How do good corporate citizens function?
A. They pursue discretionary activities that contribute to the betterment of society,
especially in areas where government has chosen not to focus its efforts or has fallen
short.
B. They are active participants in the political processes.
C. They identify up-and-coming managers who have a future in local- or state-level
politics.
D. They create a democratic workplace where the voices of lower-level employees are
heard through representation on the board of directors.
E. They seek to replace government functions with more efficient, market-driven
solutions.
The strategy-making, strategy-executing process:
A. is usually delegated to members of a company’s board of directors.
B. includes establishing a company’s mission, developing a business model aimed at
making the company an industry leader, and crafting a strategy to implement and
execute the business model.
C. embraces the tasks of developing a strategic vision, setting objectives, crafting a
strategy, implementing and executing the strategy, and then monitoring developments
and initiating corrective adjustments in light of experience, changing conditions, and
new opportunities.
D. is principally concerned with sizing up an organization’s internal and external
situation, so as to be prepared for the challenges of developing a sound business model.
E. is primarily the responsibility of top executives and the board of directors; very few
managers below this level are involved in the process.
According to the advocates of ethical relativism:
A. if the use of underage labor and/or the payment of bribes/kickbacks are acceptable in
a particular culture/society/country, then a case can be made that it is morally correct
and ethical for a company to use these practices in conducting its business activities in
that culture/society/country.
B. each company should have the flexibility to set its own standards for deciding
whether the use of underage labor and/or the payment of bribes/kickbacks are ethically
acceptable or not.
C. if the use of underage labor and/or the payment of bribes/kickbacks are not legal but
locally acceptable in a particular country, then it is morally correct and ethical for a
company to use these practices in that country.
D. each industry should go by standards established by competitors for deciding
whether the use of underage labor and/or the payment of bribes/kickbacks are ethically
acceptable or not.
E. it is very clear that the use of underage labor or the payment of bribes and kickbacks
are ethically impermissible-local customs, behavioral norms, and traditions absolutely
cannot be taken into account.
To test whether a particular diversification move has good prospects for creating added
shareholder value, corporate strategists should use:
A. the profit test, the competitive strength test, the industry attractiveness test, and the
capital gains test.
B. the better-off test, the competitive advantage test, the profit expectations test, and the
shareholder value test.
C. the barrier-to-entry test, the competitive advantage test, the growth test, and the stock
price effect test.
D. the strategic fit test, the industry attractiveness test, the growth test, the dividend
effect test, and the capital gains test.
E. the attractiveness test, the cost-of-entry test, and the better-off test.
Which of the following is part of a company’s macro-environment?
A. Conditions outside the market
B. European culture, values, and lifestyles
C. The pace of technological change factors and legal and regulatory conditions
D. The industry and competitive environment arena outside the company’s operating
territory
E. The company’s resource strengths, resource weaknesses, and competitive capabilities
While there are many routes to competitive advantage, the two biggest factors that
distinguish one competitive strategy from another are:
A. whether a company can build a brand name and an image that buyers trust.
B. whether a company’s target market is broad or narrow and whether the company is
pursuing a low cost or differentiation strategy.
C. whether a company can achieve lower costs than rivals and whether the company is
pursuing the industry’s sales and market share leader’s role.
D. whether a company can offer the lowest possible prices and whether the company
can get the best suppliers in the market.
E. whether a company’s overall costs are lower than competitors’ and whether the
company can achieve strong product differentiation.
Which of the following is NOT an example of leadership actions or managerial
practices taken to foster a results-oriented, high-performance culture?
A. Treating employees as valued partners
B. Utilizing people-management practices to build morale and foster pride
C. Setting stretch objectives and clearly communicating expectations for reaching
targets
D. Using motivational techniques and compensation incentives to inspire employees
E. Following a must-be-invented-here mindset
Enlisting employees’ sustained and energetic commitment to good strategy execution
and achievement of the strategic priorities and financial objectives is best done by:
A. having top executives commit to making employees the company’s most valuable
competitive asset.
B. developing core competencies in the use of TQM, Six Sigma programs, and business
process reengineering.
C. resourceful and effective use of motivational incentives, both monetary and
nonmonetary.
D. clever and innovative use of benchmarking and best practices.
E. providing employees with a high degree of job security and attractive perks.
Monetary rewards and nonmonetary incentives generally head the list of motivating
tools for gaining wholehearted employee commitment to good strategy execution and
focusing attention on strategic priorities.
Which of the following is NOT among the principal managerial tasks associated with
managing the strategy execution process?
A. Ensuring that policies and procedures facilitate rather than impede effective
execution
B. Creating a company culture and work climate conducive to successful strategy
implementation and execution
C. Surveying employees’ opinions on how costs can be reduced and how employee
morale and job satisfaction can be improved
D. Exerting the internal leadership needed to drive implementation forward and keep
improving on how the strategy is being executed
E. Motivating people and tying rewards and incentives directly to the achievement of
performance objectives and good strategy execution
Which of the following is NOT among the principal managerial components of the
strategy execution process?
A. Building an organization with the competencies, capabilities, and resource strengths
needed to execute strategy successfully
B. Instituting policies and procedures that facilitate rather than impede strategy
execution
C. Deciding which core competencies and value chain activities to leave as is and
which ones to overhaul and improve
D. Adopting best practices and pushing for continuous improvement in how value chain
activities are performed
E. Tying rewards directly to the achievement of strategic and financial targets and to
good strategy execution
The BEST example of a company resource is:
A. having higher earnings per share and a higher return on shareholders’ equity
investment than key rivals.
B. being totally self-sufficient such that the company does not have to rely in any way
on key suppliers, partnerships with outsiders, or strategic alliances.
C. having proven technological expertise and an ability to churn out new and improved
products on a regular basis.
D. having a larger number of competitive assets than competitive liabilities.
E. having more built-in key success factors than rivals.
In companies where intellectual capital is crucial to good strategy execution, which of
the following is generally NOT among the practices companies use to establish a
talented knowledge base?
A. Providing promising employees with challenging, interesting, and skill-stretching
assignments and also rotating them through jobs that not only have great content but
also span functional and geographic boundaries
B. Providing employees promotions, salary increases, performance bonuses, stock
options, and other perks
C. Coaching underperformers and benchwarmers to improve their skills and capabilities
D. Encouraging employees to challenge existing ways of doing things, to be creative
and innovative in proposing better ways of operating, and to push their ideas for new
products or businesses
E. Fostering a stimulating and engaging work environment such that employees will
consider the company a great place to work
The lower the user’s switching costs, the:
A. harder it is for the sellers of attractive substitutes to lure buyers to their offering.
B. more intense the competitive pressures posed by substitute products.
C. less intense the competitive pressures posed by substitute products.
D. greater the bargaining power from both suppliers and influential customers.
E. lesser the bargaining power from both suppliers and influential customers.
The best reason for investing company resources in vertical integration (either forward
or backward) is to:
A. expand into foreign markets and/or control more of the industry value chain.
B. broaden the firm’s product line and/or avoid the need for outsourcing.
C. gain a first-mover advantage over rivals in revamping the industry value chain.
D. add materially to a company’s technological capabilities, strengthen the company’s
competitive position, and/or boost its profitability.
E. achieve product differentiation and/or lengthen the company’s value chain to include
more activities performed in-house and thereby gain a greater ability to reduce internal
operating costs.
A company’s culture is in part defined and identified by:
A. its internal work climate and personality-as shaped by its shared values, work
practices, traditions, and ingrained attitudes and behaviors that define “how we do
things around here.”
B. whether it employs a low-cost provider, best-cost provider, differentiation, or
focused strategy.
C. whether decision making is centralized or decentralized and whether it is a
single-business company or a diversified company.
D. how strongly its strategic vision is linked to its core values.
E. whether it is a well-known industry leader, an up-and-coming company that is
gaining market share, a middle-of-the-pack company unlikely to move up in the
industry ranks, or an industry also-ran that may or may not survive.
Assigning a weight to each measure of competitive strength assessment is generally
analytically superior because:
A. a weighted ranking identifies which competitive advantages are most powerful.
B. an unweighted ranking doesn’t discriminate between companies with high and low
market shares.
C. it singles out which competitor has the most competitively potent core competencies.
D. weighting each company’s overall competitive strength by its percentage share of
total industry profits produces a more accurate measure of its true competitive strength.
E. all of the various measures of competitive strength are not equally important.