Soal

3/1/10 7:37 PMThe Nature of Strategic Management

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Home Chapter 1 Chapter Quiz

Chapter Quiz

This activity contains 25 questions.

The term _________ is used to refer to strategy formulation, implementation,and evaluation, with _________referring only to strategy formulation.

strategic planning; strategic management

assessment; planning

strategic management; strategic planning

management cycle; brainstorming

Which of these requires a firm to establish annual objectives, devise policies,and allocate resources?

Strategy formulation

Strategy implementation

Strategy manipulation

Strategy evaluation

The rationale for periodically conducting strategic-management meetings awayfrom the work site is to encourage more _____________ and ____________among participants.

feedback; rigidity

creativity; candor

confidence; self-interest

strategy evaluation; candor

Anything that a firm does especially well compared to rival firms is referred toas:

competitive advantage.

comparative advantage.

an external opportunity.

opportunity cost.

Both military and business organizations do all of the following except:

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use of the element of surprise.

aim "to gain competitive advantage."

use the assumption of conflict to develop strategies.

use their own strengths to exploit competitors' weaknesses.

__________ help an organization gather, analyze, and organize information.

Ethics officers

Operatives

Lobbyists

Strategists

A disadvantage of international operations is:

foreign operations can allow firms to establish low-cost production facilities inlocations close to raw materials and/or cheap labor.

economies of scale can be achieved from operation in global rather than solelydomestic markets.

competitors in foreign markets may not exist.

language, culture, and value systems differ among countries, causingcommunication barriers and problems managing people.

_________ are especially critical for successful strategy implementation.

Interpersonal skills

Technical plans

Long-range plans

Short-range plans

All of these are pitfalls an organization should avoid in strategic planningexcept:

using strategic planning to gain control over decisions and resources.

failing to involve key employees in all phases of planning.

hastily moving from mission development to strategy formulation.

using plans as a standard for measuring performance.








____________ and __________ refer to economic, social, cultural,demographic, environmental, political, legal, governmental, technological, andcompetitive trends and events that could significantly benefit or harm anorganization in the future.

Internal strengths; external threats

External opportunities; external threats

Internal weaknesses; external opportunities

Internal strengths; internal weaknesses

Strategic management can be defined as the art and science of formulating,implementing, and evaluating cross-functional decisions that enable anorganization to achieve its objectives.

True

False

The action stage of strategic management is called strategy formulation.

True

False

Three fundamental strategy evaluation activities are reviewing external andinternal factors, measuring performance, and taking corrective actions.

True

False

Strategies can be defined as specific results that an organization seeks toachieve in pursuing its basic mission.

True

False

Reasons for poor or no strategic planning on part of firms includeoverconfidence, too expensive, suspicion, and laziness.

True

False









Objectives are an organization's statements that answer the question "what dowe want to become?"

True

False

An organization can pursue any and/or all strategies that potentially couldbenefit the firm.

True

False

Communication is an act of strengthening employees' sense of effectiveness byencouraging them to participate in decision making and to exercise initiative andimagination, and rewarding them for doing so.

True

False

Strategic management must be a self-reflective learning process.

True

False

One pitfall to avoid in strategic planning is top management making manyintuitive decisions that conflict with formal planning.

True

False

Identify and describe the three stages of the strategic-management process.Give reasons within your answer to describe why each of these stages isimportant in strategic management.

To create paragraphs in your essay response, type at the beginning of the paragraph,and at the end.









What is sustained competitive advantage? Define this concept and explain how afirm can achieve it. Why is it important in strategic management?


How do external opportunities and threats differ in their strategic implicationsfrom those of internal strengths and weaknesses? Be sure to include in youranswer a brief description of each of these four terms.


What is the strategic-management model? What does it represent? Describeseveral characteristics of the strategic-management process based on what youunderstand about the strategic-management model.


Describe the concept of empowerment. How is empowerment related to thedecentralization of the strategic-management process?






decentralization of the strategic-management process?


