(Test Bank) Concepts In Strategic Management And Business Policy Globalization, Innovation And Sustainability

Wheelen,Hunger, 15

Business

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Author(s): Wheelen, Hunger

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1 Copyright © 2018 Pearson Education, Inc. Chapter 1 Basic Concepts in Strategic Management 1) The emphasis of strategic management is on A) long- term performance. B) first line managers. C) the short-run performance of the corporation. D) an examination of the organization's internal environment. E) an investigation of competitor actions. Answer: A Difficulty: Easy Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 2) Research sugges ts that strategic management evolves through four sequential phases in corporations. The first phase is A) externally oriented planning. B) basic financial planning. C) internally oriented planning. D) forecast -based planning. E) strategic management. Answ er: B Difficulty: Easy Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 3) The time horizon involved with regard to basic financial planning is usually A) one year. B) one quarter. C) three to five years . D) less than one month. E) five to ten years. Answer: A Difficulty: Easy Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 4) A difference between basic financial planning and forecast-based planning is A) the time horizon is shorter in forecast-based planning. B) forecast -based planning incorporates environmental data and extrapolates current trends. C) basic financial planning utilizes consultants with sophisticated techniques. D) basic financial planning utilizes scenarios and contingency strategies. E) basic financial planning relies heavily on input from lower levels in the organization. Answer: B Difficulty: Moderate Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Analyti cal thinking (Concepts in Strategic Management and Business Policy Globalization, Innovation and Sustainability, 15e Wheelen, Hunger) (Test Bank all Chapters)2 Copyright © 2018 Pearson Education, Inc. 5) Top- down planning that emphasizes formal strategy formulation and leaves the implementation issues to lower management levels is known as A) forecast -based planning. B) externally oriented planning. C) strategic management. D) basic financial planning. E) none of the above Answer: B Difficulty: Moderate Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 6) In the final phase of strategic management, strategic information is available to A) people throughout the organization. B) the top management responsible for decision- making. C) middle management. D) operational personnel. E) only those responsible for implementing the strategy. Answer: A Difficulty: Moderate Learning Obj.: 1.1: Discus s the benefits of strategic management AACSB: Application of knowledge 7) In a survey of 50 corporations, which of the following was rated as one of the three top benefits of strategic management? A) clearer sense of strategic vision for the firm B) high er levels of employee motivation C) higher levels of job satisfaction D) improved productivity E) lower employee turnover Answer: A Difficulty: Moderate Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 8) When an organization is evaluating its strategic position, which is not one of the strategic questions that an organization generally may ask itself? A) Where is the organization now? B) Are we on target to hit our financial objectives next year? C) If no changes are made, where will the organization be in one year? D) If the evaluation is negative, what specific actions should management take? E) If no changes are made, where will the organization be in 10 years? Answer: B Difficulty: Moderate Learnin g Obj.: 1.1: Discuss the benefits of strategic management AACSB: Analytical thinking 3 Copyright © 2018 Pearson Education, Inc. 9) Research of the planning practices of companies in the oil industry concludes that the real value of modern strategic planning is more in the ________ that is part of a future -oriented planning process than in any resulting written strategic plan. A) planning B) strategic thinking and organizational learning C) resulting written strategic plan D) formality of the process E) improved communication within the organizati on Answer: B Difficulty: Difficult Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 10) Strategic planning within a small organization A) may be informal and irregular. B) must be elaborate to allow for future growth. C) should always be formalized and explicitly stated. D) should be done by the president only. E) is unnecessary and a waste of time. Answer: A Difficulty: Moderate Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 11) Strategic planning in a multidivisional corporation A) should be informal to allow complete understanding by the many participants. B) should be instigated only from the main corporate office. C) should be accomplished quickly to decrease the likelihood of it becoming outdated. D) should encourage a clear delineation between top management and lower -level managers. E) should be a formalized and sophisticated system. Answer: E Difficulty: Moderate Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 12) Strategic management is the set of managerial decisions that determines the short- term performance of a corporation. Answer: FALSE Difficulty: Easy Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 4 Copyright © 2018 Pearson Education, Inc. 13) In the externally oriented planning phase, plans are developed by heavily involving the input of managers from lower levels. Answer: FALSE Difficulty: Moderate Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 14) General Electric led the transition from strategic planning to strategic management during the 1980s. Answer: TRUE Difficulty: Easy Learning Obj.: 1.1: Discuss the benefi ts of strategic management AACSB: Application of knowledge 15) One of the benefits of strategic management is a clearer sense of strategic vision for the firm. Answer: TRUE Difficulty: Moderate Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Analytical thinking 16) To be effective, strategic management must be a formal process. Answer: FALSE Difficulty: Difficult Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Analytical thinking 17) What are the b enefits of strategic management? Answer: The three most highly rated benefits of strategic management are: 1. Clearer sense of strategic vision for the organization 2. Sharper focus on what is strategically important 3. Improved understanding of a rapidly changing environment Difficulty: Moderate Learning Obj.: 1.1: Discuss the benefits of strategic management AACSB: Application of knowledge 18) The integrated internationalization of markets and corporations is called A) normalization. B) economic inte gration. C) globalization. D) nationalization. E) regionalization. Answer: C Difficulty: Easy Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 5 Copyright © 2018 Pearson Education, Inc. 19) The term used to describe new products, services, methods, and organizational approaches that allow businesses to achieve extraordinary returns is A) ROI. B) innovation. C) competitive advantage. D) sustainability. E) profit maximization. Answer: B Difficulty: Moderate Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 20) The free trade area composed of Argentina, Brazil, Uruguay, Venezuela, and Pa raguay is called A) EU. B) ASEAN. C) NAFTA. D) Mercosur. E) ABUP. Answer: D Difficulty: Moderate Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 21) Members of the European Union (EU) include all of the following EXCEPT A) Ireland. B) Great Britain. C) Belgium. D) France. E) Slovakia. Answer: B Difficulty: Easy Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 6 Copyright © 2018 Pearson Education, Inc. 22) Canada, the United States, and Mexico are affiliated economically under which trade alliance? A) ASEAN B) Mercosur C) EU D) NAFTA E) CAFTA Answer: D Difficulty: Easy Learning O bj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 23) The currency used to integrate the monetary systems of the European Union (EU) is called the A) peso. B) dollar. C) euro. D) franc. E) pound. Answer: C Difficulty: Easy Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 24) The triple bottom line refer s to which of the following? A) water, air, and oil B) footprints, finance, and environment C) physical environment, traditional profit/loss, and air D) traditional profit/loss, social responsibility, and environmental responsibility E) social responsibili ty, people, and ethics Answer: D Difficulty: Difficult Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 7 Copyright © 2018 Pearson Education, Inc. 25) One of the benefits of globalization is A) economies of scale. B) decreased outsourcing. C) increased union negotiations. D) increased taxes. E) additional human resource training. Answer: A Difficulty: Moderate Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management 26) Knowing a company is mindful of its impact on the environment seldom changes consumer buying habits. Answer: FALSE Difficulty: Moderate Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management 27) Globalization is the integrated internationalization of markets and corporations. Answer: TRUE Difficulty: Easy Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 28) As more industries become global, strategic management is becoming less important in positioning a company for long -term competitive advantage. Answer: FALSE Difficulty: Mo derate Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Analytical thinking 29) Business sustainability reflects business practices to manage the firm's triple bottom line. Answer: TRUE Difficulty: Moderate Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 30) One member of the European Union (EU) is Chile. Answer: F ALSE Difficulty: Moderate Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 8 Copyright © 2018 Pearson Education, Inc. 31) The goal of NAFTA is complete economic integration among Canada, the United States, and Mexico. Answer: FALSE Difficulty: Moderate Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 32) Climate change has become a growing concern for businesses to include in their corporate strategies. Answer: TRUE Difficulty: Moderate Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 33) Boston Consulting Group (BCG) found that innovation is a top 3 priority for three -quarters of the companies in the 2014 BCG global innovation survey. Answer: TRUE Difficulty: Moderate Learning Obj.: 1.2: Explain how globalization, innovat ion, and environmental sustainability influence strategic management AACSB: Application of knowledge 34) A Gallup study reported that companies that focused on business sustainability had 3.9 times the EPS growth rates as compared to organizations that did not focus on business sustainability. Answer: TRUE Difficulty: Difficult Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sustainability influence strategic management AACSB: Application of knowledge 35) Define globaliza tion and identify the role of strategic management in globalization. Answer: Globalization is the internationalization of markets and corporations. It has changed the way that modern corporations do