Management Chapter 5 Bennett has been so successful at his Fortune 500 company

Chapter 05: Strategic and Operational Planning

Test Bank

MULTIPLE CHOICE

1. _______ is the process of setting short-range objectives and determining in advance how they

will be accomplished.

a.

Long-range planning

b.

Strategic planning

c.

Single-use planning

d.

Operational planning

2. Shamar is an upper-level manager at Fortune 500 company. The company feels like they are

outdated and want to recreate their image and go in a different direction. What kind of planning

will Shamar use to develop their new mission and long-range objectives?

a.

Long-range planning

b.

Strategic planning

c.

Single-use planning

d.

Operational planning

3. ____ is a step in the strategic planning process.

a.

Analyzing the environment

b.

Assessing the code of ethics

c.

Assessing the competition

d.

Creating conclusions concerning the competitive position

4. Algemar is helping his Fortune 500 company write a statement describing his company’s

purpose. What is Algemar writing?

a.

Motto

b.

Values

c.

Objectives

d.

Mission

5. Bennett has been so successful at his Fortune 500 company that he decides to start his own

business. What does Bennett need to do first for his strategic planning process?

a.

Develop the mission

b.

Analyze the environment

c.

Set objectives

d.

Develop strategies

6. Strategic planning __________.

a.

is the process of setting short-range objectives and determining in advance how they

will be accomplished

b.

is a plan for pursuing a mission and achieving objectives

c.

describes the company’s competitive advantage in the global village

d.

is the process of developing a mission and long-range objectives and determining in

advance how they will be accomplished

7. The differences between strategic planning and operational planning are primarily _______.

a.

time frame and management level involved

b.

time frame and expense

c.

company type and management level involved

d.

company type and expense

8. In the strategic planning process, what is the third stage in the process?

a.

Implementing and controlling strategies

b.

Developing the mission

c.

Developing strategies

d.

Setting objectives

9. In the strategic planning process, what is the fourth stage in the process?

a.

Implementing and controlling strategies

b.

Developing the mission

c.

Developing strategies

d.

Analyzing the environment

10. In the strategic planning process, what is the first stage in the process?

a.

Setting objectives

b.

Developing the mission

c.

Developing strategies

d.

Analyzing the environment

11. Which of the following is not a part of the situation analysis?

a.

Industry and competitive situation analysis

b.

Company situation analysis

c.

Identification of a competitive advantage

d.

Portfolio analysis

12. Which of the following is one of the forces analyzed in competitive analysis?

a.

Strengths

b.

Assessment of present strategy

c.

Threat of substitutes products and services

d.

Assessing the employee’s benefits package

13. When measuring the power of buyers in a market, you are performing which analysis?

a.

Competitive analysis

b.

SWOT analysis

c.

Marketplace analysis

d.

Management analysis

14. Analyzing the environment is also known as _________.

a.

planning strategy

b.

situation analysis

c.

competition analysis

d.

developing the mission

15. A situation analysis ________.

a.

determines an organization’s internal environmental strengths and weaknesses and

external environmental opportunities and threats

b.

focuses on those features in a company’s environment that most directly affect its

options and opportunities

c.

describes how strategic planning is different from operational planning

d.

is a plan for pursuing a mission and achieving objectives

16. Within the company situation analysis, what step must be done right before the conclusion

concerning competitive position?

a.

Assessment of competitive strength and identification of competitive advantage

b.

Assessment of the present strategy based on performance

c.

Determination of the issues and problems that need to be addressed

d.

SWOT analysis

17. Which of the following is not involved in a SWOT analysis?

a.

Internal environmental strengths

b.

External environmental opponents

c.

External environmental threats

d.

Internal environmental weaknesses

18. __________ specifies how an organization offers unique customer value.

a.

Core competency

b.

Competitive advantage

c.

Critical success factor

d.

Resource opportunity

19. __________ are the few major things that a business must do well in order to be successful.

a.

Resource opportunities

b.

Core competencies

c.

Competitive advantages

d.

Critical success factors

20. A __________ is what a firm does well.

a.

critical success factor

b.

resource opportunity

c.

core competency

d.

competitive advantage

21. Situation analysis is an ongoing process, referred to as __________.

a.

benchmarking the field

b.

monitoring the status

c.

scanning the environment

d.

reading the trends

22. Kim’s goal is to save more money by the end of the current year. Which of the following must

criteria is not met in this statement?

a.

Single result

b.

Specific

c.

Measurable

d.

Target date

23. Which is not included in SMART goals?

a.

Specific

b.

Attainable

c.

Reliable

d.

Timely

24. Which of the following is not a step of management by objectives?

a.

Set individual objectives and plans.

b.

Give feedback and evaluate performance.

c.

Explain goals that are to be accomplished.

d.

Reward according to performance.

25. _______________ is the process in which managers and employees jointly set objectives for

the employees, periodically evaluate performance, and reward employees according to results.

a.

Performance appraisal

b.

Management by objectives

c.

Benchmarking

d.

Consensus mapping

26. Janie, a consultant for Howard & Associates LP, was given an objective to triple the client

retention in her region by the end of the quarter. After her objective was met, Janie’s boss

evaluated her performance and provided feedback. What should Janie’s boss do next when

managing by objectives?

a.

Give her more work to complete

b.

Reward her

c.

Have his assistant call her and congratulate her

d.

Move on to the next objective

27. Ford’s goal is to sell 15% more minivans. Which of the following must criteria is not met in this

statement?

a.

Single result

b.

Specific

c.

Measurable

d.

Target date

28. Which is the correct order of the Objective Writing model?

a.

(1) action verb + (2) to + (3) specific and measurable result + (4) target date

b.

(1) to + (2) action verb + (3) specific and measurable result + (4) target date

c.

(1) to + (2) action verb + (3) target date + (4) specific and measurable result

d.

(1) specific and measurable result + (2) to + (3) action verb + (4) target date

29. Which of the following is not a must criteria when setting objectives?

a.

Measurable

b.

Acceptance and commitment

c.

Specific

d.

Target date

30. A __________ is a form of retrenchment in which a corporation decides to set up one or more of

its business units as a separate company rather than selling it.

a.

Merger

b.

Acquisition

c.

Spinoff

d.

Selloff

31. A _____________ strategy is an overall corporate strategy for growth, stability, turnaround,

and/or retrenchment.

a.

master

b.

grand

c.

combination

d.

global

32. If a company decides to take its time and expand its business slowly, what type of grand strategy

is this company practicing?

a.

Growth

b.

Stability

c.

Merger

d.

Acquisition

33. A large electronics chain has decided to close some of its stores across the country to focus

more on online sales. Which type of grand strategy is the store using?

a.

Retrenchment

b.

Stability

c.

Combination

d.

Spinoff

34. Which one of the following is not a grand strategy?

a.

Stability

b.

Turnaround and retrenchment

c.

Diversification

d.

Growth

35. Lennox’s company is planning on extending its existing business in Asia. In Europe, the

company is fairly dominant, so they plan to make only slow and gradual changes in that market.

However, their efforts to establish market share in North America have not been successful, so

they plan to liquidate those assets and redirect them elsewhere. Which grand strategy is

Lennox’s company using?

a.

Growth

b.

Stability

c.

Combination

d.

Turnaround and retrenchment

36. H&M is looking to expand its business by opening more stores across the USA. What type of

grand strategy is H&M using?

a.

Turnaround and retrenchment

b.

Growth

c.

Stability

d.

Concentration

37. Carol’s Bakery has decided to hold and maintain its present size and not expand into the global

market. What type of grand strategy is Carol’s Bakery using?

a.

Turnaround

b.

Growth

c.

Concentration

d.

Stability

38. A ______________strategy is when a company decides to introduce new product lines.

a.

concentration

b.

diversification

c.

integration

d.

combination

39. When a company decides to enter a line of business that is farther away from its final customer,

what type of growth strategy is this called?

a.

Backward integration

b.

Forward integration

c.

Related diversification

d.

Unrelated diversification

40. Concentration, backward and forward integration, and related and unrelated diversification are

which type of strategy?

a.

Growth

b.

Grand

c.

Combination

d.

Turnaround

41. A ______________ strategy means an organization is growing aggressively in its existing

line(s) of business.

a.

Integration

b.

Diversification

c.

Concentration

d.

Stability

42. Which of the following is considered a growth strategy?

a.

Concentration

b.

Adaptation

c.

Analyzing

d.

Duplication

43. Mergers and acquisitions are associated with which strategy?

a.

Stability

b.

Combination

c.

Turnaround and retrenchment

d.

Growth

44. ___________ occurs when two companies form one corporation.

a.

A merger

b.

Acquisition

c.

Diversification

d.

Integration

45. One of TRESemmé’s strategies is to extend their business by continuing to create hair care

products formulated for customers with different hair types. This type of strategy is

called_________.

a.

integration

b.

turnaround and retrenchment

c.

combination

d.

concentration

46. An example of a(n) __________ is when Exxon and Mobil decided to come together as one to

form the company Exxon-Mobil.

a.

merger

b.

acquisition

c.

spinoff

d.

diversification

47. Anna is using the BCG Growth-Share Matrix to perform a portfolio analysis for her company,

Craycol Incorporated, which has four divisions: Red, Orange, Yellow, and Green. The Yellow

division is doing quite well. Although it faces strong competition in a market that is still

growing and changing rapidly, it currently has a narrow lead in market share. The Red division

has long been the company’s top performer and dominates market share in an industry that has

been stable for the past ten years. The Green division has been performing poorly for the past

five years, and there doesn’t seem to be much opportunity to gain market share from its

competitors, as customer demand has dropped significantly and is not likely to increase. The

Orange division is Craycol’s newest division. The market Orange produces products for is

potentially large, but many other companies are pursuing the same customers and it remains to

be seen how Orange will perform, as it currently lags behind some of its competitors while

outperforming others. According to the BCG Matrix, the __________ division would likely be

identified as a Star.

a.

Red

b.

Orange

c.

Yellow

d.

Green

48. Anna is using the BCG Growth-Share Matrix to perform a portfolio analysis for her company,