chap 7-9
  • 1. What is the most difficult stage of strategic management?
A) Strategy formulation
B) Market research
C) Strategy implementation
  • 2. Successful strategy formulation guarantees:
A) Financial success
B) Employee satisfaction
C) None of the above
  • 3. What personal qualities are critical for strategy implementation?
A) Creativity and intuition only
B) Discipline, commitment, and sacrifice
C) Risk-taking and networking
  • 4. Annual objectives are:
A) Short-term, measurable milestones
B) Employee evaluation metrics
C) Marketing slogans
  • 5. Key characteristics of annual objectives include:
A) Vague, flexible, broad
B) Quantitative, understandable, challenging, compatible, obtainabl
C) Secret, long-term, unmeasurable
  • 6. Policies in strategy implementation are:
A) Financial statements
B) Guidelines and procedures supporting annual objectives
C) Employee bonuses
  • 7. Resource allocation refers to:
A) Setting organizational culture
B) Distributing financial, human, physical, and technological resources
C) Monitoring competitors
  • 8. Conflict during strategy implementation is:
A) Unavoidable and can be constructive
B) Always destructive
C) Avoided by ignoring opinions
  • 9. A functional organizational structure:
A) Groups employees by function or department
B) Combines functions and divisions
C) Is used by multi-divisional firms
  • 10. A disadvantage of functional structure is:
A) Clear accountability
B) Simple management
C) Poor communication across functions
  • 11. A divisional structure is suitable for:
A) Large firms with diverse products or markets
B) Firms with no departments
C) Single-product firms
  • 12. Matrix structure combines:
A) Human resources and marketing
B) Functional and divisional structures
C) Strategic and operational planning
  • 13. Strategic Business Unit (SBU) structures are used by:
A) Firms with many divisions (>10)
B) Small family businesses
C) Single-product firms
  • 14. Reengineering involves:
A) Hiring new managers
B) Outsourcing production
C) econfiguring work processes for efficiency, quality, service, and speed
  • 15. Resistance to change can be managed by:
A) Increasing workload
B) Anticipating and involving employees in decisions
C) Eliminating communication
  • 16. Linking performance and pay to strategy:
A) Encourages employee alignment with strategic objectives
B) Focuses on external competition
C) Reduces motivation
  • 17. Promoting diversity in HR:
A) Reduces productivity
B) Focuses only on marketing
C) Enhances competitiveness and insights
  • 18. Segmenting and targeting markets:
A) Ignoring customer preferences
B) Reducing marketing expenses
C) Dividing customers and selecting groups to serve
  • 19. Product positioning is:
A) Outsourcing production
B) Hiring skilled employees
C) Creating a unique image and value proposition in customers’ mind
  • 20. Perceptual mapping helps:
A) Calculate financial ratios
B) Compare products/services to competitors in customers’ minds
C) Allocate resources
  • 21. Capital structure refers to:
A) The proportion of debt to equity on the balance sheet
B) Human resources allocation
C) A firm’s physical assets
  • 22. EPS stands for:
A) Earnings post-sale
B) Earnings per share
C) Employee productivity score
  • 23. EBIT stands for:
A) Earnings Before Interest and Taxes
B) Estimated Business Income Trend
C) Earnings Before Internal Training
  • 24. EAT stands for:
A) Expenses and Taxes
B) Earnings After Taxes
C) Economic Asset Total
  • 25. EPS/EBIT analysis helps determine:
A) Best marketing strategy
B) Optimal organizational structure
C) Most appropriate capital structure
  • 26. Projected financial statements:
A) Show past performance
B) Are irrelevant for strategy implementation
C) Show expected financial impact of recommendations
  • 27. Percentage-of-sales method is used to:
A) Evaluate market share
B) Determine employee salaries
C) Forecast COGS and operating expenses
  • 28. Corporate valuation determines:
A) Customer satisfaction
B) A firm’s cash value for mergers, acquisitions, or internal management
C) Employee productivity
  • 29. Net Worth Method values a firm based on:
A) Market share
B) Net income multiple
C) Stockholders’ equity minus goodwill and intangibles
  • 30. Price-Earnings (P/E) Ratio Method uses:
A) Cash flow only
B) Book value
C) Market valuation of earnings
  • 31. Outstanding Shares Method calculates:
A) Revenue growth
B) Debt-to-equity ratio
C) Market capitalization
  • 32. Financial ratio analysis monitors:
A) Liquidity, leverage, activity, profitability, and growth
B) HR policies
C) Marketing effectiveness
  • 33. IPO stands for:
A) Initial Public Offering
B) Internal Process Optimization
C) Investment Planning Overview
  • 34. Issuing bonds is a way to:
A) Reduce employee turnover
B) Merge with another company
C) Raise capital through debt instruments
  • 35. Strategy evaluation is important because:
A) It replaces strategy formulation
B) Even the best strategies can become obsolete
C) It guarantees profits
  • 36. Strategy evaluation should be:
A) Continuous
B) Done every five years
C) A year-end activity only
  • 37. Reviewing the underlying bases of strategy involves:
A) Writing marketing plans
B) Re-examining EFE and IFE matrices
C) Forecasting market trends
  • 38. Measuring organizational performance compares:
A) Employees’ personal goals
B) Marketing spend
C) Expected results to actual results
  • 39. Corrective actions are taken to:
A) Realign operations with strategic objective
B) Punish managers
C) Focus solely on marketing
  • 40. The Balanced Scorecard measures performance across:
A) HR satisfaction only
B) Financial, customer, internal processes, learning and growth, and social responsibility
C) Market share only
  • 41. Corporate governance refers to:
A) Employee relations
B) Marketing strategy
C) Oversight and direction of the firm by the board of directors
  • 42. Board of Directors are elected by:
A) Competitors
B) Employees
C) Shareholders
  • 43. One duty of the board of directors is:
A) Product design
B) Pricing strategy
C) Control and oversight of CEO performance
  • 44. Smaller boards (fewer than 10 members) are:
A) Required by law
B) Not recommended
C) More efficient
  • 45. Strategic management challenges include:
A) Art vs. science issue, visibility, contingency planning, auditing
B) Only marketing decisions
C) Only financial planning
  • 46. Contingency planning is:
A) Marketing research
B) Annual budgeting
C) Developing alternative plans for unexpected events
  • 47. Auditing in strategy evaluation ensures:
A) Accountability and integrity
B) Market share growth
C) Customer satisfaction
  • 48. Effective strategic management requires:
A) Strict bureaucracy
B) People process, not paper process
C) Thick documents only
  • 49. Challenging assumptions helps:
A) Reduce creativity
B) Encourage critical thinking and reality check
C) Simplify reporting
  • 50. Strategy evaluation and governance analogy:
A) A car’s dashboard and driver monitoring metrics
B) A teacher grading exams
C) A chef cooking a meal
  • 51. Matching structure with strategy means:
A) Selecting suppliers
B) Aligning organizational structure to support strategy
C) Choosing marketing tools
  • 52. Alfred Chandler’s insight states:
A) Structure is independent of strategy
B) Strategy changes require no structural changes
C) Changes in strategy lead to changes in organizational structure
  • 53. A disadvantage of divisional structure is:
A) Better market responsiveness
B) Simple reporting lines
C) Potential for inconsistent policies
  • 54. Advantages of matrix structure include:
A) Enhanced communication and resource sharing
B) No dual authority
C) Simple reporting
  • 55. A disadvantage of matrix structure is:
A) Better market responsiveness
B) Dual lines of authority, high overhead, potential confusion
C) Better resource sharing
  • 56. When constructing organizational charts, the chain of command should be:
A) Flexible
B) Clear
C) Ignored
  • 57. Span of control refers to:
A) Number of people reporting to a manager
B) Number of products produced
C) Budget allocation
  • 58. Decentralization is recommended:
A) Especially with divisional structures
B) Never
C) Only for HR
  • 59. Restructuring in production/operations involves:
A) Financial auditing
B) Downsizing to improve efficiency
C) Increasing employee numbers
  • 60. Key issue in production location decisions is:
A) Stock prices
B) Costs and logistics
C) Employee benefits
  • 61. Balancing work life and home life in HR:
A) Reduces productivity
B) Supports employee well-being and morale
C) Focuses only on top managers
  • 62. Creating a strategy-supportive culture means:
A) Aligning culture with strategic objectives
B) Reducing operational costs
C) Following tradition only
  • 63. Engaging customers in social media helps:
A) Reduce marketing costs
B) Track financial performance
C) Gain insights and understand perceptions
  • 64. EPS is calculated as:
A) EBIT / Taxes
B) Net Income / Number of Shares Outstanding
C) Net Income × Shares Outstanding
  • 65. EBIT is also called:
A) Operating Income
B) Dividends
C) Earnings After Tax
  • 66. EAT is calculated by:
A) EBT - Taxes
B) EPS × Shares
C) EBIT - Interest
