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1 The origins of Business Policy & Strategic Management can be retraced to 1930 1911 1879 1938

2 BCG in BCG matrix stands for Boston Calmette Group British Consulting Group Boston Corporate Group Boston Consulting Group

3 Which of the following is not part of the micro environment? Technology Shareholders Competitors Public

4 Which of the following is not a part the Macro Environment? Laws & Policies Demographics Suppliers Social Values

5 Cultural values would be part of which of the following factor in macro environment? Demographic
Social Ecological Natural

6 What does Dog symbolize in BCG matrix? Introduction Growth Maturity Decline

7 What does Stars symbolize in BCG matrix? Introduction Growth Maturity Decline

8 What does Question Mark (?) symbolize in BCG matrix? Remain Diversified Invest Stable Liquidate

9 What do Cash Cows symbolize in BCG matrix? Remain Diversified Invest Stable Liquidate

10 What does Green symbolize in BCG matrix? Invest & Expand Select & Earn Harvest & Divest Both a & b

11 What does Yellow symbolize in BCG matrix? Invest & Expand Harvest & Divest Select & Earn Both a & b

12 What does Red symbolize in BCG matrix? Invest & Expand Harvest and Earn Harvest & Divest Select & Earn

Industry attractiveness & Business Strength

Industry Attractiveness & Relative market
13 The GE 9 cell model is based on share Industry Growth & Relative market share
Industry attractiveness & Business Strength
Industry Growth rate & Business strength
Industry Attractiveness & Relative market Industry Growth rate & Relative market
14 The BCG Matrix is based on 1 Month to 1 year share share
Industry Growth rate & Business strength
Corporate strategies 3 to 5 years More than 5 years
15 In strategic thinking, how long is the long term, approximately?
2 to 3 years
Business Strategy Business Strategies Functional Strategies
16 Low cost, Differentiation and Focus are examples of __________________ 17 The word tactic is most likely to be
Operational Strategies
Relative Market share Operational Strategy Functional Strategy
associated with:
Corporate strategy
Relative Market share Industry Growth Rate Market Growth Rate
Business Strength
18 In BCG matrix, what is the label of the horizontal axis?
Relative Market share Industry Growth Rate Market Growth Rate
Business Strength
19 In BCG Matrix, what is the label of the Vertical axis?
Three colour matrix Industry Growth Rate Market Growth Rate
Industry Attractiveness
20 In GE 9 cell matrix, what is the label of the horizontal axis?
Read the mission statement Strategic Portfolio Matrix Colour light matrix
Stop light matrix
21 Another name for GE 9 cell model is

Look at what the organization actually does Read the strategic plan Ask the CEO
22 To find out what an organization's strategy is, you should: It provides some property that is It provides the means for renewing It addresses changes in the external
It guarantees long term survival unique or distinctive competitive advantage environment

23 Which of the following statements is not true when describing a successful strategy? An individual or group with an
An external individual or group that is Internal groups or individuals that is
An individual or group with a financial interest in the organization's
able to impose constraints on the able to influence strategic direction of
stake in the organization activities and who seeks to
24 In the context of strategic management, stakeholders can be defined as: organization the organization
influence them

Technology Publics
25 Which of the following is NOT part of the micro environment? Competitors

Micro environment
26 In company’s environment, company’s customers are part of which of the following? Internal environment Macro environment external environment

27 Cultural values would be part of which of the following factor in macro environment? Economic Social Ecological

Forwards vertical integration

28 In the case where an organization acquires its supplier, this is an example of: Horizontal integration Backwards vertical integration a and b
29 When a firm seeks the
benefits of global
integration and local Global
Multi-national Global-local
adaptation, it is best
described as which type of
Transnational It is a threshold resource It is explicit

It is based on word-of-mouth

30 It is difficult to copy Irrational Optimal

'Reputation' in the context of an organization's resources can provide competitive advantage because:
More than 5 years less than 5 year
31 A possible is making
1 to 5 years and
decisions of which type?
strategic manager that Appraisal of strengths
seeks to reach acceptable strategy
profit targets as opposed strategy; Strategy selection;
to making as much profit as
weaknesses; choice of strategic
implementation; strategic control Deliberate strategy; emergent strategy; direction; strategy implementation realized