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3/1/10 7:38 PMThe Business Vision and Mission



Chapter Quiz


Most practitioners and academicians of strategic management feel that aneffective mission statement exhibits ______ characteristics or components.

three

nine

twelve

five

Carefully prepared _____________ and ____________ are widely recognized byboth practitioners and academicians as the first step in strategic management.

short-term objectives; long-term objectives

long-term objectives; goals

creeds; long-term objectives

vision statements; mission statements

The vision and mission statement can often be found:

on the front of annual reports.

in a competitive market analysis.

on supplier invoices.

in the SEC report.

It is important to involve ______________ in the process of developing amission statement.

only those managers who will use the mission

as many managers as possible

very few people to ease consensus-building

as wide a variety of upper-level managers as possible

An article by Campbell and Yueng emphasizes that the process of developing amission statement should create a(n) ________ and ________ between theorganization and its employees.











organization and its employees.

cultural bond; sense of accomplishment

emotional bond; sense of mission

physical bond; profitable purpose

short-term plan; sense of direction

During strategy _________, corporate social policy should be set andadministered.

control

formulation

evaluation

implementation

What is the recommended length of an effective mission statement?

One sentence of 10 to 20 words.

Less than 250 words.

One page.

There is no recommendation. It can be as long as the management wants.

A study by Rarick and Vitton found that firms with a formalized missionstatement have the average return on shareholders' equity compared to thosefirms without a formalized mission statement.

twice

half

five times

one quarter

A major reason for developing a business mission statement is to attract________ who give meaning to an organization.

customers

stockholders

competitors

lobbyists








Which of the following is a question that an effective mission statementanswers?

What is our profitability?

What is the company we want to be in the long-range future?

Is the firm technologically current?

What is our net worth?

The vision statement should be short, preferably one sentence.

True

False

Commitment to a company's strategy and intellectual agreement on thestrategies to be pursued do not necessarily translate into an emotional bond.

True

False

The vision statement should be a paragraph and developed by the CEO orPresident of the company.

True

False

Drucker says that asking the question "What is our business?" is synonymouswith asking the question "what is our mission?"

True

False

Stakeholders of an organization include stockholders, customers and creditors,but not the competitors.

True

False

Developing a comprehensive mission statement is important because divergentviews can be revealed and resolved through the process.

True

False










False

An effective mission statement should include five components.

True

False

During strategy formulation, social policy should be reaffirmed and changed.

True

False

A mission statement should be longer than 250 words describing the tencomponents.

True

False

The term social policy embraces managerial philosophy and thinking at thehighest levels of an organization.

True

False

What is the purpose of a mission statement? Differentiate between a missionand a vision statement.


Why are the vision and mission statements important to a given organization?Why are they important to effective strategic management? Cite several reasonsorganizations should carefully develop a written mission statement.










What are the benefits of a vision and mission statement?


What does it mean to reflect the anticipations of customers? How can acompany incorporate this idea when developing its mission statement?


List and explain the nine essential components of a mission statement. Why arethese important?







Answer choices in this exercise appear in a different order each time the page is loaded.









3/1/10 7:38 PMThe External Assessment



Chapter Quiz


According to I/O theorists, which of the following contributes least to firmperformance?

Internal resources

Economies of scale

Barriers to market entry

Product differentiation

The external audit is aimed at:

taking advantage of potential threats and minimizing external opportunities.

developing an exhaustive list of factors that could influence the business.

identifying key variables that offer actionable responses.

developing an infinite list of opportunities that could benefit a firm.

Good _______ in business, as in the military, is one of the keys to success.

short-term plan focus

competitive intelligence

divisions

conflict encouraging scenarios

__________ are the results of a low value of the dollar.

Lower imports and higher exports

Lower imports and lower exports

Higher imports and higher exports

Higher imports and lower exports

Which of the following is NOT a key economic variable to be monitored?










Availability of credit

Price fluctuations

Stock market trends

Voter participation rates

_______________ and ______________ are creating similar patterns ofconsumption in diverse cultures worldwide.

Tax harmonization; legal factors

Distinct domestic markets; the climate for international business

Mass communication; high technology

Corporate tax breaks; mass communication

The idea of joining forces with a competitor is not easily accepted by___________, who often view cooperation and partnerships with skepticism andsuspicion.

