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Cultural norms and values seldom guide ethical behavior in business.
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Niches can grow and change over time.
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Punctuated equilibrium describes organizations as evolving through relatively long
periods of stability punctuated by relatively short bursts of fundamental change.
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A strategy's compatibility with the corporate culture has little likelihood of impacting its
success.
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Implementation of staffing involves leading through coaching people to use their
abilities and skills most effectively and efficiently to achieve organizational objectives.
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The goal of NAFTA is complete economic integration.
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One tenet of the learning organization is to maintain stability.
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An example of an objective is "increased profitability," while an example of a goal is
"to increase the firm's profitability in 2010 by 15% over 2009."
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According to Michael Porter, a high force can be regarded as a threat because it is likely
to reduce profits.
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Key success factors seldom vary from industry to industry.
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A direct interlocking directorate occurs when two corporations have directors who also
serve on the board of a third firm.
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When conducting a financial analysis, select and discuss those financial ratios that have
an impact on the company's problems.
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Political-legal forces regulate the values, mores, and customs of society.
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A Gallop study reported that companies that focused on business sustainability had 3.9
times the EPS growth rates as compared to organizations that did not focus on business
sustainability.
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Knowing a company is mindful of its impact on the environment seldom changes
consumer buying habits.
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The two general types of cooperative strategies are collusion and strategic alliances.
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Ratio analysis is a valuable part of SWOT analysis, helping to assess the company's
overall situation and pinpoint some problem areas.
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After programs have been developed, the budget process begins.
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One danger of D'Aveni's concept of hypercompetition is that it may lead to an
overemphasis on short-term tactics over long-term strategy.
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Exporting grants rights to another company to open a retail store using the franchiser's
name and operating system.
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If a mission does not provide a common thread for a corporation's businesses, managers
might be unclear about where the company is heading.
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Friedman referred to the social responsibility of business as a "fundamentally
subversive doctrine."
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In hypercompetitive industries, competitive advantage comes from an up-to-date
knowledge of environmental trends and competitive activity coupled with a willingness
to risk a current advantage for a possible new advantage.
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Firms in the same industry seldom organize themselves in similar ways.
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Kohlberg places 80 percent of U.S. adults in the principled level of development.
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Continuous manufacturing systems reap benefits from economies of scale.
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When preparing a case analysis, you should always undertake outside research and go
beyond the decision date of the case.
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Behavior, output, and input controls are all interchangeable.
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Cost leadership is the ability of a company or business unit to design, produce, and
market a comparable product more efficiently than its competitors.
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An important liquidity ratio is Earnings per Share (EPS).
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The geographic-area structure allows the company to introduce and manage a similar
line of products around the world.
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It is generally accepted that process R&D normally dominates the early stages of a
product's life cycle, whereas product R&D becomes especially important in the later
stages.
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In a leveraged buyout, the acquired company, in effect, pays for its own acquisition.
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A good rule of thumb for R&D spending is that a corporation should spend at a
"normal" rate for that particular industry unless its strategic plan calls for unusual
expenditures.
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The case method provides the opportunity to move from a broader, less precise analysis
of the overall corporation to a narrow, specialized view that emphasizes functional
techniques.
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Capabilities refer to a corporation's ability to exploit its resources.
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Durability is the rate at which a firm's underlying resources, capabilities, or core
competencies can be duplicated by others.
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Since competitors were not able to understand how Gillette's Fusion razor was
produced, it was considered transparent.
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According to Kohlberg, the third level of moral development, characterized by a
person's adherence to an internal moral code, is called
A) principled.
B) conventional.
C) essential.
D) preconventional.
E) fundamental.
Answer:
Which of the following is NOT true of case analysis?
A) Case discussion focuses on critical analysis.
B) A solution is satisfactory if it resolves important problems and if it is likely to be
implemented successfully.
C) Case analysis helps build analytic and decision-making skills.
D) A solution is satisfactory if it reflects what the company actually did.
E) Case discussion focuses on logical development of thought.
Answer:
Which of the following is NOT considered a strategic alliance success factor?
A) Have a clear strategic purpose.
B) Operate with short-term time horizon.
