deck_16967565 Flashcards
What is the primary focus of strategy in a business context? A) To replicate competitors’ activities
B) To create a unique and valuable position
C) To minimize costs at all costs
D) To maximize market share without differentiation
b
How is strategy best described? A) A set of identical activities as competitors
B) A random collection of business decisions
C) The creation of a different set of activities
D) An approach focused solely on cost reduction
c
Why is being different important in strategy? A) It leads to increased competition
B) It helps firms avoid being compared to others
C) It allows firms to meet customer needs in a unique way
D) It ensures that all firms perform similarly
c
Which of the following statements best captures the essence of strategy? A) Strategy is about following industry norms
B) Strategy is about being different and creating value
C) Strategy is primarily concerned with financial metrics
D) Strategy is a temporary plan that changes frequently
b
What is necessary for achieving a sustainable competitive advantage? A) Replicating competitors’ strategies
B) Performing different activities or similar activities differently
C) Minimizing operational costs only
D) Focusing solely on customer service
b
How does the fit of a system of activities impact replication difficulty? A) High fit makes replication easier
B) High fit makes replication more difficult
C) Fit has no impact on replication
D) Low fit leads to better competition
b
Why are systems of activities more difficult to replicate than individual parts? A) They are less comprehensive
B) They involve interconnected processes that create unique value
C) They focus on one specific activity
D) They are easily documented
B
How does the fit of a system of activities impact replication difficulty? A) High fit makes replication easier
B) High fit increases the complexity and uniqueness, making replication more difficult
C) Fit has no impact on replication
D) Low fit leads to better competitive practices
b
What is a key requirement of strategy in a competitive environment? A) To avoid making any choices
B) To make trade-offs and choose what not to do
C) To focus solely on market share
D) To replicate competitors’ strategies
b
What does it mean to create “fit” among a company’s activities? A) Ensuring all activities are identical
B) Aligning activities so that they reinforce one another and contribute to overall strategy
C) Minimizing the number of activities a company engages in
D) Standardizing activities across the industry
b
What does operational effectiveness primarily focus on? A) Creating unique products
B) Improving productivity, quality, and speed
C) Developing long-term strategies
D) Expanding into new markets
b
Which of the following is a key outcome of operational effectiveness? A) Higher average unit prices
B) Greater efficiency and lower average unit costs
C) Unique competitive positioning
D) Enhanced customer loyalty
b
What is a fundamental difference between operational effectiveness and strategic positioning? A) Operational effectiveness focuses on cost, while strategy focuses on innovation
B) Operational effectiveness involves performing similar activities better, while strategy involves performing different activities or the same activities differently
C) There is no significant difference
D) Operational effectiveness is concerned only with short-term gains
b
Why is sustainable competitive advantage not achievable through operational effectiveness alone? A) It requires a focus on financial metrics
B) Operational effectiveness can be easily imitated by competitors
C) It relies on random chance
D) Operational effectiveness is less important than strategy
b
What is one of the limitations of operational effectiveness mentioned in the text? A) It guarantees long-term profitability
B) It leads to unique market positioning
C) Management innovations can be rapidly imitated
D) It eliminates the need for strategy
c
What does “generic solutions” refer to in the context of operational effectiveness? A) Unique practices tailored to specific companies
B) Widely applicable solutions that can be implemented across many contexts
C) Innovative strategies that enhance competitive advantage
D) Cost-cutting measures that are rarely adopted
b
What is essential for companies to achieve sustainable profitability according to the text? A) Focusing solely on operational improvements
B) Maintaining a unique position in the market
C) Imitating competitors’ strategies
D) Reducing prices across the board
b
What is one potential risk of relying solely on operational improvements? A) Enhanced product differentiation
B) Destructive competition within the industry
C) Increased customer loyalty
D) Greater market share
b
Which of the following statements best summarizes the relationship between operational improvements and strategy? A) Operational improvements guarantee success without a strategy
B) Strategy is secondary to operational effectiveness
C) Both operational improvements and a strong strategy are essential for long-term success
D) A strong strategy eliminates the need for operational improvements
c
What is the primary focus of strategic management in an organization? A) Maximizing departmental efficiency
B) Achieving overall organizational goals and objectives
C) Focusing solely on employee satisfaction
D) Prioritizing individual department needs
b
What does the organizational versus individual rationality perspective suggest? A) All departments should pursue their own objectives regardless of the overall strategy
B) Objectives beneficial for one functional area may not be beneficial for the entire organization
C) Individual department goals are always aligned with organizational goals
D) Departments should operate independently without collaboration
b
in strategic management, decisions should ideally benefit: A) Only the top executives
B) The organization as a whole, not just specific departments
C) The marketing department exclusively
D) Individual employees
b
What is an example of a potential conflict in organizational objectives? A) All departments aiming for cost reduction
B) Operations aiming to reduce costs through standardization while marketing needs variety
C) Finance and operations working together on budget plans
D) Human resources promoting employee development initiatives
b
Why is it important for strategic management to consider the overall organization rather than just individual departments? A) To ensure all departments are equally prioritized
B) To prevent conflicts and align all efforts toward common goals
C) To encourage competition among departments
D) To limit the scope of decision-making
b
What should strategic management aim to achieve when making decisions? A) Short-term departmental success
B) Long-term organizational viability and success
C) Individual employee growth
D) Immediate cost reductions across all departments
b
Who are considered stakeholders in an organization? A) Only shareholders and employees
B) Shareholders, employees, customers, suppliers, and the broader community
C) Only customers and suppliers
D) Only top executives
b
What is a potential consequence of prioritizing profits for one stakeholder group, such as shareholders? A) Increased loyalty from customers
B) Enhanced employee morale
C) Alienation of other stakeholders like employees or customers
D) Improved overall company performance
c
What is essential for managers in strategic management regarding organizational needs? A) Focus solely on short-term profits
B) Address both current needs and long-term vision
C) Prioritize long-term investments only
D) Ignore financial pressures from markets
b
Why is it important to consider both short-term and long-term perspectives in strategy development? A) To create conflict among management
B) The creative tension between the two leads to more successful strategies
C) Short-term focus is always more beneficial
D) Long-term investments are not necessary
b
What must managers balance in effective strategic management? A) Cost reduction and revenue generation
B) Effectiveness (doing the right things) and efficiency (doing things right)
C) Employee satisfaction and customer loyalty
D) Short-term goals and long-term goals
b
Why is recognizing trade-offs important in strategic management? A) It eliminates the need for strategic planning
B) It helps managers decide between conflicting objectives based on the competitive environment
C) It allows for a singular focus on operational details
D) It simplifies the decision-making process
b
Ambidexterity refers to a manager’s challenge to align resources, without having to take advantage of
existing product markets or to proactively explore new opportunities.
F. Ambidexterity is the challenge managers face in both aligning resources to take advantage of existing
product markets and proactively exploring new opportunities.
Focusing on the short term and efficiency is always a bad management principle
F. Successful managers must make many trade-offs. It is central to the practice of strategic management. At
times, managers must focus on the short term and efficiency
Shareholders expect only short-term value and therefore good managers should only focus on meeting
short-term performance targets.
F. Strategic management requires incorporating both short-term and long-term
perspectives.
According to Peter Senge, a leading strategic management author, creative tension results from the need
to incorporate both short-term and long-term perspectives in strategic management.
T
Focusing on a single stakeholder is a good strategic principle for managers to follow
F
Strategic management is only concerned with short-term perspectives.
F
Only shareholders in a publicly held company are stakeholders because they are the only group that has
a stake in the success of the organization.
F.
Making trade-off decisions between effectiveness and efficiency is central to the practice of strategic
management
T
Ambidextrous behaviors in individuals illustrate how a dual capacity for _______ can be woven into the
fabric of an organization at the individual level.
A. alignment and adaptability
B. alignment and transparency
C. alignment and internal linkages
D. alignment and efficiency
D
Strategic management involves the recognition of trade-offs between effectiveness and
A. cost.
B. value.
C. return on investment.
D. efficiency
D
. In strategic management, both the short-term and long-term perspectives need to be considered because
A. shareholder value is only measured by short-term returns.
B. shareholders only care about long-term returns.
C. long-term vision precludes the analysis of present operating needs.
D. the creative tension between the two forces managers to develop more successful strategy
D
In choosing to focus on stakeholders, which of the following will not lead to success for a manager?
A. shareholders and employees
B. employees and suppliers
C. customers and the community at large
D. customers only
D
Effectiveness is often defined as
A. doing things right.
B. stakeholder satisfaction.
C. doing the right thing.
D. productivity enhancement.
C
The four key attributes of strategic management include all of the following except
A. including multiple stakeholder interests in decision making.
B. incorporating both short-term and long-term perspectives.
C. recognizing the trade-offs between effectiveness and efficiency.
D. emphasis on the attainment of short-term objectives.
D. The key attributes of strategic management are that it directs the organization toward overall goals and
objectives, includes multiple stakeholders in decision making, needs to incorporate short-term and longterm perspectives, and recognizes trade-offs between efficiency and effectiveness.
The four key attributes of strategic management include the idea that strategy must
A. be directed toward overall organizational goals and objectives.
B. be focused only on long-term objectives.
C. be focused on only one specific area of an organization.
D. focus only on competitor strengths.
A
The organizational versus the individual rationality perspective suggests that objectives that are
A. good for a functional area are always good for the overall organization.
B. good for the overall organization are always best for a functional area.
C. best for a functional area may not be best for the overall organization.
D. best for one functional area will never be best for all functional areas.
C
Management innovations such as total quality, benchmarking, and business process reengineering cannot
lead to sustainable competitive advantage because
A. companies that have implemented these techniques have lost money.
B. there is no proof that these techniques work.
C. they cost too much money and effort to implement.
D. every company is trying to implement them.
D
According to the text, the strategic management process entails three ongoing processes. They are
A. analyses, actions, and synthesis.
B. analyses, decisions, and actions.
C. analyses, evaluation, and critique.
D. analyses, synthesis, and decisions.
B
Melvin Alexander, executive director of Principled Solutions Enterprise, a management consulting firm
specializing in health care, suggests that environmental changes oblige firms to make strategic changes in
order to survive. Which of the following is one of the strategic changes he foresees will occur in the next
three to five years?
A. changes in the behavior of the health care consumers
B. reduction in the number of available medical doctors
C. increases in the number of locations of health care facilities
D. decreases in information technology investment
a
According to the external control view of leadership, which of the following factors would not be
considered an external factor that might positively or negatively affect a firm’s success?
A. economic downturns
B. governmental legislation
C. outbreak of war
D. company employee morale
D. In the external control view of leadership, external factors are responsible for positively or negatively
affecting company success. These external factors often are unanticipated and are not due to the
company’s leadership.
What are the three main components of the strategic management process?
A) Strategy formulation, strategy implementation, strategy evaluation
B) Strategy analysis, strategy formulation, strategy implementation
C) Market research, strategy formulation, financial planning
D) Resource allocation, strategy analysis, performance measurement
b
How do the components of the strategic management process relate to one another?
A) They are independent and occur in a sequential manner.
B) They are interdependent and typically occur in a non-sequential manner.
C) They follow a strict order and do not overlap.
D) They are optional and can be disregarded.
B
In the Mintzberg model, organizational decisions determined only by analysis are intended strategy.
t
What does “intended strategy” refer to?
A) The actual strategy that emerges after implementation
B) The initial plan created after analysis
C) Strategies developed in response to unexpected changes
D) Strategies that are never executed
b
Why does the intended strategy rarely survive in its original form?
A) It is too rigid to adapt to changes.
B) It is often abandoned before implementation.
C) Unforeseen circumstances can alter its execution.
D) It is not based on analysis.
c
What is “realized strategy”?
A) The initial plan created after analysis
B) The strategy that is intended but not implemented
C) The actual strategy that emerges after implementation
D) A theoretical concept without practical application
c
According to Henry Mintzberg, a management scholar, most firms realize their original intended
strategy.
f. → most firms do not realize their original intended strategy ( because of various reasons). Good managers will want to take advantage of a new opportunity presented by the environment, even if it was not part of the original set of intentions.
What leads to the development of “emergent strategies”?
A) Strict adherence to the intended strategy
B) Unexpected changes in the business environment
C) A lack of strategic planning
D) An emphasis on long-term goals
b
What primarily determines the intended strategy?
A) Organizational culture
B) Market trends
C) Analysis
D) Leadership styles
c
What does the final realized strategy of a firm combine?
A) Only intended strategies
B) Only emergent strategies
C) Both deliberate (intended) strategies and emergent strategies
D) Market-driven strategies and random adjustments
C
What are deliberate strategies often referred to as?
A) Realized strategies
B) Intended strategies
C) Emergent strategies
D) Tactical strategies
b
The final realized strategy of a firm is a combination of deliberate and emergent strategies.
t
What is the primary role of strategy analysis in the strategic management process?
A) To evaluate the effectiveness of implemented strategies
B) To serve as the starting point for formulating and implementing strategies
C) To allocate resources among different departments
D) To assess market trends
b
What does strategy analysis involve matching?
A) Resources with organizational culture
B) Vision, mission, and objectives with internal and external environmental factors
C) Financial performance with industry benchmarks
D) Employee skills with job requirements
b
What can result from a failure to conduct thorough strategy analysis?
A) Increased employee satisfaction
B) Effective strategies and smooth implementation
C) Ineffective strategies and poor implementation
D) Enhanced market competitiveness
C
Strategy analysis is the study of the external environments of the firm
F. Strategy analysis is study of the external and internal environments of a firm, and their fit with
organizational vision and goals.
Both the internal and external environments of a firm must be analyzed as well as the goals of the firm
before managers can formulate and implement appropriate strategies.
T
Strategy analysis is the starting point of the strategic management process and consists of the
A. analysis only of the vision, mission, and objectives of the firm.
B. analysis of the relevant internal and external environmental factors only.
C. analysis of relevant competitors only.
D. matching of vision, mission, and objectives with the relevant internal and external environmental
factors.
D
__________ may be considered the advance work that must be done in order to effectively formulate and
implement strategies.
A. Goal setting
B. Corporate entrepreneurship
C. Strategy analysis
D. Organizational design
C
What forms a goal hierarchy that guides strategic decisions in a company?
A) Financial forecasts and market analysis
B) Vision, mission, and strategic objectives
C) Operational efficiency metrics
D) Employee performance reviews
B
How do goals help a firm in its strategic management?
A) They focus solely on short-term profits.
B) They define competitive advantage and align actions for long-term success.
C) They dictate daily operational tasks.
D) They are only relevant for external communication.
b
What must managers continuously do regarding external factors?
A) Analyze only internal issues
B) Monitor and analyze external factors affecting the firm
C) Rely on past strategies without assessment
D) Conduct infrequent reviews
b
Which framework includes factors like demographics and economic trends?
A) Competitive Environment
B) General Environment
C) Internal Environment
D) Market Environment
b
What does the industry environment primarily focus on?
A) Internal organizational culture
B) External economic conditions
C) The competitive landscape, including competitors and suppliers
D) Employee satisfaction metrics
c
Why is assessing the internal environment important for firms?
A) To identify potential sources of competitive advantage
B) To reduce operational costs
C) To assess customer satisfaction
D) To analyze external competition
a
Which activities are typically assessed in a firm’s value chain?
A) Only financial analysis
B) Operations, marketing, and human resources
C) External market trends
D) Regulatory compliance
b
What role do intellectual assets play in a firm’s strategy?
A) They are irrelevant to competitive advantage.
B) They contribute to creating and sustaining competitive advantages.
C) They are solely based on physical resources.
D) They focus only on financial investments.
b
How can firms strengthen their intellectual assets?
A) By limiting technology use and collaboration
B) By developing networks and fostering collaboration
C) By focusing exclusively on physical resources
D) By minimizing employee training
b
Why is strategy formulation considered crucial for a firm?
A) It ensures that all employees are satisfied.
B) It determines how a business competes, grows, and creates value.
C) It focuses solely on operational performance.
D) It is the last step in the strategic management process.
b
What does Fred Smith, CEO of FedEx, suggest about operational performance?
A) It is the most important aspect of business success.
B) It is meaningless if the firm pursues a poor strategy.
C) It should be prioritized over strategy formulation.
D) It can be achieved without a clear strategy.
b
At what levels is strategy formulation developed?
A) Only at the executive level
B) At several levels within the organization
C) Only during financial planning
D) Primarily through market analysis
b
What aspects does strategy formulation address for firms?
A) Daily operational tasks
B) Investments, commitments, and operations that create competitive advantage
C) Employee training and development programs
D) Customer satisfaction surveys
b
How can successful firms develop bases for competitive advantage?
A) By focusing on short-term gains only
B) Through cost leadership, differentiation, or focusing on market segments
C) By minimizing operational costs without a clear strategy
D) By limiting their market reach
b
What are the two main strategies for achieving competitive advantage mentioned in the text?
A) Cost leadership and market penetration
B) Differentiation and customer loyalty
C) Cost leadership and differentiation
D) Market segmentation and operational excellence
c
Which market approach can firms focus on to achieve competitive advantage?
A) Narrow or industrywide market segment
B) Exclusive focus on customer service
C) Avoiding competition altogether
D) Limiting product offerings
A
Strategy formulation at the business level addresses best how to compete in a given business:
A. to attain competitive advantage
B. to reduce costs
C. to decrease buyer power
D. to thwart entry of new rivals
A
What does business-level strategy focus on?
A) Managing a portfolio of businesses
B) How a firm competes and outperforms rivals
C) International market entry strategies
D) Identifying entrepreneurial opportunities
b
Which strategies can firms pursue to achieve competitive advantage at the business level?
A) Mergers and acquisitions
B) Cost leadership, differentiation, or market segment focus
C) Expanding product lines only
D) Financial investment strategies
b
What question does corporate-level strategy aim to answer?
A) How to reduce operational costs
B) What businesses to compete in and how to manage them for value synergy
C) How to enhance customer satisfaction
D) What products to discontinue
b
What is the primary concern of corporate-level strategy?
A) How to innovate within a marketplace
B) Managing a portfolio of different businesses
C) Competing in international markets
D) Setting individual business objectives
b
In the context of international strategy, what do firms need to consider?
A) Only domestic market conditions
B) Unique opportunities and challenges when expanding beyond national borders
C) Employee training programs
D) Local supplier relationships
b
What does entrepreneurial strategy focus on?
A) Cost-cutting measures in existing businesses
B) Recognizing viable opportunities and formulating strategies to capture them
C) Expanding into new international markets
D) Merging with other firms
b
Why is understanding competitive dynamics important in entrepreneurial strategy?
A) It helps firms identify cost-saving opportunities.
B) It allows firms to innovate and create new value effectively.
C) It focuses solely on customer feedback.
D) It is only relevant for large corporations.
b
What is one goal of managing a portfolio of businesses in corporate-level strategy?
A) To ensure each business operates independently
B) To create more value together than they would separately
C) To minimize investments in all businesses
D) To focus exclusively on one business unit
b
Corporate level strategy focuses on what businesses to compete in and
A. how business can be managed to achieve synergy.
B. how business can be managed to reduce synergy.
C. how the firm can work as a stand-alone entity.
D. how the firm can create more value by operating alone
a
Corporate-level strategy looks at how to manage the ______ of its businesses to create synergies.
A. portfolio
B. stock prices
C. competitors
D. market pricing
a
What is another essential question that corporate-level strategy seeks to answer?
A) How to increase sales in one department
B) How can we manage this portfolio of businesses to create synergies?
C) What new products should we develop?
D) How to improve customer service
b
What is meant by “creating synergies among the businesses” in corporate-level strategy?
A) Ensuring each business operates independently
B) Making sure businesses work together to enhance overall value
C) Focusing on cost-cutting across all businesses
D) Reducing competition between business units
b
Entering foreign markets requires firms to ascertain foremost how they will attain
A. market share.
B. low costs.
C. competitive advantage.
D. low returns on investment
c
New value creation is a major engine for economic growth and is the main focus of _______________
strategy.
A. portfolio
B. corporate-level
C. business-level
D. entrepreneurial
D
Entrepreneurial activity aimed at new value creation is not a major engine for economic growth.
F
Business-level strategy focuses on (1) what businesses to compete in and (2) the management of the
business portfolio to create synergy among its businesses.
F. Corporate
Corporate-level strategy addresses how firms compete and outperform their rivals as well as achieve and
sustain competitive advantages.
F. Business
International strategy involves decisions concerning appropriate entry strategy and attaining competitive
advantage in international markets.
T
hich of the following is NOT a component of strategy implementation?
A) Strategic controls
B) Organizational design
C) Market research
D) Coordination and integration within the firm
c
What role does leadership play in strategy implementation?
A) It focuses on maintaining the status quo.
B) It ensures commitment to excellence and ethical behavior.
C) It limits innovation and new ideas.
D) It emphasizes short-term gains over long-term strategy.
b
Strategy implementation involves actions that carry out the formulated strategy including proper
strategic controls, organizational designs, and leadership.
T
Effective leadership can play a large role in fostering corporate entrepreneurship. Corporate
entrepreneurship can have a very positive impact on the bottom line of a firm
T
What are the two types of strategic control that firms must exercise?
A) Operational Control and Financial Control
B) Informational Control and Behavioral Control
C) Market Control and Resource Control
D) Tactical Control and Strategic Control
b
What does informational control involve?
A) Establishing fixed procedures for all operations
B) Continuously monitoring the environment and responding to threats and opportunities
C) Balancing rewards and culture within the organization
D) Limiting external communication
b
What is the purpose of behavioral control in strategy implementation?
A) To focus solely on financial metrics
B) To balance rewards, incentives, culture, and boundaries
C) To create rigid organizational structures
D) To minimize collaboration between teams
b
Firms must exercise either informational control or behavioral control in order to assure proper strategy
implementation
F. Firms must exercise two types of strategic control
Two types of strategic control that firms must exercise for good strategy implementation are
A. informational and confrontational.
B. confrontational and behavioral.
C. behavioral and financial.
D. informational and behavioral
D
What should organizational structures align with?
A) Historical practices of the firm
B) Firm strategy
C) Competitors’ strategies
D) Short-term financial goals
b
Effective organizational design means that firms must have ________ that are consistent with their
strategy.
A. designs and plans
B. organizational structures and designs
C. adopters and designs
D. adopters and plans
b
In fast-changing environments, what must organizational boundaries be?
A) Rigid and fixed
B) Flexible and permeable
C) Limited to internal operations
D) Strictly hierarchical
b
Learning organizations permit the entire organization to benefit from ____________ talents.
A. internal and
external
B. individual and collective
C. internal and collective
D. external and individual
b
Effective leaders set a direction and develop an organization so that it is committed to excellence and
___________ behavior.
A. performant
B. strategic
C. ethical
D. positive
c
What does fostering corporate entrepreneurship involve?
A) Maintaining the status quo
B) Continuously improving and finding new ways to renew the organization
C) Reducing investment in innovation
D) Eliminating risk-taking
b
ow should strategies be formulated in the context of corporate entrepreneurship?
A) To focus exclusively on existing products
B) To enhance the firm’s innovative capacity
C) To minimize collaboration with other organizations
D) To prioritize cost-cutting measures
b
Strategies should be formulated that enhance foremost the ____________ capacity of a firm.
A. innovative
B. learning
C. implementation
D. business-level
A
Leaders are responsible for creating a learning organization so that the entire organization can benefit
only from the individual talents.
F
What should be emphasized throughout an organization for effective strategic management?
A) Financial performance only
B) A strategic perspective
C) Operational efficiency
D) Marketing strategies
B
What type of view must managers adopt regarding functional areas?
A) A narrow focus on individual departments
B) An integrative view, assessing contributions to organizational goals
C) A competitive view against other companies
D) A reactive view to market changes
B
Who should be involved in strategic thinking within the organization?
A) Only top managers
B) People throughout the organization
C) Only the finance and marketing teams
D) External consultants
b
Why is it important for strategic thinking to involve more than just top managers?
A) It limits communication and decision-making.
B) It helps ensure that all employees contribute to organizational goals.
C) It reduces the overall effectiveness of strategy implementation.
D) It focuses only on individual performance.
b
Who is needed throughout the organization to develop and mobilize people and resources?
A) Only the top management
B) Leaders at all levels
C) External consultants only
D) Financial analysts
b
What role do local line leaders play in an organization?
A) They primarily focus on employee satisfaction.
B) They hold significant profit-and-loss responsibility.
C) They create learning infrastructures.
D) They influence through ideas without authority.
b
What is the primary function of executive leaders?
A) To manage day-to-day operations only
B) To guide ideas, create learning infrastructures, and establish domains for action
C) To enforce rules and regulations
D) To minimize employee involvement in decision-making
b
How do internal networkers influence others?
A) Through their formal authority and positional power
B) By leveraging their wealth and resources
C) Through the conviction and clarity of their ideas, along with validation and recognition
D) By controlling information and decision-making processes
c
What is a key characteristic of internal networkers in an organization?
A) They have significant formal authority.
B) They influence others despite having little positional power.
C) They focus exclusively on their own projects.
D) They primarily work independently from others.
b
Strategic management requires managers at all levels of the organization to take a segregated view of the
organization.
f. integrated view
The strategic management process should be addressed only by top-level executives. Mid-level and lowlevel employees are best equipped to implement the strategies of the organization
f
To develop and mobilize people and other assets, leaders are needed throughout the organization.
t
In the strategic management process, only local line leaders and executive leaders are needed.
f
Internal networks have great positional power and formal authority.
f
Local line leaders have little profit-and-loss responsibility.
f. have significantly
Executive leaders champion and guide ideas.
t
Local line leaders are key in setting the tone for the empowerment of employees.
f. Top-level executives are key in setting the tone for the empowerment of employees.
Richard Branson, the founder of the Virgin Group, is well known for creating an inclusive organizational
structure in which anybody in the organization can be involved in generating and activating upon new
business ideas.
t
What is often required to inculcate a strategic management perspective?
A) Minimal effort from managers
B) A major effort to effect transformational change
C) Strict adherence to existing processes
D) Relying solely on top executives
b
What does transformational change involve?
A) Only changing the organizational structure
B) Extensive communication, incentives, training, and development
C) Reducing employee input in decision-making
D) Focusing solely on financial performance
b
How do many successful executives demonstrate their interest in learning from employees?
A) By limiting communication
B) By rewarding only top performers
C) By holding town hall meetings and consulting employees
D) By making unilateral decisions without feedback
c
What is a benefit of having broad involvement throughout the organization in the strategic management process?
A) It simplifies decision-making by reducing input.
B) It encourages greater commitment and diverse perspectives.
C) It focuses only on executive opinions.
D) It eliminates the need for communication.
b
To inculcate a strategic management perspective, managers must often make a major effort to effect
transformational change.
T
To effect transformational change in an organization, managers must communicate extensively and
provide incentives, training, and development.
T
Nancy Snyder, corporate vice president of Whirlpool, shifted the reputation of the firm to that of an
innovator by investing financially in capital spending.
T
Successful executives do not reward honesty and input and do not show their interest in learning what
others are thinking.
f
According to the CEO of IDEO, Tim Brown, spotting and promoting at any level in the firm is
important.
t
There are few benefits to having broad investment throughout the organization in the strategic
management process.
f
Showing interest in learning what others are thinking is a leadership weakness
f
Tim Brown, CEO of IDEO, believes that the ________ of a person should not dictate the level of
influence their ideas should be accorded.
A. age
B. seniorit
y
C. position
D. education
c
Methods by which successful executives show their interest in learning what others are thinking include
A. holding town hall meetings and consulting employees on what they would do if in charge.
B. holding town hall meetings and consulting bankers on what they would do if in charge.
C. holding retreats and consulting rivals on what they would do if in charge.
D. consulting rivals and consulting investment bankers
a
Whirlpool’s transformation under corporate vice president Nancy Snyder included financial investments
in
A. shareholder dividends.
B. capital spending.
C. community development.
D. paying down borrowed debt.
b
Transformational change involves
A. extensive communication.
B. little training.
C. no employee development.
D. few incentives
a. Transformational change involves extensive communication, incentives, training, and development.
Richard Branson, founder of the Virgin Group, empowers his companies through a(n) _______ structure
in which anyone can bring forth new ideas.
A. formal
B. hierarchal
C. multi-level
D. informal
d
. Executive leaders champion and guide ideas by
A. reinforcing ideas that did not work.
B. creating a learning infrastructure.
C. validating their formal authority.
D. increasing their personal power
b
Internal networks generate their power through the _____________ of their ideas.
A. validity and correctness
B. conviction and clarity
C. validation and recognition
D. approval and awareness
b
Local line leaders have __________ responsibility.
A. local
B. executive
C. profit-and-loss
D. no
c
Leadership is a necessary (but not sufficient) condition for organizational success. Leaders should
emerge at which level(s) of an organization?
A. only at the top
B. in the
middle
C. throughout the organization
D. only during times of change
c
Peter Senge, of MIT, recognized three types of leaders. These individuals champion and guide ideas,
create a learning infrastructure, and establish a domain for taking action.
A. local line leaders
B. executive leaders
C. internal networkers
D. shop floor leaders
b
Peter Senge, of MIT, recognized three types of leaders. __________ are individuals that, although
having little positional power and formal authority, generate their power through the conviction and
clarity of their ideas.
A. Local line leaders
B. Executive leaders
C. Internal networkers
D. Shop floor leaders
c
The text argues that a strategic perspective in an organization should be emphasized
A. at the top of the organization.
B. at the middle of the organization.
C. throughout the organization.
D. from the bottom up
c
Strategy formulation and implementation is a challenging ongoing process. To be effective, it should not
involve
A. the CEO and the board of directors.
B. the board of directors, CEO, and CFO.
C. rivals.
D. line and staff managers
c
Many organizations have a large number of functional areas with very diverse and sometimes competing
interests. Such organizations will be most effective if
A. each functional area focuses on achieving their own goals.
B. goals are defined at the bottom and implemented at the top.
C. functional areas work together to attain overall goals.
D. management and employees have separate goals
c
What characterizes a vision statement?
A) Specific and measurable
B) Broad, inspiring, and evokes powerful mental images
C) Focused solely on financial performance
D) Narrowly defined and short-term
b
What is the primary purpose of a vision statement?
A) To outline specific financial targets
B) To create a better understanding of the overall purpose and direction of the organization
C) To define operational procedures
D) To establish individual employee roles
b
How do mission statements compare to vision statements?
A) They are more specific than vision statements but broader than strategic objectives.
B) They are identical to vision statements.
C) They focus only on short-term goals.
D) They are less important than vision statements.
a
What distinguishes strategic objectives from vision and mission statements?
A) They are less specific and measurable.
B) They provide a clear way to track progress toward overall goals.
C) They focus exclusively on employee engagement.
D) They are only applicable in the short term.
b
The vision of an organization is the top level of its hierarchy of organizational goals. The vision
statement should be massively inspiring, overarching, and long term.
t
Strategic objectives are more specific than vision statements.
t
According to the text, a mission statement is an overarching statement that is massively inspiring, long
term, and only discusses the purpose of the company.
f.
What does a mission statement include?
A) Only the financial goals of the organization
B) The purpose of the organization, its scope of operations, and the basis of its competitive advantage
C) Detailed employee roles and responsibilities
D) Strict operational procedures
b
A mission statement encompasses both the purpose of the organization as well as its basis of
competition, and the basis of its competitive advantage.
t
The hierarchy of organizational goals is in this order (least specific to most specific):
A. vision statements, strategic objectives, mission statements
B. mission statements, strategic objectives, vision statements
C. vision statements, mission statements, strategic objectives
D. mission statements, vision statements, strategic objectives
c
Vision statements are used to create a better understanding of the overall purpose and direction of the
organization. Vision statements
A. are very specific.
B. provide specific objectives.
C. set organizational structure.
D. evoke powerful and compelling mental images
d
Effective vision statements include
A. all strategic directions of the organization.
B. a brief statement of the company’s direction.
C. strategic posturing and future objectives.
D. financial objectives and projected figures.
b
What is the primary purpose of a vision in an organization?
A) To focus solely on financial targets
B) To serve as a destination driven by the organization’s aspirations
C) To outline operational procedures
D) To restrict the organization’s goals
b
WellPoint Health Network states: WellPoint will redefine our industry: through a new generation of
consumer-friendly products that put individuals back in control of their future. This is an example of a
A. strategic objective.
B. vision statement.
C. vague statement of direction.
D. line manager’s individual goal.
B. Effective visions provide a fundamental statement of the values, aspirations and goals of an organization.
Such visions go well beyond narrow financial objectives, of course, and strive to capture both the minds
and hearts of employees.
Although such visions cannot be accurately measured by a specific indicator of how well they are being
achieved, they do provide a fundamental statement of the __________ of an organization.
A. values, aspirations, and goals
B. expected returns and limitations
C. outstanding debt
D. credibility
A
What happens when management actions do not align with the stated vision?
A) Employee enthusiasm remains high.
B) Enthusiasm can wane.
C) The vision becomes irrelevant.
D) It leads to increased profits.
b
What issue arises when a vision is disconnected from environmental realities?
A) It becomes more engaging for employees.
B) Employees are likely to embrace it fully.
C) The vision is often rejected by employees.
D) It strengthens organizational capabilities.
c
Why should a vision not be considered a “holy grail” for organizational issues?
A) It is the only solution needed for success.
B) A vision is not a cure-all for complex problems.
C) It guarantees immediate results.
D) It eliminates the need for strategic planning.
b
What can result from an overemphasis on a vision?
A) Improved employee engagement
B) Missed opportunities in other areas
C) Enhanced organizational focus
D) Increased innovation and creativity
b
What is a potential problem with visions that are overly optimistic?
A) They inspire employees to work harder.
B) Employees may struggle to relate to them if they ignore present challenges.
