Management 9th Edition By Richard L – Test Bank

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INSTANT DOWNLOAD COMPLETE TEST BANK WITH ANSWERS

 

Management 9th Edition By Richard L – Test Bank

 

Sample  Questions

 

Chapter 3—The Environment and Corporate Culture

 

TRUE/FALSE

 

  1. Mattel managers moved swiftly to reassure parents and customers after having to recall nearly 850,000 of its most popular toys because of lead paint.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   63

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Factors external to the organizations have been primarily the focus of management as a discipline.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The general environment and the task environment are the two layers of an organization’s external environment.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The outer layer, the general environment, is widely dispersed and affects organizations directly.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. To be effective, managers must monitor and respond to the environment — a closed-systems view.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Customers and competitors are two important sectors of the economic dimension of a firm’s general environment.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Current employees, management, and especially corporate culture are part of an organization’s internal environment.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The international dimension of the external environment represents events originating in foreign countries as well as opportunities for U.S. companies in other countries.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. In recent years, the most dramatic change in the international environment is the shift of economic power to Germany and France.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The technological dimension of the external environment includes scientific and technological advancements in a specific industry as well as in society at large.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The sociocultural dimension of the general environment includes societal norms and values.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The international dimension includes scientific and technological advancements in a specific industry as well as in society at large.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   66

NAT:  AACSB Analytic | Information Technologies                  TYP:   F

 

  1. According to Manager’s Shoptalk in Chapter 3, the Chinese concept of guanxi is a supportive, mutually beneficial connection between two people.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   67

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. According to Manager’s Shoptalk in chapter 3, one of the rules of doing business in China is remembering that relationships are short-term.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   67

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Economic problems in other parts of the world have a tremendous impact on U.S. companies.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The economic dimension of the general environment represents the demographic characteristics.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The economic dimension of the general environment includes consumer purchasing power.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. An example of part of the legal-political dimension of the general environment is a government’s report on the decline of unemployment rate.

 

ANS:  F                    PTS:   1                    DIF:    3                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    A

 

  1. President Clinton’s signing of the telecommunications bill in 1996 deregulating the industry is an example of the legal-political dimension of the general environment.

 

ANS:  T                    PTS:   1                    DIF:    3                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The task environmental dimension includes all elements that occur naturally on earth, including plants, animals, rocks, and natural resources such as air, water, and climate.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Customers are the people and organizations in the environment who acquire goods or services from the organization.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Recently, there has been strong concern about climate change such as global warming caused by greenhouse gases, most notably carbon dioxide.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. McDonalds, Burger King, and Checkers are competitors since all three sell fast food to individuals.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    A

 

  1. The raw materials that organizations use to produce its outputs are provided by customers.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Other organizations in the same industry or type of business that provide goods or services to the same set of customers are referred to as suppliers.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The labor market is made up by people in the environment who can be hired to work for an organization.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. If Johnson Lumber provides trees for Westvaco Paper Manufacturing, then Johnson Lumber is considered a supplier for Westvaco.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    A

 

  1. Organizations must manage environmental uncertainty to be effective.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   72

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. An organization experiences high uncertainty when internal factors gradually change over time.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   73

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. A boundary-spanning role is an effort to spot trends that enable managers to predict future events.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   73

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. A sales executive for General Motors fills an essential boundary-spanning role.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   73

NAT:  AACSB Analytic | Environmental Influence                              TYP:    A

 

  1. Competitive intelligence professionals are really just in-house snoops who obtain information about other companies.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   74

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Competitive intelligence is an approach to boundary spanning which results from using sophisticated software to search through large amounts of internal and external data to spot patterns, trends, and relationships that might be significant.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   74

NAT:  AACSB Analytic | Information Technologies                  TYP:   F

 

  1. More organizations are requiring all employees to perform boundary-spanning because of environmental turbulence and uncertainty.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   74

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Given the increasing environmental uncertainty, managers in partnering organizations are shifting from a partnership orientation to an adversarial orientation.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   74

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. A joint venture involves a strategic alliance or program by two or more organizations.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Due to the stable environment and lack of technological change, mergers and joint ventures rarely occur in the U.S.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The internal environment within which managers work includes corporate culture, sociocultural aspects, and customers.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   75

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Culture can be defined as the ability to speak different languages.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   76

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Physical symbols are associated with the surface level of organizational culture.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   76

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Symbols, stories, heroes, slogans, and ceremonies combine to create an organization’s culture.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The set of key values, beliefs, and norms, that are shared by members of an organization are combined to create the symbols of an organization.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A symbol is a figure that exemplifies the deeds, character, and attributes of a corporate culture.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A narrative based on rumors within the organization that can lead to destructive results if not carefully controlled by management is called an organizational story.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

 

  1. A phrase or sentence that succinctly expresses a key corporate value is called a story.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The mythical sales representative at Robinson Jewelers who delivered a wedding ring directly to the church because the ring had been ordered late is an example of a hero.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A slogan is a phrase or sentence that succinctly expresses a key corporate value.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   78

NAT:  AACSB Analytic | HRM                 TYP:   F

 

  1. A ceremony is a planned activity at a special event that is conducted for the benefit of an audience.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   78

NAT:  AACSB Analytic | Motivation Concepts                          TYP:   F

 

  1. In adaptive cultures, managers are concerned with customers and processes that bring about useful change.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   79

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The achievement culture emerges in an environment that requires fast response and high-risk decision-making.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   79

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. An achievement culture is found in an environment that is dynamic and requires high-risk decision-making.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   80

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The clan culture is suited to organizations that are concerned with serving specific customers in the external environment but without the intense need for flexibility and rapid change.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   80

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A results-oriented culture that values competitiveness, aggressiveness, personal initiative, and willingness to work long and hard to achieve results is called the achievement culture.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   80

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The bureaucratic culture has an external focus and a consistency orientation for a dynamic environment.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   81

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Corporate culture plays a key role in creating an organizational climate that enables learning and innovative responses to threats from the external environment, challenging new opportunities, or organizational crises.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   82

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. When an organization pays little attention to either cultural values or business results, it is unlikely to survive for long.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   83

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. When an organization pays little attention to cultural values and instead focuses on business results, success will be difficult to sustain in the long run.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   83

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Success will be difficult to sustain in the long run when an organization puts emphasis on both cultural values and business results.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   83

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. In a high performance culture, organizations put high emphasis on both culture and solid business performance as drivers of organizational success.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   83

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. According to Unlocking Innovative Solutions Through People in Chapter 3, the Brazil-based Semco Corp. was revived when the president turned control over to the employees.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   84

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A cultural leader defines and uses signals and symbols to influence corporate culture.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   85

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

 

 

  1. The cultural leader articulates a vision for the organizational culture that employees can believe in and that generates excitement.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   85

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

MULTIPLE CHOICE

 

  1. The environments in which businesses operate are increasingly ____, requiring managers to be ready to react and respond to even subtle environmental shifts.
a. static
b. universal
c. constant
d. dynamic
e. traditional

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   63

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. ____ includes all elements existing outside the boundary of the organization that have the potential to affect the organization.
a. Organizational environment
b. Internal environment
c. Task environment
d. General environment
e. Technological environment

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. ____ system draws resources from the external environment and releases goods and services back to it.
a. Production
b. Closed
c. Open
d. Information
e. Management

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   64

NAT:  AACSB Analytic | Creation of Value                              TYP:   F

 

  1. The ____ environment represents the outer layer of the environment and affects organizations ____.
a. task; indirectly
b. general; directly
c. internal; directly
d. internal; indirectly
e. general; indirectly

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. All of these are a part of an organization’s task environment EXCEPT
a. Customers
b. Labor markets
c. Competitors
d. Employers
e. Suppliers

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Which of these is NOT a part of an organization’s general environment?
a. Technological
b. Economic
c. Competitors
d. Legal-political
e. Sociocultural

 

 

ANS:  C                    PTS:   1                    DIF:    1                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. ____ is a part of Ford’s, a U.S. auto manufacturer, task environment.
a. Inflation rate
b. Chrysler
c. Securities and Exchange Commission (SEC), a government regulating agency
d. Amazon.com, an online bookseller
e. Ford’s corporate culture

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. ____ is a part of an organization’s internal environment.
a. Its customers
b. Its salespeople
c. The consumer price index
d. Its suppliers
e. Its competitors

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Molly Madison received “The Employee of the Month” Award at Internal Workings Remodeling Service in April. Molly would be considered a part of which of these for Internal Workings?
a. General environment
b. Task environment
c. Economic environment
d. Internal environment
e. Political activity

