Deck 7: Strategic Management: Planning for Long-Term Success

Question 1

Indra Nooyi, CEO of Pepsi said, "The minute you've developed a new business model, it's extinct, because somebody is going to copy it."

Answer 1

True

Question 2

The term business ecosystems refers to the concept that the whole is greater than the sum of its parts.

Answer 2

False

Question 3

Middle- and lower-level managers become risk-taking entrepreneurs in the transactive strategy-making mode.

Answer 3

False

Question 4

In the two modern modes of strategy making, top managers act as commander and coach rather than sponsor or facilitator.

Question 5

Effective strategic management requires only top management to consider the "big picture" on a daily basis.

Question 6

Executives responding to a recent Gallup Poll said they spend the largest proportion of their time on "strategic thinking/planning".

Question 7

Today, strategic thinking is needed by managers at all levels.

Question 8

There is a trend away from the generative mode of strategy making.

Question 9

Management of the "big picture" refers to strategic management.

Question 10

Strategy is the exclusive domain of top level management.

Question 11

The command mode to making strategies relies on a style that is imperial in nature and is driven by a leader or small top team.

Question 12

Compared to the rest of the world, American managers are considered very farsighted.

Question 13

Managers with strategic farsightedness view labor as a commodity.

Question 14

Because of their long-term focus, strategic plans should not be changed once they are formulated.

Question 15

A farsighted management style involves finding solutions to problems.

Question 16

"Being a leader" is a shortsighted approach to competitive advantage.

Question 17

Managers need to achieve four types of synergy: organizational, management, human, and market.

Question 18

A traditional mode of strategy making is the transactive mode.

Question 19

There should be a clear distinction between those who plan and those who implement plans.

Question 20

An organization's strategy is defined as an integrated and externally-oriented perception of how the organization will achieve its mission.

Question 21

An example of a cost synergy is a corporate recycling program.

Question 22

Research on Porter's model indicates a positive relationship between long-term earnings growth and a good strategy/environment fit.

Question 23

When a company follows Porter's cost focus strategy, it competes worldwide on the basis of low costs and low prices.

Question 24

Porter's differentiation strategy yields larger profit margins than the low-cost strategy.

Question 25

Thanks to technological synergy, profitable new markets can be tapped without the expense of developing totally new products.

Question 26

Porter's model helps managers think strategically by enabling them to see the big picture as it affects the organization and its changing environment.

Question 27

Competitive scope can be achieved via low costs or differentiation, according to Porter.

Question 28

A prime example of a business ecosystem in action is Apple allowing developers of iPhone and iPad apps to write programs for both Apple and Android.

Question 29

"Cost leadership" is included in Porter's model of generic competitive strategies.

Question 30

Human imagination is the only limit to creating cost synergies through recycling.

Question 31

Technological synergy involves transferring technology from one application to another.

Question 32

A company with a well-known brand name such as Clorox is following a cost leadership strategy, according to Porter's generic strategy model.

Question 33

Competitive advantage and competitive scope are the two major variables in Porter's generic competitive strategies model.

Question 34

When members of the management team have identical skills, personnel synergy occurs.

Question 35

Synergy has been called the "2 + 1 = 3 effect."

Question 36

Under a cost-leadership strategy, it is especially important that a brand's image be carefully nurtured and protected, so that brand loyalty and customers' willingness to pay a premium price does not erode.

Question 37

Wal-Mart is a prime example of Porter's cost leadership strategy.

Question 38

Market synergy occurs when a grocery store sells food items and lottery tickets.

Question 39

Competition should take precedence over cooperation, according to the business ecosystem model.

Question 40

When two or more products can be designed by the same engineers, produced in the same facilities, distributed through the same channels, or sold by the same salespeople, market synergy occurs.

Question 41

As a result of the fast-paced changes occurring in the external environment, forecasting techniques have become obsolete in helping managers cope with uncertainty about the future.

Question 42

Inability to achieve cooperation, according to a business ecologist, is the major factor today limiting the spread of realized innovation.

Question 43

A fee-for-service-based Internet business model features fees charged for metered services.

Question 44

Key capabilities for today's companies include rapid product development and continuous cost reduction.

Question 45

Three types of Internet business models include advertising-based, markup-based, and referral-based.

Question 46

The "O" in a SWOT analysis stands for "outlook."

Question 47

Only large companies need to have a social media monitoring plan to respond to postings that puts the organization's reputation at risk.

Question 48

Unlike operational plans, strategic plans do not have to be measurable.

Question 49

Because of the need for corrective action, the strategic management process is a dynamic cycle.

Question 50

Today, speed is considered an important strategic competitive advantage.

