Exam 6: Planning, Strategy, and Competitive Advantage

A good plan specifies not only which goals and strategies an organization is committed to but is also accountable for putting the strategies into action to attain the goals.

While managers at ABC Manufacturing were conducting a SWOT analysis, they concluded that their product line is obsolete and narrow. Their product line would be categorized as a(n) ________.

Madison Hotels sold a foreign organization the right to use its brand name and operating know-how in return for a lump-sum payment and a share of the profits. This is an example of ________.

Explain briefly the three levels and three steps in the planning and strategy-making process. Also mention how they are linked with each other.

A written set of instructions that describes the series of actions that a manager should take in a specific situation is called an SOP of an organization.

Two divisions of a company decide to use the same manufacturing facilities to capitalize on the organization's excess capacity and to reduce the fixed costs assigned by corporate headquarters. This is an example of ________.

BIC, makers of ballpoint pens and razors, concentrates on making its products less expensive than its rivals. BIC is pursuing a _______ strategy.

Procter & Gamble uses a joint sales force to sell both its laundry detergent products and its bath soap products to the same supermarket chains. This is an example of ________.

Firestone Tire and Rubber Company purchases rubber plantations in Africa so that it will have a source of supply for its tire manufacturing plants in Akron, Ohio. This is an example of a _______ strategy.

The plan for implementing a new strategy requires the development of new functional strategies.

A strategic alliance among two or more companies that agree to jointly establish and share the ownership of a new business is called a ________.

Synergy is obtained by apportioning financial resources among divisions to increase financial returns or spread risks among different businesses.

Which of the following is most likely to require a short-term plan?

The form of international expansion which gives an organization high potential return because the organization does not have to share its profits with a foreign organization, and it reduces the level of risk because the organization's managers have full control over all aspects of their foreign company's operations, is ________.

BMW produces cars exclusively for high-income customers. BMW is pursuing a ________ strategy.

The ability of the CEO and top managers to convey to their subordinates a compelling vision of what they want the organization to achieve is known as ________ leadership.

According to Michael Porter's theory, it is possible for managers to pursue both a low-cost strategy and a differentiation strategy at the same time.

According to Porter, organizations cannot simultaneously pursue both a low-cost strategy and a differentiation strategy. Illustrate why. Show how exceptions to this "rule" can be found, and give an example to demonstrate the point.

A backward vertical integration occurs when a company expands into a new industry ________.

SynVens, a major retail chain in Hungary, is planning to diversify. It plans to enter the textiles industry and aims to be first or second in market share in this industry in five years. This is an example of a ________-level plan strategy.