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    A

 

 

  1. The ____ of the external environment represents events originating in foreign countries as well as opportunities for American companies in other countries.
a. National dimension
b. Global dimension
c. International dimension
d. Japan’s dimension
e. U.S. dimension

 

 

ANS:  C                    PTS:   1                    DIF:    1                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Scientific and technological advancements in a specific industry as well as in society at large are included in which general environment dimension?
a. Sociocultural dimension
b. Legal-political dimension
c. Economic dimension
d. Technological dimension
e. Corporate culture dimension

 

 

ANS:  D                    PTS:   1                    DIF:    1                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Which dimension of the general environment represents the demographic characteristics, norms, customs, and values of the population within which the organization operates?
a. Legal-political dimension
b. Economic dimension
c. Technological dimension
d. Corporate culture dimension
e. Sociocultural dimension

 

 

ANS:  E                    PTS:   1                    DIF:    1                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. When Miami Herald launches a Spanish-language newspaper, El Nuevo Herald, with articles emphasizing Hispanic, Cuban, and Latin American news and sports, it is responding to changes in ____ environment.
a. sociocultural
b. technological
c. economic
d. competitors
e. suppliers

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              TYP:    A

 

 

 

 

 

 

 

 

  1. ____ environment consists of demographic factors, such as population density.
a. Technological
b. Sociocultural
c. Legal-political
d. Internal
e. Economic

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Anyone considering doing business in China, according to Manager’s Shoptalk in Chapter 3, should keep in mind all of the following rules except:
a. Business is always personal
b. Don’t skip the small talk
c. Remember that relationships are not short-term
d. Be efficient with use of time
e. Make contact frequently

 

 

ANS:  D                    PTS:   1                    DIF:    1                    REF:   67

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Which of the following rules, according to Manager’s Shoptalk in Chapter 3, is about forging an emotional bond?
a. Don’t skip the small talk
b. Business is always personal
c. Remember that relationships are not short-term
d. Make contact frequently
e. Be efficient with use of time

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   67

NAT:  AACSB Analytic | Leadership Principles                         TYP:   F

 

  1. Lying at the heart of Chinese culture, ____ is a supportive, mutually beneficial connection between two people.
a. kaizen
b. ganqing
c. renqing
d. kansei
e. guanxi

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   67

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The general environment dimension that includes consumer purchasing power, the unemployment rate, and interest rates is called the
a. legal-political dimension.
b. sociocultural dimension.
c. technological dimension.
d. economic dimension.
e. task dimension.

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. A recent significant trend in the economic environment is the frequency with which companies seem to be involved in ____.
a. mergers
b. bankruptcy
c. reorganizations
d. layoffs
e. expansions outside the United States

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. A government inspection has required your company to upgrade the safety equipment in the manufacturing process of ice creamery. What dimension of the external environment has influenced these upgrades?
a. Technological
b. Legal-political
c. Task
d. Sociocultural
e. Economic

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    A

 

  1. The ____ dimension of the general environment includes federal, state, and local government regulations.
a. technological
b. legal-political
c. economic
d. sociocultural
e. international

 

 

ANS:  B                    PTS:   1                    DIF:    1                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. An interest group that works within the legal-political framework to influence companies to behave in socially responsible ways is called a(n)
a. pressure group.
b. legal group.
c. political influence group.
d. social group.
e. none of these.

 

 

ANS:  A                    PTS:   1                    DIF:    1                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

 

 

 

 

 

  1. Which of the following dimensions of the general environment includes all elements that occur naturally on earth?
a. Sociocultural dimension
b. Technological dimension
c. Economic dimension
d. Natural dimension
e. Environmental dimension

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Concern for the environment has prompted companies to take all of the following actions, EXCEPT:
a. Eliminating nonbiodegradable plastic bags from the environment
b. Hiring an environmental specialist
c. Improving efficiency of plants and factories
d. Investing in cleaner technologies
e. All of these

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The people and organizations in the environment who acquire goods or services from the organization are
a. competitors.
b. suppliers.
c. customers.
d. employees.
e. potential employees.

 

 

ANS:  C                    PTS:   1                    DIF:    1                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Integrated Computers, Inc. wants to compile a profile of the customer it will target in its next promotional mailing. What environment would this be found in?
a. Internal environment
b. Task environment
c. Work environment
d. General environment
e. None of these

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. For Southwest Airlines, all of the following can be suppliers EXCEPT
a. Exxon (providing jet fuel).
b. Citibank (providing finances).
c. Delta Airlines (providing competition).
d. Boeing (providing planes).
e. All of these are suppliers for Southwest Airlines.

 

 

ANS:  C                    PTS:   1                    DIF:    3                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    A

 

  1. ____ is(are) included in an organization’s task environment.
a. Suppliers
b. Accounting procedures
c. Technology
d. Government
e. Demographic characteristics

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The ____ represents people in the environment who can be hired to work for the organization.
a. competitors
b. labor market
c. suppliers
d. customers
e. government

 

 

ANS:  B                    PTS:   1                    DIF:    1                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Ally’s Applesauce is in the process of hiring sixty new workers. The personnel department has a large pool of unskilled labor to draw from due to the high unemployment rate in the local area. Which dimension of the external environment is involved here?
a. Sociocultural
b. Competitors
c. Technological
d. Labor market
e. Legal-political

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The internal environment within which managers work includes all of the following except
a. corporate culture
b. production technology
c. organization structure
d. physical facilities
e. labor market

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Which of the following roles are assumed by people and/or departments that link and coordinate the organization with key elements in the external environment?
a. Figurehead
b. Liaison
c. Boundary-spanning
d. Disturbance handler
e. Leader

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   73

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Which of the following is NOT a part of adapting the organization to changes in the environment for coping with high environmental uncertainty?
a. Boundary-spanning roles
b. Advertising/public relations
c. Mergers/joint ventures
d. Interorganizational partnerships
e. All of these are a part of organizational response in adapting the organization to changes in the environment.

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   73-75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. ____ is an approach to boundary spanning which results from using sophisticated software to search through large amounts of internal and external data to spot patterns, trends, and relationships that might be significant.
a. Merger intelligence
b. Business intelligence
c. Competitive intelligence
d. Partnership intelligence
e. Environment intelligence

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   74

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Kristen’s Jewelry Shop has just hired a comparative shopper to visit other local jewelry stores to gain product pricing information. What strategy is this describing?
a. Boundary-spanning roles
b. A flexible structure
c. Unfair practice
d. Increase planning and forecasting
e. Joint venture

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   74

NAT:  AACSB Analytic | Environmental Influence                              TYP:    A

 

  1. Based on the notion that organizations are dealing with a very turbulent and uncertain external environment, more organizations are requiring ____ to perform boundary-spanning activities.
a. top leaders
b. middle managers
c. line managers
d. all employees
e. suppliers

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   74

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

 

 

 

 

 

  1. Companies can reduce boundaries and increase collaboration with other organizations by creating
a. flexible structures.
b. interorganizational partnerships.
c. new company cultures.
d. new supplier connections.
e. none of these.

 

 

ANS:  B                    PTS:   1                    DIF:    1                    REF:   74

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Many organizations are adapting to the environment by developing more of a(n) ____ relationship rather than a(n) ____ relationship with competitors.
a. adversarial, partnership
b. partnership, adversarial
c. strategic, competitive
d. competitive, strategic
e. none of these

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. When two or more organizations combine to become one, it is referred to as a
a. joint venture.
b. flexible structure.
c. mechanistic structure.
d. merger.
e. inorganic venture.

 

 

ANS:  D                    PTS:   1                    DIF:    1                    REF:   75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. In a joint venture between large and small businesses, large businesses can provide all of the following EXCEPT
a. sales staff.
b. research staff.
c. financial resources.
d. distribution channels.
e. top level management.

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Culture can be defined as
a. the set of key values, beliefs, understandings, and norms shared by members of an organization
b. the ability to speak different languages
c. an object, act, or event that conveys meaning to others
d. a narrative based on true events that is repeated frequently and shared by organizational employees
e. none of these

 

 

ANS:  A                    PTS:   1                    DIF:    1                    REF:   76

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The level of corporate culture which cannot be seen but can be discerned from how people explain and justify what they do is
a. Invisible artifacts
b. Expressed values and beliefs
c. Underlying assumptions and deep beliefs
d. Dress and office layout
e. Slogans and ceremonies

 

 

ANS:  B                    PTS:   1                    DIF:    1                    REF:   76

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The level of corporate culture in which values are so deeply embedded that members are no longer consciously aware of them is
a. Invisible artifacts
b. Expressed values and beliefs
c. Underlying assumptions and deep beliefs
d. Dress and office layout
e. Slogans and ceremonies

 

 

ANS:  B                    PTS:   1                    DIF:    1                    REF:   76

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. ____ are associated with surface level of organizational culture.
a. Values
b. Norms
c. Manners of dress
d. Beliefs
e. All of these

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   76

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Which of the following would be considered a visual representation(s) of a company’s corporate culture?
a. All department heads have an executive office.
b. Each department has an award plaque for employee of the month.
c. All employees are dressed in professional business attire.
d. Top level executives drive company owned sports car.
e. All of these.

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   76

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. An object, act, or event that conveys meaning to others is referred to as a
a. symbol.
b. slogan.
c. story.
d. hero.
e. culture.

 

 

ANS:  A                    PTS:   1                    DIF:    1                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Symbols, stories, and heroes are important because they
a. entertain executive level management.
b. address the concerns of government.
c. acquaint customers to the organization.
d. communicate the significant values of an organization.
e. give employees something to talk about.

 

 

ANS:  D                    PTS:   1                    DIF:    1                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. ____ is a narrative based on true event that is repeated frequently and shared by organizational employees.
a. Symbol
b. Slogan
c. Story
d. Hero
e. Culture

 

 

ANS:  C                    PTS:   1                    DIF:    1                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A figure who exemplifies the deeds, character, and attributes of a corporate culture is referred to as a
a. symbol.
b. stories.
c. slogan.
d. hero.
e. culture.

 

 

ANS:  D                    PTS:   1                    DIF:    1                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Heroes are important to an organization due to the fact that they
a. exemplify key values of the organization.
b. exemplify a strong corporate culture.
c. serve as examples to other employees.
d. all of these.
e. none of these.

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   78

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A ____ represents a phrase or sentence that succinctly expresses a key corporate value.
a. symbol
b. stories
c. culture
d. hero
e. slogan

 

 

ANS:  E                    PTS:   1                    DIF:    1                    REF:   78

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. McDonald’s “We Love to See You Smile” represents a
a. ceremony.
b. symbol.
c. ritual.
d. slogan.
e. political activity.

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   78

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. “Chiquita. Perfect for Life.” was Chiquita’s
a. ceremony.
b. slogan.
c. symbol.
d. ritual.
e. all of these.

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   78

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    A

 

  1. If a company emphasizes that “no purchase is complete until the customer is satisfied,” then it’s
a. utilizing a symbol.
b. communicating its values to customers.
c. using a slogan to present their values to customers and employees.
d. utilizing a hero for the purpose of conveying values.
e. using customers to harass the employees.

 

 

ANS:  C                    PTS:   1                    DIF:    1                    REF:   78

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Culture tends to differ between ____, but appears similar within ____.
a. organizations, industries
b. people, organizations
c. groups, industries
d. organizations, groups
e. industries, geographical regions

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   78

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. What are managers concerned with in adaptive cultures?
a. Customers and processes that bring about useful change
b. Themselves
c. All people who have ideas on changing the company
d. Their immediate work group
e. All of these

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   79

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

 

 

 

  1. All of the following are types of corporate cultures except
a. adaptability culture.
b. clan culture.
c. consistency culture.
d. involvement culture.
e. achievement culture.

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   79

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The adaptability culture emerges in an environment that requires ____ response and ____ decision making.
a. fast; high-risk
b. fast; low-risk
c. slow; high-risk
d. slow; low-risk
e. regulated; low-risk

 

 

ANS:  A                    PTS:   1                    DIF:    3                    REF:   79

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Which of the following cultures is suited to organizations that are concerned with servicing specific customers in the external environment but without the intense need for flexibility and rapid change?
a. Adaptability culture
b. Clan culture
c. Achievement culture
d. Consistency culture
e. None of these

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   80

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The involvement culture has a(n) ____ focus on the involvement and participation of employees to rapidly meet changing needs from the environment.
a. external
b. internal
c. structural
d. competitive
e. technological

 

 

ANS:  B                    PTS:   1                    DIF:    1                    REF:   80

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The consistency culture has a(n) ____ focus and an orientation for a ____ environment.
a. external; stable
b. external; dynamic
c. internal; stable
d. internal; dynamic
e. structural; dynamic

 

 

ANS:  C                    PTS:   1                    DIF:    3                    REF:   81

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Which of the following cultures values and rewards a methodical, rational, orderly way of doing things?
a. Achievement culture
b. Involvement culture
c. Accomplishment culture
d. Consistency culture
e. Adaptability culture

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   81

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. ____ plays a key role in creating an organizational climate that enables learning and innovative responses to threats from the external environment, challenging new opportunities, or organizational crises.
a. Mission statement
b. Vision statement
c. Competitive intelligence
d. Employee training
e. Corporate culture

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   82

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. What is likely to happen to organizations that pay little attention to either cultural values or business results?
a. Unlikely to survive for long
b. No help for performance during hard times
c. Profitable in short run but difficult to sustain over long term
d. High performance
e. none of these

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   83

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. What is likely to happen to organizations that pay little attention to cultural values and instead stress business results?
a. Unlikely to survive for long
b. No help for performance during hard times
c. Profitable in short run but difficult to sustain over long term
d. High performance
e. none of these

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   83-84

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

 

 

 

 

 

 

  1. A high-performance culture is based on all of the following except
a. solid organizational mission
b. shared adaptive values
c. individual employee ownership of bottom-line results
d. individual employee ownership of organization’s cultural backbone
e. singular focus on business results

 

 

ANS:  E                    PTS:   1                    DIF:    1                    REF:   84

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. In a study by Kotter and Haskett evidence is provided to support the claim that ____ is important for performance.
a. managing cultural values
b. leading partnerships within an industry
c. surveying the external environment
d. managing client relationships as boundary spanners
e. empowering employees

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   84

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

CASE

 

Scenario – Nikki Williams

 

Nikki Williams was working as the sales manager for Industrial Instruments. Some of the sales executives were showing signs of burnout. They were losing interest in their jobs and were no longer motivated to gain new accounts. The reward system focused on old reliable accounts, but Nikki was now under pressure to expand the customer base. Nikki had recently been to a seminar on corporate value systems. She recognized that the company’s CEO wanted to change in the way employees thought about the firm and in the way they related to one another. She further recognized that a lasting solution to her problem required a fundamental shift in perception.

 

  1. To affect the value system, Nikki will be working primarily with
a. the legal-political dimension.
b. the sociocultural dimension.
c. the internal cultural dimension.
d. the economic dimension.
e. the external dimension.

 

 

ANS:

c

 

PTS:   1                    DIF:    1                    REF:   75

NAT:  AACSB Analytic | Group Dynamics                                          KEY:   Scenario Questions

TYP:   A

 

 

 

 

 

  1. Nikki could use the following to affect the corporate culture:
a. structured symbolic logic.
b. stories about political heroes.
c. stories about company officers, stressing a value.
d. stories about economic depression.
e. all of these.

 

 

ANS:

c

 

PTS:   1                    DIF:    2                    REF:   75

NAT:  AACSB Analytic | Group Dynamics                                          KEY:   Scenario Questions

TYP:   F

 

  1. It appears that one of the problems that Nikki faced was the presence of a __________ gap.
a. culture
b. logic
c. generation
d. transformation
e. symbolic

 

 

ANS:

a

 

PTS:   1                    DIF:    1                    REF:   76

NAT:  AACSB Analytic | Group Dynamics                                          KEY:   Scenario Questions

TYP:   A

 

  1. Industrial Instruments operates in an environment that requires fast response and high-risk decision making. Which type of culture may be appropriate here?
a. Consistency
b. Adaptability
c. Clan
d. Achievement
e. Involvement

 

 

ANS:

b

 

PTS:   1                    DIF:    1                    REF:   79

NAT:  AACSB Analytic | Group Dynamics                                          KEY:   Scenario Questions

TYP:   A

 

 

 

 

 

 

 

 

Scenario – Melissa Hill

 

Melissa Hill, sales manager for One-Hit-Wonder Record Company, was trying to create a new strategy to turn around the declining record sales the company was facing. Melissa needed to find a way to find out what the customers really wanted, since One-Hit-Wonder didn’t have accurate information like the competitors did. It was imperative that she find the correct strategy and information because the company was in financial trouble. The company’s President wanted all employees to help find information and work as a team to develop better relationships that might help the company. He also stated that he wanted the company to remain an independent company. Melissa realized that through hard work and team efforts, the company could get back on its feet as soon as they got reliable information.

