Chapter 1 the Nature of Strategic Management

Chapter 1   The Nature of Strategic Management

1. The goal of strategic management is to

1. achieve competitive advantage.
2. maintain competitive advantage.
3. achieve and maintain competitive advantage.
4. eliminate competitive advantage.
5. eliminate and abolish competitive advantage.

1. Strategic management focuses on integrating management, ________, and information systems to achieve organizational success.

1. marketing
2. finance and accounting
3. production and operations
4. research and development
5. all of the above

1. What can be defined as the art and science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives?

1. Strategy formulation
2. Strategy evaluation
3. Strategy implementation
4. Strategic management
5. Strategic leading

1. In recent years, the speedy flow of information through technology has

1. made it harder for people worldwide to see how others work and live.
2. strengthened national boundaries and made countries more self-contained.
3. created a borderless world with global competitors, customers, and citizens.
4. ensured that the United States is unrivaled by other companies in all industries.
5. made the real flow of financial activity align with political boundaries between countries.

1. The strategic-management process is becoming more widely used by

1. small firms.
2. nonprofit institutions.
3. governmental organizations.
4. multinational conglomerates.
5. all of the above

1. An organization should take a(n) ________ approach in its industry.

1. adversarial rather than a collegial
2. collegial rather than an adversarial
3. reactive rather than a proactive
4. proactive rather than a reactive
5. cooperative rather than a competitive

1. The strategic-management process represents a(n) ________, ________, and ________ approach for determining an enterprise's future direction.

1. logical; systematic; subjective
2. intuitive; disorganized; subjective
3. logical; systematic; objective
4. intuitive; disorganized; objective
5. inconsistent; systematic; subjective

1. The strategic-management process

1. occurs once a year.
2. is a semiannual process.
3. is a continuous process.
4. applies mostly to companies with sales greater than $100 million.
5. applies mostly to small businesses.

1. Sometimes ________ is used to refer to strategic formulation, implementation and evaluation, with ________ referring only to strategic formulation.

1. strategic planning; strategic management
2. strategic planning; strategic processing
3. strategic management; strategic planning
4. strategic management; strategic processing
5. strategic implementation; strategic focus

1. During what stage of strategic management are a firm's specific internal strengths and weaknesses determined?

1. Formulation
2. Implementation
3. Evaluation
4. Feedback
5. Goal-setting

1. An important activity in ________ is taking corrective action.

1. strategy evaluation
2. strategy implementation
3. strategy formulation
4. strategy leadership
5. all of the above

1. What step in the strategic management process involves mobilizing employees and managers to put strategies into action?

1. Strategy formulation
2. Strategy evaluation
3. Strategy implementation
4. Strategic advantage
5. Competitive advantage

1. What types of skills are especially critical for successful strategy implementation?

1. Interpersonal
2. Marketing
3. Technical
4. Conceptual
5. Visionary

1. With which phase of strategic management is most strongly associated with "action"?

1. Strategy formulation
2. Strategy implementation
3. Strategy evaluation
4. Competing advantages
5. Measuring performance

1. ________ is NOT a strategy-implementation activity.

1. Taking corrective actions
2. Establishing annual objectives
3. Devising policies
4. Allocating resources
5. Motivating employees

1. Strategy evaluation is necessary because

1. internal and external factors are constantly changing.
2. the SEC requires strategy evaluation.
3. success today is a guarantee of success tomorrow.
4. the IRS requires strategy evaluation.
5. firms have limited resources.

1. In which phase of strategic management are annual objectives are especially important?

1. Reduction
2. Formulation
3. Implementation
4. Evaluation
5. Policy

1. In which phase of strategic management are long-term objectives especially important?

1. Formulation
2. Control
3. Evaluation
4. Implementation
5. Management

1. Which statement best describes intuition?

1. It alone should be used in decision-making.
2. It represents a minor factor in decision-making integrated with analysis.
3. It should be coupled with analysis in decision-making.
4. It is better than analysis in decision-making.
5. It is management by ignorance.

1. Which individuals are most responsible for the success and failure of an organization?

1. Strategists
2. Financial planners
3. Personnel directors
4. Stakeholders
5. Human resource managers

1. What are enduring statements of purpose that distinguish one business from other similar firms?

1. Policies
2. Mission statements
3. Objectives
4. Rules
5. Employee conduct guidelines

1. An organization's vision statement

1. is a constant reminder to its employees of why the organization exists.
2. broadly charts the future direction of an organization.
3. addresses the basic question: "What is our business?"
4. answers the question: "What do we want to become?"
5. none of the above

1. Generally, external opportunities and threats are

1. uncontrollable by a single organization.
2. unable to have a significant impact on an organization.
3. not worth monitoring and evaluating.
4. key functions in strategy implementation.
5. key functions in strategy exploitation.

1. Specific results an organization seeks to achieve in pursuing its basic mission are

1. strategies.
2. rules.
3. objectives.
4. policies.
5. tenets.

1. Internal ________ are controllable activities in an organization that are performed especially well.

1. opportunities
2. incompetencies
3. strengths
4. objectives
5. factors

1. What are the means by which long-term objectives will be achieved?

1. Strategies
2. Strengths
3. Weaknesses
4. Policies
5. Opportunities

1. Long-term objectives should be all of the following EXCEPT

1. measurable.
2. continually changing.
3. reasonable.
4. challenging.
5. consistent.

