Deck 8: Managerial Decision Making, Strategy Formulation and Implementation

Question 1

Vaughn Bately manages a group of eight electrical engineers at Defiance Designs. His team is highly trained and well respected by experts both inside and outside the company. Recently, one of Vaughn's engineers suggested a new technique for the development and use of an argon laser. There appeared to be rich potential for this technology, but Vaughn wasn't certain that developing this technology was the best use of his limited resources. Vaughn was facing a significant decision.

-If Vaughn uses the classical model of decision making, which of the following assumptions would he reject?

A) The decision maker is rational and uses logic to assign values, order preferences, evaluate alternatives, and make the decision that will maximise the attainment of organisational goals.
B) The decision maker selects the alternative that will maximise the economic return to the organisation.
C) The decision maker strives for conditions of certainty and tries to gather complete information.
D) Problems are precisely formulated and defined.
E) Managers are likely to have a variety of goals and objectives.

Answer 1

Managers are likely to have a variety of goals and objectives.

Question 2

Vaughn Bately manages a group of eight electrical engineers at Defiance Designs. His team is highly trained and well respected by experts both inside and outside the company. Recently, one of Vaughn's engineers suggested a new technique for the development and use of an argon laser. There appeared to be rich potential for this technology, but Vaughn wasn't certain that developing this technology was the best use of his limited resources. Vaughn was facing a significant decision.

-If Vaughn uses the administrative model of decision making, which of these assumptions would he reject?

A) Most managers settle for a satisficing rather than maximising solution.
B) Managers' searches for alternatives are limited because of human, information, and resource constraints.
C) Rational procedures will normally lead to the best solution in a complex organisation.
D) Decision goals often are vague, conflicting, and lack consensus among managers.
E) Managers often are unaware of problems or opportunities that exist in the organisation.

Answer 2

Rational procedures will normally lead to the best solution in a complex organisation.

Question 3

All of the following are assumptions of the classical decision-making model except:

A) all alternatives and the potential results of each are calculated
B) the decision maker operates to accomplish goals that are known and agreed on
C) the decision maker is rational and uses logic to assign values, order preferences, evaluate alternatives, and make the decision that will maximise the attainment of organisational goals
D) decision goals often are vague, conflicting, and lack consensus among managers
E) criteria for evaluating alternatives are known

Answer 3

decision goals often are vague, conflicting, and lack consensus among managers

Question 4

Which of the following statements regarding the development of alternatives stage of the managerial decision-making process is true?

A) Ineffective managers usually rely on the knowledge of people throughout the organisation, and sometimes even outside the organisation, for decision alternatives.
B) Feasible alternatives are difficult to identify for both programmed and non-programmed decisions.
C) Both programmed and non-programmed decisions require new developing new courses of action that will meet the company's needs.
D) For programmed decisions, feasible alternatives usually are available within the organisation's rules and procedures.
E) Studies find that expanding the search for alternatives is a primary cause of decision failure in organisations.

Question 5

Strategy necessarily changes over time to fit environmental conditions, but to achieve competitive advantage, companies develop strategies that target specific customers, focus on core competencies, provide synergy and create value.

Question 6

The overall strategic management process begins when the executive evaluates the strategic goals of the previous year and realises a shortcoming.

Question 7

Strategy formulation may include assessing the external environment and internal problems, and integrating the results into goals and strategy.

Question 8

The BCG (Boston Consulting Group) Matrix is a coherent framework for conceptualising and categorising investments within a portfolio strategy.

Question 9

The portfolio strategy, BCG Matrix and diversification are approaches to understanding business-level strategy.

Question 10

Capital requirement and economies of scale are examples of two potential barriers to entry that can keep out new competitors.

Question 11

Cost leadership strategy is concerned with maintaining stability rather than pursuing innovation and growth.

Question 12

Learning, reallocation of existing assets and internal innovation are the route to addressing new challenges in the competitive environment and meeting new customer needs.

Question 13

Just like before, today's businesses do not see collaboration with other organisations as a strategy to succeed.

Question 14

Transnational strategy can help an organisation reap efficiencies by standardising product design and manufacturing using common suppliers, introducing products around the world more quickly, coordinating prices and eliminating overlapping facilities.

Question 15

Scancom International has chosen to pursue multidomestic strategy meaning the competition in each host's country will be handled independently of industry competition in other countries.

Question 16

An organisation pursuing export strategy is domestically focused and exports a few domestically produced products to selected countries.

Question 17

The primary key to successful strategy implementation is good leadership.

Question 18

The tools for putting strategy into action include leadership, human resources, information and controls systems, and structural design.

Question 19

The level of strategy concerned with the question 'What business are we in?' is known as:

A) corporate-level strategy
B) business-level strategy
C) functional-level strategy
D) global strategy
E) a competitive plan

Question 20

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

Question 21

The characteristics of the external environment that have the potential to help the organisation achieve or exceed its strategic goals are termed:

A) opportunities
B) strengths
C) threats
D) weaknesses

Question 22

The type of corporate-level strategy that relates to the organisation's mix of strategic business units and product lines that fit together in a way as to provide the organisation with synergy and competitive advantage is called:

A) portfolio strategy
B) global strategy
C) transnational strategy
D) BCG Matrix
E) market design strategy

Question 23

Telstra aims to find competitive edge in the Australian telecommunication industry, therefore according to Michael Porter, it can pursue the following strategies except:

A) differentiation
B) cost leadership
C) focus
D) diversification

Question 24

A(n) ____________________________ seeks to achieve both global integration and national responsiveness.

A) multidomestic strategy
B) transnational strategy
C) corporate strategy
D) globalisation strategy
E) business strategy

Question 25

The factors that contribute to the failure strategy execution include the following except:

A) employee resistance
B) manager behaviour not being in support of new direction
C) inadequate budget or resources
D) visible leadership

Question 26

The tools for putting strategy into action include:

A) leadership
B) human resources
C) information and control systems
D) structural design
E) all of these choices

Question 27

_________________________ is a situation in which there is a deep understanding and acceptance of organisational direction and purpose throughout the organisation.

A) Strength
B) Embeddedness
C) Loyalty
D) Commitment
E) Morale

Question 28

The positive internal characteristics that the organisation can exploit to achieve its strategic performance goals are known as _________________________.

Question 29

Joint ventures, strategic business partnering and preferred supplier arrangements are examples of __________________________.

Question 30

When an organisation chooses a(n) __________________________, products design and advertising strategies are standardised through the world.

Question 31

A ________________________ can help organisations reap efficiencies by standardising products design and manufacturing, using common suppliers, introducing products around the world more quickly, coordinating prices and eliminating overlapping facilities.

Question 32

The well-known adage 'Think global, act local' depicts the concept of _____________________.

Question 33

List and define the various levels of strategy.

Question 34

What is SWOT analysis? Identify and define the various components of a SWOT.

Question 35

List the various tests used in assessing the quality of strategy.

Question 36

Strategy implementation is the most important yet most difficult part of the strategic management process. In view of this, managers use some primary tools to effectively implement strategies. Discuss these tools.

Question 37

Your company is preparing to go global, as a member of the executive management team write a short essay explaining the various global strategies the company can adopt.