 

  1. Melissa will be working primarily with
a. the legal-political dimension.
b. the labor market.
c. the internal cultural dimension.
d. pressure groups.
e. the sociocultural dimension

 

 

ANS:

e

 

PTS:   1                    DIF:    1                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              KEY:   Scenario Questions

TYP:   A

 

  1. The problem Melissa faced was
a. culture gap.
b. structural instability.
c. environmental uncertainty.
d. company transformation.
e. legal problems.

 

 

ANS:

c

 

PTS:   1                    DIF:    1                    REF:   72

NAT:  AACSB Analytic | Environmental Influence                              KEY:   Scenario Questions

TYP:   A

 

 

 

 

 

 

 

 

 

 

 

 

  1. Which of the following would be the best way for One-Hit-Wonder to decrease its uncertainty?
a. To create boundary-spanning roles
b. To eliminate interorganizational partnerships
c. To merge with another company
d. To create a joint venture
e. None of these

 

 

ANS:

a

 

PTS:   1                    DIF:    1                    REF:   73

NAT:  AACSB Analytic | Environmental Influence                              KEY:   Scenario Questions

TYP:   A

 

  1. Which of the following best describes One-Hit-Wonder’s culture?
a. Clan culture
b. Achievement culture
c. Consistency culture
d. Adaptability culture
e. None of these

 

 

ANS:

d

 

PTS:   1                    DIF:    1                    REF:   79

NAT:  AACSB Analytic | Group Dynamics                                          KEY:   Scenario Questions

TYP:   A

 

COMPLETION

 

  1. The external ____________________ includes all elements existing outside the boundary of the organization that have the potential to affect the organization.

 

ANS:  organizational environment

 

PTS:   1                    DIF:    2                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The ____________________ is the outer layer that is widely dispersed and affects organizations indirectly.

 

ANS:  general environment

 

PTS:   1                    DIF:    2                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

 

 

 

 

  1. A(n) ____________________ includes the elements within the organization’s boundaries.

 

ANS:  internal environment

 

PTS:   1                    DIF:    2                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The ____________________ environment includes the sectors that conduct day-to-day transactions within the organization.

 

ANS:  task

 

PTS:   1                    DIF:    2                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. An example of ____________________ dimension is that Dixon Ticonderoga Co. is in trouble because of increased competition especially from low-cost pencil companies in China.

 

ANS:  international

 

PTS:   1                    DIF:    2                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The ____________________ environment represents an ever-changing and uneven playing field compared with domestic environment.

 

ANS:  global

 

PTS:   1                    DIF:    2                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The ____________________ dimension of the general environment includes scientific and technological advancements in a specific industry and in society.

 

ANS:  technological

 

PTS:   1                    DIF:    2                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The ____________________ dimension of the general environment represents the demographic characteristics as well as the norms, customs, and values of the general population.

 

ANS:  sociocultural

 

PTS:   1                    DIF:    2                    REF:   66

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

 

 

 

  1. Lying at the heart of Chinese culture, ____________________ is a supportive, mutually beneficial connection between two people.

 

ANS:  guanxi

 

PTS:   1                    DIF:    2                    REF:   67

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The general economic health of the country or region in which the organization operates is represented by the ____________________ dimension.

 

ANS:  economic

 

PTS:   1                    DIF:    2                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The ____________________ dimension includes government regulations at the local, state, and federal levels.

 

ANS:

legal-political

legal political

 

PTS:   1                    DIF:    2                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. An interest group that works within the legal-political framework to influence companies to behave in socially responsible ways, is called a(n) ____________________.

 

ANS:  pressure group

 

PTS:   1                    DIF:    2                    REF:   68

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Included in a(n) ____________________ environment are sectors that have a direct working relationships with the organization, among customers, competitors, suppliers, and the labor market.

 

ANS:  task

 

PTS:   1                    DIF:    2                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The ____________________ of the general environment includes all elements that occur naturally on earth.

 

ANS:  natural dimension

 

PTS:   1                    DIF:    2                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Managers today are concerned because technologically speaking, the ____________________ has given more power to customers and enabled them to directly impact an organization.

 

ANS:  Internet

 

PTS:   1                    DIF:    2                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. ____________________ are organizations in the same industry that provide goods or services to the same set of customers.

 

ANS:  Competitors

 

PTS:   1                    DIF:    2                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. People and organizations that provide raw materials the organization uses to produce its output are called ____________________.

 

ANS:  suppliers

 

PTS:   1                    DIF:    2                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. The ____________________ represents people in the environment who can be hired to work for the organization.

 

ANS:  labor market

 

PTS:   1                    DIF:    2                    REF:   70

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Not having sufficient information about environmental factors to understand and predict environmental needs and changes is called ____________________.

 

ANS:  uncertainty

 

PTS:   1                    DIF:    2                    REF:   72-73

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. When environmental factors change rapidly, the organization experiences ____________________ uncertainty.

 

ANS:  very high

 

PTS:   1                    DIF:    2                    REF:   73

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

 

 

  1. ____________________, ____________________, and ____________________ are three types of strategies that organizations can use to adapt to environmental changes.

 

ANS:

boundary-spanning roles; interorganizational partnerships; joint ventures

boundary-spanning roles; interorganizational partnerships; mergers

 

PTS:   1                    DIF:    2                    REF:   73-75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Roles assumed by people that link the organization with the external environment are called ____________________ roles.

 

ANS:  boundary-spanning

 

PTS:   1                    DIF:    2                    REF:   73

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Interorganizational partnerships allow companies to join together to become ____________________ and share ____________________.

 

ANS:  more effective; scarce resources

 

PTS:   1                    DIF:    2                    REF:   74

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. A(n) ____________________ is when two or more organizations combine to make one organization.

 

ANS:  merger

 

PTS:   1                    DIF:    2                    REF:   75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. A(n) ____________________ involves a strategic alliance or program by two or more organizations.

 

ANS:  joint venture

 

PTS:   1                    DIF:    2                    REF:   75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. ____________________ are becoming more popular as organizations strive to keep up with technological advancements and compete in the global economy.

 

ANS:  Joint ventures

 

PTS:   1                    DIF:    2                    REF:   75

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

 

  1. ____________________ can be defined as the set of key values, beliefs, understandings, and norms shared by members of an organization.

 

ANS:  Culture

 

PTS:   1                    DIF:    2                    REF:   76

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. An object, act, or event that conveys meaning to others is known as a(n) ____________________.

 

ANS:  symbol

 

PTS:   1                    DIF:    2                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A(n) ____________________ is a narrative based on true events that is repeated frequently and shared among organizational employees.

 

ANS:  story

 

PTS:   1                    DIF:    2                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The deeds of ____________________ are extraordinary, but not so extraordinary that other employees cannot perform the same deeds.

 

ANS:  heroes

 

PTS:   1                    DIF:    2                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A slogan is a phrase or a sentence that concisely communicates a key corporate ____________________.

 

ANS:  value

 

PTS:   1                    DIF:    2                    REF:   78

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Adaptability culture emerges in an environment that requires ____________________ response and ____________________ decision making.

 

ANS:  fast; high-risk

 

PTS:   1                    DIF:    2                    REF:   79

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

 

 

 

  1. A culture that is a results-oriented that values competitiveness, aggressiveness, personal initiative, and willingness to work long and hard to achieve results is called ____________________.

 

ANS:  achievement culture

 

PTS:   1                    DIF:    2                    REF:   80

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. The ____________________ culture places high value on HR, and the organization may be characterized by a caring, family-like atmosphere.

 

ANS:  involvement

 

PTS:   1                    DIF:    2                    REF:   80

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Organizations with internal focuses and consistency orientations for a stable environment should create a(n) ____________________ culture.

 

ANS:  consistency

 

PTS:   1                    DIF:    2                    REF:   81

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. ____________________ plays a key role in creating an organizational climate that enables learning and innovative responses to threats from the external environment, challenging new opportunities, or organizational crises.

 

ANS:  Corporate culture

 

PTS:   1                    DIF:    2                    REF:   82

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. A primary way in which managers shape cultural norms and values to build a high-performance culture is through ____________________.

 

ANS:  cultural leadership

 

PTS:   1                    DIF:    2                    REF:   85

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. A(n) ____________________ defines and uses signals and symbols to influence corporate culture.

 

ANS:  cultural leader

 

PTS:   1                    DIF:    2                    REF:   85

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

 

 

SHORT ANSWER

 

  1. List the five dimensions of the general environment.

 

ANS:

Technological, sociocultural, economic, legal/political, and international.

