Deck 5: Foundations of Planning

Question 1

Informal plans are not recognized as true organizational plans and are rarely carried out by managers.

Answer 1

False

Question 2

Studies of planning show that the key to successful planning is to make sure that the plans ________.

A)cover every possible detail
B)are high in quality and insight
C)are exceedingly simple to follow
D)are not shared with employees

Answer 2

B

Question 3

Organizations that don't formally plan may be more likely to have ________.

A)corrupt managers
B)legal problems
C)multiple departments performing the same task
D)a single department carrying out all company functions

Answer 3

C

Question 4

Formal planning typically leads to which of the following?

A)higher profits
B)lower productivity
C)higher sales, but lower profits
D)tension between different management levels

Question 5

In formal planning, ________.

A)specific goals covering a period of years are defined
B)to maximize flexibility, specific goals are never spelled out
C)very broad general goals are developed
D)goals may be written or unwritten

Question 6

Informal planning is ________.

A)always performed at the lowest organizational level
B)general and usually lacks continuity
C)performed exclusively by middle managers
D)more specific than formal planning

Question 7

Managers who fail to plan may ________.

A)take advantage of change
B)stimulate change
C)be positively affected by change
D)be adversely affected by change

Question 8

Failing to discard successful plans from the past is likely to lead to ________.

A)more success because conditions are unlikely to change in the future
B)failure because conditions are likely to change in the future
C)success because of the high quality of the plans
D)failure because of the low quality of the plans

Question 9

One criticism of formal planning is that it focuses on how to beat the competition rather than how to ________.

A)have cordial relationships with the competition
B)focus on new opportunities
C)balance the organization's budget
D)cooperate with the competition

Question 10

Which of the following is NOT a reason for managers to plan?

A)to give direction to an organization
B)to deal with change
C)to establish goals
D)to establish responsibility for mistakes

Question 11

In studies in which formal planning did not lead to higher performance, ________ usually the culprit.

A)unforeseen events in the environment were
B)demanding employees were
C)stubborn ownership was
D)lack of communication was

Question 12

Studies of performance in organizations that plan have reached ________ with respect to the benefits of formal planning.

A)somewhat negative conclusions
B)no conclusion
C)extremely negative conclusions
D)generally positive conclusions

Question 13

Planning gives organizations a way to deal with change that ________.

A)eliminates all uncertainty
B)reduces uncertainty
C)reduces certainty
D)increases ambiguity

Question 14

All managers plan in some way, either formally or informally.

Question 15

Which of the following is a frequently cited criticism of formal planning?

A)Plans lock organizations into rigid goals and timetables.
B)Plans take too long to create.
C)Plans create resentment within different levels of the organization.
D)Formal planning works well only for smaller companies.

Question 16

Which of the following is NOT a function of planning?

A)defining goals
B)identifying a strategy for attaining goals
C)settling disputes between employees
D)coordinating organizational activities

Question 17

Planning is concerned with ________.

A)both ends and means
B)ends only
C)means only
D)neither ends nor means

Question 18

One effect of planning on managers is that it forces them to ________.

A)fear change
B)anticipate and consider the effect of change
C)work to prevent change
D)ignore any change that doesn't directly affect them

Question 19

In informal planning, goals are usually ________ shared with others in the organization.

A)written, but little is
B)unwritten, and little is
C)written, and much is
D)unwritten, but much is

Question 20

Planning gives organizations direction that primarily helps them ________.

A)improve teamwork and coordinate activities
B)improve their image in the business community
C)improve morale of middle managers
D)improve morale of all employees

Question 21

In a short essay, identify criticisms of formal planning.

Question 22

A criticism of formal planning is that it focuses too much on groundbreaking visions and deals with ideas that are too innovative to work.

Question 23

Successful planning depends more on whether managers plan than on the quality of their planning.

Question 24

A major strength of formal planning is that it generally correlates with higher profits.

Question 25

In a short essay, define planning and compare formal and informal planning as they are used in various organizations.

Question 26

A major argument against formal plans is that they can't replace intuition and creativity.

Question 27

A major strength of formal planning is that it reinforces past successes and incorporates them into the future.

