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