Management Policy and Strategy
Pre-Test Questions
Course Introduction
Management Policy and Strategy explores the formulation, implementation, and evaluation of organizational policies and strategies that guide businesses toward achieving long-term objectives. Students will analyze the internal and external environments of firms, assess competitive dynamics, and practice applying strategic management frameworks to real-world scenarios. The course emphasizes critical thinking, decision-making processes, and ethical considerations in the creation of sustainable competitive advantage. Through case studies and group projects, students develop practical skills in strategic analysis, policy development, and leadership in complex, dynamic business environments.
Recommended Textbook
Strategic Management Theory An Integrated Approach 9th Edition by Charles W.
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13 Chapters
1070 Verified Questions
1070 Flashcards
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Page 2
L. Hill
Chapter 1: Strategic Leadership: Managing the
Strategy-Making Process for Competitive Advantage
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80 Verified Questions
80 Flashcards
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Sample Questions
Q1) The first component of the strategic management process is crafting the organization's mission statement,which provides the framework or context within which strategies are formulated.
A)True
B)False
Answer: True
Q2) The vision of a company lays out some desired future state and articulates what the company would like to achieve.
A)True
B)False
Answer: True
Q3) Vice President Chung is responsible for executing decisions about human resources.Mr.Chung is
A)a corporate-level general manager.
B)both a corporate- and business-level general manager.
C)a business-level general manager.
D)a functional manager.
E)a corporate-level,business-level,and functional manager.
Answer: D
Page 3
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Chapter 2: External Analysis: The Identification of Opportunities and Threats
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Sample Questions
Q1) Suppliers in an industry are most powerful when
A)there are few substitutes for the product suppliers sell.
B)switching costs are low.
C)companies in the industry can threaten to enter the suppliers' industry.
D)substitute products are readily available.
E)all of these choices
Answer: A
Q2) Switching costs may arise when
A)changing from one computer system to another.
B)substitute products are available at a lower unit cost.
C)when there are a large number of interchangeable products.
D)products are commodity-like in nature.
E)all of these choices.
Answer: A
Q3) Anheuser Busch,because it dominates the mass-market beer segment,does not complete with micro-brewers.
A)True
B)False
Answer: False
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Chapter 3: Internal Analysis: Distinctive Competencies, Competitive
Advantage, and Profitability
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Sample Questions
Q1) Distinctive competencies are firm-specific strengths that allow a company to differentiate its products and/or achieve substantially lower costs than its rivals.
A)True
B)False
Answer: True
Q2) The most successful firms are those that constantly learn and upgrade their distinctive competencies.
A)True
B)False
Answer: True
Q3) Together with an analysis of the company's external environment,internal analysis gives managers the information they need to choose the business model and strategies that will enable their company to attain a sustained competitive advantage.
A)True
B)False
Answer: True
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Chapter 4: Building Competitive Advantage Through
Functional-Level Strategy
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84 Flashcards
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Sample Questions
Q1) Quality can best be thought of as
A)product usefulness.
B)quality as reliability and quality as excellence.
C)product innovation.
D)a matter for a company's managers to decide for themselves without external input.
E)a matter for the marketing function of a company to decide.
Q2) Pay for performance tends to
A)increase per-unit costs.
B)decrease employee output.
C)increase employee output.
D)have little effect on employee output.
E)be used only for individual workers,not for teams.
Q3) No matter how complex the task is,learning effects typically die out after a limited period of time.
A)True
B)False
Q4) Discuss why superior efficiency is important and the many ways that different parts of the organization can help achieve it.
Page 6
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Chapter 5: Building Competitive Advantage Through Business-Level Strategy
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Sample Questions
Q1) Maximizing the profitability of a company's business model is about making the right choices with regard to value creation through differentiation,costs,and pricing given both the demand conditions in the company's market and the competitive conditions in the company's industry.
A)True
B)False
Q2) A firm makes complex telecommunications products,such as cellular telephones.Because this company has a distinctive competency in research and development,it should try to differentiate its product through A)reliability.
B)innovation.
C)advertising.
D)service.
E)low price.
Q3) A firm's business model should contain three components: what is to be satisfied,who is to be satisfied,and how they will be satisfied. A)True
B)False
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Chapter 6: Business-Level Strategy and the Industry Environment
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Sample Questions
Q1) By their choices of competitive actions and decisions about product attributes,managers can speed up or slow down the rate of progress of an industry through the stages of the industry life cycle.
A)True
B)False
Q2) An embryonic industry is one that
A)has not yet been thought of.
B)is just beginning to develop.
C)has sufficiently developed so that early industry leaders have already been identified.
D)has initial government backing because of its importance to the general populace.
E)none of these choices.
Q3) A divestment strategy's success is often dependent upon good timing.
A)True
B)False
Q4) Barnes & Noble owns thousands of retail outlets and is pursuing a strategy called franchising.
A)True
B)False
Page 8
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Chapter 7: Strategy and Technology
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Sample Questions
Q1) When an industry's products rely on a common set of features,these features are called a
A)dominant design.
B)format war.
C)first mover.
D)public domain.
E)high-tech industry.
Q2) Recently,the U.S.Food and Drug Administration began to require more descriptive labeling of food products.This is an example of standards that developed A)in the public domain.
