MCQS Notes for Chapter06

8/12/2019 MCQS Notes for Chapter06

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CHAPTER 6

Strategy Analysis and Choice

True/False

The Nature of Strategy Analysis and Choice

1. An organizations present strategies, objectives and mission provide a basis forgenerating and evaluating feasible alternative strategies, coupled with the externaland internal audit information.

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%. &trategic anal'sis and choice largel' involves ma(ing objective decisions basedon subjective information.

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*. +dentif'ing and evaluating alternative strategies shouldnt involve the managersand emplo'ees who earlier assembled the organizational vision and missionstatements, performed the external audit and conducted the internal audits.

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A Comprehensie Strategy!Formulation Frame"or#

-. The first stage of the strateg'#formulation framewor( is the input stage, followed b'the matching stage.

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. &tage % in the strateg'#formulation framewor( involves a single techni/ue, the0uantitative &trategic lanning atrix.

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". The +nternal )actor 2valuation atrix and the 2xternal )actor 2valuation atrix arepart of the final stage of the strateg' formulation framewor(.

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$. The Threats#3pportunities#4ea(nesses#&trengths 5T34&6 atrix, the &trategicosition and Action 2valuation 5&A726 atrix, the 8oston 7onsulting 9roup58796 8usiness ortfolio atrix, the +nternal#2xternal 5+26 8usiness ortfolioatrix and the 9rand &trateg' atrix are included in stage two of the strateg'#formulation framewor(.

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The %nput Stage

. 8asic input information for the matching and decision stage matrices is provided b'the information derived from &A72, T34& and 879 matrices.

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!. &trategists themselves, not anal'tical tools, are alwa's responsible and accountable

for strategic decisions.

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1. The divisions of an organization should utilize strateg'#formulation anal'tical toolsto develop their own strategies and objectives.

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11. 9ood intuitive judgment is alwa's needed to determine appropriate weights andratings in the input stage matrices.

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The &atching Stage

1%. The number of internal factors and external factors in the matching stage is reducedto generate feasible strategies.

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1*. The purpose of matching (e' factors is to generate feasible alternative strategies.

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1-. To effectivel' formulate competitive strategies, an organization should match itsexternal opportunities and threats.

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1. &3 strategies are based on using a firms internal strengths to ta(e advantage ofexternal opportunities and threats.

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1". atching strengths with wea(nesses is how &4 strategies are created.

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1$. A T34& atrix is composed of four cells for four t'pes of strategies it creates.

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1. The purpose of each stage % matching tool is to generate feasible alternativestrategies, not to select or determine which strategies are best.

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1!. 3nl' to get into a situation where the' can wor( from strengths to ta(e advantage ofopportunities, organizations generall' will pursue the other three t'pes of strategies543, &T, or 4T6.

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%. )rom matching an internal wea(ness with an external threat, a 4T strateg' in theT34& atrix could result.

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%1. 4T strategies are defensive tactics.

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%%. atching techni/ues include both the &A72 atrix and the T34& atrix.

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%*. The 2& and 7A dimension variables in a &A72 atrix are assigned a numericalvalue ranging from ;1 5best6 to ;" 5worst6.

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%-. The most important determinants of an organizations overall strategic position areconsidered to be the two internal dimensions, financial strength 5)&6 and competitiveadvantage 57A6, and the two external dimensions, industr' strength 5+&6 andenvironmental stabilit' 52&6.

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%. The &A72 atrix axes are labeled aggressive, conservative, defensive andcompetitive.

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%". The four strategies of the &A72 atrix are aggressive, conservative, offensive anddefensive.

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%$. The appropriate strategies are intensive, integration, defensive and diversificationwhen a firms directional vector is located in the aggressive /uadrant of the &A72atrix.

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%. 7onservative strategies in a &A72 atrix most often include intensive strategiesand concentric diversification.

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%!. +ntegration and diversification strategies are most often included in competitivestrategies in a &A72 atrix.

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**. +n the &A72 atrix, growth potential, profit potential and financial stabilit' couldall fall under the categor' of industr' strength.

