Q&A Hero

Q: Which of the following would be considered part of a firm's general environment? A. decreased entry barriers B. higher unemployment rates C. increased bargaining power of the firm's suppliers D. increased competitive intensity

Q: All of the following are important elements of the political/legal segment of the general environment EXCEPT: A. the deregulation of utilities B. the Americans with Disabilities Act (ADA) C. the increased use of Internet technology D. increases in the federally mandated minimum wage

Q: Emerging sociocultural changes in the environment include ____________. A. changes in the ethnic composition B. the increasing educational attainment of women in the past decade C. progressively less disposable income by consumers D. changes in the geographic distribution of the population

Q: Larger numbers of women entering the work force since the early 1970s is an example of ______. A. demographic changes B. political and legal environmental changes C. sociocultural changes D. technological developments

Q: The aging of the population, changes in ethnic composition, and effects of the baby boom are ____. A. macroeconomic changes B. demographic changes C. global changes D. sociocultural changes

Q: SWOT analysis is a framework for analyzing the internal and external environment of a company. It consists of strengths, weaknesses, opportunities, and threats. According to a SWOT analysis, which of the following is not an aspect that the strategy of the firm must follow? A. build on its weaknesses B. remedy the weaknesses or work around them C. take advantage of the opportunities presented by the environment D. protect the firm from the threats

Q: PPG Industries, the Pittsburgh-based manufacturer of paints, coatings, optical products, specialty materials, chemicals, glass, and fiber glass suffered serious failures in 1986 and 1987 when it attempted to diversify its offers. It used a technique to help it identify possible future strategies. What was it? A. crowdsourcing B. scenario analysis C. competitive intelligence D. monitoring

Q: A danger of forecasting discussed in the text is that _____________. A. in most cases, the expense of collecting the necessary data exceeds the benefit B. the retrospective nature of forecasting provides little information about the future C. managers may view uncertainty as black and white while ignoring important gray areas D. it can create legal problems for the firm if regulators discover the company is making forecasts

Q: Environmental forecasting does not involve plausible projections about the ________ of environmental change. A. direction B. scope C. speed D. lack of intensity

Q: Gathering competitive intelligence ___________. A. is good business practice B. is illegal C. is considered unethical D. minimizes the need to obtain information in the public domain

Q: Which of the following is not an example of corporate competitive analysis? A. Banks tracking home loans B. Airlines changing hundreds of fares daily in response to competitor tactics C. Car manufacturers offering sales incentives based on rival offers D. Consumers comparing product offers online

Q: Scanning the general environment would identify information on _______________. A. substitute goods B. the aging population and ethnic shifts C. customer and firm bargaining power D. competitive rivalry

Q: Taking advantage of the increasing penetration of personal computers in American homes, the Mayo Clinic transformed itself as a provider of health-related knowledge and expertise. It took advantage of the ______ trends of the _______ in the prices of PCs and the ____________ presence of PCs in virtually every home in the U.S. A. soft; increase; increasing B. soft; decrease; decreasing C. hard; decrease; decreasing D. hard; decrease; increasing

Q: _____________ tracks the evolution of environmental trends, sequences of events, or streams of activities. A. Environmental scanning B. Environmental monitoring C. Environmental surveying D. Competitive intelligence

Q: Two of the key inputs to developing forecasts discussed in the text are: A. environmental scanning and stakeholder identification. B. environmental scanning and competitor intelligence. C. assessing internal strengths and environmental scanning. D. environmental scanning and a SWOT analysis.

Q: The strategic groups in the worldwide automobile industry have been very stable and unchanging in recent years.

Q: The use of the strategic group concept is generally not helpful in charting the future directions of the strategies of a firm.

Q: The same environmental trend or event may have a very different impact on different strategic groups within the same industry.

Q: Competition tends to be more intense among firms within a strategic group than between strategic groups.

Q: Complement products typically have no impact on the value of products and services of the firm.

Q: Michael Porter's Five-Forces Analysis is a dynamic tool for analyzing industry attractiveness.

Q: (p. 66) Five-Forces analysis implicitly assumes a zero-sum game, a perspective that can be short-sighted.

Q: The Internet heightens the threat of substitutes because it creates new ways to accomplish the same task.

Q: (p. 64) Reintermediation is responsible for an overall reduction in business opportunities.

Q: Because of the Internet and digital technologies, it is very difficult for suppliers to create purchasing techniques that lower switching costs.

Q: Switching costs for an end user are likely to be much higher because of the Internet.

Q: The Internet and digital technologies suppress the bargaining power of buyers by providing them with more information to make buying decisions.

Q: In most industries, new entrants will be a bigger threat because the Internet lowers entry barriers.

Q: Rivalry will be most intense when there is a lack of differentiation or switching costs.

Q: Rivalry is most intense when there are high exit barriers and high industry growth.

Q: The more attractive the price/performance ratio of substitute products, the tighter it constrains the ability of an industry to charge high prices.

Q: (p. 59) The power of suppliers will be enhanced if they are able to maintain a credible threat of forward integration.

Q: Supplier power tends to be highest in industries where products are vital to buyers, where switching from one supplier to another is very costly, and where there are many suppliers.

Q: Buyer power tends to be higher if suppliers provide undifferentiated or standard products.

Q: The power of a buyer group is increased if the buyer group has less concentration than the supplier group.

Q: Industries characterized by high economies of scale typically attract fewer new entrants.

Q: In some industries, high switching costs can act as an important barrier to entry.

Q: The five-forces model helps to determine both the nature of competition in an industry and the profit potential for the industry.

Q: The Porter Five-Forces model is designed to help us understand how social attitudes and cultural values impact U.S. businesses.

Q: Crowdsourcing is used by companies to develop products.

Q: The Internet is a leading component in the rising emergence of digital technology.

Q: There is generally a weak relationship between equity markets (e.g., New York Stock Exchange) and economic indicators.

Q: Technological innovations can create entirely new industries and alter the boundaries of industries.

Q: A major sociocultural trend in the United States is the increased educational attainment by women.

Q: The impact of a demographic trend varies across industries.

Q: Although changes in the general environment may often adversely or favorably impact a firm, they seldom alter an entire industry.

Q: To understand the business environment of a particular firm, you need to analyze both the general environment and the firm industry and competitive environment.

Q: The opportunities and threats of a SWOT analysis refer to the internal conditions of the firm.

Q: The strengths and weaknesses of a SWOT analysis refer to the external conditions of the firm.

Q: Scenario planning is usually concerned with short-term forecasts.

Q: Even with all of the advances in recent years, forecasting is typically considered more of an art than a science and it is of little use in generating accurate predictions.

Q: Competitive intelligence generally does not benefit very much from gathering information on competitors from sources in the public domain.

Q: Competitor Intelligence (CI) is a tool that can provide management with early warnings about both threats and opportunities.

Q: Environmental monitoring deals with tracking changes in environmental trends that are often uncovered during the environmental scanning process.

Q: A number of choices government officials make are based on projections about future interest rates. The projections are soft trends.

Q: The aging of the population is a hard trend.

Q: A soft trend is a projection based on measureable facts, events, or objects. It is something that will happen.

Q: A hard trend is something that might happen and for which the probability that it might happen can be estimated.

Q: Environmental scanning and competitor intelligence provide important inputs for forecasting activities.

Q: The text discusses several characteristics of effective strategic objectives. List several of these and discuss why the strategic objectives of a firm should meet these criteria.

Q: Organizations must focus on financial and nonfinancial objectives. Select an organization and discuss possible financial and nonfinancial objectives the organization may have.

Q: A mission statement encompasses the purpose of the company as well as the basis of competition and competitive advantage. Compare the purpose of a mission statement to that of a vision statement and a strategic objective.

Q: According to the text, vision statements should be massively inspiring, overarching, and long term. Provide several examples of potential vision statements for various organizations and discuss how such vision statements would inspire employees around a cause.

Q: Leadership is a topic that is often discussed in the management literature. The text suggests that leaders should be at all levels in an organization. Discuss why it is important to have leaders throughout an organization.

Q: A firm has a variety of stakeholders. Identify several possible stakeholders a firm may have and discuss how the firm may achieve stakeholder symbiosis.

Q: Discuss the key elements of corporate governance.

Q: The strategic management process includes strategy analysis, strategy formulation, and strategy implementation. Discuss each of these steps.

Q: In large organizations, conflicts can arise between functional areas. In order to resolve these conflicts, strategic objectives: A. put financial objectives above human considerations B. align departments toward departmental goals C. help resolve conflicts through their common purpose D. cause debate and increase conflict

Q: We want to be the top-ranked supplier to our customers. (PPG) This is an example of a: A. nonfinancial strategic objective B. financial strategic objective. C. vision statement D. mission statement

Q: Fortune Brands states they will cut corporate overhead costs by $30 million a year. This is an example of a: A. nonfinancial strategic objective B. financial strategic objective C. vision statement D. mission statement

Q: Successful organizations are effective in motivating people. Employees work best when: A. they are asked to do their best B. work requirements are vague and unclear C. they are striving toward specific goals D. they are guided by an abstract mission statement

Q: The vision and mission statements of a company set the overall direction of the organization. Strategic objectives serve what role? A. operationalize the mission statement B. modify the mission statement C. are a shorter version of the mission statement D. are only clarified by the board of directors

Q: In contrast to the vision of an organization, its mission should: A. be shorter in length B. encompass both the purpose of the company as well as the basis of competition C. encompass all the major rules and regulations of the corporate work force D. be less detailed.

Q: WellPoint Health Network states: WellPoint will redefine our industry: through a new generation of consumer-friendly products that put individuals back in control of their future. This is an example of a: A. strategic objective B. vision statement C. vague statement of direction D. line manager's individual goal

Q: Examples of __________ include: To be the happiest place on earth (Disneyland), and Restoring patients to full life (Medtronic). A. vision statements B. mission statements C. strategic objectives D. operational objectives

Q: Effective vision statements include: A. all strategic directions of the organization B. a brief statement of the company's direction C. strategic posturing and future objectives D. financial objectives and projected figures

Q: Vision statements are used to create a better understanding of the overall purpose and direction of the organization. Vision statements: A. are very specific B. provide specific objectives C. set organizational structure D. evoke powerful and compelling mental images

Q: The hierarchy of organizational goals is in this order (least specific to most specific): A. vision statements, strategic objectives, mission statements B. mission statements, strategic objectives, vision statements C. vision statements, mission statements, strategic objectives D. mission statements, vision statements, strategic objectives

Q: Leadership is a necessary (but not sufficient) condition for organizational success. Leaders should emerge at which level(s) of an organization? A. only at the top B. in the middle C. throughout the organization D. only during times of change

Q: Peter Senge, of MIT, recognized three types of leaders. __________ champion and guide ideas, create a learning infrastructure, and establish a domain for taking action. A. Local line leaders B. Executive leaders C. Internal networkers D. Shop floor leaders