Chapter 8 Strategic Management (prep) – Flashcards
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b. It is involved in many of the decisions that managers make.
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35. Why is strategic management important?
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c. four
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36. The first __________ steps of the strategic management process describe the planning that must take place.
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b. What is our reason for being in business?
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37. In the first step of strategic management, the mission of the firm answers the question, ____________
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d. the organization's mission
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38. What provides clues to what an organization sees as its purpose?
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a. a basis to determine if the goals need to be changed
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39. In the first step of strategic management, identifying the current strategies and goals provides ___________.
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b. pending legislation that might affect the organization
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40. In analyzing the environment, managers should know ____________.
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c. external environment
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41. When an organization is analyzing its labor supply, it is studying its ________________.
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d. Opportunities; threats
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42. ___________ and ___________ are outcomes from a study of the external environment.
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b. the internal environment
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43. The third step in strategic management is related to analysis of ____________.
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a. its resources
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44. What are an organization's financial, physical, human, and intangible assets that are used to develop, manufacture, and deliver products or services to its customers?
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c. doing an internal analysis
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45. If a bank estimates the capabilities of its training and development department employees prior to implementing a new training program designed to change their method of providing customer service, it is completing what step in the strategic management process?
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c. Core competencies
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46. ________________ are the organization's major value-creating skills, capabilities, and resources that determine the organization's competitive weapons.
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b. communicating with customers in their own languages worldwide
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47. An example of a core competency of a firm is ___________.
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b. the content of a culture has a major effect on the strategies that can be pursued
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48. Relative to the organization's culture, a manager must be aware that ___________.
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a. It can be more difficult to change.
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49. What drawback of a strong organizational culture should a manager consider when completing the strategic management process?
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d. a strategically appropriate culture
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50. What is a culture that supports the firm's chosen strategy?
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c. intangible
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51. Corporate reputation is an organization's ________________ resource.
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d. SWOT analysis
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52. The merging of the analyses of internal and external factors influencing the organization's strategy is known as ____________.
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a. How effective have our strategies been?
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53. The final step in strategic planning answers the question, ____________
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a. business
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54. Middle-level managers typically are responsible for _______________ strategies.
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d. Corporate
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55. ___________ strategy determines what businesses an organization should be in.
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d. corporate
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56. When PepsiCo seeks to integrate the strategies of Pepsi, 7-Up International, and Frito-Lay, it is developing what level of business strategy?
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b. growth, stability, and renewal
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57. What are the three main types of corporate strategies?
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a. concentration, vert or horz integration, and diversification
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58. There are three main types of growth strategies: _____________.
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a. concentration
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59. Growth through _______________ is achieved when an organization chooses to grow by increasing its own business operations.
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d. forward vertical integration
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60. In _______________, the organization gains control of its outputs by becoming its own distributor.
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b. horizontal integration
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61. When an organization attempts to combine with other organizations in the same industry, the strategy is known as _____________.
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a. horizontal integration
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62. If United Airlines were to merge with Northwest Airlines, this would be an example of what kind of growth strategy?
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c. growth
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63. An organization that is diversifying its product line is exhibiting what type of growth strategy?
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d. related diversification
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64. When an organization attempts to combine with other organizations in different, but associated industries, the strategy is known as a _____________ strategy.
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a. unrelated diversification
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65. When an organization attempts to combine with other organizations in different and disassociated industries, the strategy is known as a(n) _____________ strategy.
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b. the industry is in a state of rapid upheaval
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66. A stability strategy is particularly appropriate when ____________.
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d. retrenchment
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67. A(n) ___________ strategy addresses organizational weaknesses, helps stabilize operations, and revitalizes organizational resources and capabilities.
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b. turnaround
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68. What type of strategy is a renewal strategy for times when the organization's performance problems are more critical?
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a. cash cow
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69. In the Boston Consulting Group (BCG) matrix, a business unit that exists in a low anticipated growth rate and a high market share is known as a _________.
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d. question mark
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70. In the BCG matrix, a business unit that exists in a high anticipated growth rate and a low market share is known as a __________.