Question 28

The first three steps of the strategic management process involve ________ strategies.

A)planning
B)implementing
C)evaluating
D)identifying

Question 29

Research indicates that organizations that don't use formal planning always outperform organizations that do use formal planning.

Question 30

Formal planning can enhance creativity in an organization.

Question 31

The four reasons that organizations plan are to establish coordinated effort, set standards, minimize waste, and reduce uncertainty and the impact of change.

Question 32

At some point, all managers create formal plans.

Question 33

Planning rarely improves teamwork and cooperation among employees.

Question 34

Planning provides direction to managers and nonmanagers alike.

Question 35

A key function of planning is to create goals.

Question 36

Informal planning typically works better in large organizations.

Question 37

The first step in the six-step strategic management process is to ________.

A)analyze the organization's strengths and weaknesses
B)identify the organization's mission
C)identify feasible strategies
D)analyze the opportunities the organization has

Question 38

In a short essay, list and discuss two reasons for planning.

Question 39

A major strength of formal planning is that it gives an organization rigidity.

Question 40

An organization that fails to plan will find it hard to assess progress.

Question 41

A mission statement does NOT include which of the following?

A)the customers of a company
B)major competitors
C)why the company is in business and what it hopes to accomplish
D)the company's basic beliefs

Question 42

Which of the following do managers NOT typically use to formulate strategies?

A)finding ways to exploit the organization's strengths
B)finding ways to protect the organization from external threats
C)finding ways to rule out existing organizational opportunities
D)finding ways to correct organizational weaknesses

Question 43

An organization's capabilities identify ________.

A)what the organization knows
B)who the organization is
C)assets that the organization can rely on
D)what the organization can do

Question 44

An external analysis, the second step of the strategic management process, helps identify ________.

A)the products that a company makes
B)the long-term goals of a company
C)a company's opportunities and threats
D)a company's concern for its employees

Question 45

In forward vertical integration, a company becomes its own ________, while in backward vertical integration, the company is its own ________.

A)supplier; distributor
B)supplier; customer
C)distributor; monitor
D)distributor; supplier

Question 46

A corporate strategy focuses primarily on ________.

A)an organization's mission
B)an organization's strengths
C)an organization's weaknesses
D)an organization's people

Question 47

Which of the following makes up the three main types of corporate strategies?

A)growth, vertical integration, horizontal integration
B)growth, retrenchment, renewal
C)renewal, retrenchment, diversification
D)growth, stability, renewal

Question 48

A mission statement includes identification of an organization's ________.

A)strengths and weaknesses
B)purpose and basic philosophy
C)assets and resources
D)resources and strengths

Question 49

General Mills expanding its line so that it sells several different types of Cheerios is an example of which of the following?

A)concentration
B)horizontal integration
C)vertical integration
D)diversification

Question 50

An organization's resources identify ________.

A)how the organization gets things done
B)where the organization operates
C)when the organization operates
D)what the organization has

Question 51

Once SWOT analysis is complete, managers ________ to address the issues that came up during the analysis.

A)formulate strategies
B)implement strategies
C)evaluate strategies
D)eliminate strategies

Question 52

Together, an organization's resources and core competencies make up which of the following?

A)core philosophy
B)competitive weapons
C)core assets
D)fundamental beliefs

Question 53

A salad dressing company that buys a large olive grove to produce olive oil is practicing which of the following?

A)concentration
B)forward vertical integration
C)backward vertical integration
D)horizontal integration

Question 54

A sneaker company creating its own stores where it sells only its own brand is an example of which of the following?

A)forward vertical integration
B)backward horizontal integration
C)forward horizontal integration
D)reverse vertical integration

Question 55

SWOT analysis identifies and analyzes an organization's ________.

A)strengths, weaknesses, opportunities, and threats
B)strategy for competing in the market
C)human resource assets
D)long-term goals

Question 56

SWOT analysis combines ________.

A)a company's mission with its goals
B)external and internal analyses
C)a company's philosophy with its ethics
D)profit with productivity

Question 57

Growth strategies include ________.