Japanese

Americans

Chinese

Europeans

All of these, except __________, are part of Porter's competitive forces inindustry analysis.

potential entry of new competitors

bargaining power of suppliers

development of substitute products

bargaining power of unions

In its simplest sense, the international challenge faced by U.S. business istwofold:

how to increase exports to other countries and how to increase imports from othercountries.

how to defend domestic markets against imported goods while minimizing exports.

how to maximize exports to other nations and how to defend domestic marketsagainst imported goods.

how to minimize imports and exports in domestic markets and slowly decreaseglobalization.








globalization.

_______________ are most appropriate when historical data are available andwhen the relationships among key variables are expected to remain the same inthe future.

Qualitative forecasts

Econometric model analyses

Quantitative forecasts

A scenario forecast

Five major categories of external variables are: (1) economic forces, (2) socialand cultural forces, (3) political, governmental and legal forces, (4)technological forces and (5) demographic forces.

True

False

Significant and unequal effects on companies in different industries and indifferent locations come from trends in the dollar's value.

True

False

Competitive pressures arising from substitute products increase as the relativeprice of substitute products declines and as consumers' switching costsdecrease.

True

False

Research findings suggest that approximately 36 percent of a firm's profitabilitycan be explained by the industry, whereas 20 percent is attributed to the firm'sinternal factors.

True

False

Nine out of 10 large companies have employees dedicated solely to gatheringcompetitive intelligence.

True

False









Suppliers can increase their bargaining power if they can inexpensively switch tocompeting brands or substitutes.

True

False

Bargaining power of consumers is usually the most powerful of Porter's fivecompetitive forces.

True

False

Many large multinational firms are moving out of EU member-countries intoSwitzerland and Ireland to avoid costs associated with tax harmonization.

True

False

Shifts in the nature and location of production systems, especially to China andIndia, are reducing the response time to changing market conditions.

True

False

Based on the best information at the time, assumptions serve as checkpoints onthe validity of strategies.

True

False

Identify the five broad categories of external forces. Which two do you think arethe most important for a firm that specializes in government contracts for themilitary? Support your response.










Briefly explain the rationale behind the industrial organization (I/O) approach tocompetitive advantage. Do you agree with this approach?


Explain the importance of technological forces for a firm. Identify some recenttechnological forces that have been factors in how companies compete in aparticular industry and explain how those forces affected competition.


Differentiate between market commonality and resource similarity. What ismeant by each of these terms? How are they used?


What is the Competitive Profile Matrix? How is it used? What factors areincluded in this analysis?






included in this analysis?











3/1/10 7:38 PMThe Internal Assessment



Chapter Quiz


A firm's strengths that cannot be easily matched or imitated by competitors arecalled:

external opportunities.

distinctive competencies.

special properties.

competitive ventures.

___________ can inhibit strategic management, for example, by leadingmanagers to miss the significance of changing external conditions.

Rules and guidelines

Culture

Market segmentation

Competitive awareness

The five functions of management are planning, organizing, _________,staffing, and controlling.

rewarding

communicating

implementing

motivating

A particular form or manner in which members of a group use sounds andwritten signs to convey meanings to each other is the definition of:

language.

saga.

metaphor.

rite.

__________ ratios measure management's overall effectiveness as shown bythe returns generated on sales and investment.










the returns generated on sales and investment.

Liquidity

Profitability

Growth

Leverage

For a resource to be valuable, it must be either rare, hard to imitate, or:

viable.

natural.

difficult to construct.

not easily substituted.

Americans place a high priority on __________ whereas many foreigners do not.

material wealth

family

relationships

silence

Staffing involves all of these activities except:

recruiting.

managing union relations.

customer analysis.

training and developing.

Which of the following ties all business functions together and provides the basisfor all managerial decisions?

Management

Marketing

Information

Technology








A _____ purpose is to improve the performance of an enterprise by improvingthe quality of managerial decisions.

management information system's

data transformer's

quality control mechanism's

dysfunctional system's

Many Europeans resent pay-for-performance, commission salaries, and objectivemeasurement and reward systems.

True

False

The process of performing an internal audit closely parallels the process ofperforming an external one.

True

False

The basic premise of the RBV is that the mix, type, amount, and nature of afirm's internal resources should be considered secondarily in devising strategiesthat can lead to sustainable competitive advantage.

