Ch 8 test review

Question 1

To remain competitive, companies should develop strategies that focus on core competencies, providing synergy, and creating value for _____.

a. customers
b. suppliers
c. stockholders
d. employees

Answer 1

a. customers

Question 2

. The set of decisions and actions used to formulate and implement strategies that will provide a competitively superior fit between the organization and its environment so as to achieve organizational goals is known as:

a. strategy formulation.
b. strategic planning.
c. strategic management.
d. strategy implementation.

Answer 2

c. strategic management.

Question 3

Which of the following is a business activity that an organization does especially well relative to its competition?

a. Strategy
b. Synergy
c. Cash cow
d. Core competence

Answer 3

Core competence

Question 4

The condition that exists when the organization’s parts interact to produce a joint effect that is greater than the sum of the parts acting alone is known as:

a. core competence.
b. synergy.
c. value creation.
d. business-level strategy.

Answer 4

b. synergy.

Question 5

When properly managed, _____ can create additional value with existing resources, providing a big boost to the bottom line.

a. synergy
b. competitors
c. government contacts
d. command structure

Answer 5

synergy.

Question 6

_____ can be defined as the combination of benefits received and costs paid by the customer.

a. Organizational benefits
b. Value
c. Cost-benefit diversity
d. Synergy

Answer 6

b. Value

Question 7

After Sunshine Systems merged with RTD Enterprises, company executives noticed that due to increased employee collaboration between the two units, costs were down and revenues increased within both areas. This is an example of what business phenomenon?

a. Strategy execution
b. Portfolio strategy
c. Core competency
d. Synergy

Answer 7

d. Synergy

Question 8

When AT&T decided to buy Media One, a cable company, it was pursuing a(n) _____ strategy.

a. functional-level
b. internal growth
c. multi-domestic
d. corporate-level

Answer 8

corporate-level

Question 9

When Philip-Morris, the tobacco giant, bought Kraft, Inc., it was pursuing a _____.

a. corporate-level strategy
b. business-level strategy
c. functional-level strategy
d. multidomestic strategy

Answer 9

corporate-level strategy

Question 10

Which of the following pertains to the organization as a whole?

a. Business-level strategy
b. Functional-level strategy
c. Corporate-level strategy
d. Operational-level strategy

Answer 10

corporate-level strategy

Question 11

A corporate-level strategy is concerned with the question:

a. what business are we in?
b. how do we compete?
c. how do we support our chosen strategy?
d. where do we market our products?

Answer 11

a. what business are we in?

Question 12

When Coca-Cola introduced Surge, a new citrus soft-drink, what type of strategy was being pursued?

a. Functional-level strategy
b. Multi-domestic strategy
c. Corporate-level strategy
d. Retrenchment strategy
e. Business-level strategy

Answer 12

e. Business-level strategy

Question 13

Ford’s decision to completely redesign its Ford Taurus can be classified as a:

a. corporate level strategy.
b. business level strategy.
c. functional level strategy.
d. retrenchment strategy.

Answer 13

Business-level strategy

Question 14

Janessa is the CEO of a privately-held software company. In defining corporate-level strategies, which of the following questions would she most likely be concerned with?

a. How do we compete?
b. What business are we in?
c. How does marketing support the business?
d. How can we maximize profits?

Answer 14

b

Question 15

Decisions regarding the proper amount of advertising for a particular good or service are related to:

a. corporate-level strategies.
b. functional-level strategies.
c. tactical-level strategies.
d. business-level strategies.

Answer 15

d. business-level strategies.

Question 16

Which of these questions is central to a functional-level strategy?

a. What business are we in?
b. How do we compete?
c. How do we support our chosen strategy?
d. What business do we buy?

Answer 16

c. How do we support our chosen strategy?

Question 17

hich of the following lists the strategic management process in proper order?

a. Formulate strategy; Evaluate strategy; Perform SWOT analysis; Define new mission/goals; Execute strategy; Control strategy.
b. Perform SWOT analysis; Evaluate current mission/goals; Formulate strategy; Execute strategy; Define new mission/goals.
c. Evaluate current mission/goals; Define new mission/goals; Formulate strategy; Execute strategy; Perform SWOT analysis .
d. Evaluate current mission/goals; Perform SWOT analysis; Define new mission/goals; Formulate strategy; Execute strategy.

Answer 17

Evaluate current mission/goals; Perform SWOT analysis; Define new mission/goals; Formulate strategy; Execute strategy.

Question 18

. Which of the following refers to the planning and decision making that lead to the establishment of the organization’s goals and of a specific strategic plan?

a. Strategy formulation
b. Strategy implementation
c. Strategy coordination
d. Strategy control

Answer 18

Strategy formulation

Question 19

. Fred has been assigned to conduct a SWOT analysis for his organization, Acme, Inc. As part of this assignment, Fred will:

a. conduct an external wage survey.
b. search for the strengths, weaknesses, opportunities, and threats that impact his firm.
c. choose a grand strategy for his firm.
d. do a cost/benefit analysis.

Answer 19

b. search for the strengths, weaknesses, opportunities, and threats that impact his firm.

