Chapter 1

Question 1

Emergent strategy

Answer 1

A strategy that has developed as external factors have emerged.

The original strategy has been widened following developments in society that could not have been planned for

Question 2

the THREE stages of the rational model of strategic planning?

Answer 2

Strategic implementation, Strategic analysis, Strategic choice

Question 3

Strategic Business Units (SBUs)

Answer 3

A fully-functional unit of a business that has its own vision and direction. Typically, a strategic business unit operates as a separate unit, but it is also an important part of the company. It reports to the headquarters about its operational status.

Question 4

responding to competitors is part of which strategy

Answer 4

Business strategy is concerned with how to compete successfully in a chosen market

Question 5

bounded rationality

Answer 5

The concept of ‘bounded rationality’ states that managers do not evaluate all the options available to them. In practice, there will be a limited number of options available because of constraints imposed by time, available information and other factors.

Question 6

When formulating a strategy, there are THREE overall types of strategic choice that have to be made.

Answer 6

Product market strategy – where to compete

Method of growth – organic, or external

Competitive strategy – how to compete

Question 7

rational planning model

Answer 7

1. Mission and objectives
2. Position appraisal
3. Generating strategic options
4. Evaluation and choice
5. Implementation
6. Review and control