True

False

The only thing certain about the future of any organization is change, andplanning is the essential bridge between the present and the future thatincreases the likelihood of achieving desired results.

True

False

Sometimes an organization will pursue a backward integration strategy primarilyto gain better control over prices charged to consumers.

True

False

An opportunity analysis is an appraisal of the costs, benefits and risksassociated with decisions.










True

False

An example of activity ratios is the times-interest-earned ratio.

True

False

Cross-training of employees can decrease efficiency, quality, productivity, andjob satisfaction.

True

False

In the value chain, total revenues minus total costs of all activities undertakento develop and market a product or service yields value.

True

False

Internal R&D and contract R&D are the two basic forms of R&D in organizations.

True

False

Describe the process of performing an internal audit. What are the goals of aninternal audit?


What is the resource-based view? Describe this approach to competitiveadvantage and explain its general reasoning.










Compare and contrast U.S. firms with European firms. Why do the managementstyles, workplace norms, and other factors of work life differ in Europe from theU.S.?


What does it mean for a manager to be motivating? What affects morale andemployee satisfaction?


Identify and describe the Internal Factor Evaluation (IFE) Matrix. What is itspurpose in strategic management?
















3/1/10 7:38 PMStrategies in Action



Chapter Quiz


__________ is based on the belief that the true measure of a really goodstrategist is the ability to solve problems.

Managing by subjectives

Managing by extrapolation

Managing by crisis

Managing by hope

Long-term objectives are needed at the ____________ of an organization.

corporate and divisional levels

corporate levels

corporate, divisional, and functional levels

divisional and functional levels

__________ strategy is designed to fortify an organization's basic distinctivecompetence.

Integrative

Retrenchment

Intensive

Diversification

Many, if not most, organizations pursue a:

concentric diversification.

combination strategy.

geographic strategy.

product development strategy.

An example of _______ strategy is establishing Web sites to sell productsdirectly to consumers.










directly to consumers.

backward integration

conglomerate diversification

horizontal integration

forward integration

Which of the following is not a guideline for pursuing liquidation?

When divestiture has not been successful.

When an organization's only alternative is bankruptcy.

When the stockholders of the firm can minimize their losses by selling the firm'sassets.

When the organization has successfully pursued retrenchment.

A popular strategy that occurs when two or more companies form a temporarypartnership for the purpose of capitalizing on some opportunity is called a(n):

merger.

joint venture.

acquisition.

takeover.

______ includes increasing the number of salespersons, increasing advertisingexpenditures, offering extensive sales promotion items, or increasing publicityefforts.

Market Development

Product development

Horizontal integration

Market penetration

______________ is selling a division of an organization.

Franchising

Divestiture

Liquidation

Horizontal integration








When employing a ______ strategy, a firm must be careful not to use suchaggressive price cuts that their own profits are low or nonexistent.

differentiation

focus

cost leadership

product development

Managing by Crisis is based on the belief that the true measure of a really goodstrategist is the ability to solve problems.

True

False

To successfully employ a focus strategy, a firm must ensure that its total costsacross its overall value chain are lower than competitors' total costs.

True

False

The overall aim of the Balanced Scorecard is to balance financial objectives withstrategic objectives.

True

False

High-velocity change is becoming more the rule rather than the exception.

True

False

Chapter 9 bankruptcy applies to farmers.

True

False

Joint ventures are being used increasingly because they allow companies tominimize risk.










True

False

Diversification strategies are becoming more popular as organizations arefinding it easier to manage diverse business activities.

True

False

Pioneering new and better technologies is an action based on the strategicposture of leading change.

True

False

An acquisition occurs when a large organization purchases a smaller firm,whereas a merger occurs when two organizations of about equal size unite toform one enterprise.

True

False

Being a first mover can be effective when a firm can easily copy or imitate thelead firm's products or services.

True

False

What are long-term objectives? Describe their purpose within various levels ofan organization.


Compare market penetration, market development, and product development.Give an example of each intensive strategy.








Give an example of each intensive strategy.


What are the diversification strategies? Describe the two general types ofdiversification strategies and explain when each type is appropriate.