  • 67. The purpose of EPS/EBIT graph analysis is to:
A) Identify financing option that maximizes EPS
B) Forecast marketing campaigns
C) Determine employee pay
  • 68. Projected financial statements are usually prepared for:
A) 3 years
B) 10 years
C) 5 years
  • 69. Retained earnings are calculated by:
A) Net Income - Dividends
B) Net Income + Dividends
C) EPS × Shares
  • 70. Cash is used as a plug figure in:
A) Tax calculations
B) Balance sheet
C) Cash flow only
  • 71. Net Income Method of valuation uses:
A) Net Income × 5
B) Market price
C) Total assets
  • 72. Financial ratio analysis is important to:
A) Determine product pricing
B) Identify strengths and weaknesses
C) Set marketing goals
  • 73. Liquidity ratios measure:
A) Profitability only
B) Ability to meet short-term obligations
C) Market share
  • 74. Leverage ratios measure:
A) Degree of debt financing
B) Product positioning
C) Short-term obligations
  • 75. Activity ratios evaluate:
A) Profit margin only
B) Employee satisfaction
C) Efficiency in using assets
  • 76. Profitability ratios assess:
A) Market growth
B) Firm’s ability to generate profit
C) Operational efficiency
  • 77. Growth ratios measure:
A) Market positioning
B) Rate of increase in financial performance
C) Customer satisfaction
  • 78. IPOs help companies:
A) Expand HR policies
B) Reduce product cost
C) Raise capital by selling stock to the public
  • 79. Issuing bonds requires:
A) Selling products
B) Reducing dividends
C) Offering fixed interest payments to investors
  • 80. Capital structure decisions impact:
A) Customer segmentation
B) EPS and cost of capital
C) HR policies only
  • 81. Strategy evaluation helps organizations:
A) Reduce costs only
B) Proactively adapt to internal and external changes
C) Focus solely on marketing
  • 82. Reviewing underlying bases of strategy asks whether:
A) Employees are satisfied
B) External opportunities/threats and internal strengths/weaknesses are still accurate
C) Marketing is effective
  • 83. Quantitative criteria in measuring performance include:
A) Customer satisfaction
B) Product quality
C) Market share, profitability, sales
  • 84. Qualitative criteria in performance measurement include:
A) Employee morale, product quality, customer service
B) ROI
C) Financial ratios
  • 85. Corrective actions should:
A) Ignore market trends
B) Only reduce costs
C) Realign operations and capitalize on strengths/opportunities
  • 86. Balanced Scorecard includes which additional category beyond Kaplan & Norton’s four?
A) Marketing effectiveness
B) Community/Social Responsibility/Ethics/Environment
C) Financial ratio
  • 87. Corporate governance ensures:
A) Operational efficiency
B) Marketing effectiveness
C) Lawful, ethical conduct and oversight by the board
  • 88. CEO rarely being the chairperson is recommended because:
A) Prevents conflict of interest
B) Simplifies accounting
C) Improves marketing
  • 89. Visible strategies foster:
A) Employee confusion
B) Commitment and support from stakeholders
C) Less transparency
  • 90. Hidden strategies may be necessary to:
A) Avoid competitor retaliation
B) Improve transparency
C) Enhance collaboration
  • 91. Art vs. science issue in strategic management refers to:
A) Marketing vs. production
B) Intuitive judgment vs. analytical decision-making
C) Governance vs. operations
  • 92. Guidelines for effective strategic management emphasize:
A) Bureaucracy and rigidity
B) People process, learning, data-supported words, simplicity
C) Paperwork over dialogue
  • 93. Challenging assumptions encourages:
A) Critical thinking and accurate assessment of reality
B) Simplifying reporting
C) Status quo
  • 94. Open-mindedness in strategy planning:
A) Creates rigidity
B) Encourages inquiry and learning
C) Reduces efficiency
  • 95. Limiting the number of strategies pursued at once prevents:
A) Data analysis
B) Innovation
C) Overextension and inefficiency
  • 96. Ethics in strategic management ensures:
A) Hidden strategies
B) Reduced planning
C) Good business practices and trust
  • 97. The Balanced Scorecard is like:
A) A marketing report
B) A training module
C) A car dashboard showing multiple performance metric
  • 98. Taking corrective actions is similar to:
A) Marketing the product
B) Adjusting the steering or speed to stay on course
C) Issuing new stock
  • 99. ontinuous strategy evaluation ensures:
A) Compliance with law
B) Sustained competitive advantage
C) Employee satisfaction
  • 100. Governance and evaluation help the firm:
A) Focus solely on HR
B) Avoid all risk
C) Monitor progress, correct course, and ensure long-term success
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