A well-designed reward system:
A. ties rewards to performance outcomes directly linked to good strategy execution and
the achievement of financial and strategic objectives.
B. should be free of elements that induce stress, anxiety, tension, pressure to perform,
and job insecurity.
C. puts the primary emphasis on denying rewards to those who fail to perform tasks in
the prescribed fashion.
D. emphasizes weeding out employees who are average performers.
E. strives for a 50-50 balance between positive and negative rewards and a 50-50
balance between monetary and nonmonetary rewards.
Which of the following is NOT something that can be gleaned from a company’s
SWOT?
A. How to improve a company’s strategy by using company strengths and capabilities
as cornerstones for its strategy
B. Which market opportunities are best suited to a company’s strengths and capabilities
C. Which resource weaknesses and deficiencies need to be corrected so as to better
enable the pursuit of important market opportunities and to better defend against certain
external threats
D. How to turn a core competence into a distinctive competence
E. Whether any of the company’s resource strengths can be used to help lessen the
impact of external threats
The resolute standard for judging whether individuals, teams, and organizational units
have done a good job must be measured by:
A. comparing industry performance standards against the company’s own internal
criteria.
B. the level of rapid growth in industry (buyer) demand.
C. whether they meet or beat performance targets that reflect good strategy execution.
D. the number of rivals existing in the marketplace and their growth results.
E. the relative competitive strengths of the industry leaders and how vulnerable they are
to mimicry.
Larger firms with more complex organizational structures are:
A. less decentralized in their decision making than smaller firms.
B. more decentralized in their decision making than smaller firms.
C. less decentralized in their decision making than larger firms with simpler structures.
D. more centralized in their decision making than smaller firms.
E. not decentralized due to their operating size.
Frequently, a significant part of a company’s culture is captured in:
A. the company’s strategic vision and strategic intent.
B. the stories that get told over and over again to illustrate the importance of certain
values and the depth of commitment that various company personnel have displayed.
C. how much stretch is built into the company’s financial and strategic performance
targets.
D. the vigor and enthusiasm with which it engages in benchmarking and seeks out best
practices.
E. the company’s track record in taking market share away from rivals.
Which of the following is MOST likely to qualify as a driving force?
A. Increases in price-cutting by rival sellers and the launch of major new advertising
campaigns by one or more rivals
B. Successful introduction of innovative new products or new ways to market products
C. An increase in the prices of substitute products
D. Decisions on the part of industry’s three biggest competitors not to pursue a strategy
of striving to be the industry’s low-cost leader
E. Decisions by one or more outsiders not to attempt to enter the industry
A differentiation-based competitive advantage:
A. nearly always is attached to the quality and service aspects of a company’s product
offering.
B. usually is the result of highly effective marketing and advertising to enhance the
brand, raise awareness, and build consistent customer experience.
C. requires developing at least one distinctive competence that buyers consider
valuable.
D. hinges on a company’s success in developing top-of-the-line product features that
will command the highest price premium in the industry.
E. often hinges on incorporating features that raise the performance of the product or
lower the buyer’s overall costs of using the company’s product, or enhances buyer
satisfaction in intangible or noneconomic ways, or delivers value to customers by
differentiating on the basis of competencies and capabilities that rivals can’t match.
Strategy-making is:
A. primarily the responsibility of key executives rather than a task for a company’s
entire management team.
B. more of a collaborative group effort that involves all managers and sometimes key
employees, as opposed to being the function and responsibility of a few high-level
executives.
C. first and foremost the function and responsibility of a company’s strategic planning
staff.
D. first and foremost the function and responsibility of a company’s board of directors.
E. first and foremost the function of a company’s chief executive officer, who
formulates strategic initiatives and submits them to the board of directors for approval.
According to integrated social contracts theory, the ethical standards a company should
try to uphold:
A. are governed by the school of ethical universalism.
B. are governed both by a limited number of universal ethical principles and the
circumstances of local cultures, traditions, and shared values.
C. are governed by each country’s Code of Required Ethical Conduct, which sets forth
that each individual/group/business/organization has a ‘social contract” to observe the
ethical and moral standards that the country has adopted.
D. should be determined by the company’s moral managers.
E. should be absolute and avoid wiggle room according to the circumstances of the
situation.
Once a company has diversified into a collection of related or unrelated businesses and
concludes that some strategy adjustments are needed, which one of the following is
NOT one of the main strategy options that a company can pursue?
A. Multinational diversification
B. Restructure the company’s business lineup with a combination of divestitures and
new acquisitions
C. Craft new initiatives designed to build/enhance the reputation and image of the
company
D. Divest some businesses and retrench to a narrower diversification base
E. Broaden the diversification base
Corporate parenting refers to all of the following EXCEPT:
A. the role that a diversified corporation plays in nurturing its component businesses
through the provision of top management expertise, disciplined control, financial
resources, and capabilities.
B. the help subsidiaries receive in performing better when they utilize astute high-level
guidance from corporate executives.
C. the corporation’s ability to provide generalized support resources so as to create
value by lowering companywide overhead costs by eliminating duplication of efforts.
D. efforts to capitalize on the umbrella brands and enhance value proposition across
businesses.
E. efforts to judiciously segregate funds for each business in such a way that keeps the
money safe and discourages shifting funds across business units.
Establishing investment priorities and steering corporate resources into the most
attractive business units typically requires the company to decide on all of the following
options, EXCEPT:
A. the pursuit of rapid growth strategies in its most promising businesses.
B. initiating profit improvement or turnaround strategies in weak-performing businesses
with potential.
C. the divestiture of unattractive businesses.
D. the pursuit of debt reduction opportunities that can lower the debt/equity ratio while
maintaining asset levels.
E. the divestiture of businesses that do not fit into the company’s longer term plans.
Which of the following is an example of a cross-border alliance?
A. Facebook took over WhatsApp for $19 billion in February 2014.
B. Hyundai Motor Company plans to open a new manufacturing plant in the Czech
Republic.
C. The insurance company Geicois a wholly owned subsidiary of Berkshire Hathaway.
D. Renault-Nissan sells more than one in ten cars worldwide.E. Carrefour, a French
grocery chain, established a new wholly-owned venture in Poland.
Which of the following is unlikely to be a primary building block in a company’s
organizational structure?
A. Functional departments
B. Process and operations departments
C. Empowered employee departments
D. Divisional units performing major processing steps
E. Geographic organizational units
The most powerful of the five competitive forces is USUALLY:
A. the competitive pressures that stem from the ready availability of attractively priced
substitute products.
B. the competitive pressures associated with the market maneuvering and jockeying for
buyer patronage that goes on among rival sellers in the industry.
C. the benefits that emerge from close collaboration with suppliers and the competitive
pressures that such collaboration creates.
D. the competitive pressures associated with the potential entry of new competitors.
E. the bargaining power and leverage that large customers are able to exercise.
The competitive advantage of a best-cost provider is:
A. having the best value chain in the industry.
B. its brand name reputation.
C. its capability to incorporate upscale or attractive attributes into its product offering at
lower costs than rivals.
D. a distinctive competence in delivering top-notch quality and customer service.E. a
distinctive competence in supply chain management.
A company’s strategy is a “work in progress” and evolves over time because of:
A. the importance of developing a fresh strategic plan every year that keeps employees
from becoming bored with executing the same strategy year after year.
B. the ongoing need to imitate the new strategic moves of the industry leaders.
C. the need to make regular adjustments in the company’s strategic vision.
D. the ongoing need of company managers to react and respond to changing market and
competitive conditions.
E. the frequent need to modify key elements of the company’s business model.
Which structure combines two or more organizational forms, with multiple reporting
relationships, and is used to foster cross-unit collaboration?
A. Matrix structure
B. Composite structure
C. Divisional structure
D. Network structure
E. Functional structure
A middle-class customer (target) base in a region is most concerned with quality and
price of products. Which of the following would be considered a best value proposition
for the customers?
A. A company that identifies unique features of its products without comparing it with a
rival’s products
B. A company that offers copycat products at low cost but an average quality compared
to rivals
C. A company that offers the same quality of products as rivals but at a high cost based
on greater market share and higher brand value
D. A company that provides same quality of products at a much lower price than rivals,
but leaves the final assembly of product pieces to customers with an easy assembly
guide
E. A company that sells an average quality product compared to rivals with a meager
difference in price.
Identify and briefly discuss/explain three components of structuring a company’s work
effort to promote successful strategy execution.
What are the strengths and weaknesses of the thesis that ethical standards are (or should
be) universal?
What are the five traits of unhealthy cultures?
Discuss control mechanisms that managers can use to monitor the performance of
empowered employees.
What is meant by the term strategic fit? What are the advantages of pursuing strategic
fit and matchups in choosing which industries to diversify into?
The use of incentives and rewards is the single most powerful tool at management’s
disposal to win strong employee commitment to carrying out the strategic plan. True or
false? Explain.