Question 1

According to Paul Nutt,a decision-making authority,what percent of decisions made by managers are failures?

Accepted Answer

According to Paul Nutt's research, about 50% of decisions made by managers end up failing. This statistic highlights the challenges and complexities involved in decision-making within organizations.

Question 2

According to the text,which of the following is not one of the reasons why innovations seem to occur more often in small firms rather than in large,established corporations?

Accepted Answer

The text does not mention that small firms are completely ignorant of risk management. In fact, it states that entrepreneurs in small firms may be more willing to accept greater risk than larger firms. The other options (A, C, D, and E) are all reasons mentioned in the text for why innovations may occur more often in small firms.

Question 3

Constituency building,coalition building,and advocacy advertising are commonly used

Accepted Answer

Constituency building, coalition building, and advocacy advertising are all political strategies commonly used in the process of influencing public opinion and policymakers. Constituency building involves identifying and mobilizing supporters around a particular issue or cause, while coalition building involves forming alliances with other groups that share similar interests or goals. Advocacy advertising involves using advertising campaigns to persuade the public or policymakers to take a particular action or support a particular policy. These strategies are commonly used by political organizations, interest groups, and advocacy groups to shape public policy and public opinion.

Question 4

Which of the following reflects the impact of industry backgrounds on strategic choices?

Accepted Answer

Executives with strong ties within an industry tend to choose strategies commonly used in that industry. This is because they have a better understanding of what works in the industry and what doesn't. This familiarity with the industry can lead to a preference for commonly used strategies rather than risky ones.

Question 5

If there is little fit between a strategic alternative under consideration and the corporate culture,which of the following is one of management's options to consider?

Accepted Answer

The answer of If there is little fit between a...

Question 6

An important consideration in the selection of a strategy is the ability of each alternative to satisfy agreed-upon objectives with the least resources and the fewest negatives.The competitive advantages developed earlier using ________ is an excellent place to start.

Accepted Answer

The VRIO framework helps to identify competitive advantages that a company may have. By starting with these advantages, a company can build upon them in selecting a strategy that will allow them to achieve objectives with the least resources and negatives. Therefore, the best choice in this scenario is B, the VRIO framework. Choices A, C, D, and E may provide valuable information for strategy selection, but they do not specifically address the competitive advantages of the company.

Question 7

The evaluation of alternative strategies and selection of the best alternative is referred to as

Accepted Answer

The evaluation of alternative strategies and selection of the best alternative is referred to as strategic choice. Therefore, the best choice is C.

Question 8

Fujitsu demonstrated a follow-the-leader strategy when it imitated IBM's strategy focused on mainframes in 1990.

Accepted Answer

Fujitsu did imitate IBM's strategy focused on mainframes in 1990.

Question 9

Another approach to evaluating alternatives under conditions of high environmental uncertainty is to use the

Accepted Answer

The real-options approach is commonly used to evaluate alternatives under conditions of high environmental uncertainty. It provides flexibility to make changes in the future and allows for the consideration of future uncertainties and opportunities. Other approaches, such as net present value, stakeholder priority matrix, risk assessment approach, or hurdle rate approach, may not be as effective in dealing with high environmental uncertainty.

Question 10

The first step in constructing a corporate scenario is to

Accepted Answer

The first step in constructing a corporate scenario is to use industry scenarios to develop a set of assumptions about the task environment. This helps in identifying the key variables that can affect the organization and developing a strategic plan accordingly. The other options listed are important steps in the process but not the first step.

Question 11

Which of the following is not true of risk?

Accepted Answer

The statement that managers who own a significant amount of stock in their firms are less likely to engage in risk-taking actions is not true of risk. This statement is false because research has shown that managers who own a significant amount of stock in their firms are actually more likely to engage in risk-taking actions as they have more to gain from the success of the firm.

Question 12

What are the strategies to avoid proposed by the authors?

Accepted Answer

The answer of What are the strategies to avoid proposed...

Question 13

To avoid the consensus trap,which technique involving presenting two conflicting views (the thesis and the antithesis) presented in a debate format can be traced back to Plato and Aristotle?

Accepted Answer

The technique described is dialectical inquiry, which involves presenting a thesis and an antithesis in a debate format to arrive at a synthesis or consensus. This technique can be traced back to Plato and Aristotle. Devil's advocate, Sloan's judgment, sales presentation, and scenario construction are all different techniques that may be used in corporate decision-making, but they do not involve presenting conflicting views in a structured debate format.

Question 14

The technique used to help strategic managers choose among alternative choices by defining the task environment,developing a set of various forecasts,and using pro forma financial statements is called

Accepted Answer

Corporate scenarios involve defining the task environment, developing forecasts, and using pro forma financial statements to evaluate strategic choices.

Question 15

The most commonly used political strategies include which of the following?

Accepted Answer

All of the above strategies are commonly used in politics. Constituency building involves cultivating relationships with constituents to gain their support, political action committee contributions involve donating to candidates or campaigns, advocacy advertising aims to influence public opinion on an issue, and lobbying involves attempting to influence government officials to support a particular cause.

Question 16

The type of strategy used to influence a corporation's key stakeholders in order to increase their support of corporate activities is

Accepted Answer

Political strategy is used to influence key stakeholders, such as government officials or advocacy groups, to support a corporation's activities. This can include lobbying efforts, forming alliances with interest groups, or engaging in public relations campaigns to shape public opinion. Cooperative strategy refers to working with partners to achieve mutual goals, while competitive strategy involves competing with rivals to gain market share. Marketing strategy focuses on promoting and selling products or services, while profit strategy involves increasing revenues and reducing costs to maximize profitability.

Question 17

Which one of the following is not one of the questions that management should raise in their attempt to assess the importance to the corporation of stakeholders' concerns?

Accepted Answer

While stakeholder representation on the board of directors is important for some companies, it is not a question that is directly related to assessing the importance of stakeholders' concerns. The other questions listed are more relevant to understanding and addressing stakeholders' concerns.

Question 18

Risk in strategic management is only the probability that the strategy will be effective.

Accepted Answer

Risk in strategic management encompasses both the probability of success and the potential negative consequences of failure, such as financial loss, reputation damage, and stakeholder discontent. Therefore, risk involves both the likelihood of achieving strategic goals and the potential impact on the organization if those goals are not attained.

Question 19

Once the best strategic alternative is selected,the broad guidelines for its implementation are then defined by

Accepted Answer

Policies define the broad guidelines for the implementation of the selected strategic alternative, guiding decision-making and actions within an organization.

Question 20

To avoid the consensus trap,which technique assigns a group or individual to identify potential pitfalls and problems with a proposed alternative strategy in a formal presentation?

Accepted Answer

The devil's advocate technique assigns a group or individual to take an opposing view and highlight potential pitfalls and problems with a proposed alternative strategy. This helps to avoid the consensus trap by encouraging critical thinking and robust discussion. The other options (B) Sloan's judgment, (C) sales presentation, (D) dialectical inquiry, and (E) scenario construction may be useful in other contexts but are not directly related to avoiding the consensus trap.

Quiz 8: Strategy Formulation: Functional Strategy and Strategic Choice