One of the important benefits of a well-conceived and well-stated strategic vision is to:
A. clearly delineate how the company’s business model will be implemented and
executed.
B. clearly communicate management’s aspirations for the company to stakeholders and
help steer the energies of company personnel in a common direction.
C. set forth the firm budgetary objectives in clear and fairly precise terms.
D. help create a “balanced scorecard” approach to objective-setting and not stretch the
company’s resources too thin across different products, technologies, and geographic
markets.
E. indicate what kind of sustainable competitive advantage the company will try to
create in the course of becoming the industry leader.
When evaluating whether an industry’s environment presents a company with an
above-average profitability and an attractive business opportunity, it primarily involves:
A. determining the industry outlook for future profitability.
B. determining which firms in the industry have a competitive advantage and how they
got their advantage.
C. determining the overall strength of the five competitive forces.
D. constructing a strategic group map and assessing the attractiveness of the
competitive position of each strategic group to determine the overall attractiveness of
all the strategic groups.
E. using value chain analysis to determine the relative cost positions of rival firms and
to learn who the industry’s low-cost producer is.
Which one of the following does NOT account for WHY a company’s strategy evolves
from one version to another?
A. A need to promote stability and retain the status quo
B. The need to abandon some strategy elements that are no longer working well
C. A need to respond to changing customer requirements and expectations
D. A need to react to fresh strategic maneuvers on the part of rival firms
E. The proactive efforts of company managers to improve obsolete aspects of the
strategy
Tangible resources do not include:
A. physical resources.
B. financial resources.
C. human assets.
D. technological assets.
E. organizational resources.
All of the following are distinctive characteristics of an unhealthy corporate culture
EXCEPT:
A. the presence of counterproductive cultural traits that adversely impact the work
climate and company performance.
B. a preoccupation with risk management and capitalizing on related market
opportunities.
C. a decision-making effort that is subject to pressure from many different cliques.
D. ethical behavior that is driven by subcultures.
E. a strong fixation on attending to what customers are saying and how their needs and
expectations are to be met.
The big risk of employing an outsourcing strategy is:
A. causing the company to become partially integrated instead of being fully integrated.
B. hollowing out a firm’s own capabilities and losing touch with activities and expertise
that contribute fundamentally to the firm’s competitiveness and market success.
C. hurting a company’s R&D capability.
D. putting the company in the position of being a late mover instead of an early mover.
E. increasing the firm’s risk exposure to both supply chain management failures and
shifts in the composition of the industry value chain.
Outsourcing the performance of value chain activities presently performed in-house to
outside vendors and suppliers makes strategic sense EXCEPT when:
A. an activity can be performed better or more cheaply by outside specialists.
B. it allows a company to focus its entire energies on its core business.
C. it restricts a company’s ability to assemble diverse kinds of expertise speedily and
efficiently.
D. it reduces the company’s risk exposure to changing technology and/or changing
buyer preferences.
E. it allows a company to leverage its key resources.
Which of the following is NOT something a company should usually consider in
crafting a strategy of social responsibility?
A. Actions to benefit shareholders such as raising the dividend or boosting the stock
price
B. Making charitable contributions and supporting community service endeavors and
reaching out to make a difference in the lives of the disadvantaged
C. Actions to ensure the company has an ethical strategy and operates honorably and
ethically
D. Actions that promote good stewardardship (by protecting and enhancing) the
environment
E. Actions to enhance workforce diversity
Market maneuvering among industry rivals:
A. determines whether the industry’s strategic group map will be static or dynamic.
B. centers around collaborative efforts to overcome the bargaining power of powerful
suppliers and powerful buyers.
C. is usually an industry’s strongest driving force.
D. is usually one of the two or three weakest competitive forces because of the close
familiarity that rivals have for one another’s likely next moves.
E. is ongoing and dynamic, with moves and countermoves of rivals producing a
continually evolving competitive landscape that delivers winners and losers.
The competitive objective of a best-cost provider strategy is to:
A. outmatch the resource strengths of both low-cost providers and differentiators.
B. position the company outside the competitive arena of low-cost producers and
differentiators.
C. meet or exceed buyer expectations on key quality/performance/features/service
attributes and beat their expectations on price (given what rivals are charging for much
the same attributes).
D. deliver superior value to buyers by doing such a good job of cost control that it ends
up with the best cost (as compared to rivals) in performing each activity in its value
chain.
E. identify and concentrate on those differentiating features that are inexpensive to
incorporate.
Which of the following is the BEST guideline for deciding what the priorities should be
for allocating resources to the various businesses of a diversified company?
A. Businesses with high industry attractiveness ratings should be given top priority and
those with low industry attractiveness ratings should be given low priority.
B. Business subsidiaries with the brightest profit and growth prospects, attractive
positions on the nine-cell matrix, and solid strategic and resource fits generally should
head the list for corporate resource support.
C. The positions of each business in the nine-cell attractiveness-strength matrix should
govern resource allocation.
D. Businesses with the most strategic and resource fits should be given top priority and
those with the fewest strategic and resource fits should be given low priority.
E. Businesses with high competitive strength ratings should be given top priority and
those with low competitive strength ratings should be given low priority.
The basic premise of unrelated diversification is that:
A. the least risky way to diversify is to seek out businesses that are leaders in their
respective industry.
B. the best companies to acquire are those that offer the greatest economies of scope
rather than the greatest economies of scale.
C. the best way to build shareholder value is to acquire businesses with strong
cross-business financial fit.
D. any company that can be acquired on good financial terms and that has satisfactory
growth and earnings potential represents a good acquisition and a good business
opportunity.
E. the task of building shareholder value is better served by seeking to stabilize earnings
across the entire business cycle than by seeking to capture cross-business strategic fits.
What is the connection between a company’s strategy and its quest for sustainable
competitive advantage?
Does a company have a duty to go beyond legal requirements and conform to the
ethical norms of the societies in which it operates?
Explain why an acquisition is better than a greenfield venture.
Define and discuss the programs commonly included under a company’s corporate
social responsibility strategy.
What is meant by integrated social contracts theory? What is its contribution to the
debate about ethical standards?
Identify and discuss the three ways that a corporate culture, grounded in actions,
behaviors, and work practices and conducive to good strategy implementation can assist
corporate strategy execution.
A new entrant in a market dominated by established players introduces itself with
copycat products of another competitor. Would this strategy work in the long term for
the firm? Justify your answer.
While Six Sigma programs often improve the efficiency of many operating activities
and processes, there is evidence that innovation can be stifled by Six Sigma programs.
True or false? Explain.
Identify and briefly discuss three factors a company must consider in order to capture
the benefits of engaging in strategic alliances.