32 In strategic thinking, how

long is the long term, Corporate Strategy Business Strategy both b and c
1 to 12 months
Business Strategies Functional Strategies both a and c

Business Strategy Operational Strategy both a and b

33 What are stages 2, 3 and 4
of the outline strategy
Competitive leadership Honest difference of opinion Poor reward structures
implement strategy

strategy-implementation long-range planning short-range planning

34 The strategy of TATA

Motors would be:
Functional Strategy

35 Growth, retrenchment and

stability are examples of select
Corporate strategies

36 The word tactic is most

likely to be associated with:
Corporate strategy

37 Which of these is not a

reason why some firms do
not have strategic
planning? Laziness

38 Developing a vision and

mission, identifying an
organization's external
opportunities and threats,
and determining internal
strengths and weaknesses
are all __________
activities. strategy-
39 The _________ answers the question "What do we want to become?" whereas _________answers the question Vision statement; mission statement Short-term
objectives objectives; long-term Objectives; strategies Mission; vision "What is our business?"

40 What is the recommended length of an effective mission statement? One page Less than 200 words One sentence of 10 to 20 words. There is no

41 Which one of these is NOT a __________ part of Porter's competitive forces in industry analysis? Potential entry of new competitors Bargaining power of suppliers Development of
substitute products Threat services of substitute products and

42 __________ is based on the assumption that the future will be just like the past Delphi forecasts Econometric models Linear regression
Scenario forecasts

43 Concentric diversification
__________ is adding new, unrelated products or services for present customers Horizontal diversification Conglomerate diversification Product development
SWOT's focus on the external
44 Which of the following is not a limitation of SWOT (Strengths, Weaknesses, Opportunity, Threats) analysis? competitive advantageOrganizational strengths may not lead to moving targetSWOT gives a one-shot view of a environment is too broad and SWOT dimension of strategyoveremphasizes a single
45 A marketing department that promises delivery quicker than the production department's ability to produce is an example 62 Interest rate increases have a ________ impact on the residential home construction industry and a ___ effect on industries that produce consumer necessities, such as
of a lack of understanding of the prescription drugs or basic grocery items

63 An independent group of suppliers, such as farmers, gather to form a cooperative in order to sell their products to buyers directly, replacing their previous distributor. This is an
example of
46 XYZ Corp. is centering on the objective of low-cost, high quality, on-time production by curtailing idle productive facilities

and workers. The XYZ Corp. is taking advantage of a ____________ system 47 Which of the following lists is comprised of
64 The bargaining power of the supplier is less than that of the buyer when
support activities:

65 As seen in Porter's Five Forces model, conditions under which a supplier group can be powerful include all the following except

48 Although competitive advantage. Examples include all of the following except:firm infrastructure is quite frequently viewed only
as overhead expense, it can become a source of 66 The most extreme rivalry results from

49 The competencies or skills that a firm employs to transform inputs into outputs are:

67 Which of the following is an example of the interrelationship between the competitive and general environments?
50 An reputation with its customers and suppliers. Such competitive advantages are based uponarray of firm resources includes
interpersonal relations among managers in the firm, its culture, and its

68 The value chain is subdivided into two main headings. These are primary activities and:
51 A company's ability to meet its short-term financial obligations is measured by which of the following categories?

52 69 In the value chain, primary activities are:

The "balanced scorecard" supplies top managers with a _____________ view of the business

The CEO of Lucent Technologies made a lot of mistakes, such as committing errors in assessing the market and
53 competitive conditions, as well as improperly redesigning the organization into 11 business units. Such errors led to 70 The 'operations' in a passenger airline service would be:
performance declines. According to the text, this example illustrates the _________________ perspective of leadership

54 The "advance work" in the strategic management process is comprised of

71 One of the strategic decisions relating to the value chain concerns vertical integration. This would involve:
55 Members of an organization's board of directors should, while working to prioritize and fulfill their responsibilities,

72 Firm A has decided to use an outside travel firm for making travel arrangements but it is based on the premises of Firm A. This is an example of:
56 The "triple bottom line" approach to corporate accounting, according to the text, includes which three components

57 As our world increases in complexity, the global environment is increasingly challenging and competitive. The key to effective 73 A network of firms providing different parts of a value-chain in the production of a product or service is known as:

74 A firm outsources many of its value chain activities. Compared to a firm that does everything in-house this is likely to incur:

globalization is 58 Which of the following lists is the hierarchy of organizational goals in order from least specific to most

75 When a firm promises more than it can actually deliver to win a contract, this is known as:


76 Which of the following outcomes is a potential benefit of outsourcing?

Synergy of the business units Need to maintain the reputation of the Interrelationships among functional
company Organizational culture and leadership areas and firm strategies

Just-In-Time (JIT)
59 An organization's mission, in contrast to its vision, should Last In, First Out (LIFO) First In, First Out (FIFO) Highly mechanized
human resource management, customer service, information systems, human resource management, human resource management, information systems, procurement, and
technology development, and technology development, customer customer service, marketing and

60 Vision statements are used to create a higher understanding of the organization's overall direction and purpose. Vision

statements 61 Which of the following would be thought of as part of a firm's general environment?
firm infrastructure procurement service, and procurement sales, and operations Those activities that are all undertaken Directly involved in the production and marketing and delivery of the product production,
marketing and delivery of
in-house delivery of the product or service or service the product or service

Marketing expertise increasing a firm's Effective information systems contributing Top management providing a key role in
Negotiating and maintaining ongoing relations
revenues and enabling it to enter new significantly to a firm's overall cost collaborating with important customers
with regulatory bodies Getting passengers and baggage
markets leadership strategy
The design of the price structure and
The manufacture of the aircraft from A to B by means of flying in an Selling the tickets to passengers
yield plan aircraft
Tangible resources Physical Reputational resources Tangible
Intangible resources Path Organizational capabilities Social

resources Deciding whether the activity should Deciding whether to share certain
uniqueness dependency complexity Deciding whether to locate operations in Deciding to link all activities using be performed within the organization activities across different products and the home country or in a foreign
location Enterprise Resource Planning
or by a different firm markets

Near shoring ratios Insourcing Outsourcing
profitability ratios activity ratios
liquidity ratios

fast but Near

Franchising comprehensive
shoring Orchestrating Co-specialization
detailed and complex simple and routine
long-term financial

Higher transaction costs, lower control Higher transaction costs, higher control Lower transaction costs, higher control Lower transaction costs, lower control
external control
internal mechanism operational
Adverse selection Inverse selection Moral hazard Trust hazard

Strategy analysis
Strategy implementation Strategic posturing Higher flexibility Higher control Lower transaction costs Better linkages between activities
Strategy formulation
77 A joint venture can be defined as:
Represent the interests of the
Emphasize the importance of shortterm goals shareholders
Represent their own interests
Direct all actions of the CEO
78 Substantial changes to the range of offerings or the markets served or both are known as:
Financial, environmental, and customer
Financial, organizational, and psychological Financial, organizational, and customer Financial, environmental, and social

The flow of capital, people, and information 79 At corporate level, diversification comes about when a firm is involved in two or more:
More people speaking more languages
Governmental regulations The flow of goods
Mission statements, vision statements, Vision statements, strategic objectives, Vision statements, mission
strategic objectives mission statements statements, strategic objectives
80 On average, the highest levels of profitability are shown by:
Mission statements, strategic objectives, vision
Encompass both the purpose of the
Encompass all the major rules and company as well as the basis of Be shorter in length regulations of the
corporate work force competition 81 Economies of scale are derived from:
Be less detailed

Evoke powerful and compelling

Are very specific Set organizational structure 82 Which of the following outcomes is NOT an advantage of a completely vertically integrated business?
mental images increased bargaining power of the decreased entry barriers
Provide specific objectives
increased competitive intensity
83 Which of the following might be sources of synergy between two business units?
firm's suppliers

increased trade deficit

84 Which of the following might NOT be an advantage of increasing the number of countries in which a clothing firm does business?

positive; negative negative; positive negative; negligible

positive; negligible
85 Which of the following are NOT likely to be sources of relatedness between businesses?
Two firms collaborate together on a One firm licenses its intellectual Two firms come together to form a third,
Backward integration Threat of substitute products Threat of entry
specific project property to another firm Two firms merge together legally separate firm

Forward integration

Differentiation Diversification Brand extension

Cost savings from the supplier's Threat of backward integration by Relocation
The buyer's profit margin is low
product are minimal buyers is low
Volume of purchase is low Industries
Businesses Markets Segments
Firms with a moderately diverse
Readily available substitute
Firms with a very diverse range of Firms with a diverse range of unrelated
Lack of importance of the buyer to the supplier High differentiation by the supplier Dominance by a few suppliers
Firms focused on just one or two products range of related products and related products and businesses products and
group products
businesses businesses