A)diversification, concentration, integration, stabilization
B)vertical integration, horizontal integration, concentration, diversification
C)vertical integration, horizontal integration, lateral integration, horizontal concentration
D)integration, renewal, horizontal diversification, vertical diversification

Question 58

Which term refers to an organization's capital, workers, and patents?

A)resources
B)capabilities
C)abilities
D)core competencies

Question 59

An internal analysis, the third step of the strategic management process helps identify ________.

A)opportunities and threats
B)resources and capabilities
C)opportunities and possibilities
D)values and philosophy

Question 60

The three different types of strategies that managers implement are ________.

A)corporate, private, functional
B)corporate, competitive, functional
C)long-term, short-term, public
D)competitive, noncompetitive, corporate

Question 61

Which of the following describes a company that is following a focus strategy?

A)a software company that makes a wide variety of games and financial products
B)a software company that makes games for a wide audience
C)a software company that makes financial products for accountants, consumers, and businesses
D)a software company that makes financial products for accountants only

Question 62

Two companies that both sell fine timepieces combine.What are they doing?

A)diversifying, because they both sell the same products
B)integrating vertically, because they both sell the same products
C)integrating vertically in a backward direction, because they are sharing distribution
D)integrating horizontally, because they both sell similar products

Question 63

Which of the following would you expect to find in a clothing store that follows a cost leadership strategy?

A)only the finest, most expensive materials
B)pampered, personalized service
C)state-of-the-art design
D)basic, no frills, practical items

Question 64

A cost leadership competitive strategy focuses on which of the following?

A)efficiency
B)innovation
C)elegant design
D)luxury

Question 65

Which of the following functional areas has become an important strategic element for companies such as Prada?

A)customer servicer
B)cost control and accounting
C)human resources
D)information technology

Question 66

The thing that makes your product special is known as your ________.

A)assets
B)destruction device
C)competitive advantage
D)core device

Question 67

Two movie studios combining to form one larger studio is an example of which of the following?

A)forward vertical integration
B)horizontal integration
C)backward vertical integration
D)diversification

Question 68

A company whose goal is to retain its ideal size and market share is employing which kind of strategy?

A)noncorporate
B)growth
C)renewal
D)stability

Question 69

According to Michael Porter, a company with good products that has no clear competitive advantage is said to be ________.

A)perfectly positioned
B)stuck in the middle
C)in the wheelhouse
D)outside of the box

Question 70

A company with a differentiation strategy focuses on making its products or services ________.

A)unique and special
B)similar to its competitors
C)familiar
D)affordable

Question 71

A company that looks for a niche in the market is following which strategy?

A)cost leadership
B)differentiation
C)focus
D)turnaround

Question 72

A differentiation strategy ________.

A)usually focuses on price
B)must focus on price
C)can focus on a brand image
D)can focus on value, but not service

Question 73

Competitive advantages for a high-prestige, premium coffee franchise like Starbucks are likely to include all of the following EXCEPT ________.

A)high quality
B)lowest prices
C)well-trained employees
D)pleasant venues

Question 74

Remedies that all renewal strategies employ include which of the following?

A)hiring efficiency experts
B)new ad campaigns
C)emulating competitors
D)cutting costs

Question 75

When Google purchased YouTube, a company that featured different, but related products, Google was engaging in which of the following?

A)concentration
B)forward vertical integration
C)backward vertical integration
D)diversification

Question 76

The ________ strategy occupies the level below the corporate strategy.

A)business unit
B)competitive
C)functional
D)performance

Question 77

A company that is on the verge of collapse or bankruptcy might employ this strategy.

A)retrenchment
B)incremental improvement
C)turnaround
D)hunker down

Question 78

Troubled companies seek ________ to address serious problems.

A)competitive strategies
B)corporate strategies
C)vertical and horizontal strategies
D)renewal strategies

Question 79

To address limited, short-term problems, a company is most likely to employ a ________ strategy.

A)retrenchment
B)turnaround
C)doomsday
D)self-critical

Question 80

A diversified corporation is likely to have ________.

A)multiple competitive strategies
B)a single competitive strategy
C)no more than two competitive strategies
D)thousands of competitive strategies