B)with a dominant design.
C)through industry cooperation.
D)by government mandate.
E)through market demand.
Q3) Write as if you were an outside management consultant and advise a firm attempting to win a format war with a powerful and capable competitor.Give several options.
Q4) Describe the advantages and disadvantages of being a first mover or a follower in a high-tech industry.In your opinion,which strategy is preferable,and why?
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Chapter 8: Strategy in the Global Environment
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Sample Questions
Q1) When toymaker Mattel sells Barbie dolls in the Middle East,it changes the doll's shape to one that is a more accurate portrayal of a female body.Mattel does this to A)create a commodity-type product.
B)transfer technological know-how.
C)increase product standardization.
D)realize experience curve effects.
E)respond to differences in local tastes.
Q2) A company may create value if it can leverage the skills created within subsidiaries and apply them to other operations within the firm's global network.
A)True
B)False
Q3) Most manufacturing companies begin their global expansion by exporting.
A)True
B)False
Q4) A transnational strategy makes the most sense when there are strong pressures for cost reductions and when demand for local responsiveness is minimal.
A)True
B)False
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Chapter 9: Corporate-Level Strategy: Horizontal Integration,
Vertical Integration, and Strategic Outsourcing
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Sample Questions
Q1) The term bureaucratic costs refers to costs associated with the creation and maintenance of the administrative function in a company.
A)True
B)False
Q2) Outsourcing occurs when a firm
A)buys one of its rivals.
B)merges with one of its suppliers.
C)enters into a joint venture with a rival.
D)hires another firm to perform value creation activities.
E)enters into contracts with two suppliers simultaneously.
Q3) Vertical integration is undertaken to support the competitive position of a company's core business.
A)True
B)False
Q4) Strategic alliances and outsourcing are two alternatives to vertical integration.What are the advantages and disadvantages of each compared to vertical integration? What can managers do to eliminate or reduce the risks?
Q5) How can strategic outsourcing strengthen a company's business model and increase its profitability?
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Chapter 10: Corporate-Level Strategy: Related and Unrelated Diversification
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Sample Questions
Q1) Companies that concentrate on just one industry may miss out on opportunities to increase their profitability by leveraging their distinctive competencies to make and sell products in new industries.
A)True
B)False
Q2) The coordination required to realize value from a diversification strategy based on transferring,sharing,or leveraging competencies is a major source of bureaucratic costs.
A)True
B)False
Q3) New ventures
A)should be killed if they don't make a profit within three years.
B)are often preferred by technology-based companies.
C)are preferred compared to acquisitions when entry barriers are high.
D)are less risky than acquisitions.
E)are best when the company is entering the industry on a small scale.
Q4) What are the two general types of diversification and when would one be preferred over the other?
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Chapter 11: Corporate Performance, Governance, and Business Ethics
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Sample Questions
Q1) Sarbanes-Oxley,federal legislation enacted in 2002,requires
A)CEOs to endorse their company's financial statements.
B)CFOs to endorse their company's financial statements.
C)companies to use the same accounting firm for auditing and consulting services.
D)members of the board of directors to post a surety bond.
E)CEOs and CFOs to endorse their company's financial statements.
Q2) Critics of corporate governance state that boards with more inside directors than outside directors are generally an effective governance mechanism because they know more about how the company works.
A)True
B)False
Q3) To satisfy stockholders,many companies seek to
A)increase the share value of a company's stock.
B)introduce as many new products as possible.
C)reward executives handsomely.
D)minimize global expansion.
E)reduce the number of custom-made products produced.
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Page 13
Chapter 12: Implementing Strategy in Companies That
Compete in a Single Industry
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Sample Questions
Q1) Control systems can help managers evaluate how efficiently they are producing goods and services.
A)True
B)False
Q2) A drawback of the functional structure is
A)that each worker must report to more than one superior.
B)the difficulty in communicating and coordinating across functions.
C)too much decentralization of decision-making authority.
D)its lack of flexibility.
E)the need to downsize before implementing this structure.
Q3) Matrix structures
A)have many hierarchical levels.
B)are appropriate for companies with many low-skilled workers.
C)group activities vertically by function and horizontally by product or project.
D)are appropriate for a firm pursuing a low-cost strategy.
E)have many hierarchical levels and two forms of horizontal differentiation.
Q4) Whenever different functions work together,bureaucratic costs inevitably arise.
A)True
B)False
14
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Chapter 13: Implementing Strategy in Companies That
Compete Across Industries and Countries
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Sample Questions
Q1) In a multidivisional structure,corporate managers can compare the performance of one division against another in terms of its cost structure or the profit it generates.
A)True
B)False
Q2) To expand its global sales,U.S.-based Miller Brewing Company purchased a firm that processes grains in Brazil.Miller plans to manage the new business by allowing it to continue as before,with little integration into the rest of the firm.Based on this information,which entry mode is Miller using in Brazil?
A)Acquisition
B)Internal new venture
C)Joint venture
D)Divestiture
E)Merger
Q3) The wasteful duplication of functional resources is most likely to arise with a A)functional structure.
B)product team structure.
C)matrix structure.
D)multidivisional structure.
E)geographic structure.
15
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