 

PTS:   1                    DIF:    2                    REF:   65

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. List three visible artifacts of an organization’s culture.

 

ANS:

Possible responses would include dress, heroes, office layout, symbols, slogans, and ceremonies.

 

PTS:   1                    DIF:    2                    REF:   76

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. List two reasons why ceremonies are held in an organization.

 

ANS:

Possible responses would include: to reinforce valued accomplishments, to create a bond among people by allowing them to share an important event, and to anoint and celebrate heroes.

 

PTS:   1                    DIF:    2                    REF:   78

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Name one of the two dimensions that the categories of culture are based on.

 

ANS:

Responses will be either (1) the extent to which the external environment requires flexibility or stability, or (2) the extent to which a company’s strategic focus is internal or external.

 

PTS:   1                    DIF:    3                    REF:   79

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Name one of the two dimensions that organizations with high-performance cultures emphasize.

 

ANS:

cultural values and business performance

 

PTS:   1                    DIF:    2                    REF:   83

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

 

 

 

 

 

 

ESSAY

 

  1. Define the organizational task environment. List the four things this environment includes that could influence an organization.

 

ANS:

The external organizational environment is all elements that exist outside the organization’s boundaries that have the potential to affect the organization.

 

The environment includes: competitors, resources, technology, and economic conditions.

 

PTS:   1                    DIF:    2                    REF:   64

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Name the five dimensions of the general environment and describe each dimension.

 

ANS:

The five dimensions of the general environment are international, sociocultural, economic, and legal-political. International dimension refers to evens originating in foreign countries as well as opportunities for American companies in other countries. Technological dimension refers to the scientific and technological advancements within a specific industry and society. Sociocultural dimension represents the demographic characteristics of the general population. Economic dimension represents the general economic health of the country or area in which the organization operates. Legal-political dimension refers to the local, state, and federal regulations and the political activities designed to influence company behavior.

 

PTS:   1                    DIF:    2                    REF:   65-69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Briefly describe the task environment and its four primary sectors

 

ANS:

The task environment is the portion of the external environment that directly influences the organization’s operations and performance. The task environment is made up of customers, competitors, suppliers, and the labor market. These sectors typically conduct day-to-day transactions with the organization.

 

PTS:   1                    DIF:    2                    REF:   69

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. What are the three basic strategies for dealing with increased uncertainty with respect to customers, competitors, suppliers, or government regulations?

 

ANS:

The three basic strategies are boundary-spanning roles, interorganizational partnerships, and mergers or joint ventures.

 

PTS:   1                    DIF:    2                    REF:   73

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Based on the model in the text, discuss the relationship between external environmental characteristics and uncertainty.

 

ANS:

The external environment can be evaluated along two dimensions. First, one can evaluate (high to low) a number of factors in the environment. Second, one can evaluate (high to low) the rate of change of those factors. When both variables are low, low uncertainty characterizes the external environment. When both variables are high, the external environment is marked by a high level of uncertainty. A highly uncertain environment requires organizations to adapt and/or attempt to influence the external environment.

 

PTS:   1                    DIF:    3                    REF:   73

NAT:  AACSB Analytic | Environmental Influence                              TYP:    F

 

  1. Discuss the different levels of culture.

 

ANS:

Culture can be analyzed at three levels. At the surface, there are the visible representations of culture, such as ceremonies and patterns of behaviors. These representations are easily observable. The second level of culture can be found in expressed ideas and values. These ideas and values can be identified through an analysis of such things as symbols and stories. The third level of culture refers to those values and understandings that are so deeply held that they are unobservable and operate at the level of the subconscious and/or unconscious.

 

PTS:   1                    DIF:    3                    REF:   76

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. What are the two types of heroes? Give at least one example of each and why the examples are heroes.

 

ANS:

Real heroes are heroes who actually existed and worked for the organization. The text gives Lee Iacocca as an example of a real hero. He worked for $1 a year when he first went to Chrysler to prove the courage of his convictions.

 

Mythical heroes are symbolic heroes. The example the text gives is the mythical sale representative who delivered a wedding ring directly to the church because the ring had been ordered late.

 

PTS:   1                    DIF:    2                    REF:   77

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

 

 

 

 

 

 

 

 

 

 

  1. List the four categories of culture and describe what kind of environments each fit best in.

 

ANS:

Adaptability culture fits best in fast response and high-risk decision making environments. Achievement culture fits best in results-oriented cultures that value competitiveness, aggressiveness, personal initiative, and willingness to work long and hard to achieve results. Involvement culture fits best in internal and employee-need focused environments where the organization is seen as having a caring, family-like atmosphere. Consistency culture fits best in internal focused organization that has a consistency orientation for a stable environment.

 

PTS:   1                    DIF:    2                    REF:   79

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

 

  1. Briefly discuss the two key areas that cultural leaders influence culture.

 

ANS:

The cultural leader articulates a vision for the organizational culture that employees can believe in and that generates excitement. This means the leader defines and communicates central values that employees believe in and will rally around.

 

The cultural leader heeds the day-to-day activities that reinforce the cultural vision. The leader makes sure that work procedures and rewards systems match and reinforce the values. Actions speak louder than words, so cultural leaders “walk their talk.”

 

PTS:   1                    DIF:    2                    REF:   85

NAT:  AACSB Analytic | Group Dynamics                                          TYP:    F

Chapter 7—Strategy Formulation and Implementation

 

TRUE/FALSE

 

  1. Strategic management largely determines which organizations succeed and which ones struggle.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   185

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Front-line mangers have the final responsibility for strategic planning.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   186

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Top managers and chief executives have the final responsibility for strategic planning.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   186

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Research has shown that strategic thinking and planning positively affect a firm’s performance and financial success.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   186

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Strategy means knowing your desired outcomes, how to acquire factual knowledge, thinking clearly about tactics and cause-effect relationships, and implementing behaviors that will achieve the desired outcomes.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   187

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Better-Than-The-Rest, Inc.’s ability to market its products better than its competitors is an example of its core competence.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   188

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. Core competence is the plan of action that prescribes resource allocation and other activities for dealing with the environment.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   188

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The essence of formulating strategy is choosing how the organization will be identical to its key competitors in the industry.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   188

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Competitive advantage refers to the set of decisions and actions used to formulate and implement strategies.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   188

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The interaction of Production and Sales working together to produce profit greater than the total of both working separately is an example of synergy.

 

ANS:  T                    PTS:   1                    DIF:    3                    REF:   189

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. The combination of benefits received and costs paid by the customer refers to value.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   189

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Value occurs when the organizational parts interact to produce a joint effect that is greater than the sum of the parts acting alone.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   189

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Corporate-level strategy pertains to the organization as a whole.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. “How do we compete?” question concerns functional-level strategy.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Strategic decisions at the business level concern amount of advertising, direction and extent of R & D, product changes, new product development, equipment and facilities, and expansion or contraction of product lines.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The three levels of strategy are business, corporate, and global.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Strategy implementation involves the planning and decision making that lead to the establishment of the firm’s goals.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The administration and implementation of the strategic plan is strategy execution.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. SWOT analysis includes a review of the internal threats and opportunities.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   192

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Executives acquire information about external opportunities and strengths from a variety of reports, including budgets, financial ratios, profit and loss statements, and surveys of employee attitudes and satisfaction.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   192

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Internal analysis examines overall organization structure, management competence and quality, and human resource characteristics.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   192

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. For the social networking site Facebook, technological know-how and an aggressive and innovative culture, is a significant strength to include in its SWOT analysis.

 

ANS:  T                    PTS:   1                    DIF:    3                    REF:   193

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. Threats are characteristics of the internal environment that may prevent the organization from achieving its strategic goals.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   193

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The task environment sectors are the most relevant to strategic behavior and include the behavior of competitors, customers, suppliers, and the labor supply.