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*-. 8' examining the relative mar(et share and industr' growth rate of each divisionrelative to all other divisions with the 879 matrix, a multidivisional organization isallowed to manage its portfolio of businesses.

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*. roduct /ualit' is an important consideration in the 879 atrix.

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*". Technical (now#how, mar(et share and product life c'cle are some examples of

areas to consider when evaluating a compan's competitive advantage.

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*$. The 8oston 7onsulting 9roup atrix is good for firms with man' =profit centers.>

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*. The compan's total sales and number of emplo'ees are (e' considerations in the8oston 7onsulting 9roup atrix.

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*!. The firm should pursue conservative strategies if the coordinates of a &A72directional vector are 51,-6.

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-. A firm should pursue defensive strategies if the coordinates of a &A72 directionalvector are 5%,*6.

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-1. The firm should pursue aggressive strategies if the coordinates of a &A72directional vector are 5,-6.

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-%. A firm should pursue competitive strategies if the coordinates of a &A72directional vector are 5-,"6.

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-*. &tar, /uestion mar(, cash cow and dogs are the four /uadrants exhibited b' the&A72 atrix.

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--. The size of the circle in a 879 atrix corresponds to the proportion of corporaterevenue generated b' that business unit. The pie slice indicates the proportion ofcorporate profits generated b' that division.

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-. ?ivisions with a low relative mar(et share position and a high industr' growth arecalled /uestion mar(s in the 879 atrix.

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-". 7ash cows represent the organizations best long#run opportunities for growth andprofitabilit'.

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whether to strengthen them b' pursuing intensive strategies or engaging in jointventure.

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-. The major overall benefit of the 879 atrix is that it draws attention to the cashflow, investment characteristics and needs of an organizations various divisions.

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-!. ?ogs on the 879 atrix usuall' become stars after mar(et penetration.

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. 9enerall', the 879 atrix and the +2 atrix are used onl' in formulating strategiesin multidivisional firms.

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1. @iewing businesses as star, cash cow, dog, or /uestion mar( is an oversimplification.

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%. The 879 atrix does not reflect whether or not various divisions or their industries

are growing over time.

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*. aving no temporal /ualities, the 879 atrix is a snapshot of an organization at agiven point in time.

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-. 8oth +2 and 879 atrices are called portfolio matrices.

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. 3n the x#axis of the +2 atrix, an internal factor evaluation score of %. represents awea( internal position.

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". 879 atrix re/uires more information about the divisions than the +2 atrix.

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$. The +2 atrix can be divided into three major regions that have different strateg'implications: grow and build, hold and maintain and harvest or divest.

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. The 9rand &trateg' atrix is based on two evaluative dimensions, mar(et share andmar(et growth.

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!. ositioned in or around cell +B in the +2 atrix, successful organizations are able toachieve a portfolio of businesses.

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". According to the 9rand &trateg' atrix, when a 0uadrant + firm is too heavil'committed to a single product, then concentric diversification ma' reduce the ris(sassociated with a narrow product line.

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"1. 0uadrant +++ organizations compete in rapid#growth industries and have wea(competitive positions, according to the 9rand &trateg' atrix.

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The -ecision Stage

"%. The 0uantitative &trategic lanning atrix is an excellent decision stage anal'ticaltool.

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"*. &mall companies could s(ip &tages 1 and % of the strateg'#formulation framewor(and develop a 0&.

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"-. To objectivel' evaluate feasible alternative strategies identified in &tage %, the0& uses input information derived from &tage 1.

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". The left column of a 0& consists of information ta(en directl' from the +nternal)actor 2valuation atrix and the 2xternal )actor 2valuation atrix.

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"". Alternative strategies derived from the T34& atrix, &A72 atrix, 879 atrix,+2 atrix and 7ompetitive rofile atrix are included in the 0&s top row.

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"$. An' number of sets of alternative strategies can be included in the 0&, and an'number of strategies can comprise a given set.

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". &tep 1 of a 0& assigns weights to each (e' external and internal factor.