What is differentiation? When would a firm pursue a differentiation strategy?Give an example of a firm that uses differentiation.


What is business-process outsourcing (BPO)? For what reasons would companieschoose to outsource their functional operations?
















3/1/10 7:38 PMStrategy Analysis and Choice



Chapter Quiz


The __________ is based on 2 key dimensions: the IFE total weighted scoreson x-axis and the EFE total weighted scores on the y-axis.

IE Matrix

SPACE Matrix

BCG Matrix

Grand Strategy Matrix

_________ are defensive tactics directed at reducing internal weakness andavoiding external threats.

SW Strategies

WO Strategies

WT Strategies

ST Strategies

Which stage in the strategy-formulation framework focuses on generatingfeasible alternative strategies?

The input stage

The output stage

The matching stage

The decision stage

______ have a low relative market share position and compete in a slow- or no-market-growth industry.

Question marks

Cash cows

Stars

Dogs

Which of these is not a SPACE Matrix quadrant?










Defensive

Offensive

Aggressive

Competitive

______ organizations compete in slow-growth industries and have weakcompetitive positions.

Quadrant I

Quadrant III

Quadrant IV

Quadrant II

A division with a high relative market share position in a low-growth industrycan be described as a:

star.

dog.

question mark.

cash cow.

Slow market growth characterizes ______ and ______ of the Grand StrategyMatrix.

Quadrant II; Quadrant III

Quadrant I; Quadrant IV

Quadrant II; Quadrant I

Quadrant III; Quadrant IV

_____ is shifting focus from specific issues to more general ones may increasestrategists' options for gaining organizational commitment.

Generalization

Equifinality

Satisfying

Focusing on higher-order issues








Which of the following is not a tactic used by politicians for centuries that canaid strategists?

Equifinality

Objectivity

Focus on higher-order issues

Generalization

Sustainability is the idea that a business can meet its financial goals withouthurting customers.

True

False

Organizations generally will pursue ST, SO, or WT strategies to get into asituation in which they can apply WO strategies.

True

False

FA and CA are the 2 dimensions with negative ratings in SPACE Matrix.

True

False

The major benefit of the BCG Matrix is that it draws attention to the cash flow,investment characteristics, and needs of an organization's various divisions.

True

False

The IE Matrix can be divided into three major regions that have differentstrategy implications: grow and build, hold and maintain, and harvest or divest.

True

False

Quadrant IV businesses compete in slow-growth industries and have weakcompetitive positions.

True

False










False

The Grand Strategy Matrix is based on two evaluative dimensions: market shareand market growth.

True

False

If the directional vector appears in the lower-right or competitive quadrant ofthe SPACE Matrix, it suggests competitive strategies such as backward, forward,and horizontal integration.

True

False

The BCG Matrix graphically portrays differences among divisions in terms ofrelative market share position and industry growth rate.

True

False

In the U.S. today, each board director attends at least 90 percent of allmeetings.

True

False

Describe the eight steps involved in constructing a SWOT Matrix. Whatstrategies are derived from the development of a SWOT Matrix? How are theyused?


What is the BCG Matrix? What is its purpose and how does it help strategicmanagers?








managers?


What is the role of the QSPM? Briefly describe how the QSPM is used.


How do good corporate governance and strategy relate to one another? Identifysome principles of good governance according to BusinessWeek.


Describe the political tactics of successful strategists within large organizations.Identify some of these tactics specifically.
















3/1/10 7:39 PMImplementing Strategies: Management and Operations Issues



Chapter Quiz


Which of these is true about strategy implementation?

It is positioning forces before the action.

It is primarily an operational process.

It focuses on effectiveness.

It requires intuitive rather than leadership skills.

In organizations that do not use a strategic-management approach to decisionmaking, _________ is often based on political or personal factors.

goal setting

policy making

resource allocation

company strategy

_______ can be defined as a disagreement between two or more parties on oneor more issues.

Avoidance

Conflict

Compromise

Rational discussion

Perhaps the most important limitation of a divisional structure is that it:

allows local control of situations.

leads to a competitive climate within a firm.

streamlines staff services too much.

is costly.

The most widely used structure is the ________ type.










divisional

SBU

functional

matrix

Which of the following is not one of the ways divisional structures can beorganized?