Question 20

How business units and product lines fit together in a logical way is the essence of:

a. business-level strategy.
b. portfolio strategy.
c. competitive strategy.
d. financial strategy.

Answer 20

portfolio strategy.

Question 21

The BCG matrix organizes along which of the following dimensions?

a. Market share and profit
b. Sales and market share
c. Business growth rate and market share
d. Business growth rate and profit

Answer 21

Business growth rate and market share

Question 22

Double Click, Inc. has a number of strategic business units. Their hand-held computer unit has a large market share in this rapidly growing industry. Their hand-held computer business would be classified as:

a. a dog.
b. a star.
c. a question mark.
d. a cash cow.

Answer 22

b. a star.

Question 23

Which of these is true about the cash cow?

a. It generates tremendous profits in a rapidly growing industry.
b. It has a small market share in a rapidly growing industry.
c. It has a small market share in a slow growth industry.
d. It has a large market share in a slow growth industry.

Answer 23

d. It has a large market share in a slow growth industry.

Question 24

The star has a:

a. large market share in a rapidly growing industry.
b. large market share in a slow growth industry.
c. small market share in a rapidly growing industry.
d. small share of a slow growth market.

Answer 24

a. large market share in a rapidly growing industry.

Question 25

Which of the following portfolio categories is made up of poor performers who command only a small share of a slow growth market? a. Star b. Cash cow c. Question mark d. Dog

Answer 25

d. Dog

Question 26

The question mark has a: a. large market share in a rapidly growing industry. b. large market share in a slow growth industry. c. small market share in a rapidly growing industry. d. small share of a slow growth market.

Answer 26

small market share in a rapidly growing industry.

Question 27

. Gillette operates numerous strategic business units. Most of its units in the personal care division have low market share but high business growth. These units are classified as _____. a. dogs b. question marks c. stars d. cash cows

Answer 27

question marks

Question 28

When an organization expands into a totally new line of business, it is implementing a strategy of: a. Related diversification b. Unrelated diversification c. Cross-functional diversification d. Product line diversification

Answer 28

Unrelated diversification

Question 29

Semway, a regional bank, recently announced that it would soon begin offering financial planning services. This is an example of which of these? a. Related diversification b. Unrelated diversification c. Cross-functional diversification d. Product line diversification

Answer 29

Related diversification

Question 30

The purpose of _____ is to expand the firm’s business operations to produce new kinds of valuable products and services? a. retrenchment b. diversification c. liquidation d. cash cow

Answer 30

diversification

Question 31

All of the following are Porter's competitive forces except: a. differentiation. b. bargaining power of buyers. c. bargaining power of suppliers. d. threat of substitute products. e. potential new entrants.

Answer 31

a. differentiation.

Question 32

The _____ strategy involves seeking efficient facilities, cutting costs and using tight cost controls to be more efficient than competitors. a. cost leadership b. differentiation c. focus d. internal growth

Answer 32

cost leadership

Question 33

FLY Industries is a global conglomerate company headquartered in the United States that does business in over fifty countries. The company seeks to balance global efficiencies and local responsiveness by hiring locally as well as from home. It can best be described as using which global corporate strategy? a. Globalization strategy b. Multidomestic strategy c. Export strategy d. Transnational strategy

Answer 33

Multidomestic strategy

Question 34

If ABC International has standardized its product line throughout the world it is pursuing a: a. multidomestic strategy. b. retrenchment strategy. c. diversity strategy. d. globalization strategy.

Answer 34

d. globalization strategy.

Question 35

The assumption that a single global market exists would lead to a: a. globalization strategy. b. multidomestic strategy. c. diversity strategy. d. domestic strategy.

Answer 35

a. globalization strategy.

Question 36

_____ refers to the modification of product design and advertising strategies to suit the specific needs of individual countries. a. Domestic strategy b. Global strategy c. Transnational strategy d. Multidomestic strategy e. Market design strategy

Answer 36

Multidomestic strategy

Question 37

Which of the following refers to a strategy that combines global coordination to attain efficiency with flexibility to meet specific needs in various countries? a. Domestic strategy b. Global strategy c. Transnational strategy d. Multidomestic strategy

Answer 37

c. Transnational strategy

Question 38

Core competence is something the organization does very well in comparison to its competitors. A core competence represents a competitive advantage because the company acquires expertise that competitors do not have.

Answer 38

Core competence

Question 39

. Synergy occurs when organizational parts interact to produce a joint effect that is greater than the sum of the parts acting alone. The organization may attain a special advantage with respect to cost, market power, technology, or management skill

Answer 39

Synergy

Question 40

Value creation should be at the heart of strategy. Value is the combination of benefits received and costs paid by the customer. Managers help their companies create value by devising strategies that exploit core competencies and attain synergy.

Answer 40

Value creation

Question 41

Strategy implementation uses managerial and organizational tools to direct resources toward accomplishing strategic results

Answer 41

Strategy implementation

Question 42

Strategy formulation includes the planning and decision making that lead to the establishment of the firm's goals and the development of a specific strategic plan. Also, it includes assessing the external environment and internal problems and integrating the results into goals and strategies.

Answer 42

Strategy formulation