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"!. The &um Total Attractiveness &cores are defined b' the product of multipl'ing theweights 5step %6 b' the attractiveness scores 5step -6 in each row of the 0&.

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$. Total attractiveness scores are defined as the sum of the attractiveness scores in agiven column of the 0&.

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$1. The relative desirabilit' of one strateg' over another is indicated b' the magnitudeof the difference between the total attractiveness scores in a given set of strategicalternatives.

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$%. Two limitations of the 0uantitative &trategic lanning atrix are weights andratings.

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$*. A positive feature of 3& is that sets of strategies can be examined se/uentiall' orsimultaneousl'.

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$-. 3ne positive feature of 3& is that it does not re/uire intuitive judgments andeducated assumptions.

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Cultural Aspects of Strategy Choice

$. 7ulture includes the set of shared values, beliefs, attitudes, customs, norms,personalities, heroes and heroines that describe a firm.

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$". 9enerall', small organizations have a business plan whereas large organizationshave culture.

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$$. 7ulture is the uni/ue wa' an organization does business.

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$. 4henever two firms merge, it becomes especiall' important to evaluate and

consider culture#strategies lin(ages.

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The Politics of Strategy Choice

$!. &uccessful strategists establish additional hurdles or tests for strongl' supportedideas that are considered unacceptable, but which are best not opposed openl'.

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. &uccessful top managers (eep a low political profile on acceptable proposals.

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1. 8' continuousl' chatting and informall' /uestioning, successful 723s sta' abreastof how things are progressing and (now when to step in to intervene.

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%. &uccessful strategists minimize their own political exposure on issues that are highl'controversial and in circumstances where opposition from major power centers wasli(el'.

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*. 2/uifinalit' means it is often possible to achieve similar results using differentmeans or paths.

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-. &atisficing means it is often possible to achieve similar results using different meansor paths.

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. &hifting focus from specific issues to more general ones ma' increase strategistsoptions for gaining organizational commitment.

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The Role of a 0oard of -irectors

". Cow averaging 1 members rather than 1% as the' did a few 'ears ago, the trend inAmerica is toward larger boards.

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$. 8oards of directors are composed mostl' of outsiders who are becoming moreinvolved in an organizations strategic management.

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. Business Weekrecommends board members retire at age ".

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!.Business Week

recommends the entire board of directors be up for election annuall'.

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!. The board of directors of Trans Dnion 7orporation, according to a ruling b' the&upreme 7ourt of ?elaware in 1!, violated the interests of shareholders whenthe' hastil' accepted a ta(eover bid from the armon 9roup.

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!1. The impact of increasing legal pressures on board members is that directors aredemanding access to more financial performance information on a regular basis.

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!%. 8oards of directors toda' are composed mostl' of outsiders who are becoming moreinvolved in the compan's strategic#management activities.

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!*. There are on average five times more outsiders on the board than insiders atAmerican firms.

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Conclusion

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!. The EEEEEEEE stage involves a single techni/ue, 0&.a. &tage %b. ?ecisionc. +nputd. atching

e. &tage 1

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!!. A5n6 EEEEEEEEEE reveals the relative attractiveness of alternative strategies and thusprovides an objective basis for selecting specific strategies.a. T34&b. &A72c. 0&d. +)2e. 7

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1. 2ach of the nine techni/ues included in the strateg' formulation framewor( rel' onthe use ofa. strictl' factual data.b. luc(.c. financial formulas and statistics.d. intuition and anal'sis.e. s'nerg'.

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The %nput Stage

11. The EEEEEEEEEE stage includes an +nternal )actor 2valuation atrix and a7ompetitive rofile atrix.a. inputb. matchingc. decisiond. penetratione. research

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1%. EEEEEEEEEE is not an input stage matrix.a. +)2b. +2c. 7d. 2)2

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The &atching Stage

1*. EEEEEEEEEE is not a &tage % matching techni/ue.a. The &A72 atrixb. The 9rand &trateg' atrixc. The 7ompetitive rofile atrixd. The 8usiness ortfolio atrixe. The T34& atrix

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1-. The EEEEEEEEEE of the strateg' formulation framewor( contains the T34& atrix,the &A72 atrix, the 9rand &trateg' atrix and the 7ompetitive rofile atrix.a. input stageb. matching stagec. decision staged. output stagee. Cone of the above

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1. EEEEEEEEEE is not a T34& strateg'.a. &3b. 43c. &4d. &Te. 4T

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1". oor product /ualit', coupled with reliable suppliers, would suggesta. 4T strategies.b. 43 strategies.c. &T strategies.d. &3 strategies.

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1$. atching internal strengths with external opportunities is part of which section ofthe T34& atrixGa. The 4T cellb. The 43 cellc. The &T cell

d. The &3 celle. The center four cells

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1. The most ideal situation for a compan' to be in on the T34& atrix would be ifthe' had alla. &3 strategies.b. 43 strategies.c. &T strategies.d. 4T strategies.

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1!. 4hich strategies aim at improving internal wea(nesses b' ta(ing advantage ofexternal opportunitiesGa. &3b. 43c. &4d. &Te. 4T

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11. The purpose of each &tage % matching tool is toa. identif' the strengths, wea(nesses, opportunities and threats of the firm.b. generate the feasible alternative strategies for the firm.c. pic( the best strateg' for the firm to carr' out.d. decide who the compan's major competitors are.

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111. +f an organization were to match high emplo'ee turnover with increased localcompetition, what t'pe of strategies would be appropriateGa. &3 strategiesb. 43 strategiesc. &T strategiesd. 4T strategies

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11%. 4hich strategies use a firms strengths to avoid or reduce the impact of externalthreatsGa. &4b. 43c. &4

d. &Te. 4T

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11*. EEEEEEEEEE strategies are defensive tactics directed at reducing internal wea(nessesand avoiding environmental threats.a. &3b. 43c. &4d. &T

e. 4T

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11-. A T34& atrix is composed of EEEEEEEEEE cells.a. four b. sixc. nined. eighte. two

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11. 4hich of the following is not a step of a T34& atrixGa. Hist the firms (e' external threatsb. atch strengths with external opportunities and record the resultant &3

strategies in the appropriate cellc. atch internal wea(nesses with external threats and record the resultant 4T

strategiesd. Hist the firms external wea(nessese. Hist the firms external threats

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11". 4hich of these is not a &A72 atrix /uadrantGa. Aggressiveb. ?efensivec. 7ompetitived. 3ffensive

e. 7onservative

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11$. EEEEEEEEEE reveals whether aggressive, conservative, defensive, or competitivestrategies are most appropriate.a. 9rand &trateg' atrixb. &A72 atrixc. 7ompetitive rofile atrixd. T34& atrixe. 0&

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11. The two positive#rated dimensions on &A72 atrix area. )& and 7A.b. 7A and 2&.c. )& and +&.d. +& and 2&.e. )& and 2&.

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11!. A firm located in the aggressive /uadrant of the &A72 atrix should use itsinternal strengths toa. ta(e advantage of external opportunities.b. overcome internal wea(nesses.c. avoid external threats.d. do all of the above.

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1%. )inancial strengths are measured on the &A72 atrix b' variables such asinvestment, leverage, li/uidit', wor(ing capital anda. ease of entr' into the mar(et.b. product /ualit'.c. operations and facilities.d. wor(ing capital.

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1%1. 4hat is the 879 atrix ideal for anal'zingGa. 7ompanies with more than one divisionb. All companiesc. 7ompanies with annual sales greater than I1 milliond. 7ompanies with annual sales of less than I1 million

e. Harge companies

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1%%. The 879 measures relative mar(et share position asa. a divisions sales compared to the sales of similar companies.b. a divisions mar(et share divided b' the mar(et share of the largest rival in that

industr'.c. the number of products a division has on the mar(et compared to the

competitors.d. the number of emplo'ees in a division compared to the number of emplo'ees in

the largest rival in the industr'.