By geographic area

By product

By suppliers

By process

A _____ structure leads to short-term and narrow thinking that may underminewhat is best for the firm as a whole.

divisional

functional

matrix

strategic business unit

________ is concerned more with employee and customer well-being thanshareholder well-being.

Restructuring

Reengineering

E-engineering

Benchmarking

A change strategy that attempts to convince people the change is to theirpersonal advantage is:

rational.

force.

educative.

compromise.








_______ can thrust managers into roles that emphasize counseling andcoaching over directing and enforcing.

Cross-training

JIT

Adding new branches

Quality control

Strategy implementation is managing forces during the action.

True

False

Nothing could be more detrimental to strategic management and organizationalsuccess than for resources to be allocated inconsistent with priorities indicatedby annual objectives.

True

False

Defusion is exemplified by exchanging members of conflicting parties so thateach can gain an appreciation of the other's point of view.

True

False

The structural format for developing objectives and policies can significantlyimpact all other strategy-implementation activities.

True

False

Functional structure design violates the unity-of- command principle.

True

False

Defusion includes such actions as ignoring the problem in hopes the conflict willresolve itself or physically separating the conflicting individuals.

True

False










False

Medium-sized firms tend to be divisionally structured, whereas large firms tendto use an SBU (strategic business unit) or matrix structure.

True

False

Communication is often the best in a functional structure.

True

False

The educative change strategy presents information to convince people of theneed to change.

True

False

There is a much higher tolerance for adversarial relations or friction at work inMexico as compared to the United States.

True

False

Contrast strategy formulation and strategy implementation. Provide specificexamples of how they differ.


What is the purpose of annual objectives? Why are they essential to strategyimplementation?










Why is resource allocation so important? How are strategy, structure, andresources related?


What is the matrix structure? When is it appropriate to use this type oforganizational structure?


What are some reasons for resistance to change? How can this threatensuccessful strategic implementation?















3/1/10 7:39 PMImplementing Strategies: Marketing, Finance/Accounting, R&D, and MIS Issues



Chapter Quiz


______ can be defined as the subdividing of a market into distinct subsets ofcustomers according to needs and buying habits.

Product positioning

Marketing mix

Market segmentation

Divisional structure

______________ and ____________ rank as marketing's most importantcontributions to strategic management.

Market penetration; market segmentation

Product diversification; market penetration

Market segmentation; product positioning

Product positioning; product diversification

An effective product positioning strategy leads customers to expect__________service than a company can deliver.

much higher

slightly lower

the same

much lower

_______ entails developing schematic representations that reflect how yourproducts or services compare to competitors' on dimensions most important tosuccess in the industry.

Promotion

Positioning

Placing

Pricing

What is the most widely used technique for determining the best combination ofdebt and stock?










debt and stock?

Earnings per share/earnings before interest and tax analysis

Debt-to-stock ratio

Present value analysis

Gross profit analysis

Nearly all financial institutions require at least __________ years of projectedfinancial statements whenever a business seeks capital.

five

three

four

six

The first approach in evaluating the worth of a business is determining its__________ or __________.

net income; operating revenue

cash flow; net income

wealth; revenue

net worth; stockholders' equity

Which of the following can be forecasted using the percentage-of-sales method?

Cost of good sold

Taxes

Interest

Dividends

In many firms, _________ is doing away with the workplace and allowingemployees to work at home or anywhere, anytime.

management

the economy

government

information technology








The level of management support for R&D is often constrained by:

the limited performance of R&D.

difficult market penetration.

high levels of competition in R&D.

resource availability.

The most common bases for segmenting markets are geographic anddemographic.

True

False

An EPS/EBIT analysis is the most widely used technique for determiningwhether debt, stock, or a combination is the best alternative for raising capitalto implement strategies.

True

False

The balance sheet should be prepared before the income statement inperforming projected financial analyses.

True

False

Financial budgets can be viewed as the planned allocation of a firm's resourcesbased on past performance.

True

False

Strategies such as forward, backward, and horizontal integration require thatnew products be successfully developed and that old products be significantlyimproved.

