25) The managerial task of effectively conveying the essence of the strategic vision is made
easier by
A) having operating strategies that are easy for company personnel to understand and execute.
B) combining the strategic vision and the company’s values statement into a single document.
C) adopting a catchy slogan and then using it repeatedly to illuminate the direction and purpose
of “where we are headed and why.”
D) waiting until the company realizes its mission and ensures the existing corporate culture is
compatible with the new vision and direction.
E) distributing written statements that explain “where we are going and why.”
26) Effectively communicating the strategic vision down the line to lower-level managers and
employees has the value of
A) explaining “where we are going and why” and, more importantly, inspiring and energizing
company personnel to unite to get the company moving in the intended direction.
B) helping company personnel understand why making a profit and having a business plan are so
important.
C) making it easier for top executives to set and communicate the company’s stretch objectives.
D) helping lower-level managers and employees better understand the company’s business
model.
E) aiding lower-level managers and employees in formulating and achieving a balanced
scorecard.
27) Perhaps the most important benefit of a vivid, engaging, and convincing strategic vision is
A) helping gain managerial consensus on what resources must be developed to successfully
achieve strategic objectives.
B) uniting company personnel behind managerial efforts to get the company moving in the
intended direction.
C) helping justify the company’s mission of making a profit.
D) helping company personnel understand the logic of the company’s business model.
E) keeping company personnel well-informed.
28) The benefit of a vivid, engaging, and convincing strategic vision is NOT its ability to
A) crystallize top management’s own view about the company’s long-term direction.
B) reduce the risk of rudderless decision making by managers at all levels of the organization.
C) help an organization prepare for the future.
D) unite company personnel behind managerial efforts to get the company moving in the
intended direction.
E) help company personnel understand the logic of the company’s business model.
29) The payoffs of having a strategic vision that describes management’s aspirations for the
company’s future and the course and direction charted to achieve those aspirations are not
typically connected with
A) reducing the risks of rudderless decision making.
B) helping the organization prepare for the future.
C) avoiding strategic inflection points and management’s reaction in aligning decision choices.
D) helping to crystallize top management’s own view about the firm’s long-term direction.
E) providing a tool for winning the support of organizational members for internal changes that
will help make the vision a reality.
30) A well-conceived and communicated strategic vision ordinarily does not result in
A) solidifying senior executives’ view of the firm’s long-term direction.
B) minimizing the risk of rudderless decision making.
C) galvanizing organizational members in support of internal changes that will help make the
vision a reality.
D) assisting the organization in preparing for the future.
E) protests from stakeholders that the business is rudderless.
31) A company’s mission statement typically addresses which question?
A) Who we are and what do we do?
B) What objectives and level of performance do we want to achieve?
C) Where are we going and what should our strategy be?
D) What approach should we take to achieve sustainable competitive advantage?
E) What business model should we employ to achieve our objectives and our vision?
32) The difference between the concept of a company mission statement and the concept of a
strategic vision is that a
A) mission concerns what to do to achieve short-term objectives, while a strategic vision
concerns what to do to achieve long-term performance targets.
B) mission statement focuses on the methods needed to make a profit, whereas a strategic vision
concerns what business model to employ in striving to make a profit.
C) mission statement deals with what to accomplish on behalf of shareholders, while a strategic
vision concerns what to accomplish on behalf of customers.
D) mission statement typically concerns a company’s purpose and its present business scope,
whereas the principal concern of a strategic vision is a company’s aspirations for its future.
E) mission statement deals with “where we are headed,” whereas a strategic vision provides the
critical answer to “how will we get there?”
33) The primary difference between a company’s mission statement and the company’s strategic
vision is that
A) mission statement explains why it is essential to make a profit, whereas the strategic vision
explains how the company will be a moneymaker.
B) mission statement typically concerns a company’s present business scope and purpose,
whereas a strategic vision sets forth “where we are going and why.”
C) mission statement deals with how to please customers, whereas a strategic vision deals with
how to please shareholders.
D) mission statement deals with “where we are headed,” whereas a strategic vision provides the
critical answer to “how will we get there?”
E) mission statement addresses “how we are trying to make a profit today,” while a strategic
vision concerns “how will we make money in the markets of tomorrow?”
34) A company’s mission statement does not
A) identify the company’s services and products.
B) specify the buyer’s needs that the company seeks to satisfy.
C) identify the customer or market that the company intends to serve.
D) give the company its own identity.
E) explain “where we are headed.”
35) A company should not couch its mission statement in terms of making a profit because a
profit is more correctly an
A) obligation and a reason for what a company does.
B) objective and a result of what a company does.
C) outlay and a rationale for what a company does.
D) obligation and a responsibility for what a company does.
E) outflow and a right of what a company does.
36) A company’s values or core values concern
A) whether and to what extent it intends to operate in an ethical and socially responsible manner.
B) how aggressively it will seek to maximize profits and enforce high ethical standards.
C) the beliefs and operating principles built into the company’s balanced scorecard for measuring
performance.
D) the beliefs, traits, and behavioral norms that company personnel are expected to display in
conducting the company’s business and pursuing its strategic vision and mission.
