Crafting and executing strategy-Thompson , Strickland, Gamble, Peterae,Janes & Sutton - Ch2
1 Which one of the following is not an integral part of the managerial process of crafting and executing strategy?
A) Developing a strategic vision, mission and values.
B) Choosing a strategic intent.
C) Setting objectives.
D) Executing the strategy.
E) Monitoring developments, evaluating performance, and initiating ive adjustments.
2 A strategic vision for a company
A) involves how fast to pursue the chosen strategy and reach the targeted levels of performance.
B) consists of thinking through what it will take to make the chosen strategy work as planned.
C) describes management's aspirations for the business, providing a panoramic view of "where we are going" and a convincing rationale for why this makes good business sense for the company-a strategic vision thus points an organization in a particular direction and charts a strategic path for it to follow in preparing for the future.
D) spells out how the company is going to get from where it is now to where it want to go and when it is expected to arrive.
E) concerns management's view of how to transition the company's business model from where it is now to where it needs to be.
3 Which of the following statements about a company's values is false?
A) A company's values are the beliefs, traits, and behavioral norms that company personnel are expected to display in conducting the company's business and pursuing its strategic vision and strategy
B) In companies with long-standing values that are deeply entrenched in the corporate culture, senior managers are careful to craft a vision, mission, and strategy that match established values, and they reiterate how the value-based behavioral norms contribute to the company's business success. If the company changes to a different vision or strategy, executives take care to explain how and why the core values continue to be relevant.
C) A company's core values can relate to such things as fair treatment, integrity, ethical behavior, the emphasis the company will place on innovativeness or top-notch quality or superior customer service, and the company's beliefs in high ethical standards, socially responsible behavior, and giving back to the community.
D) At companies whose executives take the stated values very seriously, the values are widely adopted by company personnel, are ingrained in the corporate culture, and are mirrored in how company personnel conduct themselves and the company's business on a daily basis
E) At all but a few companies, the stated values are mostly window-dressing and serve mainly to embellish the company's public image.
4 A company's objectives or performance targets
A) represent a managerial commitment to achieving specified outcomes and results; they function as yardsticks for tracking the company's progress and performance-well-stated objectives are quantifiable, or measurable, and contain a deadline for achievement.
B) are typically established after a company decides on a strategic vision and strategy so that they will entail performance targets that truly signal business success.
C) are best stated in general terms (maximize profits, reduce costs, increase sales) rather than quantifiable terms (increase after-tax profits by 10% in 2 years, grow sales revenues by 20% annually) so that managers will have the latitude to adjust target outcomes to levels that can be achieved.
D) should place far more emphasis on financial performance targets than strategic performance targets.
E) All of these.
5 Which of the following represents the best example of a well-stated strategic objective (as opposed to a well-stated financial objective)?
A) Achieve revenue growth of 10% annually
B) Increase market share from 17% to 22% and achieve the lowest overall costs of any producer in the industry, both within three years
C) Invest more money in R&D to enable the company to offer customers the widest selection of products in the industry
D) Achieve a AA bond rating within 2 years and an annual cash flow of $500 million
E) Pay more attention to reducing costs over the next two years
6 Which of the following statements about objectives is false?
A) A company's managers are well-advised to give the achievement of financial objectives a much higher priority than the achievement of strategic objectives.
B) Companywide objectives need to be broken down into performance targets for each separate business, product line, functional department, and individual work unit because company performance can't reach full potential without each area of the organization doing its part and contributing directly to the desired companywide outcomes and results.
C) A "balanced scorecard" for measuring company performance views financial performance measures as lagging indicators that reflect the results of past decisions and organizational activities and views strategic performance measures as leading indicators of a company's future financial performance.
D) Objectives should be set at high enough levels to stretch an organization to reach its full potential.
E) The experiences of countless companies and managers teach that precisely spelling out how much of what kind of performance by when and then pressing forward with actions and incentives calculated to help achieve the targeted outcomes greatly improve a company's actual performance.
7 A balanced scorecard for measuring company performance
A) entails balancing the pursuit of good bottom-line profit against the pursuit of non-profit objectives (although achieving profitability targets is nearly always given greater emphasis).
B) involves putting equal emphasis on the achievement of financial objectives, strategic objectives, and social responsibility objectives.
C) entails setting both financial and strategic objectives and putting balanced emphasis on their achievement.
D) helps prevent the pursuit of strategic objectives from dominating the pursuit of financial objectives.
E) is necessary in order to prevent the drive for achieving financial objectives from weakening the attention paid to social responsibility, community citizenship, and other worthy goals.
8 The task of crafting a strategy is
A) the function and responsibility of a few high-level executives.
B) more of a collaborative group effort that involves all managers and sometimes key employees striving to arrive at a consensus on what the overall best strategy should be.
C) the function and responsibility of a company's strategic planning staff.
D) a job for a company's whole management team-senior executives plus the managers of business units, operating divisions, functional departments, manufacturing plants, and sales districts
E) first and foremost the function and responsibility of a company's board of directors.
9 The strategy-making hierarchy in a single business company consists of
A) business strategy, divisional strategies, and departmental strategies.
B) business strategy, functional strategies, and operating strategies, whereas in a diversified company it consists of corporate strategy, business strategies (one for each business the diversified company is in), functional strategies, and operating strategies.
C) business strategy and operating strategy.
D) managerial strategy, business strategy, and divisional strategies.
E) corporate strategy, divisional strategies, and departmental strategies (whereas in a diversified company it consists of corporate strategy, divisional strategy and operating strategy).
10 Which one of the following is not among the chief duties/responsibilities of a company's board of directors insofar as the strategy-making, strategy-executing process is concerned?
A) Directing senior executives as to what the company's long-term direction, objectives, business model, and strategy should be and, further, closely supervising senior executives in their efforts to implement and execute the strategy
B) Overseeing the company's financial accounting and financial reporting practices
C) Evaluating the caliber of senior executives' strategy-making/strategy-executing skills
D) Being inquiring critics and exercising strong oversight over the company's direction, strategy, and business approaches
E) Instituting a compensation plan for top executives that rewards them for actions and results that serve stakeholders' interests, most especially those of shareholders.