True

False

Using all debt or all stock to raise capital may impose fixed obligations,restrictive covenants, or other constraints that could severely reduce a firm'sability to raise additional capital in the future.










ability to raise additional capital in the future. True

False

Financial budgeting should not be thought of as a tool for limiting expendituresbut rather as a method for obtaining the most productive and profitable use ofan organization's resources.

True

False

To use the price-earnings ratio method, divide annual earnings per share by themarket price of the firm's common stock and multiply by average net incomefor the past five years.

True

False

A good information system can cause a firm to increase costs due to theexpense of new technology.

True

False

A good information system can allow a firm to reduce costs by establishingdirect communications between elements of the value chain.

True

False

What are some marketing decisions that may require actual policies? Providesome examples.










What specific steps are required in product positioning?


Describe projected financial statement analysis. How is it used for strategyimplementation?


What methods are involved in evaluating a business's worth? Briefly describeeach.


What is a management information system? How are these systems becomingmore important?
















3/1/10 7:36 PMStrategy Review, Evaluation, and Control



Chapter Quiz


__________ refers to the need for strategists to examine sets of trends as wellas individual trends in evaluation strategies.

Consistency

Consonance

Feasibility

Advantage

Strategy evaluation includes all of the following basic activities, EXCEPT:

Examining the underlying bases of a firm's strategy.

Comparing expected results with actual results.

Comparing results of competitors' strategies.

Taking corrective actions to ensure that performance conforms to plans.

The purpose of strategy evaluation is to:

improve R&D programs.

evaluate employees' performance.

make budget changes.

alert management to problems or potential problems.

______ require a more elaborate and detailed strategy evaluation system.

Small organizations

Functional structures

Large organizations

Divisional structures

A revised _________ matrix should indicate how effective a firm's strategieshave been in response to key opportunities and threats.










have been in response to key opportunities and threats.

IFE

grand strategy

SPACE

EFE

_______ should place an organization in a better position to capitalize uponinternal strengths; to take advantage of key external opportunities; to avoid,reduce, or mitigate external threats; and to improve internal weaknesses.

Corrective actions

Strategy structure

Strategic circle

Layoffs

Which of these is not a key financial ratio?

Market share

Production quality

Earnings per share

Asset growth

Which of the following is not a qualitative question that is useful in strategyevaluation?

How much has our market share grown?

Is the strategy internally consistent?

Is the strategy appropriate in view of available resources?

Is the strategy consistent with the environment?

_______ can be defined as alternative plans that can be put into effect if certainkey events do not occur as expected.

Strategy formulation

Contingency plans

Long-term plans

Strategy implementation








The Balanced Scorecard approach to strategy evaluation aims to:

emphasize long-term concerns.

balance the financial concerns.

emphasize nonfinancial concerns.

balance internal with external concerns.

Advantage, in Rumelt's criteria for evaluating strategies, means a strategy mustneither overtax available resources nor create unsolvable subproblems.

True

False

Alternative strategies not selected for implementation should be discarded, asthey have a tendency to contaminate the contingency plans.

True

False

And IFE Matrix should indicate how effective a firm's strategies have been inresponse to key opportunities and threats.

True

False

The end of the fiscal year is the best time of the year to do strategy evaluation.

True

False

Criteria that predict results may be more important than those that reveal whatalready has happened.

True

False

Strategy evaluation, to be effective, should be based on quantitative criteriaonly.

True

False










False

Instituting an environmental audit can include moving environmental affairsfrom the staff side of the organization to the line side.

True

False

Auditor-employees within an organization are responsible for safeguardingcompany assets, assessing the efficiency of company operations, and ensuringthat generally accepted business procedures are practiced.

True

False

Proponents of the top-down approach contend that top executives are the onlypersons in the firm with the collective experience, acumen, and fiduciaryresponsibility to make key strategy decisions.

True

False

Strategy evaluation is becoming easier with the passage of time.

True

False

Identify and describe Rumelt's criteria for evaluating strategies.


..

What are some key questions to address in evaluating strategies?










..

How is the Balanced Scorecard used as a strategy-evaluation tool? Support yourresponse.


..

What are the characteristics of an effective evaluation system?


..

What is the purpose of contingency planning? What are some commoncontingency plans? Provide at least two examples.







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