Download Strategic Management True/False Questions 1. The first step in the

Strategic Management
True/False Questions
1.
The first step in the strategic management process is analyzing the external environment.
False (difficult)
2.
Within an industry, an environment can present opportunities to one organization and pose
threats to another.
True (moderate)
3.
The final step in the strategic management process is implementing the objectives.
False (difficult)
TYPES OF ORGANIZATIONAL STRATEGIES
1.
Corporate strategies are developed for organizations that run more than one type of
business.
True (moderate)
2.
The business group that is characterized by having low growth but high market share is
known as a cash cow.
True (moderate)
3.
According to the Boston Consulting Group matrix, question marks are businesses that
generate large amounts of cash, but their prospects for future growth are limited?
False (moderate)
4.
According to Porter's competitive strategies framework, the cost leadership strategy would
result in the best quality product at a justifiable cost.
False (difficult)
Multiple Choice
1.
The strategic management process is divided into which of the following sections?
a. planning, implementation, and evaluation (easy)
b. problem identification, planning, and implementation
c. implementation, evaluation, and restructuring
d. mission statement, environmental evaluation, and specific goals
e. mission statement, environmental scoping, and evaluation
2.
In the strategic management process, the ______________ defines the organizational
purpose and answers the question: "What is our reason for being in business?"
a. objective
b.
c.
d.
e.
evaluation
strategy
mission (easy)
values statement
3.
Which of the following is not an example of an organization's mission?
a. We believe our first responsibility is to doctors, nurses and patients, to mothers and all
others who use our products and services. (Johnson & Johnson).
b. AMAX's principal products are molybdenum, coal, iron ore, copper, lead, zinc,
petroleum and natural gas, potash, phosphates, nickel, tungsten, silver, gold, and
magnesium.
c. We at Xeren want to increase market share by 10% during the next fiscal year.
(difficult)
d. We are dedicated to the total success of Corning Glass Works as a worldwide
competitor.
e. Hoover Universal is a diversified, multi-industry corporation with strong manufacturing
capabilities, entrepreneurial policies, and individual business unit autonomy.
4.
Which of the following is not part of the organization's external environment?
a. what competition is doing
b. pending legislation that might affect the organization
c. consumer trends
d. employees' education level (moderate)
e. labor supply
5.
What step in the strategic management process follows analyzing the external
environment?
a. identifying opportunities and threats (moderate)
b. mission statement
c. evaluation
d. identifying strengths and weaknesses
e. formulating strategies
6.
What step in the strategic management process follows analyzing the organization's
resources?
a. identifying opportunities and threats
b. formulating strategy
c. mission statement
d. implementing strategy
e. identifying strengths and weaknesses (easy)
7.
In the strategic management process, what step comes prior to evaluating results?
a. identifying strengths and weaknesses
b. formulating strategies
c. identifying opportunities and threats
d. implementing strategies (easy)
f. analyzing the organization's resources
8.
What is the final step in the strategic management process?
a. mission statement
b. identifying opportunities and threats
c. implementing strategies
d. analyzing the organization's resources
e. evaluating results (easy)
9.
Lower level managers in an organization are typically responsible for which of the
following types of strategies?
a. functional strategies
b. competitive strategies
c. corporate strategies
d. mergers and acquisitions
10.
Which of the following is associated with corporate strategies?
a. They are needed if your organization is in more than one type of business.
(moderate)
b. They answer: "How should our business compete?"
c. They represent a single business.
d. They are a method of support for the business-level strategies.
e. They determine the operations of a single business unit.
11.
When PepsiCo seeks to integrate the strategies of Pepsi, 7-Up International, and Frito-Lay,
it is developing what type of strategy?
a. functional
b. system
c. management
d. competive
e. corporate (moderate)
12.
Examples of a corporate stability strategy include all of the following EXCEPT:
a. continuing to serve the same clients by offering the same product or service.
b. maintaining market share.
c. sustaining the organization’s return-on-investment results.
d. implementing vertical or horizontal integration. (moderate)
13.
When should management pursue a stability strategy?
a. Organizational performance is slipping.
b. The environment is changing.
c. The organization's performance is satisfactory and the environment is stable.
(moderate)
d. The firm has valuable strengths.
e. There are abundant environmental opportunities.
14.
In ______________, the organization attempts to gain control of its inputs by becoming its
own supplier.
a. forward vertical integration
b. backward vertical integration (moderate)
c. horizontal integration
d. related diversification
e. unrelated diversification
15.
Which of the following describes a company growing by combining with other
organizations in the same industry?
a. forward vertical integration
b. backward vertical integration
c. horizontal integration (moderate)
d. related diversification
e. unrelated diversification
16.
Which of the four business groups in the corporate portfolio matrix has high growth and
high market share?
a. cash cow
b. stars (difficult)
c. question marks
d. dogs
e. elephants
17.
Michael Porter's competitive strategies framework identifies three generic competitive
strategies: cost leadership, differentiation, and ______________.
a. depth.
b. breadth.
c. revenue growth.
d. focus. (moderate)
e. acquisition.
18.
Porter's competitive strategies framework describes a ______________ strategy whereby
an organization wants to be unique in its industry along dimensions widely valued by
buyers.
a. differentiation (moderate)
b. focus
c. cost leadership
d. depth
e. defender
Scenarios
A Large Taco (Scenario)
It is now ten years later and, as the original owner of Taco Rocket, you have seen your business
holdings grow substantially. You now need to decide how to best manage and utilize the large
number of assets represented by the companies you own. You called the Boston Consulting Group
(BCG), and they have offered you some advice based on their corporate portfolio matrix.
1.
2.
Your oldest holding, Taco Rocket, has not grown much in recent years but, due to low debt,
generates a huge amount of cash. Taco Rocket would be considered, according to BCG, a
______________.
a. cash cow (moderate)
b. star
c. question mark
d. dog
e. does not fit with their matrix
Recently, you also purchased a company that manufactures a new satellite dish, allowing
you to enter into the cable television market. The business is profitable and growing, but
the technological unknowns make it risky. BGC considers it a ______________.
a. cash cow
b. star
c. question mark (moderate)
d. dog
e. does not fit with their matrix
3.
Another purchase you made was to acquire a local coffee-cart chain with thirty locations
around the city. You don't see it growing very much, but then, it doesn't cost much to
operate. BGC has labeled this venture a ______________.
a. cash cow
b. star
c. question mark
d. dog. (moderate)
e. does not fit with their matrix
4.
You also got somewhat lucky with an investment made a few years ago. You were an
original investor in a computer chip company that took off quickly and now dominates the market.
While growing quickly, it does not tend to generate positive cash flow and is in continuous need
of reinvestment of equipment and product development. BGC considers this a ______________.
a. cash cow
b. star (moderate)
c. question mark
d. dog
e. does not fit with their matrix