C) Agree on an exit strategy for when the partners' objectives are achieved or the
partnership fails.
D) Minimize conflicts among the partners by clarifying the objectives.
E) Identify likely partnering risks and deal with them when the alliance is formed.
Answer:
According to D'Aveni
A) except for a few stable industries, strategy initiatives do not provide sustainable
competitive advantage.
B) hypercompetition is rare.
C) it is enough to gain competitive advantage by being the lowest cost competitor.
D) the theory of hypercompetition is not supported by any research.
E) the American home appliance industry was immune to hypercompetition.
Answer:
An acronym for the assessment of the external and internal environments of the
business corporation in the process of strategy formulation/strategic planning is
A) PET.
B) MBO.
C) SWOT.
D) SBU.
E) ROI.
Answer:
Which strategy is most appropriate for a company in an industry in which the future is
expected to continue as an extension of the present?
A) horizontal integration strategy
B) no change strategy
C) retrenchment strategy
D) pause/proceed with caution strategy
E) profit strategy
Answer:
Which of the following is NOT descriptive of external environmental scanning?
A) used as a tool to ensure a corporation's long-term health
B) used to monitor, evaluate, and disseminate information relevant to the organizational
development of strategy
C) used to identify major stockholders
D) used as a tool for corporations to avoid strategic surprise
E) used to determine a firm's competitive advantage
Answer:
All of the following are benefits for a company to raising its debt levels EXCEPT
A) deterrent to takeover by other firms.
B) improvement in productivity.
C) improvement in cash flows.
D) force management to focus on core businesses.
E) improvement in strategic options.
Answer:
Which type of pricing attempts to hasten market development and offers the pioneer the
opportunity to utilize the experience curve to gain market share with a low price and
dominate the industry?
A) demand pricing
B) competitive pricing
C) skim pricing
D) penetration pricing
E) loss-leader pricing
Answer:
A budget is a statement of a corporation's programs in dollar terms. Which is NOT true
of the budgetary function?
A) It is used in planning and control.
B) It serves as a detailed plan of strategy in action.
C) Only one budget is necessary to capture all programs.
D) It details the impact on the firm's future financial situation.
E) It is used as a means of measuring success based on certain criteria.
Answer:
Which of the following is a function of corporate culture?
A) It encourages a laissez faire set of attitudes.
B) It encourages flexibility and thus constant change.
C) It conveys a sense of identity for employees.
D) It generates creative approaches to new situations.
E) It focuses employee commitment on their own careers.
Answer:
"Inventory to net working capital" is an example of a(n)
A) leverage ratio.
B) liquidity ratio.
C) activity ratio.
D) asset management ratio.
E) profitability ratio.
Answer:
When a company's core competencies are superior to those of competitors, these are
known as
A) resources.
B) distinctive competencies.
C) core competencies.
D) critical success factors.
E) key performance factors.
Answer:
When a firm internally makes 100% of its key supplies and completely controls its
distributors, this is known as
A) full integration.
B) taper integration.
C) mass integration.
D) economical integration.
E) strategic integration.
Answer:
The hiring of new people with new skills, firing of people with inappropriate or
substandard skills, and/or training existing employees to learn new skills are included
the process of
A) training.
B) staffing.
C) structuring.
D) operating.
E) financing.
Answer:
Which defensive tactic was used by Southwest Airlines when deliberately keeping their
prices low and constantly investing in cost-reducing measures?
A) guerilla warfare
B) lower the inducement for attack
C) encirclement
D) raise structural barriers
E) increase expected retaliation
Answer:
A non-quantitative approach to forecasting that requires simply the presence of people
with some knowledge of the situation to be predicted to propose ideas without first
mentally screening them is called
A) simulations.
B) the delphi technique.
C) brainstorming.
D) signal monitoring.
E) scenarios.
Answer:
Codetermination
A) is the process by which both management and the board establish corporate strategic
management.
B) is the inclusion of a corporation's employees on its board.
C) occurs when one or more individuals on one board also serve on other boards.
D) is present when all board members are also employed by the corporation.
E) occurs when minority shareholders concentrate their votes.
Answer:
In which type of international industry do corporations tailor their products to the
specific needs of consumers in a particular country?