business. As more industries become global, strategic management is becoming an increasingly important way to keep track of international developments and position the company for long -term competitive advantage. Difficulty: Easy Learning Obj.: 1.2: Explain how globalization, innovation, and environmental sus tainability influence strategic management AACSB: Application of knowledge 9 Copyright © 2018 Pearson Education, Inc. 36) Which theory proposes that once an organization is successfully established in a particular environmental niche, it is unable to adapt to changing conditions? A) population ec ology B) institution C) citizenship D) strategic choice E) organizational learning Answer: A Difficulty: Moderate Learning Obj.: 1.3: Discuss the differences between the theories of organizations AACSB: Application of knowledge 37) The theory that proposes organizations can and do adapt to changing conditions by imitating other successful organizations is known as A) population ecology. B) institution theory. C) citizenship theory. D) strategic theory. E) sample theory. Answer: B Difficulty: Moderate Learning Obj.: 1.3: Discuss the differences between the theories of organizations AACSB: Application of knowledge 38) The ability of an organization to reshape its environment is described by A) population ecology theory. B) institution theory. C) the strategic choice perspective. D) organizational learning theory. E) organizational citizenship theory. Answer: C Difficulty: Moderate Learning Obj.: 1.3: Discuss the differences between the theories of organizations AACSB: Application of knowledge 39) Population ecology is a theory that proposes organizations can and do adapt to change by imitating other successful organizations. Answer: FALSE Difficulty: Easy Learning Obj.: 1.3: Discuss the differences between the theories of organizations AACSB: Application of knowledge 10 Copyright © 2018 Pearson Education, Inc. 40) The ability of a corporation to shift from one dominant strategy to another is called A) strategy implementation. B) chaos formulation. C) contingency management. D) logical incrementalism. E) strategic flexibility. Answer: E Difficulty: Moderate Learning Obj.: 1.4: Discuss the activities where learning organizations excel AACSB: Application of knowledge 41) An organization skilled at creating, acquiring, and transferring knowledge, and at modifying its behavior to reflect new knowledge and insights is a(n) A) learning organization. B) strategically managed corporation. C) innovative organization. D) hypercompetitive competitor. E) entrepreneurial firm. Answer: A Difficulty: Easy Learning Obj.: 1.4: Discuss the activitie s where learning organizations excel AACSB: Application of knowledge 42) All of the following reflect activities of a learning organization EXCEPT A) experimenting with new approaches. B) learning from its own experiences and past history. C) solving problems systematically. D) alienating competitors in the industry. E) transferring knowledge quickly and efficiently throughout the organization. Answer: D Difficulty: Moderate Learning Obj.: 1.4: Discuss the activities where learning organizations excel AACSB: Application of knowledge 43) According to Alfred Chandler, A) high -tech industries cannot be defined by "paths of learning" if they want to evolve. B) companies spring from an individual entrepreneur's knowledge, which is composed exclusively of t echnical skills. C) once a corporation has built its learning base to the point where it has become a core company in its industry, entrepreneurial start -ups are rarely able to successfully enter. D) learned capabilities derive from organizational strength s. E) organizational knowledge can seldom be a competitive advantage. Answer: C Difficulty: Difficult Learning Obj.: 1.4: Discuss the activities where learning organizations excel AACSB: Application of knowledge 11 Copyright © 2018 Pearson Education, Inc. 44) According to organizational learnin g theory, an organization uses knowledge to improve the fit between itself and its environment. Answer: TRUE Difficulty: Moderate Learning Obj.: 1.4: Discuss the activities where learning organizations excel AACSB: Application of knowledge 45) Strateg ic flexibility is the ability to shift from one dominant strategy to another. Answer: TRUE Difficulty: Easy Learning Obj.: 1.4: Discuss the activities where learning organizations excel AACSB: Application of knowledge 46) One tenet of the learning orga nization is to maintain stability. Answer: FALSE Difficulty: Moderate Learning Obj.: 1.4: Discuss the activities where learning organizations excel AACSB: Application of knowledge 47) What are the four main activities of a learning organization? Answe r: The four main activities of a learning organization are solving problems systematically, experimenting with new approaches, learning from their experiences and history as well as from the experiences of others, and transferring knowledge quickly and ef ficiently throughout the organization. Difficulty: Moderate Learning Obj.: 1.4: Discuss the activities where learning organizations excel AACSB: Application of knowledge 48) Strategic management is that set of managerial decisions and actions that dete rmine the long - run performance of a corporation. Which one of the following is not one of the basic elements of the strategic management process? A) strategy formulation B) strategy implementation C) statistical process control D) evaluation and control E) environmental scanning Answer: C Difficulty: Easy Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 12 Copyright © 2018 Pearson Education, Inc. 49) The monitoring, evaluating, and disseminating of information from the exter nal and internal environments to key people within the corporation is referred to as A) environmental scanning. B) external scanning. C) internal scanning. D) strategy formulation. E) strategy implementation. Answer: A Difficulty: Moderate Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 50) The S in SWOT stands for A) strategies. B) scanning. C) strengths. D) societal. E) sociocultural. Answer: C Difficulty: Easy Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 51) The T in SWOT stands for A) trust. B) technical. C) terminal. D) threats. E) task. Answer: D Difficulty: Easy Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 52) The variables structure, culture, and resources pertain to the A) external environment. B) internal environment. C) sociocultural forces. D) task environment. E) societal environment. Answer: B Difficulty: Moderate Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 13 Copyright © 2018 Pearson Education, Inc. 53) The task environment A) includes those elements or groups within an organi zation's industry. B) encompasses the physical working areas of the organization. C) is an accounting of the many jobs within an organization. D) is an advisory committee to top -management. E) includes general forces that only indirectly affect an organiza tion's activities. Answer: A Difficulty: Moderate Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 54) Which one of the following is included in the firm's societal environment? A) competitors B) economic forces C) resources D) governments E) special interest groups Answer: B Difficulty: Moderate Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 55) Which one of the following is included in the firm's task environment? A) technological factors B) sociocultural factors C) culture D) stockholders E) political- legal forces Answer: D Difficulty: Moderate Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 56) The Strategic Management Model presents the following process for strategy formulation: A) Objectives – Policies – Strategies – Mission. B) Mission – Policies – Strategies – Objectives. C) Policies – Mission – Strategies – Objectives. D) Policies – Strategies – Objectives – Mission. E) Mission – Objectives – Strategies – Policies. Answer: E Difficulty: Moderate Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Analytical thinking 14 Copyright © 2018 Pearson Education, Inc. 57) The development of long -range plans for the effective management of environmental opportunities and threats in light of corporate strengths and weaknesses is known as A) strategy formulation. B) strategy impleme ntation. C) strategy control. D) strategic analysis. E) strategy evaluation. Answer: A Difficulty: Moderate Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 58) The corporate missi on is best described by which one of the following? A) a description of the activities carried out by the organization B) the purpose or reason for the corporation's existence C) a description of top management's responsibilities D) a statement of corporat e objectives E) a statement of what the organization would like to become Answer: B Difficulty: Moderate Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 59) Which one of the follow ing is an example of a mission with a narrow scope? A) transportation (vs. railroads) B) computers (vs. office equipment) C) health care (vs. hospitals) D) real estate (vs. apartments) E) telecommunications (vs. television) Answer: B Difficulty: Difficult Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Analytical thinking 60) The organization's corporate mission statement A) should have a different mission statement for each subsidiary division. B) should be less formally stated to allow for growth. C) should contain explicit descriptions of their competitive advantages. D) should state what the organization would like to become. E) should describe the organization's SWOT. Answer: C Difficulty: Moderate Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 15 Copyright © 2018 Pearson Education, Inc. 61) Which of the following is an example of a mission statement? A) diversify product line to appeal to more people B) increase sales by ten percent over last year C) pay highest salaries to keep high quality employees D) develop and sell quality appliances worldwide E) divide a sales region into a group of sales districts Answer: D Difficulty: Difficult Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 62) A goal differs from an objective because it A) is open- ended. B) is quantified. C) specifies measurable results. D) is clearly specified. E) provides a time horizon. Answer: A Difficulty: Difficult Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Analytical thinking 63) Which of the following is an example of an objective? A) to diversify product line to appeal t o more people B) to increase sales by ten percent over last year C) to pay highest salaries to keep high quality employees D) to develop and sell quality appliances worldwide E) to divide a sales region into a group of sales districts Answer: B Difficulty : Difficult Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge 64) Which of the following is an example of a corporate strategy? A) diversify product line to appeal to more people B) imitate products of competitors C) pay highest salaries to keep high quality employees D) develop and sell quality appliances worldwide E) divide a sales region into a group of sales districts Answer: A Difficulty: Difficult Learning Obj.: 1.5: Describe the basic model of strategic management and its components AACSB: Application of knowledge