Question 1

Lily,the CEO of Beautiful Flowers,is interested in using strategic management in her florist shops nationwide.When she attended the workshop on strategic management,the speaker suggested to first establish the mission and the vision,second to assess the current reality,and third to formulate the grand strategy as the first three steps in the strategic-management process.

Accepted Answer

The first three steps of the strategic-management process are (1)establish the mission and the vision, (2)assess the current reality,and (3)formulate the grand strategy (see Figure 6.1).

Question 2

According to Burt Nanus,"powerful mission and vision statements challenge and inspire people in the organization and help to align their energies in multiple directions."

Accepted Answer

Burt Nanus says that a good vision statement helps align people's energies in a common direction,and prevents people from being overwhelmed by immediate problems because the vision statement helps distinguish what is truly important from what is merely interesting.

Question 3

The five steps of (1)establishing the mission and the vision, (2)assessing the current reality, (3)formulating the grand strategy, (4)implementing the strategy,and (5)maintaining strategic control and the feedback loop make up the organizational-management process.

Accepted Answer

The strategic-management process has five steps,plus a feedback loop (see Figure 6.1): (1)establishing the mission and the vision, (2)assessing the current reality, (3)formulating the grand strategy, (4)implementing the strategy,and (5)maintaining strategic control and the feedback loop.

Question 4

Frank is interested in rewriting the vision for his antique shops,and he wants his employees and his business to grow.So the vision for Frank's stores should be positive and inspiring,and it should stretch the company and his employees to achieve objectives that they believe are not possible.

Accepted Answer

A vision should be positive and inspiring,and it should stretch the organization and its employees to achieve a desired future state that appears beyond its reach.

Question 5

Jiffy Lube provides only lubricants,but it provides them to all kinds of people with all kinds of motor vehicles.This is an example of how a strategic position can result from serving the few needs of many customers.

Accepted Answer

Strategic position emerges from three sources: Few needs and many customers,broad needs and few customers,and last,broad needs and many customers.With the source of few needs,many customers,strategic position can be derived from serving the few needs of many customers.Example: Jiffy Lube provides only lubricants,but it provides them to all kinds of people with all kinds of motor vehicles.

Question 6

ABC Bowling Centers has a policy of opening locations only in small cities,where there are broad needs and many customers.This is one source of strategic positioning.

Accepted Answer

Strategic position emerges from three sources: Few needs and many customers,broad needs and few customers,and lastly,broad needs and many customers.With the source of broad needs,many customers,strategy may be oriented toward serving the broad needs of many customers.

Question 7

Most strategies are compatible.Therefore,organizations need only to choose what strategies to follow.

Accepted Answer

Strategy requires trade-offs in competing.Some strategies are incompatible.Thus a company has to choose not only what strategy to follow but also what strategy not to follow.

Question 8

Developing a program focused on individual aspects of an organization for short-term success is the focus of strategic planning.

Accepted Answer

Strategic planning is concerned with developing a comprehensive program for long-term success.

Question 9

A 2013 survey found that the use of mission and vision statements is popular among managers.

Accepted Answer

A 2013 survey found that the most widely used management tool in 2012 was used 12,even 14 years earlier-namely,strategic planning,thought to be effective by about 80% of the senior managers surveyed.The use of mission and vision statements also continued to be popular,also favored by about 80%.

Question 10

Writer Geoffrey Colvin stated that successful managers need to be able to make large,painful decisions and radically alter their business design,such as "exiting businesses,firing people,admitting you were wrong (or at least not omniscient)."

Accepted Answer

Because of fast-spreading world conditions,such as the threat of products becoming commodities,rapidly increasing productivity,and global overcapacity,managers must be able to make difficult decisions.The writer Geoffrey Colvin puts it as,"The future will demand ever more people with the golden trait,the fortitude to accept and even seek psychic pain."

Question 11

When Pablo and his partner wrote the mission for their fitness center,like any good mission statement it did not include descriptions of their customers or the products and services they offer.

Accepted Answer

Mission statements may include information about customers and products or services.

Question 12

To provide direction and momentum,encourage new ideas,and develop a sustainable competitive advantage are reasons why an organization should adopt strategic management and strategic planning.

Accepted Answer

Organizations should adopt strategic management and strategic planning for three reasons: They can (1)provide direction and momentum, (2)encourage new ideas,and above all (3)develop a sustainable competitive advantage.

Question 13

The vision is an organization's purpose or reason for being,and a company's mission statement is its long-term goal of what it wants to become.

Accepted Answer

The mission statement is an organization's purpose or reason for being,and a company's vision is its long-term goal of what it wants to become.

Question 14

Donna's Restaurant is a popular café that specializes in home-cooked meals,friendly service,and a menu that contains vegan and vegetarian dishes,something no other restaurant in the area does.Donna's is engaging in strategic positioning by offering the unique menu items of vegan and vegetarian dishes.

Accepted Answer

Strategic positioning means performing different activities from rivals,or performing similar activities in different ways.

Question 15

The Strategic Management Society voted Michael Porter,a Harvard Business School professor,the most influential living economist.

Accepted Answer

Certainly Michael Porter's status as a leading authority on competitive strategy is unchallenged.The Strategic Management Society,for instance,voted him the most influential living strategist.

Question 16

Sustainable competitive advantage occurs when an organization is able to get and stay ahead in being responsive to customers,in innovating,in quality,and in effectiveness.

Accepted Answer

A sustainable competitive advantage is the ability of an organization to produce goods or services more effectively than its competitors do,thereby outperforming them.

Question 17

An analysis of several studies found that strategic planning was appropriate only for large firms and companies with more than 500 employees,where the improvement in financial performance was also quite large.

Accepted Answer

One analysis of several studies found that strategic planning was appropriate not just for large firms.Companies with fewer than 100 employees could benefit as well,although the improvement in financial performance was small.

Question 18

Research has shown that companies seldom start utilizing strategic management after a crisis,but rather when profits are high and their industries become less competitive.

Accepted Answer

When is a good time to begin the strategic-management process? Often it's touched off by some crisis,such as the one Toyota faced regarding claims of uncontrolled acceleration problems in its automobiles.

Question 19

A and B Supply,a small family-owned company,sells high-priced pens,some as expensive as $2,500,to executives in its area.Very few companies have chosen to market this product,and A and B has enjoyed record profits over the last 25 years.A and B Office Supply is an example of a company that would typically not choose not to utilize strategic planning.

Accepted Answer

Research results indicate that for small companies strategic planning is probably not worth the effort unless the company is in a highly competitive industry where small differences in performance may affect the firm's survival potential.

Question 20

According to Harvard Business School professor Michael Porter,strategic positioning "means performing different activities from rivals,or performing similar activities in different ways" to achieve sustainable competitive advantage.

Accepted Answer

Strategic positioning attempts to achieve sustainable competitive advantage by preserving what is distinctive about a company.According to Harvard Business School professor Michael Porter,strategic positioning "means performing different activities from rivals,or performing similar activities in different ways" to achieve sustainable competitive advantage.

Quiz 6: Strategic Management: How Exceptional Managers Realize a Grand Design