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1%*. EEEEEEEEEE should not be included as a factor in the 2nvironmental &tabilit' 52&6computation.a. Technological changesb. 7ompetitive pressurec.


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1%. +f the &A72 atrix directional vector falls in the aggressive /uadrant, which ofthese strategies are not appropriateGa. +ntensiveb. +ntegrativec. ?iversification

d. ?efensivee. 7ombination

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1%". 4hich of these /uadrants in &A72 atrix implies sta'ing close to the firms basiccompetencies and not ta(ing excessive ris(sGa. 7onservativeb. 7ompetitivec. ?efensived. Aggressive

e. Cone of these

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1%$. EEEEEEEEEEEEEE is common to the defensive and conservative /uadrants of a&A72 atrix.a. roduct developmentb. 7oncentric diversificationc. ?ivestitured. ar(et penetratione.


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1%!. +n the &A72 anal'sis what does a 5J", J*6 strateg' profile portra'Ga. A strong industr'b. An unstable environmentc. A stable environmentd. A wea( industr'

e. A wea( financial position

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1*. ow would a division with a low relative mar(et share position in a high growthindustr' be describedGa. 0uestion mar( b. 7ash cowc. &tar d. &tuc(#in#the#middlee. ?og

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1*1. 4hen a division of an organization has a high relative mar(et share and is in a fast#growing industr', it is called aa. star.b. cash cow.c. /uestion mar(.d. dog.

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1*%. A division with a high relative mar(et share position in a low#growth industr' can bedescribed as aa. star.b. cash cow.c. /uestion mar(.d. dog.e. failure.

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1**. 4hich of these is an attractive strateg' for a cash cow divisionGa. 7oncentric diversificationb. orizontal integrationc. 7onglomerate diversificationd. 8ac(ward integratione. )orward integration

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1*-. ost li(el', a cash cow was what in the pastGa. dogb. /uestion mar(c. calf d. star

e. failure

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1*. The 879 atrix limitations includea. being a time#consuming and costl' anal'sis.b. re/uiring at least three 'ears worth of data.c. not reflecting divisional or industr' growth over time.d. not allowing a compan' to be classified as somewhere in between two

categories.e. both c K d.

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1*". The 879 atrix and the +2 atrix are different in all of the following aspectsexcepta. their axes.b. the +2 re/uires more information about the divisions than the 879 atrix.c. the wa' the' plot organizational divisions.d. their strategic implications.

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1*$. 4hat has four /uadrants based on two dimensions: competitive position and mar(etgrowthGa. 7ompetitive rofile atrixb. T34& atrixc. &A72 atrixd. 9rand &trateg' atrixe. 0&

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1*. )irms located in which /uadrant of the 9rand &trateg' atrix are in an excellentstrategic positionGa. +b. ++c. +++d. +@

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1*!. EEEEEEEEEE in the 9rand &trateg' atrix is recommended for a firm with rapidmar(et growth and a strong competitive position.a. ar(et penetrationb. 7onglomerate diversificationc. Loint venture

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1-*. 0uadrant EEEEE organizations have a strong competitive position but are in a slow#growth industr', according to the 9rand &trateg' atrix.a. +b. ++c. +++

d. +@

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1--. A5n6 EEEEEEEEEE strateg' could be most effective when a firm has excessproduction capacit' and its basic industr' is experiencing declining sales and profits.a. bac(ward integrationb. forward integrationc. concentric diversificationd. joint venturee. integration

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The -ecision Stage

1-. EEEEEEEEEE is included in the decision stage of the strateg' formulation framewor(.a. +nternal )actor 2valuation atrixb. 0uantitative &trategic lanning atrixc. 879 8usiness ortfolio atrixd. 9rand &trateg' atrixe. &A72 atrix

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1-". The top row of a 0& consists of alternative strategies derived from all of theseexcepta. T34& atrix.b. 879 atrix.c. &pace atrix.d. 7 atrix.e. +2 atrix.

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1-$. The EEEEEEEEEE determines the relative attractiveness of various strategies based onthe extent to which (e' external and internal critical success factors are capitalized.a. 879 atrixb. &A72 atrixc. T34& atrix

d. +2 atrixe. 0&

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1-. +n the 0&, a minimum of EEEEEEE internal and EEEEEE external critical successfactors should be included.a. %F %b. -F -c. 1F 1d. -F -

e. %F %

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1-!. 4hich of the following is the first step in developing 0&Ga. 7ompute the Total Attractiveness &coresb. 2xamine the &tage % matrices and identif' alternative strategies the

organization should consider implementingc. Assign weights to each (e' external and internal factord. ?etermine the Attractiveness &corese. a(e a list of the firms (e' external opportunitiesMthreats and internal

strengthsMwea(nesses in the left column of the 0&

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1. 4hat term is defined as the product of multipl'ing ratings b' attractiveness scores ineach row of the 0&Ga. Total attractiveness scoresb. &um total attractiveness scoresc. 4eighted scoresd. Total weighted scorese. )actors

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11. 4hat should be included in strategies in the 0&Ga. all strategies suggested b' &tage % matrices.b. onl' the best or most promising strategies suggested b' &tage % matrices.b. strategies that will assure organizational success.c. strategies that encourage corporate expansion.

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1%. 4hat is the highest number of strategies that can be examined at one time with the0&Ga. b. %c. 1d. 1e. There is no limit.

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1*. 4hich of these do 0& limitations includeGa. 3nl' a few strategies can be evaluated simultaneousl'b. The cost of doing the anal'sisc. &ubjective judgments and educated guesses are re/uiredd. +t is onl' as good as the prere/uisite input information and matching

anal'ses upon which it is basede. 8oth c K d

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Cultural Aspects of Strategy Choice

1-. 4hat includes the set of shared values, beliefs, attitudes, customs, norms,personalities, heroes and heroines that describe a firmGa. &trateg'b. 7ulturec. issiond. 3bjectivese. 0&

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1. The culture of a firm is important when considering strategies becausea. cultural products can support strategies so managers can often implement

changes swiftl' and easil'.b. ever'one in the firm should have a vote as to which strategies to implement.c. culture can dictate the choice of strategies.

d. 2mplo'ees alwa's welcome cultural change.

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The Politics of Strategy Choice

1". EEEEEEEEEE is (nown as the tactic of shifting focus from specific issues to moregeneral ones.a. 2/uifinalit'b. )ocus on higher#order issuesc. 9eneralization

d. &atisficinge. Cone of the above

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1$. EEEEEEEEEE means it is possible to achieve similar results using different means orpathsa. 9eneralizationb. &atisficingc. )ocus on higher#order issuesd. 2/uifinalit'e. &pecialization

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The Role of a 0oard of -irectors

1. Toda', boards of directors are composed mostl' of EEEEEEEEEE.a. outsidersb. managementc. uniond. emplo'eese. stoc(holders

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1!. 2xcept for EEEEEEEEEEEEEEEE, the roles and duties of a board of directors include allof these broad categories.a. control and oversight over managementb. adhering to legal prescriptionsc. consideration of sta(eholders interests

d. advancement of stoc(holders rightse. expansion of management stoc( options

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1". According toBusiness Week, a good board of directors performs all of theseresponsibilities excepta. lin( the 723s pa' to specific goals.b. place the entire board up for election ever' five 'ears.c. re/uire directors to retire at age $.d. re/uire each director to own a large amount of compan' stoc(.

e. compensate board members onl' in compan' stoc(.

Ans: b age: %%*#%%-

1"1. 4hat didBusiness Weekconclude a board of directors should doGa. 2nsure no more than two board members are insidersb. Himit the number of other boards a member can serve onc. 8an interloc(ing directorshipsd. All of the above

Ans: d age: %%*#%%-

Essay 1uestions

1"%. 2xplain the concept of matching in the strateg' formulation framewor(. 9ive at leastthree examples of matching.

atching external and internal critical success factors is the (e' to effectivel'generating feasible alternative strategies. &ee Table "#1 on page % for examples ofmatching.

age: 1!!#%

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1"*. +f 'ou construct a &A72 atrix and the directional vector points to the lower left/uadrant, what t'pe of strategies would 'ou recommendG 9ive several examples.