Numerous equally balanced Achieving cheaper unit costs through Increasing the number of markets
Few competitors, slow industry growth, Numerous equally balanced Using cheaper raw materials Increasing the breadth of the portfolio
A high level of differentiation competitors, manufacturing capacity lack of differentiation, high fixed or
making larger quantities served
competitors, slow industry growth,
increases only in large increments, low storage costs high fixed or
storage costs exit barriers
Potentially greater control is achieved Potentially greater quality is achieved Lowering of risk is achieved Lower price of supplies is achieved

A decline in a nation's educational standards The profits from one can be used to
results in a decline in the nation's productivity Increased awareness of personal They have similar customers and use finance the other when its gets into They both have a website They are both located in the same town the same distribution channels trouble
A country's technological inferiority health leads to lower demand, and
Greater awareness of the environment
results in its enactment of strong tradeExposure
greater to
rivalry in the alcoholic
demanding customersresults
with in Making life more difficult for
environmental legislation barriers against importation beverages industry Increased efficiency Increased access to funding
Peripheral activities exotic tastes competitors

Support activities Secondary activities Outsourced activities Operating in industries with similar Selling to customers with similar
Similarities in size Similarities in production technologies
success factors demographic characteristics
Directly involved in the production, Those activities that support the
86 Synergies allow businesses to add value to one another whereas the extent to which the corporate centre can add value to each of its businesses is called: Relatedness Size Competencies Vision

87 Learning from trying out new and different things is termed: Absorptive capacity Exploitation Exploration Economies of scope

profits one would expect to earn on

88 Businesses without a competitive advantage are not likely to earn more than "normal" profits in the long run. Normal profits are investments that have a similar level of profits received by corporations in the normal course of business what one would receive on U.S. Treasury securities
profits earned by a corporation on a diversified portfolio of stocks risk

Primary value chain activities that involve the effective layout of receiving dock operations (inbound logistics) and
89 support value chain activities that include expertise in process engineering (technology development) characterize differentiation overall cost leadership differentiation focus stuck-in-the-middle what generic strategy?

it helps a firm to deal with supplier supplier power is increased firms will enjoy high customer loyalty,
Which of the following is false regarding how a differentiation strategy can help a firm to improve its competitive by increasing a firm's margins, it avoids
90 position vis à vis Porter's five forces? the need for a low cost position power and reduces buyer power since because suppliers will be able to thus experiencing less threat from
buyers lack comparable alternatives charge higher prices for their inputs substitutes than its competitors

91 A narrow market focus is to a differentiation-based strategy as a Growth market is to a differentiation-based Growth market is to a cost-based
strategy strategy Technological innovation is to a Broadly-defined target market is to a cost

costbased strategy Profit outsourcing leadership strategy Profit pool

92 Profit maximizer Revenue enhancer
The total profits in an industry at all points along the industry's value chain is called the

93 The emphasis on product design is very high, growth introduction decline

the intensity of competition is low, and the
market growth rate is low maturity in the
______ stage of the industry life cycle
maturity growth decline

94 In the _______ stage of the industry life cycle,

there are numerous segments, competition is
very intense, and the introduction emphasis on Costs continue to increase Application for patents increase Differentiation opportunities increase
process design is high

Strong competitive advantage Mergers and acquisitions

95 As markets mature There is increasing Decline in the market life cycle
emphasis on efficiency

96 The most probable time to pursue a harvest

strategy is in a situation of High growth

97 An 'industry recipe' can be defined as: An competingaccepted pattern of operating and A next movetactic for anticipating a competitor's The difficult to imitatehidden competences that are A strategic group

98 Which of the following industries is least likely to follow the conventional life-cycle model? Software development Coal mining Insurance broking Hairdressing

99 Brandenburger and Nalebuff added a sixth force to Porter's Five Forces. It is known as: The threat of substitutes The power of complementors Seller power Government regulation

100 An industry characterized by irregular patterns of stability, rapid technological change, high uncertainty and global Hypercompetitive Hyperactive Atypical Co-optative
competition can be described as: