Business Planning
Final Exam
Course Introduction
Business Planning explores the essential concepts, processes, and tools required to develop, implement, and evaluate effective business plans. This course guides students through the stages of identifying business opportunities, conducting market research, defining objectives, setting strategies, and forecasting financial outcomes. Emphasis is placed on integrating marketing, financial, operational, and strategic elements to create comprehensive business plans suitable for startups and existing organizations. Practical assignments and real-world case studies enable students to apply theoretical knowledge, critically analyze business proposals, and develop the skills necessary to launch and sustain successful ventures in competitive environments.
Recommended Textbook
Crafting and Executing Strategy Concepts and Cases 20th Edition by Arthur Thompson
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Chapter 1: What Is Strategy and Why Is It Important
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Q1) A computer chip manufacturing giant decides to outsource its operations to a new geographical location with cheaper labor amidst ongoing labor strikes in a few of its existing locations (due to proposed job cuts).This draws criticism in its new market and affects its current market position and productivity.Which of the following would be an appropriate reactive (emergent)strategy while moving forward?
A) Hiring and training new talent to begin operations in the emerging market
B) Acquiring a local computer chip marketing and distribution specialist firm in the new location
C) Cancelling the idea of outsourcing and retaining the existing the workforce to run operations
D) Shifting the existing workforce to the new geographical location and paying them according to new standards
E) Cancelling the job cuts till the market situation and entry operations stabilize
Answer: E
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Q1) What is the strategy-making hierarchy for a diversified company? How does it differ from the strategy-making hierarchy for a single business company?
Answer: In diversified companies multiple and sometimes strikingly different businesses have to be managed,and crafting a full-fledged strategy involves four distinct types of strategic actions and initiatives,namely,corporate strategy,business strategy,functional-area strategy,and operating strategy.Each of these involves different facets of the company's overall strategy and calls for the participation of different types of managers.In single-business companies,the uppermost level of the strategy-making hierarchy is the business strategy,so a single-business company has three levels of strategy:business strategy,functional-area strategies,and operating strategies.
Q2) A company's strategic plan:
A) maps out the company's history.
B) links the company's financial targets to control mechanisms.
C) outlines the competitive moves and approaches to be used in achieving the desired business results.
D) focuses on offering a more appealing product than rivals.
E) lists methods of making money in its chosen business.
Answer: C
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Chapter 3: Evaluating a Companys External Environment
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Q1) One of the things that can be gleaned from a strategic group map of industry rivals is:
A) which rivals have been in business longer and thus have greater access to experience curve effects.
B) which rivals have newer manufacturing facilities and thus have achieved greater product quality.
C) which strategic groups have the highest profit margins and the highest customer switching costs and thus represent key operating characteristics.
D) that some strategic groups are more favorably positioned than others because they confront weaker competitive forces and/or because they are more favorably impacted by industry driving forces.
E) which strategic groups are currently being shunned by customers because of high prices and relatively low product quality.
Answer: D
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Chapter 4: Evaluating a Companys Resources, Capabilities, and Competitiveness
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Q1) Which of the following is NOT something that can be gleaned from a company's SWOT?
A) How to improve a company's strategy by using company strengths and capabilities as cornerstones for its strategy
B) Which market opportunities are best suited to a company's strengths and capabilities
C) Which resource weaknesses and deficiencies need to be corrected so as to better enable the pursuit of important market opportunities and to better defend against certain external threats
D) How to turn a core competence into a distinctive competence
E) Whether any of the company's resource strengths can be used to help lessen the impact of external threats
Q2) Tangible resources do not include:
A) physical resources.
B) financial resources.
C) human assets.
D) technological assets.
E) organizational resources.
Q3) Why do a company's core competencies matter in crafting strategy?
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Chapter 5: The Five Generic Competitive Strategies
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Q1) Focused strategies keyed either to low cost or differentiation are especially appropriate for situations where:
A) the market is composed of distinctly different buyer groups who have different needs or use the product in different ways.
B) most other rival firms are using a best-cost producer strategy.
C) buyers have strong bargaining power and entry barriers are low.
D) most industry rivals have weakly differentiated products.
E) most industry participants are also using a focused differentiation strategy.
Q2) Each of the following is likely to help a company's low-cost provider strategy succeed EXCEPT:
A) resources and capabilities to keep costs below those of its competitors.
B) cost-effective management of value chain activities better than rivals.
C) effective leveraging of cost drivers.
D) having the innovative capability to bypass certain value chain activities being performed by rivals.
E) capabilities to simultaneously deliver lower cost and higher-quality/differentiated features.
Q3) What are the pitfalls to be avoided in pursuing a broad differentiation strategy?
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Chapter 6: Strengthening a Companys Competitive Position
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Q1) Strategic alliances are:
A) the cheapest means of developing new technologies and getting new products to market quickly.
B) collaborative formal arrangements where two or more companies join forces and agree to work cooperatively toward some strategically relevant objective.
C) a proven means of reducing the costs of performing value chain activities.
D) best used to insulate a company from the impact of the five competitive forces.
E) the best way to help insulate a firm from the adverse impacts of industry driving forces.
Q2) What are the strategic disadvantages of a forward vertical integration strategy?
Q3) Backward vertical integration can produce a:
A) full integration when activities remain the domain of key suppliers.
B) tapered integration if the firm consolidates all activities in-house.
C) differentiation-based competitive advantage when activities enhance the performance of the final product.
D) focused differentiation strategy when the market is broad and the product is a commodity.
E) lower degree of flexibility in accommodating shifting buyer preferences.
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Chapter 7: Strategies for Competing in International Markets
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Q1) Which of the following factors does NOT determine whether to employ entry strategy options?
A) Cross-border transfer activities and home country advantages
B) The nature of the firm's objectives
C) Whether the firm has a full range of resources and capabilities needed to operate abroad
D) Country-specific factors such as trade barriers
E) Transaction costs involved (the cost of contracting with a partner and monitoring compliance with the terms of the contract)
Q2) Explain why an acquisition is better than a greenfield venture.
Q3) When concentrating production in a few locations,which of the following can allow a manufacturer to lower unit costs,boost quality,or master a new technology more quickly?
A) Significant scale economies
B) Learning-curve effects
C) Superior resources
D) Profit sanctuaries
E) Supporting industries
Q4) When is a global strategy "superior" to a multidomestic strategy?
Q5) When should a company choose to set up operations from the ground up?
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Chapter 8: Corporate Strategy
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Q1) One of the most significant contributions to strategy making in diversified companies that the nine-cell industry attractiveness competitive strength matrix provides is:
A) identifying which businesses have strategies that should be continued,which businesses have strategies that need fine-tuning,and which businesses have strategies that need a major overhaul.
B) that businesses having the greatest competitive strength and that are positioned in the most attractive industries should have the highest priority for corporate resource allocation and that competitively weak businesses in relatively unattractive industries should have the lowest priority and perhaps even be considered for divestiture.
C) pinpointing which strategies are most appropriate for businesses positioned in the four corners of the matrix (although the matrix reveals little about the best strategies for businesses positioned in the remainder of the matrix).
D) its ability to pinpoint what kind of competitive advantage or disadvantage each business has.
E) pinpointing which businesses to keep and which ones to divest.
Q2) Explain the difference between a cash cow business and a cash hog business.
Q3) Discuss the pros and cons of a strategy of unrelated diversification.
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Page 10
Chapter 9: Ethics, Corporate Social Responsibility,
Environmental-Sustainability, and Strategy
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Q1) Define and discuss the programs commonly included under a company's corporate social responsibility strategy.
Q2) Which of the following companies incurs mainly internal administrative costs due to unethical practices?
A) Company A loses its customer loyalty by selling low-quality products for a high cost. B) Company B's tax evasion practices are revealed,leading to a drastic fall in stock prices.
C) Company C incurs penalties of $1.5 billion for discharging toxic wastes into a river. D) Company D must retrain its employees who are using their Twitter accounts to post workplace frustrations.
E) Company E pays men higher wages than women while at the same time propagating messages of equality and fair play.
Q3) Explain the difference between ethical universalism and integrated social contracts theory.Which school of thought is most inclusive? Explain the reasons for your answer.
Q4) What is the difference between ethics and business ethics?
Q5) What is the case for why business strategies should be ethical?
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Chapter 10: Building an Organization Capable of Good Strategy Execution
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Q1) The strategic importance of deliberately trying to develop organizational competencies and capabilities is:
A) lower costs for employee training.
B) improved strategy execution and a potential for competitive advantage.
C) an increased ability to reduce total operating costs.
D) the added ease with which strategic fit and resource fit benefits can be captured.
E) the enhanced ability to avoid the perils of outsourcing.
Q2) Outsourcing value chain activities has such strategy executing advantages as:
A) less internal bureaucracy,speedier decision making,and quicker responses to changing market conditions.
B) facilitating the empowerment of employees (because there are fewer things to do internally).
C) promoting a total quality management culture.
D) reducing the need to establish a strongly implanted corporate culture.
E) reducing the strategic importance of building valuable core competencies.
Q3) Identify and briefly discuss/explain three components of structuring a company's work effort to promote successful strategy execution.
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Chapter 11: Managing Internal Operations
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Q1) Business process reengineering is a tool for:
A) expediting the redesign of existing products and shortening the design-to-market cycle.
B) radically redesigning and streamlining how an activity (workflow)is performed,by pulling the pieces of strategy-critical activities out of different departments and unifying their performance in a single department or cross-functional work group.
C) instituting total quality management.
D) making the most effective use of Six Sigma techniques.
E) the rapid redesign of an organization's structure so as to quickly create organizational competencies and capabilities.
Q2) Focusing jobholders' attention and energy on what to do as opposed to what to achieve makes the work environment results-oriented.True or false? Explain your answer.
Q3) Why does it make sense to create some job anxiety,insecurity,and stress as part of a company's motivational and reward scheme for promoting competent strategy execution?
Q4) Identify and describe ways that policies and procedures facilitate strategy execution.
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Chapter 12: Corporate Culture and Leadership
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Q1) Which of the following is something to look for in identifying a company's culture?
A) The atmosphere,spirit and character that pervades the work climate and the values,business principles,and ethical standards that management preaches and practices
B) The track record in meeting or beating its financial and strategic performance targets
C) The intensity and makeup of the company's value chain
D) The strategic intent and competitive strategy inherent within the company's efforts for successful strategy execution
E) The resource strengths,core competencies,and competitive capabilities that permeate the organization
Q2) Identify and briefly discuss four steps that managers can take to change a culture that is out of step with the company's strategy.
Q3) After a company's corporate culture is established,what are four approaches that can be used to perpetuate the culture?
Q4) What is meant by the term corporate culture? Why is corporate culture an important factor in implementing and executing strategy?
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