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c. dog
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71. In the BCG matrix, a ________ does not consume or produce much cash and holds little or no improved performance.
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c. stars; question marks
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72. Managers should "milk" cash cows for as much as they can, limit any new investment in them, and use the large amounts of cash generated to invest in __________ and __________ .
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b. stars
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73. Heavy investment in __________ will help take advantage of the market's growth and help maintain high market share.
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d. dogs
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74. The __________ should be sold off or liquidated as they have low market share in markets with low growth potential.
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c. a corporate portfolio matrix
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75. What can provide a framework for understanding diverse businesses and help managers establish priorities for making resource allocation decisions?
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a. Business
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76. __________________ strategy determines how an organization should compete in each of its businesses.
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a. how the company will compete in its main market
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77. For a small organization in only one line of business, the competitive strategy simply describes ______________.
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b. strategic business units
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78. An organization is said to have ______________ when it has several different businesses that are independent and that formulate their own strategies.
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d. competitive advantage
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79. An example of ________________ is when an organization possesses a characteristic that sets itself apart from competitors and gives the firm a distinctive edge.
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a. 3M
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80. What company has a competitive advantage in developing and marketing products because it stresses risk taking and innovation?
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b. sustainable
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81. To a degree, an organization's commitment to quality and continuous improvement can differentiate it from competitors, but constant improvement and reliability of an organization's products and/or services may result in a competitive advantage that is _________.
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d. market instabilities
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82. What can challenge managers' attempts at creating a long-term, sustainable competitive advantage?
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b. industries
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83. Michael Porter proposes that some ____________ are inherently more profitable than others.
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c. bargaining power of suppliers
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84. Which of the following is a force in the Porter's five forces model of industry attractiveness?
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d. focus
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85. Michael Porter's competitive strategies framework identifies three generic competitive strategies: cost leadership, differentiation, and ___________.
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a. aggressively search out efficiencies to maintain the lowest cost structure
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86. Cost leadership as a strategy requires a firm to ____________.
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b. be unique in its product offering
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88. Differentiation as a strategy requires a firm to ___________.
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a. differentiation strategy
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89. Practically any successful consumer product or service can be identified as an example of the ________________.
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b. focus
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90. What generic competitive strategy involves a cost advantage or a differentiation advantage in a narrow segment or niche?
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a. segment
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91. When following the focus strategy, a ____________ can be based on product variety, type of end buyer, distribution channel, or geographic location of buyers.
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a. a cost or differentiation advantage
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92. A firm that is "stuck in the middle" cannot develop _____________.
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c. three companies usually dominate the majority of market share
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93. The premise of the rule of three is that _____________.
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b. business strategy
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94. Functional-level strategy directly supports ____________.
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a. strategic flexibility
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95. What is the ability to recognize major external environmental changes, to quickly commit resources, and to recognize when a strategic decision is not working?
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a. encourage employees to be open about disclosing negative information
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96. How can a company create strategic flexibility?
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d. by using Web-based inventory control systems that reduce storage costs
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97. How can a cost leader use e-business to reduce costs?
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b. differentiator
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98. An Internet-based knowledge management system that resulted in shorter customer response times would be one e-business technique that contributes to the competitive advantage of a _____________.
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c. a focuser
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99. Who targets a narrow market segment with customized products?
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b. clicks-and-bricks
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100. What e-business strategy uses both online and traditional stand-alone locations?
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b. providing employees with customer service training
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101. Customer service strategies involve giving the customers what they want, effective communication, and ____________.
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c. innovation emphasis and innovation timing
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102. Innovation strategies should reflect the organization's philosophy about innovation, which is shaped by _______________.
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c. process improvement
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103. Senior managers must decide whether or not the emphasis of their innovation efforts is going to be based upon ____________.
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a. looking for ways to enhance existing work processes
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105. Process development strategies seek to achieve a competitive advantage by _____________.
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c. first mover
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106. The first organization to bring a product or service to market is often referred to as the _____________.
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d. cost and learning benefits
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107. What is a strategic advantage of being a first mover?
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b. risk of competitors imitating innovations
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108. What is a strategic disadvantage of being a first mover?
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