Performance of the firm is most directly attributable to The process of creating strategy Introduction. The goal of the organization's ___ is to point the firm in the direction of where it would like to be in the years to come. According to Hitt, the primary drivers of hyper-competition are: the emergence of a global economy and rapid technology change. It should seek to diversify. c. disruptive technologies. c. a process directed by top . (Check all that apply. b. the complex set of ideologies, symbols, and core values that are shared throughout the firm. a. a set of activities that will assure a sustainable competitive advantage and above-average returns for the firm. \text{Gross profit}&\text{357,000}\\ In Chapter 6 Selecting Business-Level Strategies, we discuss how selecting business-level strategies helps to provide firms with a recipe that can be followed that will increase the likelihood that their strategies will be successful. c. a process directed by top management with input from other stakeholders that seeks to achieve above- average returns for investors through effective use of the organization's resources. 97.A major assumption about the strategic management process is that it is: (A) inspired. Even for companies capable of succeeding in global markets, it is critical that they, The rate of technological diffusion is increasing. c. the lack of an organizational mission for the school board. To simply put, strategy evaluation entails reviewing and appraising the strategy implementation process and measuring organizational performance. The final chapter explores how to lead an ethical organization through corporate governance, social responsibility, and sustainability. The ______ process consists of the analyses, decisions, and actions an organization undertakes in order to create and sustain competitive advantages. d. expand the strategic responsibilities to all organizational stakeholders. It is the culmination of all of the prudent decisions taken by the firm's managers throughout time for the benefit and prosperity . c. the minimum required for survival in virtually any industry. True/False, Relative power is the most critical element for prioritizing the demands of stakeholders. Collect and review information to help make the upcoming strategic decisions. d. estimating the size of the value-chain activity in the pool. b. weak competition The culmination of the strategic management process is: performance Although an organization's good reputation is a valuable resource that takes years of superior marketplace competence to achieve, it is not a good basis for building a competitive advantage because it can be destroyed almost instantly by bad publicity. True/False, Corporate-level strategy in a diversified organization requires a common business strategy for each component of business. b. strategic flexibility c. core competence. Strategic management is a process that involves building a careful understanding of how the world is changing, as well as a knowledge of how those changes might affect a particular firm. a. operating each individual business under the corporate umbrella. True/False, Examples of incremental innovations include iPods, PDAs, WiFi, and web browser software. Characteristics of Strategic Management. Above average returns are those in excess of what an investor expects to earn from other investments with similar stock prices. b. split responsibilities between the CEO and the board of directors as a result of corporate scandals triggered by unethical CEOs. (Check all that apply.). c. the I/O model. When managers refer to their organizational boundaries they mean both ______ and ______ boundaries. The ending balance in retained earnings equals: Kick-Off Meeting: 1 hr. Explain Strategy formulation. people throughout the organization strive toward overall goals. - Resource analysis to select workforce and assign suitable tasks. b. urgency of satisfying each stakeholder \end{array} d: 70: 3884478507 c. is mainly intended to emotionally inspire employees and other stakeholders. c. one business-level strategy for failure. . the culmination of the strategic management process is: the culmination of the strategic management process is: . a. strategic competitiveness b. a permanently sustainable . Strategic management is the formulation and implementation of major objectives and projects, by an organization's management on behalf of its shareholders (or owners). All of the following are resources of an organization EXCEPT 3. . c. companies provide a dynamic, stimulating, and rewarding work environment. b. a decision-making activity concerned with a firm's internal resources, capabilities, and competencies, independent of the conditions in its external environment. In a diversified firm, corporate-level strategy is concerned with b. mission d. critically important mainly in high technology industries. d. Revenue. b. television New markets created by iPods, PDAs, and Wi-Fi are a result of a. predict future revenue streams for the organization. ______ is performing similar activities better than rivals do. The process hinges on the philosophical approach that if a leader "thinks . Apple's iPod and iPad are examples of They involve balancing culture and boundaries or constraints. c. the firm's actions to exploit its competitive advantage over rivals. a. performance. Your company's core competencies. When resources and capabilities serve as a source of competitive advantage for a firm, the firm has created a(n): In the resource-based model, which of the following factors would be considered a key organizational success? Strategic Management by Reed Kennedy is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted. d. resources that are valuable, rare, costly to imitate, and non-substitutable form the basis of a firm's core competencies. True/False, If a firm is dependent on a specific stakeholder group, that group has less influence on the firm's strategic decision-making. regardless of their location in the organization, strengths, weaknesses, opportunities, threats, In the strategic management process ASP stands for. c. the interests of the firm's organizational stakeholders have been maximized. Information Technology Project Management: Providing Measurable Organizational Value, Operations Management: Sustainability and Supply Chain Management, Service Management: Operations, Strategy, and Information Technology, John David Jackson, Patricia Meglich, Robert Mathis, Sean Valentine. . c. the key to competitive success is the structure of the industry in which the firm competes. Alfred Chandler, 1962. Strategic management is a process that involves building a careful understanding of how the world is changing, as well as a knowledge of how those changes might affect a particular firm. A strategy The strategic management process has five steps: establish the mission and vision, establish the grand strategy, formulate the strategic plans, carry out the strategic plans, and maintain strategic control. The message of the ad is that this firm's accountants love their work. True/False, Research shows that a greater percentage of a firm's profitability is explained by the I/O rather than the resource-based model. The resource-based model of the firm argues that Managers must constantly scan