E) the beliefs, principles, and ethical standards that are incorporated into the company’s strategic
intent and business model.
37) A company’s values relate to such things as
A) how it will balance its pursuit of financial objectives against the pursuit of its strategic
objectives.
B) how it will balance the pursuit of its business purpose/mission against the pursuit of its
strategic vision.
C) fair treatment, integrity, ethical behavior, innovativeness, teamwork, top-notch quality,
superior customer service, social responsibility, and community citizenship.
D) whether it will emphasize stock price appreciation or higher dividend payments to
shareholders.
E) whether it will put more emphasis on the achievement of short-term performance targets or
long-range performance targets.
38) A superior example of a company vision that is short, specific, memorable, clearly
articulated, and forward-looking is
A) Hilton Hotel’s vision “to fill the earth with light and the warmth of hospitality.”
B) Whole Foods’ vision “to be a dynamic leader in the quality food business. We are a mission-
driven company that aims to set the standards of excellence for food retailers. We are building a
business in which high standards permeate all aspects of our company. Quality is a state of mind
at Whole Foods Market.”
C) Keurig’s vision “to become the world’s leading personal beverage systems company.”
D) Nike’s vision “to create products, services and experiences for today’s athlete while solving
problems for the next generation.”
E) Google’s vision “to organize the world’s information and make it universally accessible and
useful.”
39) Well-stated objectives are
A) quantifiable or measurable, and contain deadlines for achievement.
B) succinct and concise so as to identify the company’s risk and return options.
C) broad and take into account views of all the stakeholders.
D) directly related to the dividend payout ratio for stockholder returns.
E) representative of customers’ aspirations for company performance.
40) A company needs financial objectives
A) to overtake key competitors on such important measures as net profit margins and return on
investment.
B) because without adequate profitability and financial strength, the company’s ultimate survival
is jeopardized.
C) to convince shareholders that top management is acting in their interests.
D) to translate the company’s business model into action items.
E) to indicate to employees that financial objectives always take precedence over strategic
objectives.
41) What does a company specifically exhibit when it relentlessly pursues an ambitious strategic
objective, concentrating the full force of its resources and competitive actions on achieving that
objective?
A) competitive edge
B) sustainable advantage
C) strategic intent
D) financial strength
E) strategic vision
42) A company exhibits strategic intent when
A) management crafts and adopts a strategic plan.
B) it relentlessly pursues an ambitious strategic objective, concentrating the full force of its
resources and competitive actions on achieving that objective.
C) it aggressively pursues financial objectives, establishing a priority on meeting the
performance metrics and instilling a sense of urgency throughout the company.
D) management establishes a comprehensive set of financial objectives that meet stockholder
expectations.
E) it capitalizes on its primary competitive advantage and ensures resources are allocated to
maintain its strategy.
43) Managers can deliberately set challenging performance targets at levels high enough to
promote outstanding company performance by establishing
A) stretch objectives that challenge the organization to deliver stretch gains in performance.
B) mainstay objectives that although are easily attainable, and the company is obligated to meet,
they are designed to spur motivation in the workforce.
C) financial objectives that drive standardization of cost-efficiency and unify stringent operating
specifications.
D) a specifically detailed and integrated model of operating policies, practices, and procedures.
E) why the company does certain things in trying to please its customers.
44) A company needs financial objectives to
A) spur company personnel to help the company overtake key competitors on such important
measures as net profit margins and return on investment.
B) communicate management’s targets for financial performance and achieve strategic
objectives.
C) indicate to employees whether the emphasis should be on earnings per share, return on
investment, return on assets, or positive cash flow.
D) convince shareholders that top management is acting in their interests.
E) counterbalance its pursuit of strategic objectives and have a balanced scorecard for judging
the caliber of its overall performance.
45) The best example of a well-stated, specific financial objective is to
A) increase earnings per share by 15 percent annually.
B) gradually boost market share from 10 percent to 15 percent over the next several years.
C) achieve lower costs than any other industry competitor.
D) boost revenues by a percentage margin greater than the industry average.
E) maximize total company profits and return on investment.
46) A superior example of a well-stated strategic objective is to
A) increase revenues by more than the industry average.
B) be among the top five companies in the industry in customer service.
C) overtake key competitors on product performance or quality within three years.
D) improve manufacturing performance by 5 percent within 12 months.
E) obtain 150 new customers during the current fiscal year.
47) Strategic objectives
A) are more essential in achieving a company’s strategic vision than are financial objectives.
B) relate to strengthening a company’s overall market standing and competitive position.
C) are more difficult to achieve and harder to measure than financial objectives.
D) are generally less important than financial objectives.
E) help managers track an organization’s true progress better than financial objectives.
48) Adopting a set of “stretch” financial and stretch strategic objectives
A) pushes the company to strive for lesser but adequate profitability levels, because the stretch
objectives are considered unattainable.
B) is a widely held method for creating a “scorecard” for monitoring company performance.
C) helps convert the mission statement into meaningful company values.
D) challenges company personnel to execute the strategy with greater enthusiasm, proficiency,
and understanding.
E) is an effective tool for pushing the company to perform at its full potential and deliver the best
possible results.