Question 51

The sources of competitive advantage for production-based Internet business models are search and problem-solving.

Question 52

New strategies should only be communicated to top and middle managers since they are responsible for implementing them.

Question 53

To protect their own self-interests, middle managers often resist or derail strategies.

Question 54

A commission-based Internet business model adds value through selection, distribution efficiencies, and by leveraging brand image and reputation.

Question 55

With the help of a SWOT analysis, an organization can find its correct niche.

Question 56

A business ecosystem is an economic community of organizations and all their stakeholders.

Question 57

When a Web site draws the same customer back again and again, it is called a "corner store site."

Question 58

Formulation of a grand strategy, formulation of strategic plans, implementation of strategic plans, and strategic control are the four major steps in the strategic management process.

Question 59

A careful situational analysis of the organization and its environment is part of developing a grand strategy.

Question 60

Both an organization's weaknesses and strengths are examined in a situational analysis.

Question 61

____ strategies are found in farsighted organizations.

A) Formally written
B) Short-term profit-oriented
C) Verbal
D) Computerized
E) Informal

Question 62

____ is not a key dimension of strategic farsightedness.

A) Emphasizing the development of new products
B) Emphasizing increased market share
C) Writing a formal mission statement
D) Viewing labor as a commodity
E) Relying on upward communication

Question 63

Top management's role is that of a ____ in the rational strategy-making mode.

A) sponsor
B) facilitator
C) boss
D) coach
E) commander

Question 64

The key to good scenario writing is to focus on the few readily identifiable, but unpredictable, factors that will have the greatest impact on the topic in question.

Question 65

A farsighted strategy for the ____ dimension involves heavy emphasis on developing new products and services and on innovations in production, marketing, and human resource management.

A) competitive advantage
B) organizational structure
C) research and development
D) human resources
E) problem-solving

Question 66

Which of these is found in a farsighted organization?

A) Emphasis on long-term development of employees
B) Emphasis on short-term profits
C) Emphasis on chasing symptoms and blaming scapegoats
D) Emphasis on applying competitors' good ideas
E) Emphasis on rigid structure emphasizing downward communication

Question 67

As cable network television emerged in the early 1980's, which company embraced this change in television programming by advertising on the newly founded MTV and realizing great results for several years as their market share increased?

A) McDonald's
B) Pepsi
C) Coke
D) Starbucks
E) Google

Question 68

Amazon.com's founder, Jeff Bezo's credits ___________ for his company's strength during the Great Recession.

A) closing half their brick and mortar store locations
B) strategic farsightedness (long-term thinking)
C) strategic shortsightedness (short-term thinking)
D) selling to Google
E) borrowing money

Question 69

There is a trend away from the ____ mode and toward the ____ mode in strategy-making.

A) symbolic; generative
B) symbolic; rational
C) transactive; symbolic
D) command; rational
E) generative; command

Question 70

According to the author, which group needs a general understanding of strategic management?

A) Staff specialists and managers at all levels
B) Planning specialists only
C) Primarily top executives
D) Everyone above the department head level
E) Every person in the organization

Question 71

Forecasts are considered pure guesses, "a shot in the dark", since one cannot predict the future.

Question 72

The two main types of scenario analysis are "hard" and "soft" scenarios.

Question 73

An office manager would be able to do a time series forecast of the quantity of her e-mails a year from now if she kept a daily record of her e-mail.

Question 74

The best tool for Trend Analysis is Google.

Question 75

From a strategic standpoint, all of the following are shortsighted except

A) emphasizing increased market share.
B) a follow the leader attitude.
C) focus on short-term profits
D) a rigid structure.
E) viewing labor as a commodity.

Question 76

Scenario analysis involves getting a group of experts to agree on one most likely future outcome.

Question 77

Strategists are advised to avoid relying on forecasts today because things are changing too quickly.

Question 78

Kevin, a web developer, tends to emphasize short-term profits. Which strategy does he use?

A) Shortsighted emphasis on management style
B) Farsighted emphasis on organizational strategy
C) Shortsighted emphasis on organizational strategy
D) Shortsighted emphasis on return
E) Farsighted emphasis on return

Question 79

Which statement best describes a shortsighted organization?

A) Emphasis on finding solutions to problems
B) Flexible structure encouraging change, adaptability, and speed
C) A formally written and communicated statement of long-term organizational mission
D) Emphasis on stopgap hiring and training
E) Emphasis on gaining and holding a strategic competitive edge

Question 80

According to research evidence, what kind of impact does strategic planning have on business performance?

A) Inconclusive
B) Neutral
C) Positive
D) Negative
E) Marginal