mgmt09_tif08 - Chapter 8 Strategic Management TRUE/FALSE...

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Chapter 8 Strategic Management TRUE/FALSE QUESTIONS THE IMPORTANCE OF STRATEGIC MANAGEMENT 1. Strategic management is the set of managerial decisions and actions that determines the short-term performance of an organization. (False; moderate; p. 208) 2. “Strategic model” is a term that is often used in conjunction with strategic management and strategies. (False; easy; p. 209) 3. The most fundamental questions about strategy address why firms, facing the same environmental conditions, have varying levels of performance. (True; easy; p. 209) THE STRATEGIC MANAGEMENT PROCESS 4. The first step in the strategic management process is analyzing the external environment. (False; difficult; p. 210) 5. Within an industry, an environment can present opportunities to one organization and pose threats to another. (True; moderate; p. 212) 6. Evaluating an organization’s intangible assets is part of doing an internal analysis in the strategic management process. (True; easy; p. 212) 7. Activities that an organization does well or resources that it has available are called capabilities. (False; easy; p. 212) 8. Exceptional or unique organizational resources are known as core capabilities. (False; moderate; p. 212) 9. A strong organizational culture may act as a significant barrier to accepting any changes in organizational strategies. (False; easy; p. 213) 10. SWOT analysis includes an analysis of an organization’s environmental opportunities and threats. (True; easy; p. 214) 201
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11. The final step in the strategic management process is implementing the objectives. (False; easy; p. 216) TYPES OF ORGANIZATIONAL STRATEGIES 12. Corporate-level strategies are developed for organizations that run more than one type of business. (True; moderate; p. 217) 13. One method of implementing a growth strategy is to increase production capacity. (True; moderate; p. 217) 14. A trucking company that grows by purchasing a chain of gasoline stations is engaged in horizontal integration. (False; moderate; p. 218) 15. Diversification is an example of a corporate retrenchment strategy. (False; moderate; p. 218) 16. If Burger King were to buy out Mom and Pop’s Burgers, Burger King would be growing by vertical consolidation. (False; difficult; p. 218) 17. A stability strategy is developed when management decides it will remain profitable by maintaining the status quo in a rapidly changing external environment. (False; difficult; p. 219) 18. A retrenchment strategy is a renewal strategy designed to address organizational weaknesses that are leading to performance declines. (True; moderate; p. 220) 19. Turnaround is one type of renewal strategy. (True; moderate; p. 220) 20. The BCG matrix evaluates an organization’s various businesses to identify which ones offer high potential and which drain organizational resources. (True; moderate; p. 220) 21. Stars, one of the four business groups in the corporate portfolio mix, are characterized by low growth and low market share.
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