49) Setting stretch objectives does not provide an organization with the advantage of
A) helping to avoid mediocre results.
B) pushing company personnel to be more inventive and innovative.
C) helping clarify the company’s strategic vision and strategic intent.
D) helping a company be more focused and intentional in its actions.
E) spurring exceptional performance and helping build a firewall against contentment with
modest performance gains.
50) Strategic intent refers to a situation where a company
A) commits to using a particular business model to make money.
B) decides to adopt a particular strategy.
C) relentlessly pursues an ambitious strategic objective.
D) commits to pursuing balanced-scorecard objectives.
E) changes its long-term direction and decides to pursue a newly adopted strategic vision.
51) A “balanced scorecard” for measuring company performance
A) entails putting equal emphasis on financial and strategic objectives.
B) entails putting balanced emphasis on profit and nonprofit objectives.
C) prevents the drive for achieving financial objectives from overwhelming the pursuit of
strategic objectives.
D) prevents the drive for achieving strategic objectives from overwhelming the pursuit of
financial objectives.
E) strikes a balance between financial and strategic objectives.
52) A “balanced scorecard” that includes both strategic and financial performance targets is a
conceptually strong approach for judging a company’s overall performance because
A) it assists managers in putting roughly equal emphasis on short-term and long-term
performance targets.
B) it entails putting equal emphasis on good strategy execution and good business model
execution.
C) a balanced-scorecard approach pushes managers to avoid strategic management that reflects
the results of past decisions and organizational activities.
D) financial performance measures are lagging indicators that reflect the results of past decisions
and organizational activities, whereas strategic performance measures are leading indicators of a
company’s future financial performance and business prospects.
E) it forces managers to put equal emphasis on financial and strategic objectives.
53) Perhaps the most reliable way for a company to improve its financial performance over time
is to
A) put 100 percent emphasis on the achievement of its short-term and long-term financial
objectives.
B) recognize that the achievement of strategic objectives signals that the company is well
positioned to sustain or improve its performance.
C) substitute financial intent for strategic intent and judiciously concentrate on the mission of
making a profit.
D) not allocate any resources to the achievement of strategic objectives until it is very clear that
the company can meet or beat its stretch financial performance targets.
E) avoid use of the balanced-scorecard philosophy since achievement of financial performance
targets is obviously more important than the achievement of strategic performance targets.
54) A company that pursues and achieves strategic objectives
A) is likely to weaken the achievement of its short-term and long-term financial objectives.
B) believes that the company’s financial performance is not as important as it really is.
C) is generally not strongly focused on its true mission of making a profit.
D) is frequently in a better position to improve its future financial performance because of the
increased competitiveness that flows from the achievement of strategic objectives.
E) is likely to be a weak financial performer because diverting resources to the pursuit of
strategic objectives takes away from the achievement of financial performance targets.
55) A company needs performance targets or objectives
A) to help guide managers in deciding what strategic path to take in the event that a strategic
inflection point is encountered.
B) because they give the company clear-cut strategic intent.
C) in order to unify the company’s strategic vision and business model.
D) for its operations as a whole and also for each of its separate businesses, product lines,
functional departments, and individual work units.
E) in order to prevent lower-level organizational units from establishing their own objectives.
56) Company objectives
A) are needed only in those areas directly related to a company’s short-term and long-term
financial strength.
B) need to be broken down into performance targets for separate businesses, product lines,
functional departments, and individual work units.
C) play the important role of establishing the direction toward which an organization needs to be
headed.
D) are important because they help guide managers in deciding what the company’s strategic
intent should be.
E) should support, but not conflict with, the performance targets of lower-level organizational
units.
57) When trade-offs have to be made between achieving long-term and achieving short-term
objectives
A) long-term objectives should take precedence unless the short-term performance targets have
unique importance.
B) long-term objectives should take precedence because of the need for future survival.
C) short-term objectives should take precedence because they focus attention on delivering
performance improvement.
D) short-term objectives should take precedence unless the long-term performance targets are not
achievable.
E) long-term objectives should never take precedence until the short-term objective is achieved.
58) The task of stitching together a strategy
A) entails addressing a series of hows: how to grow the business, how to please customers, how
to outcompete rivals, how to respond to changing market conditions, and how to achieve
strategic and financial objectives.
B) is primarily an exercise in deciding which of several freshly emerging market opportunities to
pursue.
C) is mainly an exercise that should be dictated by what is comfortable to management from a
risk perspective and what is acceptable in terms of capital requirements.
D) requires trying to copy the strategies of industry leaders as closely as possible.
E) is mainly an exercise in good planning.
59) For most modern, highly diversified, global corporations, the CEO’s role in strategy-making
normally does not involve
A) being held accountable for the results the strategy produces, whether good or bad.
B) acting as captain of the ship, carrying the mantles of chief direction setter, chief objective
setter, chief strategy maker, and chief strategy implementer for the total enterprise.
C) involving as many company personnel as possible in the strategy-making process.
D) functioning as chief architect of the strategy, personally deciding what the key elements of the
company’s strategy will be.
E) knowing enough about the situation in every organizational unit to direct every strategic move
made in a company’s worldwide organization.