Strategic Management Chapter 01

Topics: Strategic planning, Strategic management, Management Pages: 63 (11190 words) Published: January 20, 2013
Chapter 01
Strategic Management: Creating Competitive Advantages

True / False Questions

1. Nortel, like other firms, suffered from a drop in overall industry demand for telecommunications equipment during 2000 and 2001. According to the text, this would be an example of the "romantic" perspective of leadership.  True    False


2. Strategic management consists of the analyses, decisions, and actions an organization undertakes in order to create and sustain competitive advantages.  True    False


3. Strategic management includes strategy analysis, strategy formulation, and strategy implementation.  True    False


4. Management innovations such as total quality, benchmarking, and business process reengineering often lead to sustainable competitive advantage.  True    False


5. Strategic management recognizes the trade-offs between effectiveness and efficiency.  True    False


6. The best firms always realize their intended strategy.  True    False


7. According to the text, formulating strategy includes taking into consideration strategy at the business, international, and corporate levels. In addition managers must formulate effective entrepreneurial initiatives.  True    False


8. Business-level strategy focuses on two issues, (1) what businesses to compete in, and (2) how businesses can be managed to achieve synergy.  True    False


9. Corporate-level strategy addresses how firms compete and outperform their rivals as well as achieve and sustain competitive advantages.  True    False


10. Effective leadership can play a large role in fostering corporate entrepreneurship. Corporate entrepreneurship can have a very positive impact on a firm's bottom line.  True    False


11. The three primary participants in corporate governance are: (1) the shareholders; (2) management (led by the chief executive officer); and, (3) employees.  True    False


12. Decisions by Boards of Directors are always consistent with shareholder interests.  True    False


13. Former Chrysler vice chairman Robert Lutz stated: "We are here to serve the shareholder and create shareholder value. I insist that the only person who owns the company is the person who paid good money for it." This is an example of a symbiotic approach to stakeholder management.  True    False


14. Stockholders in a company are the only individuals with an interest in the financial performance in the company.  True    False


15. Stockholders, employees, and the community-at-large are among a firm's stakeholders.  True    False


16. Symbiosis is the ability to recognize interdependencies among the interests of multiple stakeholders within and outside an organization.  True    False


17. One of the benefits of crowdsourcing is that stakeholders are restricted to one narrow role.  True    False


18. Social responsibility is the idea that organizations are not only accountable to stockholders but also to the community-at-large.  True    False


19. The concept of "shared value" redefines the purpose of the corporation as creating shared value in order to create a more even distribution of the profits to all employees, not just top level executives.  True    False


20. Shell, NEC, and Procter & Gamble have been measuring their performance according to what has been called a "triple bottom line." This technique involves an assessment of financial, social, and environmental performance.  True    False


21. The strategic management process should be addressed only by top-level executives. Mid-level and low-level employees are best equipped to implement the organization's strategies.  True    False


22. Organizational vision statements are the beginning point for the hierarchy of goals throughout the organization. An organization's vision statement should be massively inspiring, overarching, and long term.  True    False

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