1. What are guides to decision making that address repetitive or recurring situations called?

1. Strategies
2. Rules
3. Policies
4. Objectives
5. Goals

1. The act of strengthening employees' sense of effectiveness by encouraging and rewarding them for participating in decision-making and exercising initiative and imagination is referred to as

1. authoritarianism.
2. proaction.
3. empowerment.
4. transformation.
5. delegation.

1. Which of the following is often considered to be the first step in strategic planning?

1. Developing a vision statement
2. Establishing goals and objectives
3. Making a profit
4. Developing a mission statement
5. Determining opportunities and threats

1. Which of the following is part of the Strategic-Management Model?

1. Measure and evaluate performance
2. Develop mission and vision statements
3. Establish long-term objectives
4. Implement strategies
5. All of the above

1. Strategic management enables an organization to ________, instead of just responding to threats in its business environment.

1. be proactive
2. be immune to threats
3. avoid responsibility for shaping its future
4. relinquish control over its destiny
5. be reactive

1. How do line managers become "owners" of the strategy?

1. By attending top manager meetings
2. By executing plans formulated by other people
3. By involvement in the strategic-management process
4. By becoming a shareholder of the firm
5. By buying off top managers

1. Annually, ________ businesses in the United States fail.

1. exactly 100
2. less than 1,000
3. about 10,000
4. more than 100,000
5. almost 10 million

1. Organizations using strategic management are generally ________ than those that do not.

1. more profitable
2. more complex
3. less profitable
4. less successful
5. less complex

1. According to Greenley, strategic management offers all of the following benefits EXCEPT

1. increased discipline.
2. enhanced communication.
3. increased synergy.
4. increased resistance to change.
5. more effective allocation of time and resources.

1. There is a dramatic shift in mass retailing to

1. "trading up" and taking customers from more exclusive stores.
2. selling only the most expensive merchandise.
3. opening dramatically larger supercenters.
4. operating stores with less square footage.
5. cutting back on their online presence.

1. Anything that a firm does especially well compared to rival firms is referred to as

1. competitive advantage.
2. comparative disadvantage.
3. opportunity cost.
4. unsustainable advantage.
5. an external opportunity.

1. In mass retailing, big-box companies like Walmart, Best Buy, and Sears are

1. gaining competitive advantage over smaller stores.
2. participating in a dramatic shift to becoming bigger.
3. increasing the square-footage of their retail locations.
4. finding that less brick and mortar is better.
5. noticing a sharp decline in online purchases.

1. The fact that Apple has no manufacturing facilities of its own

1. has caused it to build up massive debt on its balance sheet.
2. has enabled it to remain financially lean.
3. has been problematic for Apple in terms of debt.
4. illustrates that having more fixed assets than rival firms can provide major competitive advantages in a global recession.

1. The Internet has transferred power from ________ to ________.

1. businesses; individuals
2. governments; businesses
3. individuals; businesses
4. businesses; governments
5. individuals; governments

1. Which of the following is NOT a reason given for poor or no strategic planning in an organization?

1. Planning is viewed as a waste of time
2. Content with current success
3. Too busy "firefighting" to plan ahead
4. No monetary rewards for planning
5. Trust of management makes it unnecessary

1. All of these are pitfalls an organization should avoid in strategic planning EXCEPT

1. using plans as a standard for measuring performance.
2. using strategic planning to gain control over decisions and resources.
3. failing to involve key employees in all phases of planning.
4. too hastily moving from mission development to strategy formulation.
5. being so formal in planning that flexibility and creativity are stifled.

1. Which of the following is NOT a pitfall an organization should avoid in strategic planning?

1. Failing to communicate the plan to employees
2. Involving all managers rather than delegating planning to a "planner"
3. Top managers not actively supporting the strategic-planning process
4. Doing strategic planning only to satisfy accreditation or regulatory requirements
5. Failing to create a collaborative climate supportive of change

1. Terms such as objectives, mission, strengths, and weaknesses were first formulated to address problems

1. on the battlefield.
2. in the boardroom.
3. on the trading floor.
4. in the military hierarchy.
5. in interpersonal relationships.

1. According to Webster's New World Dictionary, ________ is "the science of planning and directing large-scale military operations, of maneuvering forces into the most advantageous position prior to actual engagement with the enemy."

1. competitive advantage
2. war
3. strategy
4. formulation
5. business

1. Business or military success is

1. generally the happy result of accidental strategies.
2. undermined by the element of surprise.
3. the product of both attention to changing external and internal conditions and the insightful adaptations to those conditions.
4. unrelated to external conditions.

1. Superior strategy formulation and implementation ________ an opponent's superiority in numbers and resources.

1. are irrelevant to
2. are not enough to surmount
3. can overcome
4. can lead to
5. unite

1. A strong ________ heritage underlies the study of strategic management.

1. military
2. government
3. political
4. social
5. cultural

1. Military strategy is based on an assumption of ________, whereas business strategy is based on an assumption of ________.

1. conflict; cooperation
2. conflict; competition
3. cooperation; conflict
4. competition; conflict
5. cooperation; competition

1. Both business and military organizations must ________ and ________ to be successful.

1. be impervious to change; continually improve
2. adapt to change; constantly improve
3. shun change; stay the course
4. be impervious to change; stay the course
5. none of the above