Question 1

If a bank evaluates the capabilities of its training and development department employees prior to implementing a new training program designed to change their method of providing customer service, it is completing what step in the strategic management process?
A) external analysis
B) identify the organization's current mission, goals, and strategies
C) internal analysis
D) formulate strategies
E) implement strategies

Accepted Answer

The bank is completing the step of internal analysis by evaluating the capabilities of its training and development department employees. This step involves assessing the organization's resources and capabilities to understand its strengths and weaknesses.

Question 2

When an organization attempts to grow by merging with or acquiring firms in different but associated industries, the strategy is known as a __________ strategy.
A) related differentiation
B) horizontal integration
C) vertical integration
D) related diversification
E) concentration

Accepted Answer

When an organization attempts to grow by merging with or acquiring firms in different but associated industries, the strategy is known as related diversification. This strategy allows the organization to expand its operations and minimize risk by diversifying its products and services while leveraging its existing strengths and resources. Horizontal integration involves merging with or acquiring firms in the same industry, vertical integration involves merging with or acquiring firms at different stages of the supply chain, and related differentiation and concentration strategies focus on differentiating products or services or concentrating on a specific niche market rather than diversifying across different industries.

Question 3

The major value-creating capabilities and skills of the organization are knows as ______________.
A) core competencies
B) human resources
C) financial resources
D) leadership expertise
E) training and development programs

Accepted Answer

Core competencies refer to the unique strengths and capabilities of an organization that allow it to differentiate itself from competitors and create value for customers. These competencies can include technical expertise, innovative products or services, strong brand reputation, and efficient operations. Human resources, financial resources, leadership expertise, and training and development programs are important components of an organization's overall capabilities, but core competencies refer specifically to those capabilities that give the organization a competitive advantage.

Question 4

When an organization grows by combining operations with competitors, the strategy is known as a __________ strategy.
A) retrenchment
B) horizontal integration
C) vertical integration
D) stability
E) diversification

Accepted Answer

When an organization grows by combining operations with competitors, the strategy is known as a horizontal integration strategy. This involves the organization acquiring or merging with a similar company in the same industry to achieve economies of scale, reduce competition, increase market share, and gain access to new markets.

Question 5

Once managers have completed their analysis of the strengths, weaknesses, opportunities, and threats facing the organization, they can proceed to the next step of the strategic management process, which is to __________.
A) identify competitors
B) identify the organization's current mission, goals, and strategy
C) implement strategies
D) formulate strategies
E) identify environmental trends

Accepted Answer

Once the SWOT analysis is completed, the next step in the strategic management process is to formulate strategies based on the analysis. This involves using the information gathered in the SWOT analysis to identify specific goals and actions that will address the issues identified.

Question 6

Over the last century, the Campbell Soup Company has expanded by acquiring other packaged consumer food companies such as Pace, V8, Pepperidge Farms, Swanson, and Godiva Chocolatiers. Campbell was pursuing which corporate strategy?
A) backward vertical integration
B) forward vertical integration
C) related diversification
D) unrelated diversification
E) horizontal integration

Accepted Answer

Campbell Soup Company's strategy of acquiring other packaged consumer food companies such as Pace, V8, Pepperidge Farms, Swanson, and Godiva Chocolatiers falls under related diversification. This is because these acquisitions are related to Campbell's core business of producing packaged food products.

Question 7

When consumer electronics manufacturer Sony Corporation decided to open its own chain of retail stores, it was pursuing which corporate strategy?
A) backward vertical integration
B) forward vertical integration
C) related diversification
D) unrelated diversification
E) horizontal integration

Accepted Answer

Forward vertical integration involves a company expanding into a distribution channel previously controlled by its customers. In this case, Sony Corporation is opening its own retail stores, which allows them to sell directly to consumers and control the distribution of their products.

Question 8

__________ strategy addresses organizational weaknesses, helps stabilize operations, and revitalizes organizational resources and capabilities.
A) diversification
B) integration
C) concentration
D) retrenchment
E) stability

Accepted Answer

Retrenchment strategy focuses on reducing organizational weaknesses and stabilizing operations by cutting costs and revitalizing resources. This strategy is implemented when the organization is facing financial constraints, declining revenues, or competitive pressures. Other strategies, such as diversification, integration, concentration, and stability are focused on growth and expansion rather than addressing weaknesses and revitalizing resources.