C) They create a clear direction for the organization.
D) They enhance the organization’s reputation.
b
. In contrast to the vision of an organization, its mission should
A. be shorter in
length.
B. encompass both the purpose of the company as well as the basis of competition.
C. encompass all the major rules and regulations of the corporate work force.
D. be less detailed.
B
ow do effective mission statements address stakeholder management?
A) They focus solely on customer needs.
B) They recognize the needs of multiple groups, including customers, employees, suppliers, and owners.
C) They prioritize profits above all else.
D) They ignore stakeholder concerns.
b
What should a strong mission statement highlight?
A) Financial returns as the sole focus
B) Short-term operational goals
C) Strategic priorities that help the organization remain competitive while considering stakeholder needs
D) The personal goals of the CEO
c
Which of the following is an example of Federal Express’s mission statement?
A) “To build the best product for our customers.”
B) “To produce superior financial returns for our shareholders while serving our customers with high-quality services.”
C) “To expand our operations globally.”
D) “To prioritize employee satisfaction above all.”
b
What is Patagonia’s mission statement focused on?
A) Maximizing profits
B) Building the best product, causing no unnecessary harm, and inspiring solutions to environmental issues
C) Increasing shareholder dividends
D) Expanding its market share
b
What is often the primary audience for a mission statement?
A) Shareholders
B) Customers
C) Employees
D) Competitors
c
How do successful mission statements typically address profit?
A) They focus solely on profit as the main goal.
B) They emphasize core values like quality and impact, which drive financial success.
C) They ignore the concept of profit entirely.
D) They suggest profit is unimportant.
B. They do not make profit the sole or primary focus. Instead, they focus on core values like quality, people, and impact, which, in turn, drive financial success.
What does research suggest about companies with mission statements that emphasize values beyond profitability?
A) They are less successful.
B) They struggle to maintain market share.
C) They outperform those that focus narrowly on profits.
D) They have lower employee morale.
c
Which of the following statements best defines a strategic objective?
a) A company’s long-term vision for the future
b) A short-term goal that operationalizes the mission statement
c) A statement that sets the overall direction of the organization
d) A guideline to motivate employees
B
The vision and mission statements of a company set the overall direction of the organization. Strategic
objectives serve what role?
A. operationalize the mission statement
B. modify the mission statement
C. are a shorter version of the mission statement
D. are only clarified by the board of directors
A
What characteristic of effective strategic objectives ensures that there is at least one indicator to measure progress?
a) Timely
b) Measurable
c) Appropriate
d) Realistic
b
Strategic objectives should be achievable and consider the organization’s capabilities and external opportunities. Which characteristic does this describe?
a) Timely
b) Specific
c) Realistic
d) Measurable
c
Why is it important for strategic objectives to be timely?
a) To ensure they are consistent with the organization’s vision
b) To ensure they can be measured properly
c) To set a clear and defined time frame for achieving the objective
d) To challenge the employees’ capabilitie
c
Which of the following is NOT a benefit of having meaningful strategic objectives?
a) Channeling employee efforts toward common goals
b) Providing motivation through specific goals
c) Creating divisions in the organization to handle separate goals
d) Resolving conflicts that arise between different parts of the organization
c
Which of the following is an example of a nonfinancial strategic objective?
a) Cutting corporate overhead costs by $30 million
b) Increasing sales growth by 6 percent to 8 percent
c) Being the top-ranked supplier to customers
d) Accelerating core net earnings growth by 13 percent to 15 percent
c
What happens if a company sets too many strategic objectives?
a) It improves focus and results
b) It dilutes focus and diminishes results
c) It leads to higher revenue
d) It motivates employees more effectively
b
Single Source Systems initially set 15 objectives but missed revenue targets. What did they do next to achieve success?
a) Set even more objectives to cover all priorities
b) Focused on fewer key priorities
c) Increased their revenue targets
d) Changed their mission statement
b
Successful organizations are effective in motivating people. Employees work best when
A. they are asked to do their best.
B. work requirements are vague and unclear.
C. they are striving toward specific goals.
D. they are guided by an abstract mission statement
c
hat effect do challenging objectives have on employee motivation and performance?
A) They reduce stress and allow for more creativity.
B) They lead to higher levels of commitment and effort.
C) They create confusion about what is expected.
D) They make employees work less effectively.
b
What is the primary purpose of strategic objectives in an organization?
A) To create a mission statement.
B) To provide guidance on achieving the mission and vision.
C) To set performance reviews for employees.
D) To limit the organization’s growth potential.
b
Fortune Brands states they will cut corporate overhead costs by $30 million a year. This is an example of
a
A. nonfinancial strategic objective.
B. financial strategic objective.
C. vision statement.
D. mission statement.
b
In large organizations, conflicts can arise between functional areas. In order to resolve these conflicts,
strategic objectives
A. put financial objectives above human considerations.
B. align departments toward departmental goals.
C. help resolve conflicts through their common purpose.
D. cause debate and increase conflict.
c
