Deck 8: Strategy Formulation and Execution

Question 1

The combination of benefits received and costs paid by the customer refers to value.

Answer 1

True

Question 2

Some companies hire competitive intelligence professionals to scan the external environment and provide data and research on relevant domestic and global trends.

Answer 2

True

Question 3

Competitive advantage refers to the set of decisions and actions used to formulate and implement strategies.

Answer 3

False

Question 4

Strategy implementation involves the planning and decision making that lead to the establishment of the firm's goals.

Question 5

Executives acquire information about external opportunities and strengths from a variety of reports, including budgets, financial ratios, profit and loss statements, and surveys of employee attitudes and satisfaction.

Question 6

Threats are characteristics of the internal environment that may prevent the organization from achieving its strategic goals.

Question 7

Corporate-level strategy pertains to the organization as a whole.

Question 8

The "How do we compete?" question concerns functional-level strategy.

Question 9

The task environment sectors are the most relevant to strategic behavior and include the behavior of competitors, customers, suppliers, and the labor supply.

Question 10

The interaction of Production and Sales working together to produce profit greater than the total of both working separately is an example of synergy.

Question 11

Core competence is the plan of action that prescribes resource allocation and other activities for dealing with the environment.

Question 12

Strategic thinking is more important -profit businesses than for non-profit organizations.

Question 13

Strategic partnerships are the current trend, rather than mergers and acquisitions.

Question 14

Front-line managers have the final responsibility for strategic planning.

Question 15

The essence of formulating strategy is choosing how the organization will conform to become like its key competitors in the industry.

Question 16

Top managers and chief executives have the final responsibility for strategic planning.

Question 17

Research has shown that strategic thinking and planning positively affect a firm's performance and financial success.

Question 18

In a turbulent business climate, managers should focus on strategic stability rather than flexibility.

Question 19

The three levels of strategy are business, corporate, and global.

Question 20

The administration and implementation of the strategic plan is strategy execution.

Question 21

The question mark exists in a new, rapidly growing industry but has only a small market share, according to the BCG Matrix.

Question 22

With a multidomestic strategy, a company will achieve the globalization or standardization of marketing and production approaches.

Question 23

Opportunities are characteristics of the internal environment that have the potential to help the organization achieve or exceed its strategic goals.

Question 24

Differentiation, cost leadership, and focus are three of Porter's competitive strategies.

Question 25

Diversification is a strategy of moving into new lines of business.

Question 26

Vertical integration means a firm expands into businesses that either produce the supplies needed to make products or that distribute and sell those products to customers.

Question 27

According to the BCG Matrix, the cash cow has a large market share in a rapidly growing industry.

Question 28

The world-wide standardization of product design and advertising refers to globalization.

Question 29

The mix of business units and product lines that fit together in a logical way to provide synergy and competitive advantage for the corporation pertains to portfolio strategy.

Question 30

Unrelated diversification occurs when an organization expands into a totally new line of business.

Question 31

Business-level strategies include all of the major functions, including finance, research and development, marketing, and manufacturing.

Question 32

A director of finance would most likely be interested in executing functional level strategies.

Question 33

A transnational strategy combines degrees of both global standardization and national responsiveness.

Question 34

The transnational strategy handles markets independently for each country.

Question 35

Organization's with a focus strategy concentrate on a specific regional market or buyer group.

Question 36

A transnational strategy seeks to achieve both global integration and national responsiveness.

Question 37

The BCG (Boston Consulting Group) matrix evaluates SBUs with respect to their business growth rate and geographical location.

Question 38

Cost leadership is a type of competitive strategy with which the organization seeks to distinguish its products or services from that of competitors.

Question 39

The dog, according to the BCG Matrix, is a poor performer.

Question 40

An SBU stands for Star Business Unit.

Question 41

A corporate-level strategy is concerned with the question:

A) what business are we in?
B) how do we compete?
C) how do we support our chosen strategy?
D) where do we market our products?
E) should we promote from within?

Question 42

The plan of action that prescribes resource allocation and other activities for dealing with the environment and helping the organization attain its goals is known as a(n) _____.

A) goal
B) objective
C) mission
D) vision
E) strategy

Question 43

Which of the following is a business activity that an organization does especially well relative to its competition?

A) Strategy
B) Synergy
C) Cash cow
D) Core competence
E) Multidomestic

Question 44

In order to protect an organization's mission, the human resource functions are removed from strategic goals.

