or service
B)maintaining market share
C)sustaining the organisation's return-on-investment results
D)implementing vertical or horizontal integration
E)avoiding changes in focus of products and services

Question 60

Direct expansion and diversification are examples of a corporate retrenchment strategy.

Question 61

In the Boston Consulting Group (BCG)matrix, a business unit that exists in a high anticipated growth rate and a low market share is known as a ________.

A)cash cow
B)star
C)dog
D)question mark
E)exclamation point

Question 62

Which of the following businesses, according to the Boston Consulting Group matrix, are in a fast-growing market and hold a dominant share of that market?

A)cash cows
B)stars
C)question marks
D)dogs
E)elephants

Question 63

A competitive strategy is defined as a strategy for how an organisation's business units will compete against each other.

Question 64

When a university cuts back on the number of courses they offer students, what type of renewal strategy is it employing?

A)retrenchment
B)acquisition
C)turnaround
D)stability
E)either A or C

Question 65

Strategic business units depend on each other to formulate their strategy.

Question 66

Which of the four business groups in the corporate portfolio mix is characterised by having speculative products that entail high risks?

A)cash cows
B)stars
C)question marks
D)dogs
E)elephants

Question 67

The BCG (Boston Consulting Group)Matrix evaluates SBUs to identify which SBUs offer high potential and which drain organisational resources.

Question 68

The business group that is characterised by having low growth but high market share is known as a cash cow.

Question 69

Dogs, one of the four business groups in the corporate portfolio mix, are characterised by low growth and low market share.

Question 70

A(n)________ strategy is a short-run corporate-level strategy designed to address minor performance problems.

A)retrenchment
B)acquisition
C)growth
D)stability
E)expansion

Question 71

According to the Boston Consulting Group (BCG)matrix, which businesses generate large amounts of cash, but their prospects for future growth are limited?

A)question marks
B)dogs
C)cash cows
D)stars
E)elephants

Question 72

Which of the four business groups in the BCG corporate portfolio matrix has low growth and high market share?

A)question marks
B)dogs
C)cash cows
D)stars
E)elephants

Question 73

The SBU (strategic business unit)concept separates business units for purposes of developing strategy.

Question 74

Competitive advantage is what sets an organisation apart.

Question 75

The following business categories are all included in the corporate portfolio BCG matrix EXCEPT ________.

A)cash cow
B)dog
C)star
D)question mark
E)white elephant

Question 76

According to the corporate portfolio matrix, the horizontal axis represents ________ and the vertical axis indicates ________.

A)market share; anticipated market growth
B)growth; profits
C)total firm profits; number of firms
D)current stock price; market share
E)desired growth; actual growth

Question 77

Which of the four business groups in the BCG corporate portfolio matrix has high growth and high market share?

A)cash cows
B)stars
C)question marks
D)dogs
E)elephants

Question 78

According to the Boston Consulting Group matrix, question marks are businesses that generate large amounts of cash, but their prospects for future growth are limited.

Question 79

In a short essay, discuss the Boston Consulting Group (BCG)matrix and explain its usefulness in segmenting businesses.Include a discussion of the characteristics for each of the four categories based on the BCG matrix.

Question 80

Dogs, one of the four business groups in the BCG corporate portfolio mix, are characterised by which of the following features?

A)low growth, high market share
B)high growth, low market share
C)low growth, low market share
D)high growth, high market share
E)moderate growth, moderate market share