 

ANS:  T                    PTS:   1                    DIF:    3                    REF:   193

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The mix of business units and product lines that fit together in a logical way to provide synergy and competitive advantage for the corporation pertains to portfolio strategy.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

 

  1. The BCG (Boston Consulting Group) matrix evaluates SBUs with respect to their business growth rate and geographical location.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The question mark exists in a new, rapidly growing industry but has only a small market share, according to the BCG Matrix.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. In BCG Matrix, the circle size represents the relative profit made by each business in the company’s portfolio.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. According to the BCG Matrix, the cash cow has a large market share in a rapidly growing industry.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The dog, according to the BCG Matrix, is a poor performer.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Diversification is a strategy of moving into new lines of business.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   195

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The bargaining power of customers is one of Porter’s five competitive forces.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   196

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. According to Porter, the bargaining power of the government is one of the five competitive forces affecting an organization’s competitive environment.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   196

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Vertical integration means a firm expands into businesses that either produce the supplies needed to make products or that distribute and sell those products to customers.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   196

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

  1. The internet tends to lower the bargaining power of suppliers.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   197

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. With the leveling force of the Internet and information technology, it has become easier for many companies to find ways to distinguish themselves from their competitors.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   197

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Differentiation, cost leadership, and focus are three of Porter’s competitive strategies.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Cost leadership is a type of competitive strategy with which the organization seeks to distinguish its products or services from that of competitors.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. A differentiation strategy can increase rivalry with competitors if buyers are loyal to a company’s brand.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Organization’s with a focus strategy concentrate on a specific regional market or buyer group.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   199

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Strategic partnerships are the current trend, rather than mergers and acquisitions.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   199

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Dynamic capabilities is the leveraging and developing more from the firm’s existing assets, capabilities, and core competencies in a way that will provide a sustained competitive advantage.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   200

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Internal innovation means companies are independent and always go at it alone.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   200

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

  1. The world-wide standardization of product design and advertising refers to globalization.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   201

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The export strategy treats the world as a single global market.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   201

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The transnational strategy handles markets independently for each country.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   201

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. With a multidomestic strategy, a company will achieve the globalization or standardization of marketing and production approaches.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   202

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. A multidomestic strategy standardizes global products/advertising strategies.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   202

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. A transnational strategy seeks to achieve both global integration and national responsiveness.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   202

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Human resources, in strategy implementation, are the ability to influence people to adopt the new behaviors need.

 

ANS:  F                    PTS:   1                    DIF:    1                    REF:   203

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. In strategy implementation, leadership is the ability to influence people to adopt the new behaviors need.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   203

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Effective implementation is not a necessity if the strategies are truly creative.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   203

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

  1. For successful execution, a strategy must be complex, with a broad plan that breaks the implementation process into a series of actions.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   204

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Communication is one of the most important methods for effective strategy execution.

 

ANS:  T                    PTS:   1                    DIF:    1                    REF:   204

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Structural design pertains to managers’ responsibilities, their degree of authority, and the consolidation of facilities, departments, and divisions.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   204

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. A firms’ leadership is responsible for recruiting, selecting, training, transferring, promoting, and laying off employees.

 

ANS:  F                    PTS:   1                    DIF:    2                    REF:   205

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Information and control systems include reward systems, pay incentives, budgets for allocating resources, information technology systems, and the organization’s rules.

 

ANS:  T                    PTS:   1                    DIF:    2                    REF:   205

NAT:  AACSB Analytic | Strategy             TYP:   F

 

MULTIPLE CHOICE

 

  1. 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.
e. strategy evaluation.

 

 

ANS:  C                    PTS:   1                    DIF:    1                    REF:   188

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

 

 

 

 

  1. The plan of action that prescribes resource allocation and other activities for dealing with the environment and helping the organization attain its goals is known as a(n)
a. goal.
b. objective.
c. mission.
d. vision.
e. strategy.

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   188

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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
e. Multidomestic

 

 

ANS:  D                    PTS:   1                    DIF:    1                    REF:   196-197

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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.
e. multidomestic strategy.

 

 

ANS:  B                    PTS:   1                    DIF:    1                    REF:   189

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. ____ 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
e. Core competence

 

 

ANS:  B                    PTS:   1                    DIF:    1                    REF:   189

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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
e. cooperation among customers

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   189

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. When AT&T decided to buy Media One, a cable company, it was pursuing a
a. functional-level strategy.
b. internal growth strategy.
c. multi-domestic strategy.
d. corporate-level strategy.
e. business-level strategy.

 

 

ANS:  D                    PTS:   1                    DIF:    3                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. 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.
e. retrenchment strategy.

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. 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
e. Competitive-level strategy

 

 

ANS:  C                    PTS:   1                    DIF:    1                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Sears’ decision to sell off much of its financial services division is an example of a
a. corporate-level strategy.
b. business-level strategy.
c. functional-level strategy.
d. growth strategy.
e. stability strategy.

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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?
e. should we promote from within?

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

  1. 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

 

 

ANS:  E                    PTS:   1                    DIF:    3                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. 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.
e. stability strategy.

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. 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.
e. retrenchment strategies.

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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?
e. Where to market our products?

 

 

ANS:  C                    PTS:   1                    DIF:    1                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. ____ refers to the use of managerial tools to direct resources toward the achievement of strategic goals.
a. Strategy formulation
b. Strategy coordination
c. Strategy implementation
d. Strategy control
e. Strategy planning

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

  1. 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
e. SWOT

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Fred has been assigned to conduct a SWOT analysis for his organization, Flintstones, 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.
e. develop a mission.

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   192

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. Techniques used to monitor external environments include
a. hiring scanning organizations.
b. hiring the competitive intelligence professionals.
c. government reports.
d. professional journals.
e. all of these.

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   192

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Classy Clay has extremely creative employees who, in the opinion of the organization, keep the company ahead of the competition. The creativity of these employees would be classified as
a. an internal weakness.
b. an external opportunity.
c. an external strength.
d. an internal strength.
e. a neutral factor.

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   192

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. Where does the information about opportunities and threats comes from?
a. An analysis of the organization’s internal environment
b. A department by department study of the organization
c. Scanning the external environments
d. Employee grievances
e. Financial ratios of the organization

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   193

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Flush Away, Inc. is particularly concerned about pending legislation in Congress that would further regulate their organization. This legislation would be classified as
a. an external opportunity.
b. an internal strength.
c. an external threat.
d. an external weakness.
e. a congressional chaos.

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   193

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. Which of the following is NOT a strength of the social network company, Facebook?
a. A new legislation that opens the international markets
b. Technological know-how
c. An aggressive and innovative culture
d. A partnership with Microsoft
e. Work networks are exploding and older generations prefer Facebook

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   193

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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.
e. functional strategy.

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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
e. Sales and profits

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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.
e. stuck in the middle.

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. 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.
e. It is generally a dead business that should be divested.

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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.
e. moderate market share in a slow growth industry.

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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
e. Cat

 

 

ANS:  D                    PTS:   1                    DIF:    1                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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.
e. moderate market share in a slow growth industry.

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Which of these is true about the dog division?
a. It has a large market share in a rapidly growing industry.
b. It has a large market share in a slow growth industry.
c. It has a small market share in a rapidly growing industry.
d. It has a small share of a slow growth market.
e. It has a moderate market share in a rapidly growing industry.

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

  1. Gillette operates numerous strategic business units. Most of its ____ are in the personal care division.
a. dogs
b. question marks
c. stars
d. cash cows
e. none of these

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Which of the following refers to the acquisition of businesses that are related to current product lines or that takes the corporation into new areas?
a. retrenchment.
b. diversification.
c. liquidation.
d. cash cow.
e. internal growth.

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Which of the following strategies refers to moving into a new business that is related to the company’s existing business activities?
a. Horizontal integration
b. Vertical integration
c. Unrelated diversification
d. Related diversification
e. Strategic partnership

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. According to the BCG Matrix, which of the following exists in a mature, slow-growth industry, but is a dominant business in the industry, with a large market share?
a. Question mark
b. Asterisk
c. Dog
d. Star
e. Cash cow

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Barriers to entry are related to which competitive force?
a. Rivalry among competitors
b. Potential new entrants
c. Threat of substitute products
d. Bargaining power of buyers
e. Bargaining power of suppliers

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   196

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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.

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   196

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Which of the following is NOT one of Porter’s competitive forces?
a. Potential new entrants
b. Bargaining power of suppliers
c. Bargaining power of stockholders
d. Bargaining power of customers
e. Rivalry among competitors

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   196

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Which of Porter’s five forces is influenced by all of the other four?
a. Threat of substitute products
b. Rivalry among competitors
c. Bargaining power of buyers
d. Potential new entrants
e. Bargaining power of suppliers

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   197

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Which of the following strategies involve an attempt to distinguish the firm’s products or services from others in the industry?
a. Cost leadership
b. Differentiation
c. Focus
d. Internal growth
e. Liquidation

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Which strategy can be profitable for an organization when customers are loyal and willing to pay high prices?
a. Focus
b. Globalization
c. Overall cost leadership
d. Differentiation
e. Liquidation

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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
e. liquidation

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The human resource department at Paula’s Powerwheels is implementing a number of functional level strategies. These strategies include focusing on ways to retain and develop a stable work force and ways to improve efficiency in the organization. These functional-level strategies are consistent with which of the following strategies?
a. Overall cost leadership
b. Differentiation
c. New product development
d. New market development
e. Divestiture

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. With a(n) ____ strategy, the organization concentrates on a specific regional market or buyer group.
a. cost leadership
b. differentiation
c. focus
d. internal growth
e. liquidation

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   199

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Mingles, Inc. concentrates its efforts on its target market of 18 to 25 year olds. It is using a(n) ____ strategy.
a. focus
b. differentiation
c. overall cost leadership
d. multidomestic
e. universal strategy

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   199

NAT:  AACSB Analytic | Strategy             TYP:   A

 

 

 

 

 

 

  1. ____ means that managers focus on leveraging and developing more from the firm’s existing assets, capabilities, and core competencies in a way that will provide a sustained competitive advantage.
a. Differentiation
b. Active aptitudes
c. Core competencies
d. Strategic partnerships
e. Dynamic capability

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   200

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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.
e. liquidation strategy.

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   201

NAT:  AACSB Analytic | Strategy             TYP:   A

 

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

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   201

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Which of the following strategies would be appropriate when the need for both national responsiveness and global integration is low?
a. Globalization
b. Multidomestic
c. Export
d. Transnational
e. Import

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   201

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. ____ 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

 

 

ANS:  D                    PTS:   1                    DIF:    1                    REF:   202

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. 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
e. Region design strategy

 

 

ANS:  C                    PTS:   1                    DIF:    1                    REF:   202

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Some people argue that ____ is the most difficult and most important part of strategic management.
a. SWOT analysis
b. strategic formation
c. strategic implementation
d. strategic analysis
e. strategy evaluation

 

 

ANS:  C                    PTS:   1                    DIF:    2                    REF:   203

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Persuasion, motivation, and changes in cultures and values are examples of which of the dimensions used to implement strategy?
a. Leadership
b. Structural design
c. Human resources
d. Information and control systems
e. Compensation

 

 

ANS:  A                    PTS:   1                    DIF:    1                    REF:   203

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Which of the following is NOT one of the tools used for putting strategy into action?
a. Leadership
b. Diversification
c. Human Resources
d. Structural Design
e. Information and Control systems

 

 

ANS:  B                    PTS:   1                    DIF:    2                    REF:   203

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. To reach the goal of cutting costs, Delta Dreamforce rearranged its organizational chart to consolidate facilities. This is an example of which of the dimensions used for implementing strategy?
a. Information and control systems
b. Human resources
c. Leadership
d. Structural design
e. SWOT

 

 

ANS:  D                    PTS:   1                    DIF:    2                    REF:   204

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. According to MANAGER’S SHOPTALK in Chapter 7, all of the following are clues for creating an environment and process conducive to effective strategy implementation EXCEPT:
a. Assume commitment to the strategy
b. Devise a clear implementation plan
c. Pay attention to culture
d. Take advantage of employees’ knowledge and skills
e. Communicate, communicate, communicate

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   204

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The ____ function recruits selects, trains, transfers, promotes, and lays off employees to achieve strategic goals.
a. production
b. leadership
c. information and control systems
d. structural design
e. human resource

 

 

ANS:  E                    PTS:   1                    DIF:    2                    REF:   205

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. As a way of implementing their differentiation strategy which emphasizes quality, ABC Corporation decided to switch from an assembly line manufacturing system to a system based on work teams. This is an example of which of the dimensions used for implementing strategy?
a. Leadership
b. Structural design
c. Human resources
d. Information systems
e. Control systems

 

 

ANS:  B                    PTS:   1                    DIF:    3                    REF:   205

NAT:  AACSB Analytic | Strategy             TYP:   A

 

  1. To encourage employees to find ways to cut costs, and thus achieve their strategic goal of overall cost leadership, Delta Dreamforce introduced a pay-for-performance system. This is an example of which of the dimensions used for implementing strategy?
a. Information and control systems
b. Human resources
c. Leadership
d. Structural design
e. SWOT

 

 

ANS:  A                    PTS:   1                    DIF:    2                    REF:   205

NAT:  AACSB Analytic | Strategy             TYP:   A

 

 

 

 

 

 

CASE

 

Scenario – Theresa Teutul

 

Theresa Teutul was an executive with Digital Industries, a leading manufacturer of color televisions. She recognized that the color television market in the late 1970’s was facing significant challenges. After two decades of highly successful development and marketing, the sales of color televisions had slowed and replacing older color television sets largely created her market.

 

  1. Using the logic of the BCG grid, Theresa should recognize that her strategic business unit was in which quadrant?
a. Star
b. Cash Cow
c. Question Mark
d. Dog
e. None of these

 

 

ANS:

b

 

PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             KEY:  Scenario Questions              TYP:    A

 

  1. The strategy that the BCG matrix suggests that Theresa should take for this SBU is
a. invest and grow.
b. liquidate while still profitable.
c. ask her astrologer for advice.
d. keep the SBU healthy and use its excess earnings to invest in other SBU’s.
e. divestiture.

 

 

ANS:

d

 

PTS:   1                    DIF:    2                    REF:   194-195

NAT:  AACSB Analytic | Strategy             KEY:  Scenario Questions              TYP:    A

 

  1. Which one of the following is not one of the competitive forces that Porter recommends that Theresa should recognize?
a. Potential new entrants
b. Bargaining power of buyers
c. Threat of substitute products
d. Bargaining power of suppliers
e. All of these are competitive forces.

 

 

ANS:

e

 

PTS:   1                    DIF:    2                    REF:   196-197

NAT:  AACSB Analytic | Strategy             KEY:  Scenario Questions              TYP:    A

 

Scenario – SS.com

 

Faced with rapidly growing business, Swift Stocks, Inc., a global brokerage company with the largest market share, recently announced that they have established an on-line stock investment and trading subsidiary, SS.com, where investors can trade stocks at the lowest rates in the industry. The .com subsidiary has less than one percent market share but it faces a very high business growth rate. In the brokerage industry the competition is fierce and all players are cutting their on-line commission rates.

 

  1. Swift Stock’s traditional brokerage business could be classified as a
a. cash cow.
b. dog.
c. star.
d. question mark.
e. stuck in the middle business.

 

 

ANS:

c

 

PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             KEY:  Scenario Questions              TYP:    A

 

  1. SS.com subsidiary for Swift Stocks can be classified as a
a. cash cow.
b. dog.
c. star.
d. question mark.
e. stuck in the middle business.

 

 

ANS:

d

 

PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             KEY:  Scenario Questions              TYP:    A

 

  1. If Swift Stock’s traditional brokerage business were to face a declining business growth, it may need to be reclassified as a
a. cash cow.
b. dog.
c. star.
d. question mark.
e. dead business.

 

 

ANS:

a

 

PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             KEY:  Scenario Questions              TYP:    A

 

 

  1. Swift Stock is following which strategy, according to Porter, through the .com subsidiary?
a. Stability
b. Cost leadership
c. Focus
d. Differentiation
e. Retrenchment

 

 

ANS:

b

 

PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             KEY:  Scenario Questions              TYP:    F

 

COMPLETION

 

  1. ____________________ is 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.

 

ANS:  Strategic management

 

PTS:   1                    DIF:    2                    REF:   188

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The plan of action that prescribes resource allocation and other activities for dealing with the environment and helping the organization attain its goals is called a(n) ____________________.

 

ANS:  strategy

 

PTS:   1                    DIF:    2                    REF:   188

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. A business activity that an organization does particularly well relative to its competition is known as a(n) ____________________.

 

ANS:  core competence

 

PTS:   1                    DIF:    2                    REF:   188

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. When organizational parts interact to produce a joint effect that is greater than the sum of the parts acting alone, ____________________ occurs.

 

ANS:  synergy

 

PTS:   1                    DIF:    2                    REF:   189

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

  1. The question What business are we in? concerns ____________________ strategy.

 

ANS:  corporate-level

 

PTS:   1                    DIF:    2                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

 

 

  1. The question How do we compete? concerns ____________________ strategy.

 

ANS:  business-level

 

PTS:   1                    DIF:    2                    REF:   190

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The question How do we support the business-level competitive strategy? concerns ____________________ strategy.

 

ANS:  functional-level

 

PTS:   1                    DIF:    2                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. ____________________ includes the planning and decision making that lead to the establishment of the firm’s goals and the development of a specific strategic plan.

 

ANS:  Strategy formulation

 

PTS:   1                    DIF:    2                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The use of managerial and organizational tools to direct resources toward accomplishing strategic results is known as ____________________.

 

ANS:  strategy execution

 

PTS:   1                    DIF:    2                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. ____________________ is a type of corporate-level strategy that pertains to the organization’s mix of strategic business units.

 

ANS:  Portfolio strategy

 

PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

  1. In the BCG matrix, the dog has ____________________ market share and ____________________ business growth rate.

 

ANS:  low; low

 

PTS:   1                    DIF:    2                    REF:   194

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The acquisition of business that are related to current product lines or that take the corporation into new areas is called ____________________.

 

ANS:  diversification

 

PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. In the BCG matrix, the star has a(n) ____________________ market share in a rapidly growing industry.

 

ANS:  large

 

PTS:   1                    DIF:    2                    REF:   195

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The ____________________ strategy involves an attempt to distinguish the firm’s products or services from others in the industry.

 

ANS:  differentiation

 

PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. With a(n) ____________________ strategy, the organization aggressively seeks efficient facilities, pursues cost reductions, and uses tight cost controls to produce products more efficiently than competitors.

 

ANS:  cost leadership

 

PTS:   1                    DIF:    2                    REF:   198

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. With a(n) ____________________ strategy, the organization concentrates on a specific regional market or buyer group.

 

ANS:  focus

 

PTS:   1                    DIF:    2                    REF:   199

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

  1. The ____________________ is driving and supporting the move toward partnership thinking.

 

ANS:  Internet

 

PTS:   1                    DIF:    2                    REF:   200

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. ____________________ means that managers focus on leveraging and developing more from the firm’s existing assets, capabilities, and core competencies in a way that will provide a sustained competitive advantage.

 

ANS:  Dynamic capability

 

PTS:   1                    DIF:    2                    REF:   200

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The standardization of product design and advertising strategies throughout the world is called ____________________.

 

ANS:  globalization

 

PTS:   1                    DIF:    2                    REF:   201

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. When an organization chooses a(n) ____________________ strategy, it means that business decisions such as product design are made on a country-by-country basis.

 

ANS:  multidomestic

 

PTS:   1                    DIF:    2                    REF:   202

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. A(n) ____________________ strategy seeks to achieve both global integration and national responsiveness.

 

ANS:  transnational

 

PTS:   1                    DIF:    2                    REF:   202

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. The ability to influence people to adopt the new behaviors needed for strategy implementation is called ____________________.

 

ANS:  leadership

 

PTS:   1                    DIF:    2                    REF:   203

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

  1. It is argued that ____________________ is the most difficult and most important part of strategic management.

 

ANS:  strategic implementation

 

PTS:   1                    DIF:    2                    REF:   203

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Reward systems, pay incentives, budgets for allocating resources, information technology systems, and organization’s rules, policies, and procedures are included in ____________________.

 

ANS:  information and control systems

 

PTS:   1                    DIF:    2                    REF:   205

NAT:  AACSB Analytic | Strategy             TYP:   F

 

SHORT ANSWER

 

  1. List the three global corporate strategies.

 

ANS:

Globalization strategy, transnational strategy, and multidomestic strategy.

 

PTS:   1                    DIF:    2                    REF:   201-202

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. List the four components of a SWOT analysis.

 

ANS:

A SWOT includes — strengths, weaknesses, opportunities, and threats.

 

PTS:   1                    DIF:    2                    REF:   192

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. List Porter’s competitive forces.

 

ANS:

Potential new entrants, bargaining power of buyers, bargaining power of suppliers, threat of substitute products, and rivalry among competitors.

 

PTS:   1                    DIF:    2                    REF:   196

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

 

 

 

 

ESSAY

 

  1. Name and describe the three types of global strategies.

 

ANS:

The three types of global strategies are globalization, multidomestic, and transnational. Globalization means that a company’s product design and advertising strategies are standardized throughout the world. This approach is based on the assumption that a single global market exists for many consumer and industrial products. The theory is that people everywhere want to buy the same products and live the same way. Multidomestic strategies believe that competition in each country is handled independently of industry competition in other countries. Thus, marketing, advertising, and product design is encouraged to be modified and adapted to the specific needs of each country the company is present in. Many companies reject the idea of a single global market. Transnational strategies seek to achieve both global integration and national responsiveness. A true transnational strategy is difficult to achieve, because one goal requires close global coordination while the other goal required local flexibility. However, many industries are finding that, although increased competition means they must achieve global efficiency, growing pressure to meet local needs demands national responsiveness.

 

PTS:   1                    DIF:    2                    REF:   201-202

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Compare and contrast the three levels of strategy in an organization.

 

ANS:

There are three levels of strategy in an organization: corporate-level, business-level, and functional-level. Corporate-level strategies involve the whole organization. This level of strategy is most concerned with answering the question: “What business are we in?” These types of decisions often involve issues of growth, retrenchment, and/or joint ventures. Business-level strategies are concerned with the question “How do we compete?” They focus on how the individual business unit competes within its industry. They may involve such issues as advertising, product changes, and new-product development. Functional-level strategies are concerned with the question of “How do we support the business-level strategy?” Involving all of the organization’s major functions, these types of strategies link the functional unit with the strategic business unit.

 

PTS:   1                    DIF:    2                    REF:   190-191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

 

 

 

 

 

 

 

 

 

 

  1. In order for companies to remain competitive, their strategies must focus on three things. Describe these three focuses.

 

ANS:

The three focuses are core competencies, synergy, and value creation. 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. 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. 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.

 

PTS:   1                    DIF:    2                    REF:   188-189

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Differentiate between strategy formulation and strategy implementation.

 

ANS:

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

 

PTS:   1                    DIF:    2                    REF:   191

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Briefly describe the Boston Consulting Group matrix, including its dimensions, quadrants, and strategic recommendations.

 

ANS:

The two dimensions of the matrix are business growth rate and market share. When growth is high and share is high, the SBU has the best situation and is called a star. When growth is low and share is high, the SBU is known as a cash cow. When growth is high but share is low, the SBU is a question mark. In the fourth quadrant, growth and share are both low. This is the worst situation, and the SBU is a dog. The strategic recommendations are: (1) invest in stars; (2) milk the cash cow; (3) invest in question marks to create stars or divest the question marks; and (4) divest the dogs.

 

PTS:   1                    DIF:    3                    REF:   194-195

NAT:  AACSB Analytic | Strategy             TYP:   F

 

 

 

 

 

 

 

 

 

  1. Briefly describe the five competitive forces identified by Michael E. Porter.

 

ANS:

Potential new entrants: Capital requirements and economies of scale are examples of two potential barriers to entry that can keep out new competitors.

 

Bargaining power of buyers: Informed customers become empowered customers.

 

Bargaining power of suppliers: The concentration of suppliers and the availability of substitute suppliers are significant factors in determining supplier power.

 

Threat of substitute products: The power of alternatives and substitutes for a company’s product may be affected by changes in cost or in trends that will deflect buyer loyalty.

 

Rivalry among competitors: This is influenced by the previous four forces as well as by cost and product differentiation.

 

PTS:   1                    DIF:    2                    REF:   196-197

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. Briefly discuss Porter’s three competitive strategies.

 

ANS:

Porter identified three competitive strategies: differentiation, cost leadership, and focus. A differentiation strategy involves the organization attempting to distinguish its product or service from those of its competition. Advertising, product features, and customer service are some of the ways an organization can successfully differentiate. A cost leadership strategy is based on the organization achieving a low-cost position relative to the competition. A company may achieve a cost leadership through the operation of efficient facilities, cutting costs, or maintaining tight cost control. When a company uses a differentiation or a cost leadership strategy in a particular market or buyer group, they are employing a focus strategy. This strategy allows the organization to concentrate on a narrow market niche.

 

PTS:   1                    DIF:    2                    REF:   198-199

NAT:  AACSB Analytic | Strategy             TYP:   F

 

  1. When a company goes global, it is difficult to implement strategies. Explain.

 

ANS:

In the international arena, flexibility and superb communication are considered mandatory leadership skills. Also, managers must design a structure for the organization that will achieve the desired level of global integration and local responsiveness, as well as, have the ability to merge successfully with foreign cultures. Information and control systems must fit the needs and incentives within local cultures. Recruitment, training, transfer, promotion, and layoff of international human resources create an array of problems not confronted in North America. Labor laws, guaranteed jobs, and cultural traditions of keeping unproductive employees on the job provide special problems for strategy and implementation.

 

PTS:   1                    DIF:    3                    REF:   203-205

NAT:  AACSB Analytic | Strategy             TYP:   F

 

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