Company objectives:
A. are needed only in those areas directly related to a company’s short-term and
long-term profitability.
B. need to be broken down into performance targets for each of its organizational
levels-for separate businesses, product lines, functional departments, and individual
work units.
C. play the important role of establishing the direction in which it needs to be headed.
D. are important because they help guide managers in deciding what the company’s
strategic intent should be.E. should be set in a manner that does not conflict with the
performance targets of lower-level organizational units.
Easy DriveIn, a fast food facility, offers products at lower prices than its competitors in
the market and has a drive-through-only operation with no indoor seating. What
strategy is Easy DriveIn using to gain competitive advantage?
A. A low-cost provider strategy
B. A broad differentiation strategy
C. A focused low-cost strategy
D. A focused differentiation strategy
E. A best-cost provider strategy
Which of the following factors is NOT a relevant consideration in judging whether
buyer bargaining power is relatively strong or relatively weak?
A. Whether certain customers offer sellers important market exposure or prestige
B. Whether customers are relatively well-informed about sellers’ products, prices, and
costs
C. Whether buyer needs and expectations are changing rapidly or slowly
D. Whether sellers’ products are highly differentiated, making it troublesome or costly
for buyers to switch to competing brands or to substitute products
E. Whether buyers pose a major threat to integrate backward into the product market of
sellers
The payoff of good scouting reports on rivals is an improved ability to:
A. anticipate what moves rivals are likely to make next.
B. determine which rivals are in the best strategic group.
C. figure out how many key success factors a rival has.
D. determine whether a rival is gaining or losing market share.E. determine whether a
rival has the best strategy and is the industry leader.
Strategic objectives:
A. are more essential in achieving a company’s strategic vision than are financial
objectives.
B. relate to strengthening a company’s overall market standing and competitive
position.
C. are more difficult to achieve and harder to measure than financial objectives.
D. are generally less important than financial objectives.
E. help managers track an organization’s true progress better than financial objectives.
Amanda owns one of two bakery stores in her neighbourhood. Which of the following
questions would NOT help Amanda predict the next strategic moves and countermoves
of her rivals?
A. Which mode of transport does the rival’s supplier use?
B. How does her rival manage door-to-door deliveries at no extra cost?
C. What percentage of customer frequent her rival’s store?
D. Why are her rival’s cupcakes so popular among customers?
E. When does her rival undertake special orders for custom cakes?
Within the integrated social contracts approach, we find that a multinational company’s
code of conduct involves universal norms that must be enforced worldwide and also the
inclusion of local moral standards (traditions and cultures) by the host country, thereby
allowing for ethical diversity which entails:
A. the self-righteous company trying to operate as a standard bearer of morality
worldwide.
B. the disturbing case where a multinational’s ethical conduct is found to be no higher
than those local ethical norms, where local ethical norms permit practices generally
considered immoral.
C. the necessity to activate compromises on what is ethically permissible and what is
not.
D. much internal conflict because “first-order” ethical norms always take precedence
over local ‘second-order” norms.
E. a “no compromise” position in instances involving universally applicable ethical
norms on what is ethically permissible and what is not.
One of the most significant contributions to strategy making in diversified companies
that the nine-cell industry attractiveness competitive strength matrix provides is:
A. identifying which businesses have strategies that should be continued, which
businesses have strategies that need fine-tuning, and which businesses have strategies
that need a major overhaul.
B. that businesses having the greatest competitive strength and that are positioned in the
most attractive industries should have the highest priority for corporate resource
allocation and that competitively weak businesses in relatively unattractive industries
should have the lowest priority and perhaps even be considered for divestiture.
C. pinpointing which strategies are most appropriate for businesses positioned in the
four corners of the matrix (although the matrix reveals little about the best strategies for
businesses positioned in the remainder of the matrix).
D. its ability to pinpoint what kind of competitive advantage or disadvantage each
business has.
E. pinpointing which businesses to keep and which ones to divest.
A low-cost leader can translate its low-cost advantage over rivals into superior profit
performance by:
A. underpricing rivals and attracting quality-sensitive buyers in great enough numbers.
B. maintaining the present price, and using the lower-cost edge to earn a higher profit
margin on each unit sold.
C. going all out to use its cost advantage to capture a dominant share of the market.
D. spending heavily on advertising to promote its cost advantage to build strong
customer loyalty.
E. out-producing rivals and thus having more available units for sale.
Diversified companies striving to capture the benefits of synergy between separate
businesses have to be aware of all of the following challenges EXCEPT:
A. giving business-unit heads full rein to operate independently.
B. having pieces of strategically relevant activities and capabilities scattered across
many departments, with each pursuing its own priorities, projects, and agendas.
C. centralizing performance of functions requiring close coordination at the functional
level.
D. serving the interests of individual businesses and not the company as a whole.E.
forming cross-business strategic fit by enforcing close collaboration.
The most significant signs of a well-managed company are:
A. the eagerness with which executives set stretch financial and strategic objectives and
develop an ambitious strategic vision.
B. aggressive pursuit of new opportunities and a willingness to change the company’s
business model whenever circumstances warrant.
C. good strategy-making combined with good strategy execution.
D. a visionary mission statement and a willingness to pursue offensive strategies rather
than defensive strategies.
E. a profitable business model and a balanced scorecard approach to measuring the
company’s performance.
Which of the following contribute to the emergence and sustainability of a strong
culture?
A. Senior executives that walk the talk of high ethical standards
B. A strong emphasis on developing innovative core competencies and competitive
capabilities
C. A sincere, long-standing company commitment to operating the business according
to established traditions, thereby creating an internal environment that supports decision
making and strategies based on cultural norms
D. Centralized decision making and strict enforcement of company policies
E. A long-standing commitment to strict enforcement of established policies and
procedures and steadfast unwillingness to change these policies and procedures
Which of the following is NOT a factor that causes buyer bargaining power to be
stronger?
A. Some buyers are a threat to integrate backward into the business of sellers and
become an important competitor.
B. Buyers are small and numerous relative to sellers.
C. Buyers have considerable discretion over whether and when they purchase the
product.
D. Buyers purchase the item frequently and are well-informed about sellers’ products,
prices, and costs.
E. The costs incurred by buyers in switching to competing brands or to substitute
products are relatively low.
A company requires a dynamically evolving portfolio of resources and capabilities to:
A. assist the strategic planning team in overall direction.
B. sustain complex manufacturing systems as a strategic recall.
C. sustain its competitiveness and help drive improvements in its performance.
D. sustain benefits of high market share as an interest in growth strategies.
E. transform knowledge into a management style supporting competition in a globally
diverse world.
The underlying criteria of a best-cost provider strategy usually is found in the ability of
a company to:
A. offer better goods at attractive prices.
B. create attributes that appeal specifically to niche members.
C. lower overall costs more than rivals in serving niche members.
D. offer buyers something attractively different from competitors’ offerings.
E. offer the best product at the industry’s lowest possible price.