Question 1

The BCG (Boston Consulting Group) matrix evaluates SBUs with respect to their business growth rate and geographical location.

Accepted Answer

The BCG matrix evaluates SBUs with respect to their market share and market growth rate, not geographical location.

Question 2

The administration and execution of the strategic plan is strategy implementation.

Accepted Answer

Strategy implementation involves the actual execution of the strategic plan through various tactics and initiatives.

Question 3

Corporate-level strategy pertains to the organization as a whole.

Accepted Answer

Corporate-level strategy involves decisions that affect the entire organization and its overall direction, such as diversification, mergers and acquisitions, and resource allocation. These decisions are made by top-level executives and are meant to create long-term value and competitive advantage for the company as a whole.

Question 4

SWOT analysis includes a review of the internal threats and opportunities.

Accepted Answer

The answer of SWOT analysis includes a review of the...

Question 5

The bargaining power of the government, according to Porter, is one of the five competitive forces affecting an organization's competitive environment.

Accepted Answer

According to Porter's Five Forces framework, the five forces are: the threat of new entrants, the threat of substitutes, the bargaining power of buyers, the bargaining power of suppliers, and industry rivalry. The government is not one of these forces.

Question 6

According to the BCG Matrix, the question mark exists in a new, rapidly growing industry but has only a small market share.

Accepted Answer

According to the BCG matrix, a question mark represents a business that operates in a new, rapidly growing industry but has only a small market share.

Question 7

Mergers and acquisitions represent the ultimate in collaborative relationships.

Accepted Answer

Mergers and acquisitions typically involve two or more companies working together to combine their resources and operations, with the goal of creating a stronger, more competitive entity. This can require significant collaboration between different teams, departments, and organizational cultures, making it a highly collaborative relationship.

Question 8

Information and control systems include reward systems, pay incentives, budgets for allocating resources, information technology systems, and the organization's rules.

Accepted Answer

Information and control systems can include reward systems, pay incentives, budgets, technology systems, and rules.

Question 9

Portfolio strategy pertains to the mix of business units and product lines that fit together in a logical way to provide synergy and competitive advantage for the corporation.

Accepted Answer

Portfolio strategy is focused on creating a cohesive mix of business units and product lines that work together to provide strategic advantage for the corporation.

Question 10

Threats are characteristics of the internal environment that may prevent the organization from achieving its strategic goals.

Accepted Answer

Threats are characteristics of the external environment, not the internal environment. Internal characteristics that may prevent an organization from achieving its goals are typically referred to as weaknesses.

Question 11

According to Unlocking Innovative Solutions Through PEOPLE in Chapter 8, managers and staff members at Four Seasons Hotel can implement ideas on how to improve customer service after asking middle management for an OK.

Accepted Answer

The book emphasizes empowering employees at all levels to implement ideas without needing approval from middle management, fostering a culture of innovation and responsiveness.

Question 12

In BCG Matrix, the circle size represents the relative profit made by each business in the company's portfolio.

Accepted Answer

The circle size in BCG Matrix represents the relative market share of each business in the company's portfolio, not the profit. The profitability is represented by the position of the circle on the grid, with businesses in the upper right quadrant considered to be the most profitable.

Question 13

One of Porter's five competitive forces is bargaining power of customers.

Accepted Answer

The answer of One of Porter's five competitive forces is...

Question 14

Situation analysis typically includes a search for SWOT--situation without threats.

Accepted Answer

This statement is incorrect. SWOT analysis stands for Strengths, Weaknesses, Opportunities, and Threats. It is an essential tool used in situation analysis to identify a company's internal strengths and weaknesses and external opportunities and threats.

Question 15

Preferred supplier arrangements occur when a company develops a special relationship with suppliers.

Accepted Answer

Preferred supplier arrangements involve establishing a closer and more collaborative relationship with certain suppliers, often through contractual agreements, which can result in more stable supply chains, better pricing, and improved quality of goods and services.

Question 16

Strategic decisions at the business level concern amount of advertising, direction and extent of R & D, product changes, new product development, equipment and facilities, and expansion or contraction of product lines.

Accepted Answer

Strategic decisions at the business level indeed concern amount of advertising, direction and extent of R & D, product changes, new product development, equipment and facilities, and expansion or contraction of product lines.

Question 17

Differentiation, cost leadership, and focus are three of Porter's competitive strategies.

Accepted Answer

This statement is true. Porter's competitive strategies include differentiation, cost leadership, and focus.

Question 18

For General Electric, a strong financial base, combined with an excellent reputation with creditors and the equity market, is with a significant strength to include in its SWOT analysis.

Accepted Answer

A strong financial base and a good reputation with creditors and the equity market are strengths that General Electric can capitalize on and should include in its SWOT analysis.

Question 19

Strategy implementation involves the planning and decision making that lead to the establishment of the firm's goals.

Accepted Answer

Strategy implementation involves the actions taken to achieve the established goals, not the planning and decision making leading up to that point.

Question 20

"How do we compete?" question concerns functional-level strategy.

Accepted Answer

The answer of "How do we compete?" question concerns functional-level...

Quiz 8: Strategy Formulation and Implementation