A) consortium industry
B) global industry
C) indigenous industry
D) multidomestic industry
E) worldwide industry
Answer:
A relationship that illustrates the term "complementor" is
A) Microsoft and Intel.
B) General Motors and Ford.
C) Hewlett Packard and Compaq.
D) Gateway and Dell.
E) America Online and CompuServe.
Answer:
The text authors note that the essence of strategy is
A) opportunity divided by strengths minus weaknesses.
B) strength divided by opportunity.
C) threat divided by capacity.
D) threat divided by opportunity.
E) opportunity divided by threat.
Answer:
When firms follow each other's lead to reduce the level of competition such as GE and
Westinghouse did in steam turbines, it is referred to as
A) explicit collusion.
B) a strategic alliance.
C) a mutual service consortium.
D) conscious parallelism.
E) partnering.
Answer:
Which of the following statements is true regarding the board of directors?
A) The board is charged by law to act with due care.
B) If a director or the board as a whole fails to act with due care and, as a result, the
corporation is in some way harmed, the careless director or directors can be held
personally liable for the harm done.
C) Director liability insurance is often needed to attract people to become members of
boards.
D) Directors must be aware of the needs of various constituent groups to balance all
their interests.
E) all of the above
Answer:
Successful analyzer firms tend to be headed by CEOs with backgrounds in the areas of
A) research/engineering and general management.
B) accounting/finance, manufacturing/production, and general management.
C) marketing/sales.
D) human resources and strategy.
E) purchasing and logistics.
Answer:
Surveys of large U.S. and Canadian corporations found outsiders make up what
percentage of total board membership?
A) 2%
B) 30%
C) 50%
D) 80%
E) 98%
Answer:
The combination of the degree of complexity and the degree of change existing in an
organization's external environment is/are called
A) strategic factors.
B) strategic issues.
C) environmental uncertainty.
D) strategic fit.
E) scenarios.
Answer:
According to the text, which one of the following is NOT descriptive of a corporation's
culture?
A) A corporation's culture is a collection of beliefs, expectations, and values learned and
shared by the corporation's members and transmitted from one generation of employees
to another.
B) Corporate cultures are only temporary and can be easily changed.
C) Culture gives a company a sense of identity.
D) The culture reflects the company's values.
E) Cultures have a powerful influence on the behavior of managers and can strongly
affect a corporation's ability to shift its strategic direction.
Answer:
For many large corporations the typical strategic planning staff has just fewer than how
many people?
A) 5
B) 10
C) 7
D) 15
E) 3
Answer:
Some people claim that morality is relative to some personal, social, or cultural
standard and that there is no method for deciding whether one decision is better than
another. This is called
A) ethical relativity.
B) moral philosophy.
C) comparative ethics.
D) cultural imperialism.
E) moral relativism.
Answer:
The T in SWOT represents
A) threat.
B) tactic.
C) tautology.
D) task.
E) time.
Answer:
Explain the impact of the Sarbanes-Oxley Act on corporate governance.
Answer:
Define a value chain and the significance of the center of gravity.
Answer:
What are Porter's four generic strategies?
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What ratios are recommended for financial ratio analysis?
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What is executive succession? Discuss the hiring of insiders versus outsiders.
Answer:
What are the criteria for selecting a good director?
Answer:
What is moral relativism? What are the four types of moral relativism?
Answer:
Discuss some reasons for unethical behavior by business people.
Answer:
What three general practices were identified by Black and Gregersen in companies
which do a good job of managing foreign assignments?
Answer:
List the five-step feedback model of the evaluation and control process.
Answer:
What are the strategies to avoid proposed by the authors?
Answer:
Explain the four combination strategies that may be generated from the TOWS Matrix.
Answer:
What is portfolio analysis?
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What is stakeholder analysis? List the three-step process.
Answer:
Explain the continuum of board involvement.
Answer:
What is the impact of hypercompetition on competitive advantage?
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What information should an action plan include?
Answer:
What is a functional strategy?
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What is a propitious niche? Provide an example of a firm that has been able to
successfully occupy a propitious niche.
Answer:
What is reengineering? What are the principles for reengineering proposed by Michael
Hammer?
Answer:
