47422217-Test-Questions.pdf

47422217-Test-Questions.pdf - Testfragen(Barney/Hesterly...

Info icon This preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Testfragen (Barney/Hesterly, Strategic Management and Competitive Advantage) Strategic Management in General The strategic management process is a sequential set of analyses and choices that can increase the likelihood that a firm will choose a good strategy that generates competitive advantages. Answer: TRUE The second step in the strategic management process is the definition of a firm's mission. Answer: FALSE A firm's mission defines both what it wants to be in the long run and what it wants to avoid in the meantime. Answer: TRUE Mission statements often contain so many common elements that even if a firm's mission statement does not influence behavior throughout an organization, it is likely to have a significant impact on a firm's actions. Answer: FALSE Mission statements that are very inwardly focused and are defined only with reference to the personal values and priorities of its founders and top managers can hurt a firm's performance. Answer: TRUE Green Frog is an environmentally friendly firm in the cosmetics industry that has decided to undertake a strategic planning project. It wants to ensure that it performs the process correctly and so intends to start the process with the first step of the strategic planning process, which is A) crafting a mission statement. B) setting objectives. C) measuring performance. D) defining its business level strategy. Answer: A Define the term "mission" and discuss how a firm's mission can both positively and negatively impact a firm's performance. Answer: A firm's mission is its long-term purpose and it defines both what a firm aspires to be in the long run and what it wants to avoid in the meantime. If a mission statement does
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
not influence firm behavior, it is unlikely to have an impact on a firm's actions. However, visionary firms, or firms whose mission is central to all they do, tend to earn substantially higher returns than average over the long run even though their mission statements suggest that profit maximization is not their primary reason for existence. However, missions that are inwardly focused and defined only with reference to the personal values and priorities of their founders or top managers, independent of whether or not those values and priorities are consistent with the economic realities facing a firm, are not likely to be a source of competitive advantage. Visionary firms earn substantially higher returns than average firms because they acknowledge that profit maximizing is their primary reason for existence. Answer: FALSE Objectives are the specific measurable targets a firm can use to evaluate the extent to which it is realizing its mission. Answer: TRUE Write objectives for each of the following mission statements. a. We will be a leader in pharmaceutical innovation b. Customer satisfaction is our primary goal c. We promise on time delivery d. Product quality is our first priority.
Image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.