Calculating competitive strength ratings for a company and comparing them against
strength ratings for its key competitors helps indicate:
A. which weaknesses and vulnerabilities of competitors the company might be able to
attack successfully.
B. which competitors are in profitable strategic groups and which competitors are in
unprofitable strategic groups.
C. which competitors are employing offensive strategies and which competitors are
employing defensive strategies.
D. which competitors are likely to make money and which are likely to lose money in
the years ahead.
E. what the industry’s key success factors are.
An important consideration in designing a strategy-supportive reward system is to:
A. link the payment of all monetary rewards to the company’s bottom-line profitability.
B. employ incentives that will help motivate employees to put in long hours and
sacrifice personal ambitions and aspirations to pursue the priorities of management.
C. choose those types of rewards and incentives that will focus employees’ attention on
total customer satisfaction.
D. make across-the-board wage and salary increases the cornerstone of monetary
rewards.
E. make nonmonetary rewards and recognition an integral part of the reward system.
Strategic group map analysis does NOT entail drawing conclusions about:
A. where on the map is the best place to be and why.
B. which companies/strategic groups are destined to prosper because of their positions.
C. which companies/strategic groups seem destined to struggle.
D. what accounts for why some parts of the map are better than others.
E. where on the map is the easiest position to shift from to a more favorably situated
position.
To profitably employ a best-cost provider strategy, a company must have the resources
and capabilities to:
A. sell a product with the best cost at the best price.
B. have the best cost (as compared to rivals) for each activity in the industry’s value
chain.
C. provide buyers with the best attributes at the best cost.
D. incorporate attractive or upscale attributes into its product offering at a lower cost
than rivals.
E. do a better job than rivals of adopting the best operating practices.
Because when to make a strategic move can be just as important as what move to make,
a company’s best option with respect to timing is:
A. to be the first mover.
B. to be a fast follower.
C. to be a late mover (because it is cheaper and easier to imitate the successful moves of
the leaders and moving late allows a company to avoid the mistakes and costs
associated with trying to be a pioneer-first-mover disadvantages usually overwhelm
first-mover advantages).
D. to be the last-mover-playing catch-up is usually fairly easy and almost always is
much cheaper than any other option.
E. to carefully weigh the first-mover advantages against the first-mover disadvantages
and act accordingly.
A company’s strategy in toto that tends to be a combination of proactive and reactive
elements is known as its:
A. realized strategy.
B. emergent strategy.
C. deliberate strategy
D. visionary strategy.
E. abandoned strategy.
When are capabilities-motivated acquisitions essential?
A. When industry conditions, like technology advances are central to growth and rivalry
is intense
B. When first-mover advantages for products or services can be added to the portfolio
lineup
C. When the acquired firm can be purchased at a discount due to underperformance
D. When a market opportunity can slip by faster than a needed capability can be created
internally
E. When the capabilities involve tacit knowledge and complex routines
Managers must be prepared to modify their strategy in response to all of the following
EXCEPT:
A. changing circumstances that affect performance and the desire to improve the
current strategy.
B. competitor moves in the market and shifting needs of buyers.
C. stagnating market and restrictive industrial opportunities.
D. mounting evidence that the strategy is less effective.E. public pronouncements from
rivals about monthly profit margins.
Which of the following is NOT true regarding the effect of ethical standards on a
company’s strategy?
A. An unethical strategy reflects badly on the character of the company personnel
involved.
B. A strategy that is unethical in whole or in part is morally wrong.
C. Pursuing an unethical strategy damages a company’s reputation and can have costly
consequences.
D. An ethical strategy is good business and is in the best interest of shareholders.
E. An ethical strategy results in higher employee turnover.
The top management at a new social media technology company would like to revamp
its incentive compensation system to attract ambitious employees. What would be their
best approach?
A. Make the performance bonus at least 3 to 4 percent of base salary to have some
impact.
B. Make the performance bonus at least 10 to 12 percent of base salary to have some
impact.
C. Make the performance payoff equal for average and below-average performers.
D. Set unrealistic performance standards, but with an equally high compensation.
E. Reward people who work very hard, even if they fall short of achieving performance
targets.
Each of the following exemplifies the impact of the macro-environment on a company’s
strategic opportunities EXCEPT:
A. sales of Smirnoff dwindle on account of new laws regulating the sale of liquor.
B. consumer confidence in GM rises as its stock price soars.
C. Nike considers Adidas its most potent rival in the industry.
D. footfalls at the outlets of Pizza Express increase following its drive to go vegan.
E. sales of Smooth Fitness Treadmills surge on account of a new feature that monitors
users’ blood pressure.
A blue-ocean strategy:
A. is an offensive strike employed by a market leader that is directed at pilfering
customers away from unsuspecting rivals to boost profitability.
B. involves an unexpected (out-of- the-blue) preemptive strike to secure an
advantageous position in a fast-growing market segment.
C. works best when a company is the industry’s low-cost leader.
D. involves abandoning efforts to beat out competitors in existing markets and instead
invent a new industry or new market segment that renders existing competitors largely
irrelevant and allows a company to create and capture altogether new demand.
E. involves the use of highly creative, never-used-before strategic moves to attack the
competitive weaknesses of rivals.
A primary reason for why mergers and acquisitions sometimes fail is due to the:
A. misinterpretation of the cultural differences, like employee disenchantment and low
morale, differences in management styles and operating procedures, and operations
integration decision mistakes.
B. execution of functional and integration activity, while sustaining and capitalizing on
the combined sources of revenue.
C. development of effective integration plans conducive to employee satisfaction.
D. advertising message detailing the merger announcement.
E. creation of management-employee programs in order to foster better communication.
A company achieves a competitive advantage when it:
A. provides buyers with superior value compared to rival sellers or offers the same
value at a lower cost.
B. has a profitable business model.
C. is able to maximize shareholder wealth.
D. is consistently able to achieve both its strategic and financial objectives.
E. has a strategy well-matched to its business model.