Question 1

The purpose of __________ is to identify assets, resources, skills, and processes that represent either strengths or weaknesses of the organization.

Accepted Answer

An internal analysis is specifically designed to identify the strengths and weaknesses within an organization, focusing on its assets, resources, skills, and processes.

Question 2

Distinctive competencies which lead to a competitive advantage are referred to as

Accepted Answer

Distinctive competencies that lead to a competitive advantage are referred to as strengths. These are internal attributes and resources that support a company's successful performance and strategy execution.

Question 3

Some issues that executives should consider in an internal analysis include

Accepted Answer

An internal analysis focuses on the internal capabilities and resources of a company, such as the abilities and skills of its personnel and managers.

Question 4

Which of the following is not an element of strategy formulation?

Accepted Answer

Formulating functional strategies is considered a part of strategy implementation rather than strategy formulation. Strategy formulation involves defining the mission, setting strategic goals, identifying alternatives, and choosing the most advantageous strategy, not the detailed planning of how those strategies will be executed, which is where functional strategies come into play.

Question 5

Although mission statements will vary greatly among firms, every mission statement should describe three primary aspects of the organization:

Accepted Answer

A mission statement should describe the organization's primary products and services, its distinctive competitive advantage, and its overall strategy for enduring long-term success. These elements help communicate the organization's purpose, uniqueness, and approach to achieving its goals.

Question 6

Which of the following is not a characteristic of effective strategic goal-setting?

Accepted Answer

Effective strategic goal-setting involves creating goals that are specific rather than general. This specificity helps ensure that the goals are clear, measurable, and actionable, making it easier to develop strategies and measure progress towards achieving them.

Question 7

A unique skill or knowledge that an organization can use to accomplish something better than a competitor is considered a(n)

Accepted Answer

A distinctive competency is a unique skill or knowledge that an organization possesses, which allows it to achieve better performance than its competitors. This concept is crucial in strategic management and competitive strategy, as it helps organizations leverage their unique strengths to gain a competitive advantage.

Question 8

Each year, the top managers at JohnsonKay update the broad statements of the results they would like to see their company achieve over the long term. These statements are referred to as

Accepted Answer

These broad statements of long-term desired results are known as strategic goals, which guide the overall direction and priorities of a company.

Question 9

Broad statements of the results an organization wishes to achieve in the long run are referred to as

Accepted Answer

Strategic goals are broad statements that define the desired outcomes an organization aims to achieve over a long period. These goals guide the organization's direction and strategic planning efforts.

Question 10

A comprehensive, general approach for achieving the strategic goals of an organization is referred to as a/an

Accepted Answer

A grand strategy is a comprehensive, general approach for achieving the strategic goals of an organization. It outlines the overall direction and encompasses a wide range of actions and initiatives.

Question 11

Grand strategies can be divided into three broad categories:

Accepted Answer

Grand strategies are typically categorized into three main types: stability, growth, and retrenchment. These strategies guide an organization's approach to achieving its long-term objectives.

Question 12

According to their 2005 Annual Report, Walgreens opened a net number of 371 new stores in 2005 and will open 475 total new stores in 2006. Walgreens grand strategy is apparently

Accepted Answer

The opening of a significant number of new stores in consecutive years indicates a strategy focused on expansion and increasing market presence, which aligns with a growth strategy.

Question 13

After completing a rigorous strategic plan, Costco Corporation decided to remain in the same line of business as it had in the past, with little change to its operations. Costco chose a grand strategy of

Accepted Answer

Costco's decision to remain in the same line of business with little change to its operations aligns with a stability grand strategy. This strategy involves maintaining the current course of action and focusing on consistent operations without significant changes or attempts to expand or reduce the scale of operations.

Question 14

After completing its strategic plan, Circuit City decided to pursue a grand strategy that focused on increasing its sales, profits, and corporate portfolio. Circuit City chose a grand strategy of

Accepted Answer

The correct answer is E) growth. A grand strategy of growth focuses on increasing a company's sales, profits, and corporate portfolio, which aligns with Circuit City's strategic plan objectives.

Question 15

Which grand strategy focuses on being innovative, seeking out new opportunities, and taking risks?

Accepted Answer

Growth strategies focus on being innovative, seeking out new opportunities, and taking risks to expand a company's footprint in its market or into new markets.

Question 16

Many small business owners are content to run businesses that supports their families. This is an example of

Accepted Answer

This is an example of stability, where the business owner is satisfied with maintaining the current level of business to support their family without necessarily seeking significant growth, differentiation, or cost leadership.

Question 17

The purpose of a __________ strategy is to reverse negative sales and profitability trends.

Accepted Answer

A retrenchment strategy is designed to reverse negative sales and profitability trends by cutting costs, focusing on core activities, and restructuring business operations.

Question 18

Which grand strategy typically requires the elimination of one or more business units either through divestment or through liquidation?

Accepted Answer

Retrenchment strategy often involves shrinking the company's scope by eliminating or divesting business units that are not performing well or do not align with the company's core competencies, in order to focus on strengthening the remaining units.

Question 19

In the mid-1980s, the oil producing states of Louisiana, Texas, and Oklahoma began to witness companies pursuing a __________ strategy when the price of oil reached uncharacteristic lows. It was no longer cost-efficient to explore for oil and to maintain so many rigs on land and in the Gulf of Mexico. These states witnessed massive layoffs and closures of many oil fields and refining facilities.

Accepted Answer

The correct strategy is retrenchment, which involves reducing operations to cut costs and stabilize the business during periods of financial difficulty, such as when oil prices are low and exploration becomes cost-inefficient.

Question 20

The __________ strategy defines the primary way in which the firm competes in its respective markets.

Accepted Answer

The generic strategy outlines the fundamental approach to how a firm competes in its market, focusing on aspects like cost leadership, differentiation, or focus/niche strategies.

Quiz 4: Strategic Management and Planning in a Global Environment