Question 45

For successful execution, alignment of everyone in the organization must occur.

Question 46

Which of these questions is central to a functional-level strategy?

A) What business are we in?
B) How do we compete?
C) How do we support our chosen strategy?
D) What business do we buy?
E) Where to market our products?

Question 47

When properly managed, _____ can create additional value with existing resources, providing a big boost to the bottom line.

A) synergy
B) competitors
C) government contacts
D) command structure
E) cooperation among customers

Question 48

After Sunshine Systems merged with RTD Enterprises, company executives noticed that due to increased employee collaboration between the two units, costs were down and revenues increased within both areas. This is an example of what business phenomenon?

A) Strategy execution
B) Portfolio strategy
C) Core competency
D) Synergy
E) Delivering value

Question 49

_____ can be defined as the combination of benefits received and costs paid by the customer.

A) Organizational benefits
B) Value
C) Cost-benefit diversity
D) Synergy
E) Core competence

Question 50

Janessa is the CEO of a privately-held software company. In defining corporate-level strategies, which of the following questions would she most likely be concerned with?

A) How do we compete?
B) What business are we in?
C) How does marketing support the business?
D) How can we maximize profits?
E) How can we make manufacturing processes more efficient?

Question 51

Which of the following pertains to the organization as a whole?

A) Business-level strategy
B) Functional-level strategy
C) Corporate-level strategy
D) Operational-level strategy
E) Competitive-level strategy

Question 52

_____ level strategy pertains to the major functional departments within the business unit.

A) Operational
B) Corporate
C) National
D) Business
E) Functional

Question 53

_____ refers to the use of managerial tools to direct resources toward the achievement of strategic goals.

A) Strategy formulation
B) Strategy coordination
C) Strategy execution
D) Strategy control
E) Strategy planning

Question 54

Which of the following refers to the planning and decision making that lead to the establishment of the organization's goals and of a specific strategic plan?

A) Strategy formulation
B) Strategy implementation
C) Strategy coordination
D) Strategy control
E) SWOT

Question 55

The set of decisions and actions used to formulate and implement strategies that will provide a competitively superior fit between the organization and its environment so as to achieve organizational goals is known as:

A) strategy formulation.
B) strategic planning.
C) strategic management.
D) strategy implementation.
E) strategy evaluation.

Question 56

Which of the following lists the strategic management process in proper order?

A) Formulate strategy; Evaluate strategy; Perform SWOT analysis; Define new mission/goals; Execute strategy; Control strategy.
B) Perform SWOT analysis; Evaluate current mission/goals; Formulate strategy; Execute strategy; Define new mission/goals.
C) Evaluate current mission/goals; Define new mission/goals; Formulate strategy; Execute strategy; Perform SWOT analysis .
D) Evaluate current mission/goals; Perform SWOT analysis; Define new mission/goals; Formulate strategy; Execute strategy.
E) Define new mission/goals; Execute strategy; Formulate strategy; Evaluate new mission/goals; Perform SWOT analysis.

Question 57

In strategy implementation, leadership is the ability to influence people to adopt the new behaviors needed.

Question 58

Decisions regarding the proper amount of advertising for a particular good or service are related to:

A) corporate-level strategies.
B) functional-level strategies.
C) tactical-level strategies.
D) business-level strategies.
E) retrenchment strategies.

Question 59

The condition that exists when the organization's parts interact to produce a joint effect that is greater than the sum of the parts acting alone is known as:

A) core competence.
B) synergy.
C) value creation.
D) business-level strategy.
E) multidomestic strategy.

Question 60

To remain competitive, companies should develop strategies that focus on core competencies, providing synergy, and creating value for _____.

A) customers
B) suppliers
C) stockholders
D) employees
E) board members

Question 61

Gatekeep Utilities is a subsidiary of GW Enterprises. Gatekeep has a mission and product line that is unique from GW. Gatekeep's competitors are also very different from those of its parent, and the subsidiary markets to a very different group of customers. As such, Gatekeep can be described as a(n) _____.

A) product unit
B) functional unit
C) operational unit
D) strategic business unit
E) boston consulting group unit

Question 62

How business units and product lines fit together in a logical way is the essence of:

A) business-level strategy.
B) portfolio strategy.
C) competitive strategy.
D) financial strategy.
E) functional strategy.