+f the directional vector points to the lower#left /uadrant of the &A72 atrix,students should suggest defensive strategies. ?efensive strategies include

retrenchment, divestiture, li/uidation and concentric diversification.

age: %

1"-. 9ive five coordinates of a &A72 atrix directional vector that would suggestconservative strategies to be most appropriate.

&tudent answers will var'. owever, five examples the' ma' suggest are 5#1,16,5#%,%6, 5#*,*6, 5#-,-6, and 5#,6.

age: %

1". +n a 879 atrix, all divisions are called /uestion mar(s, stars, cash cows, or dogs.?efine each of these terms.

0uestion ar(s have a low relative mar(et share position, 'et the' compete in ahigh#growth industr'.&tars represent the organizations best long#run opportunities for growth andprofitabilit'.7ash 7ows have a high relative mar(et share position but compete in a low#growthindustr'.?ogs have a low relative mar(et share position and compete in a slow# or no#mar(et#growth industr'.

age: %#%1

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1"". 2xplain the benefits and limitations of developing a 8oston 7onsulting 9roupatrix.

The 879 atrix has one major benefit: draws attention to the cash flow, investmentcharacteristics and needs of an organizations various divisions.

The 879 atrix has some limitations: 16 @iewing ever' business as either a star,cash cow, dog, or /uestion mar( is an oversimplificationF man' businesses fall rightin the middle of the 879 atrix and thus are not easil' classified, %6 the 879atrix does not reflect whether or not various divisions or their industries aregrowing over timeF that is, the matrix has no temporal /ualities, but rather it is asnapshot of an organization as an' given point in time and *6 other variables besidesrelative mar(et share position and industr' growth rate in sales are important inma(ing strategic decisions about various divisions.

age: %1#%11

1"$. 7ompare and contrast the +2 atrix with the 879 atrix.

The +2 atrix is similar to the 879 atrix in that both tools involve plottingorganizational divisions in a schematic diagram. Also, the size of each circlerepresents the percentage sales contribution of each division, and pie slices revealthe percentage profit contribution of each division in both the 879 and +2 atrix.

&ome important differences between the +2 atrix and the 879 atrix include 16different axes, %6 the +2 atrix re/uires more information about the divisions thanthe 879 atrix and *6 the strategic implications of each matrix are different.

age: %11#%1%

1". Dsing a 9rand &trateg' atrix approach, what strategies are recommended for afirm that is a wea( competitor in a slow#growing mar(etG 2laborate on what thesestrategies could mean for a college or universit'.

A firm that is a wea( competitor in a slow#growing mar(et would be located in0uadrant +++. 0uadrant +++ strategies include retrenchment, concentricdiversification, horizontal diversification, conglomerate diversification, divestitureand li/uidation.

&tudent answers will var' when elaborating on what these strategies could mean fora college or universit'. owever, students should mention that the college oruniversit' could possibl' have to be closed or facilit' and staff ma' have to bedrasticall' reduced which leads to unhapp' students in ver' large classes.

age: %1-

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1"!. ?escribe the positive features and limitations of 0&.

There are three positive features of 0&: 16 &ets of strategies can be examinedse/uentiall' or simultaneousl', %6 there is no limit to the number of strategies thatcan be evaluated or the number of sets of strategies that can be examined at once

using the 0& and *6 the last positive feature is that it re/uires strategists tointegrate pertinent external and internal factors into the decision process.

The 0& is not without some limitations: 16 +t alwa's re/uires intuitive judgmentsand educated assumptions, %6 The ratings and attractiveness scores re/uirejudgmental decisions, even though the' should be based on objective informationand *6 it can be onl' as good as the prere/uisite information and matching anal'sesupon which it is based.

age: %1!

1$. ?iscuss the appropriate role of a board of directors in an organization.

lease refer to Table "#$ on page %%* for 8oard of ?irectors ?uties and

Documents

MCQS Notes for Chapter06