Question 9

When Air Canada acquired its largest domestic competitor, Canadian Airlines International, it was pursuing a strategy of __________.
A) forward vertical integration
B) horizontal integration
C) related diversification
D) related differentiation
E) backward vertical integration

Accepted Answer

When Air Canada acquired Canadian Airlines International, it was pursuing a strategy of horizontal integration, which involves merging with or acquiring firms in the same industry to increase market share and competitiveness.

Question 10

When Kimberly-Clark Corporation merged with Scott Paper Company to form the world's largest producer of tissue paper, they were pursuing which growth strategy?
A) backward vertical integration
B) forward vertical integration
C) related diversification
D) unrelated diversification
E) horizontal integration

Accepted Answer

The merger between Kimberly-Clark Corporation and Scott Paper Company is an example of horizontal integration, as both companies were in the same industry, producing similar products (tissue paper), and the merger expanded their market share.

Question 11

Bella Vista Clothing targets teenaged girls with a range of affordable ready-to-wear clothing. The company is opening two new outlets, as sales have been excellent. Which of the following represents a strength for the company?
A) The company's in-house designers have a knack for identifying and popularizing fashion trends.
B) Disposable income is rising, and consumers will have more money to spend on clothes.
C) Overseas customers have shown an interest in buying Bella Vista clothes through the company's online store.
D) A long-time competitor recently went out of business, so Bella Vista can cut down on its advertising budget.
E) Teenage girls are increasingly taking part-time jobs so they can afford to buy more clothes.

Accepted Answer

The fact that Bella Vista's in-house designers have a knack for identifying and popularizing fashion trends is a strength for the company. This implies that the company can continue to create fashionable and trendy clothing that appeals to its target market, which is crucial in the fashion industry.

Question 12

An organization that has been able to excel in product research and design, manufacturing, marketing and managing its human resources to reach a leadership position in the marketplace is taking advantages of its _________.
A) competitive advantage
B) leadership expertise
C) creativity and innovation
D) core competencies
E) marketing expertise

Accepted Answer

The organization's ability to excel in various aspects of business (product research and design, manufacturing, marketing, and human resource management) suggests that it has developed core competencies that give it a competitive advantage in the market. Core competencies are unique strengths or capabilities that an organization possesses and can use to differentiate itself from competitors.

Question 13

Organizations grow by using strategies of ________.
A) concentration, integration, or diversification
B) concentration, integration, or innovation
C) integration, diversification, or differentiation
D) integration, diversification, or stabilization
E) differentiation, integration, or innovation

Accepted Answer

Organizations grow by focusing on concentration, integration, or diversification strategies, which involve focusing on core activities, expanding through mergers or acquisitions, and entering new markets or industries, respectively.

Question 14

When an organization attempts to grow by merging with or acquiring firms in different and unrelated industries, the strategy is known as a __________ strategy.
A) unrelated diversification
B) horizontal integration
C) vertical integration
D) unrelated differentiation
E) retrenchment

Accepted Answer

This strategy involves expanding the organization's operations by acquiring firms in completely different and unrelated industries. It allows the organization to spread its risks and reduce dependence on any one industry. However, it also requires significant resources and expertise to manage diverse businesses successfully.

Question 15

When L'Oreal acquired The Body Shop, it carried out ________.
A) horizontal integration
B) forward horizontal integration
C) backward horizontal integration
D) diversified integration
E) unrelated diversification

Accepted Answer

L'Oreal acquired The Body Shop to expand its product portfolio and enter the natural and organic beauty market. This is an example of horizontal integration, where a company acquires another company in the same industry and at the same stage of the production process.

Question 16

Pat's Pets has developed a reputation as the industry leader in quality pet care. It has exceptionally skilled employees who are known for their humane and loving treatment of animals. For Pat's, these resources would be considered __________.
A) opportunities
B) differential benefits
C) competitive assets
D) primary resources
E) core competencies

Accepted Answer

Pat's exceptional employees and their skills in providing quality pet care are not just opportunities or differential benefits, but they are the competitive assets that set Pat's apart from their competitors. These resources are also core competencies that form the foundation of Pat's ability to deliver value to its customers and achieve sustainable competitive advantage.