Question 63

Double Click, Inc. has a number of strategic business units. Their hand-held computer unit has a large market share in this rapidly growing industry. Their hand-held computer business would be classified as:

A) a dog.
B) a star.
C) a question mark.
D) a cash cow.
E) stuck in the middle.

Question 64

Which of the following portfolio categories is made up of poor performers who command only a small share of a slow growth market?

A) Star
B) Cash cow
C) Question mark
D) Dog
E) Cat

Question 65

When an organization expands into a totally new line of business, it is implementing a strategy of:

A) Related diversification
B) Unrelated diversification
C) Cross-functional diversification
D) Product line diversification
E) Industry diversification

Question 66

Which of these is true about the dog division?

A) It has a large market share in a rapidly growing industry.
B) It has a large market share in a slow growth industry.
C) It has a small market share in a rapidly growing industry.
D) It has a small share of a slow growth market.
E) It has a moderate market share in a rapidly growing industry.

Question 67

Which of these is true about the cash cow?

A) It generates tremendous profits in a rapidly growing industry.
B) It has a small market share in a rapidly growing industry.
C) It has a small market share in a slow growth industry.
D) It has a large market share in a slow growth industry.
E) It is generally a dead business that should be divested.

Question 68

The star has a:

A) large market share in a rapidly growing industry.
B) large market share in a slow growth industry.
C) small market share in a rapidly growing industry.
D) small share of a slow growth market.
E) moderate market share in a slow growth industry.

Question 69

Semway, a regional bank, recently announced that it would soon begin offering financial planning services. This is an example of which of these?

A) Related diversification
B) Unrelated diversification
C) Cross-functional diversification
D) Product line diversification
E) Industry diversification

Question 70

Classy Clay has extremely creative employees who, in the opinion of the organization, keep the company ahead of the competition. The creativity of these employees would be classified as a(n) _____.

A) internal weakness
B) external opportunity
C) external strength
D) internal strength
E) neutral factor

Question 71

What type of organizational unit has a unique business mission, product line, competitors, and markets relative to other units in the same corporation?

A) Product unit
B) Functional unit
C) Strategic business unit
D) Operational unit
E) Business consulting group unit

Question 72

The question mark has a:

A) large market share in a rapidly growing industry.
B) large market share in a slow growth industry.
C) small market share in a rapidly growing industry.
D) small share of a slow growth market.
E) moderate market share in a slow growth industry.

Question 73

Paramount, Inc. is particularly concerned about pending legislation in Congress that would further regulate their organization. This legislation would be classified as a(n) _____.

A) external opportunity
B) internal strength
C) external threat
D) external weakness
E) congressional chaos

Question 74

Where does the information about opportunities and threats comes from?

A) An analysis of the organization's internal environment
B) A department by department study of the organization
C) Scanning the external environments
D) Employee grievances
E) Financial ratios of the organization

Question 75

Sherri has been asked to participate on a cross-functional task force that is charged with performing an audit checklist for her advertising firm. The task force will analyze organizational strengths and weaknesses as they apply to the firm. Sherri's task is to analyze management quality, staff quality, degree of centralization, and organizational charts. This level of analysis pertains to which area of the audit?

A) Management and organization
B) Marketing
C) Human resources
D) Research and development
E) Production

Question 76

Gillette operates numerous strategic business units. Most of its units in the personal care division have low market share but high business growth. These units are classified as _____.

A) dogs
B) question marks
C) stars
D) cash cows
E) none of these

Question 77

Techniques used to monitor external environments include:

A) hiring scanning organizations.
B) hiring the competitive intelligence professionals.
C) government reports.
D) professional journals.
E) all of these.

Question 78

The BCG matrix organizes along which of the following dimensions?

A) Market share and profit
B) Sales and market share
C) Business growth rate and market share
D) Business growth rate and profit
E) Sales and profits

Question 79

According to the BCG Matrix, which of the following exists in a mature, slow-growth industry, but is a dominant business in the industry, with a large market share?

A) Question mark
B) Asterisk
C) Dog
D) Star
E) Cash cow

Question 80

Fred has been assigned to conduct a SWOT analysis for his organization, Acme, Inc. As part of this assignment, Fred will:

A) conduct an external wage survey.
B) search for the strengths, weaknesses, opportunities, and threats that impact his firm.
C) choose a grand strategy for his firm.
D) do a cost/benefit analysis.
E) develop a mission.