Deck 1: The Concept of Stategy

Question 1

Strategy today has been forced to evolve to cope with an increasingly fast-paced and volatile environment, making inflexible long-term plans redundant.

Answer 1

True

Question 2

Corporate strategy is also called business strategy, or competitive strategy.

Answer 2

False

Question 3

The essential purpose of a commercial firm can be seen as creating value for customers, and then to appropriate a portion of this value for the firm.

Answer 3

True

Question 4

Business strategy has largely evolved from the theories put forward by academics.

Question 5

Much can be learned about a firm's actual strategy by looking at where it invests most money, and what products, services, and technologies it is working on.

Question 6

For most firms, although good luck may play a part, success is more likely to be a result of a soundly grounded and well executed strategy.

Question 7

In the 1970s and 1980s, strategy evolved to be viewed more in terms of competition, competitive advantage, market share, and profit.

Question 8

To determine a large firm's strategy, it's sufficient to read the annual corporate report.

Question 9

Company law throughout the developed, industrialized world including Asia and Europe obliges firms to solely focus on profit for shareholders.

Question 10

Strategy in the 1950s and 1960s was dominated by top-down corporate planning and so-called scientific management.

Question 11

Some observers have noticed that there's only a weak link between a firm's intended or stated strategy, and its actual or realized strategy.

Question 12

Strategy is in essence a long-term plan for an organization to achieve its long-term objectives.

Question 13

Paradoxically, the most consistently profitable companies are those whose primary goals are NOT stated in terms of profits.

Question 14

From the military arena, tactics are about actions and techniques for winning battles, whereas strategy is about winning the war.

Question 15

Sound strategy and implementation largely determine the probability and extent of the success of a firm.

Question 16

In summary, strategy has evolved from "strategy as a detailed plan" to become "strategy as direction" in the early 21st century.

Question 17

Strategy today is essentially a detailed plan which every member of the organization must follow to ensure success.

Question 18

Usually, business success has been proved to rely in the end on superior resources.

Question 19

A sound strategy relies on four factors: simple, long-term and consistent goals; profound understanding of the competitive environment; objective appraisal of resources; and effective implementation of strategic decisions.

Question 20

Strategic decisions are likely to significantly affect the organization as a whole and involve major resource commitment.

Question 21

Corporate and business strategy differ mainly in that

A)corporate strategy has a broader scope, including decisions about which industries to operate in.
B)business strategy is the responsibility of top management.
C)both a and b.
D)there is no real difference; they are the same thing.

Question 22

Modern strategy applied to the business world shares with military strategy

A)only linguistic roots.
B)some authors such as sun tzu and his "art of war".
C)the existence of resources, conflict, and battle between players.
D)decisions of significance to overall success, and major resource commitment.

Question 23

The simplest useful definition of business strategy would be

A)a sort of plan.
B)a conceptual construct relating to the juxtaposition of corporate richness versus the snakes and ladders of a kaleidoscopic environment.
C)how to win the corporate wars; price wars, technology races, develop killer applications.
D)how to compete within an industry or market.

Question 24

The success of an organization, in general, depends on the following:

A)being consistently focused on an achievable goal.
B)having a strong and in-depth knowledge of the competitive environmen.
C)realistic appraisal of its own strengths and weaknesses.
D)all of the above plus the ability to implement strategy with commitment, consistency and determination.

Question 25

A good starting point to identify a large firm's strategy is

A)to read the annual corporate report.
B)to call the CEO and ask him/her what the strategy is.
C)to look on the company's website.
D)to search the internet to find out if someone else has already done the work.

Question 26

Select the best answer. Modern business strategy has evolved across time due to

A)changes in demographics.
B)changes in laws and demographics.
C)the needs of business.
D)none of the above.

Question 27

Appraising a firm's resources consists of

A)protecting the firm from its weaknesses and trying to reduce or eliminate them.
B)leveraging the firm's strengths to increase market share and profit.
C)a and b.
D)completing 360-degree analytical evaluations of top managers' strengths and weaknesses.

Question 28

The shift in strategy from a plan to a direction leads to

A)a downgrade its role in management.
B)an overt reliance on flexibility and responsiveness.
C)a need for top managers' training.
D)less work for top managers.

Question 29

The shift from Corporate Planning to Strategy Making implies

A)from the sources of profit outside the firm to the sources of profit within the firm.
B)to the resource-based view of the firm.
C)both a and b.
D)from the structure-based approach to the value-added perspective.

Question 30

In addition to just reading published information, to identify a firm's strategy you could

A)identify where the company is making most of its investments.
B)identify where the company is doing most of its business.
C)find out what new products and services the company is putting most effort into.
D)all of the above.

Question 31

Strategy and tactics

A)are interchangeable terms.
B)relate to achievement of overall long-term objectives, and multiple short-term objectives, respectively.
C)can be seen as what top managers do and what lower level employees do, respectively.
D)none of the above.

Question 32

The 1950s/60s style of corporate planning assumed that

A)there would be almost no difference between the intended strategy and the realized strategy.
B)the business world is essentially a predictable environment.
C)there was unlikely to be anything unexpected to occur of sufficient importance to disrupt the strategic plan.
D)all of the above.

Question 33

A contemporary phenomenon is known as "winner-take-all markets". This concept is exemplified by

A)Enron and WorldCom.
B)E-Trade and WebVan.
C)Microsoft (PC software)and Intel (PC core processors).
D)Peapod in grocery retailing.

Question 34

In the military field, we generally make the following distinction between strategy and tactics:

A)tactics are the overall plan whereas strategy focuses on specific actions.
B)tactics are a scheme of specific everyday actions, practices and techniques whereas strategy relates to the top-level plan.
C)tactics encompass specific political actions within the firm whereas strategy is the overall plan for deploying resources to establish a favorable position.
D)tactics are the overall plan whereas strategy is concerned with the maneuvers to win battles.

Question 35

By the 1990s, thinking on strategy had shifted to

A)an emphasis on competition, market share and industry profitability.
B)the development of the "PIMS" at the Strategic Planning Institute.
C)resources and capabilities of the firm.
D)the management of political, economic and technological influences.

Question 36

In the twenty-first century strategy has become less about sustaining competitive advantage and more about

A)business school academics developing new theories, which are taught to new graduates.
B)earlier methods have simply been seen as old-fashioned.
C)flexibility and successive temporary advantages.
D)computerisation and the internet age meaning that we know more about what's really going on nowadays.

Question 37

Select the best answer. Success is fundamentally linked to

A)a soundly formulated strategy and luck.
B)an effectively formulated strategy and a strong awareness of the rivals' strengths.
C)a clear understanding of the environment and strong political skills.
D)a soundly formulated and effectively implemented strategy.

Question 38

Strategic goals should be

A)simple.
B)consistent.
C)long term.
D)all of the above.

Question 39

Strategy is fundamentally about

A)being better than rivals.
B)success in achieving long-term goals.
C)satisfying all stakeholders.
D)being an excellent "corporate citizen".

Question 40

Business strategy can be summarized as

A)establishing a competitive advantage over rivals.
B)the means by which individuals achieve their objectives.
C)the formal detailed plans used by organizations to guide their actions.
D)the will of top managers to change their organization.

Question 41

The notion of "strategic fit"

A)does not mean much, and is a common statement made in strategic literature.
B)implies coherence between resources, capabilities, structure and systems.
C)expresses how well a firm's strategy fits its internal and external environment.
D)b and c.

Question 42

Profit-making firms are about creating value:

A)this value is simply the profit generated at the end of the year.
B)they must create value for several stakeholder groups if this is to result in sustainable long-term profit generation.
C)value to some stakeholders (e.g. customers)may be difficult to quantify in money terms.
D)both c and b.

Question 43

Select the best answer. Business strategy is a combination of

A)goals and objectives.
B)intended and emergent strategy.
C)strategic objectives and financial analysis.
D)none of the above.

Question 44

The difference between intended and realized strategy is

A)so great that arguably only 30% of intended strategy becomes realized.
B)greater in unsuccessful companies.
C)unimportant, because no-one ever expects the intended strategy to seriously be implemented.
D)only a very small difference, in general.

Question 45

The role of strategy today is claimed to be

A)a unifying role underpinning all consequent decisions.
B)a means by which top management can communicate and gain commitment to a sense of direction.
C)a means by which top management can inspire and motivate the workforce.
D)all of the above.

Question 46

The approach taken in the textbook primarily assumes that

A)CSR is taking over from generating profits as the primary corporate goal.
B)top managers determine the success of a firm by concentrating on short-term profits.
C)the "anglo-saxon" model of shareholder capitalism is the right one.
D)profit making firms are seeking to maximise profits for the owners over the long term.

Question 47

In practice, strategy making is

A)a combination of centrally-driven rational design and decentralized adaptation.
B)a combination of luck, organizational politics, and centrally-driven planning.
C)the expression of political games among top managers.
D)none of the above.

Question 48

Business strategy defines

A)the way a firm competes in a particular industry or market.
B)how a firm gains a competitive advantage over its rivals within a specific industry or market.
C)both a and b.
D)neither a nor b.

Question 49

The underlying purpose of studying strategy is

A)to reach quick-fix decisions.
B)to better understand the issues facing top managers.
C)to work out how to best create value in the future.
D)both b and c.

Question 50

Two basic questions concerning corporate and business strategy are:

A)Where and how to compete?
B)How and when to compete?
C)What are the best arenas and structures to compete?
D)When and where to compete?

Question 51

As the environment becomes more turbulent, or unpredictable,

A)strategy appears to not be very useful.
B)strategy remains just as vital a tool to navigate the firm through "stormy seas".
C)strategy is put into the hands of external consultants.
D)strategy becomes an "impossible exercise".

Question 52

Corporate social responsibility

A)fits more readily with the continental europe and asian legal framework of broader stakeholder obligations.
B)is not seen as an imperative requirement by all influential thinkers.
C)is becoming more important for all firms to take account of due to the threat of adverse publicity.
D)all of the above.

Question 53

Maximising shareholder value

A)is the sole objective of all profit-making companies in every country.
B)is the primary legal obligation in most English-speaking countries.
C)is not the only legal obligation in continental Europe, and in Asia. Firms here are legally obliged to take account of a broad range of stakeholder interests.
D)both b and c.

Question 54

A strategy can be described as

A)intended, emergent, or realized.
B)intended, emergent, or sustained.
C)emergent, critical, or sustained.
D)realized, emergent, failed.

Question 55

The textbook limits attention to

A)the global business environment.
B)profit-making companies in market economies.
C)both public and private sector firms in english-speaking countries.
D)profit making companies above a certain size.

Question 56

In regard to strategy making, most firms are likely to exhibit

A)a combination of design and emergence.
B)a process labeled as "planned emergence".
C)an interaction between strategic design, through formal top-level processes, and strategic enactment through decisions made by all management levels of the organization.
D)all of the above.

Question 57

The fundamental role of strategy is to

A)determine how the firm will make a profit in its industry environment.
B)determine how the firm will deploy its resources to satisfy its short-term financial goals.
C)determine how the firm will deploy its resources to satisfy its long-term goals, given the conditions in the competitive environment.
D)determine how the firm can organize its own activities and achieve dominance.

Question 58

The balance between designed strategy and emergent strategy depends mostly on

A)the type of organizational structure.
B)the stability and predictability of a firm's environment.
C)top managers' personalities.
D)middle managers' autonomy.

Question 59

If a firm's strategy ensures it is consistent with both its internal and external environment, it achieves

A)strategic fit.
B)strategic adjustment.
C)environment consistency.
D)political and social fit.