Question 17

When athletic sportswear manufacturer Nike decided to open its own chain of retail stores, it was pursuing which corporate strategy?
A) backward vertical integration
B) forward vertical integration
C) related diversification
D) unrelated diversification
E) horizontal integration

Accepted Answer

Nike opening its own chain of retail stores falls under forward vertical integration, as it involves the company expanding its operations into the distribution chain and reaching directly to the end consumers.

Question 18

The renewal strategy of __________ is used to correct less serious performance setbacks, while a __________ strategy is used for more critical performance problems.
A) diversification; integration
B) integration; retrenchment
C) stability; concentration
D) retrenchment; turnaround
E) stability; retrenchment

Accepted Answer

Retrenchment is used for more critical performance problems, while turnaround is used to correct less serious performance setbacks.

Question 19

Which of the following is one of the drawbacks to strong organizational cultures that a manager should consider when completing the strategic management process?
A) They always hinder the organization's strategic actions.
B) Employees will have less understanding of the planning process.
C) Employee attitudes tend to be strong, but their organizational values are weak.
D) They cancel out any organizational distinctive competence.
E) They are difficult to change.

Accepted Answer

Strong organizational cultures can be difficult to change, which can make it challenging to adapt to new strategies or changes in the industry. This can lead to resistance to change and difficulty implementing new initiatives.

Question 20

The Jim Pattison Group has grown by acquiring firms in diverse industries. Today, Jim Pattison owns food retail chains, car dealerships, radio stations, a fishing company, a sign company, a packaging company, and several museum-themed tourist attractions. Jim Pattison has pursued a strategy of __________.
A) vertical integration
B) horizontal integration
C) related differentiation
D) unrelated differentiation
E) unrelated diversification

Accepted Answer

The Jim Pattison Group's acquisition of firms in diverse industries indicates a strategy of unrelated diversification, rather than vertical or horizontal integration or related differentiation. This strategy involves entering into new and unrelated markets in order to spread risk and achieve growth opportunities outside of the firm's core industry.

Quiz 9: Managing Strategically

If a bank evaluates the capabilities of its training and development department employees prior to implementing a new training program designed to change their method of providing customer service, it is completing what step in the strategic management process?

When an organization attempts to grow by merging with or acquiring firms in different but associated industries, the strategy is known as a __________ strategy.

The major value-creating capabilities and skills of the organization are knows as ______________.

When an organization grows by combining operations with competitors, the strategy is known as a __________ strategy.

Once managers have completed their analysis of the strengths, weaknesses, opportunities, and threats facing the organization, they can proceed to the next step of the strategic management process, which is to __________.

Over the last century, the Campbell Soup Company has expanded by acquiring other packaged consumer food companies such as Pace, V8, Pepperidge Farms, Swanson, and Godiva Chocolatiers. Campbell was pursuing which corporate strategy?

When consumer electronics manufacturer Sony Corporation decided to open its own chain of retail stores, it was pursuing which corporate strategy?

__________ strategy addresses organizational weaknesses, helps stabilize operations, and revitalizes organizational resources and capabilities.

When Air Canada acquired its largest domestic competitor, Canadian Airlines International, it was pursuing a strategy of __________.

When Kimberly-Clark Corporation merged with Scott Paper Company to form the world's largest producer of tissue paper, they were pursuing which growth strategy?

Bella Vista Clothing targets teenaged girls with a range of affordable ready-to-wear clothing. The company is opening two new outlets, as sales have been excellent. Which of the following represents a strength for the company?

An organization that has been able to excel in product research and design, manufacturing, marketing and managing its human resources to reach a leadership position in the marketplace is taking advantages of its _________.

Organizations grow by using strategies of ________.

When an organization attempts to grow by merging with or acquiring firms in different and unrelated industries, the strategy is known as a __________ strategy.

When L'Oreal acquired The Body Shop, it carried out ________.

Pat's Pets has developed a reputation as the industry leader in quality pet care. It has exceptionally skilled employees who are known for their humane and loving treatment of animals. For Pat's, these resources would be considered __________.

When athletic sportswear manufacturer Nike decided to open its own chain of retail stores, it was pursuing which corporate strategy?

The renewal strategy of is used to correct less serious performance setbacks, while a strategy is used for more critical performance problems.

Which of the following is one of the drawbacks to strong organizational cultures that a manager should consider when completing the strategic management process?