Strategic Management

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The Nature of Strategic Management



1. The underpinnings of strategic management hinge on managers gaining an understanding of competitors, markets, prices, suppliers, distributors, governments, creditors, shareholders and customers worldwide.

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2. Although the Internet has increased in popularity, it has actually led to increases in company expenses.

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3. Consumer e-commerce is five times greater than business-to-business e-commerce.

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What Is Strategic Management?

4. Optimizing for tomorrow the trends of today is the purpose of strategic management.

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5. Even though useful, strategic planning has been cast aside by corporate America since the early 1990s.

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Resource allocation is included in strategy-formulation activities.

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6. The terms strategic management and strategy implementation are synonymous.

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7. A vision statement is, in essence, a company’s game plan.

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8. Strategy implementation is often considered to be the most difficult stage in the strategic-management process because it requires personal discipline, commitment and sacrifice.

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9. The final stage in strategic management is strategy implementation.

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10. Strategy formulation, implementation and evaluation activities occur at three hierarchical levels in a large diversified organization: corporate, divisional and functional.

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11. One of the fundamental strategy evaluation activities is reviewing external and internal factors that are the bases for current strategies.

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12. An objective, logical, systematic approach for making major decisions in an organization is a way to describe the strategic-management process.

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13. Strategic management is an attempt to organize qualitative and quantitative information in a way that allows effective decisions to be made under conditions of uncertainty.

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14. Analytical and intuitive thinking should complement each other.

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15. According to Albert Einstein, “Knowledge is far more important than intuition.”

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16. Management by intuition can be defined as operating from the “I’ve-already-made-up-my-mind-don’t-bother- me-with-the-facts mode.”

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17. By monitoring external events, companies should be able to identify when change is required.

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Key Terms in Strategic Management

18. Anything the firm does especially well compared to rival firms could be considered a competitive advantage.

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19. Once a firm acquires a competitive advantage, they are usually able to sustain the competitive advantage for an extended period of time.

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20. Newspaper companies in the United States provide a good example of how a company can sustain a competitive advantage over the long term.

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21. In order for a firm to achieve sustained competitive advantage, a firm must continually adapt to changes in external trends and events and effectively formulate, implement, and evaluate strategies that capitalize upon those factors.

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22. Strategists are usually found in higher levels of management and have considerable authority for decision-making in the firm.

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23. The middle manager is the most visible and critical strategic manager.

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24. All strategists have similar attitudes, values, ethics and concerns for social responsibility.

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25. A vision statement answers the question, “What is our business?,” whereas a mission...
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