the external environment for trends and events that affect the overall economy, and they must monitor changes in the particular industry in which the firm operates. .It is well known that the elected school board of a large city engages in unethical and illegal activities involving the awarding of major contracts. A comprehensive & ongoing management process aimed at formulating and implementing effective strategies; a way of approaching business opportunities and challenges such that the firm achieves its vision and mission. A strategic management process can help guide the decisions and actions of senior executives within an organisation. How to develop a strategic management process. a. The Princeton Alliance Church states in its website that "PAC exists to help you live life to the fullest by knowing God, developing community and bringing hope." The strategic management process is a crucial element of any organization's success. Strategic management is the process of setting organizational goals, performing a competitive analysis, reflecting on a company's internal structure, and evaluating current strategies. Importance of Strategic Management. Strategic planning process is a systematic or emerged way of performing strategic planning in the organization through initial assessment, thorough analysis, strategy formulation, its implementation and evaluation. Capital market stakeholders include ______ provides the firm with new and up-to-date skill sets, which allow it to adapt to its environment as it encounters changes. Ideally, you already have some goal materials in place, including: Your vision statement. Methods by which strategies are operationalized or executed within the organization; it focuses on the processes through which strategies are achieved. ______ strategies are those organizational decisions that follow from analysis and rarely survive in their original forms. Strategy in which organizational decisions are determined by both analysis and unforeseen environmental developments is called ______ strategy. Prepare a vertical analysis of the income statement for Thain Corporation. The two primary drivers of hyper-competition are the emergence of the global economy and technology. a. industry; capability (Check all that apply. As a result, virtually all of the assets under her control are fully depreciated. a. insight. Feedback may occur at all times to revise these actions. coordinating and integrating activities within the firm and with suppliers and customers, Strategy implementation involves ______. a. strategic mission. _____ is an investor's uncertainty about the economic gains or losses that will result from a particular investment. Meaning of Strategic Management. Strategic Management can be found in . It guides the company to move in a specific direction. Which of the following statements about organizational knowledge is correct? Strategic management is a process that requires the ability to manage change. It is a philosophical approach to business. b. top-management team. It's an important step since it is here that businesses can review performance metrics of all components and make any tweak necessary to ensure accomplishment of long-term goals. True/False, The rapid rate of technological diffusion has increased the competitive benefits of patents. Strategic management is directed toward a company's ______. Strategic management of an organization entails which of the following ongoing processes? Managers must determine how to create a(n) ______ advantage in the marketplace to be successful over the long-term. Strategy Implementation emphasizes on efficiency; requires motivational and leadership traits. Strategy Formulation emphasizes on effectiveness; requires initiative and logical skills. Which of the following best explains a ratio of "net sales to average net fixed assets" that exceeds the industry average? d. the firm's chief executive officer, A prominent national accounting firm runs television advertisements showing an accountant working alone late in the office on a client's project, while clenching a long-stemmed rose in his teeth and grinning ecstatically. a. culture a. unique; easy to imitate. To have the potential to become sources of competitive advantage, resources and capabilities must be non- substitutable, valuable, , and Greenleaf Property Management has been earning below-average returns for the last three years. emphasizes that it is difficult to develop and sustain a competitive advantage based on resources alone. (Check all that apply. Inside CRM Editors. d. differences in resources and capabilities are the basis of competitive advantage. Strategic management can also be described as a bundle of decisions and acts which a manager undertakes and which determine the result of the business's performance. a. the key factor in success is choosing the correct industry in which to compete. Use the simple interest formula method. True/False, When the firm earns lower-than-average returns, the highest priority is given to satisfying the needs of capital market stakeholders over the needs of product market and organizational shareholders. d. locate the most promising areas of an industry's value chain. It is long-term in nature. c. vision. d. the CEO, COO, and CFO only. Situation Analysis. 60; 40 _________ strategy is a combination of deliberate and emergent strategies. The culmination of the strategic management process is Sue prefers the Red Shuttle because it gets her to the airport in an hour and a half, while the Blue Shuttle takes $80$ minutes. This is because the organization's role as a taxpayer is most important to ___ as stakeholders. The culmination of the strategic management process is: Managers must adopt a new mind-set that values ______ and the challenges that evolve from constantly changing conditions. Strategic management is defined as the process of evaluation, planning, and implementation designed to maintain or improve competitive advantage . d. mission, ___is an investor's uncertainty about the economic gains or losses that will result from a particular investment. https://youtu.be/o0U0gwvnhek. The is the most critical criterion in prioritizing stakeholders. c. in the finance area The development of these goals, however, requires a strategic management process to be done correctly and thoroughly. Which of the following statements about operational effectiveness are correct? True/False, The assumptions of the I/O model and the resource-based model are contradictory. The situation is where relevant information is needed to create the organization's culture, mission, or vision statement. Which of the following are characteristics of a well-written organizational vision statement? - Formulating an action plan and strategies. Here are the key elements of strategic management. c. knowledge intensity. Economies of scale and huge advertising budges are just as effective in the new competitive landscape as they were in the past. c. The firm has a lot of old plant and equipment. C ) rational . The steps for identifying the profit pools in an industry include all of the following EXCEPT c. strategic power c. economies of scale 2. c. the external environment is assumed to impose pressures and constraints that determine the strategies that result in above-average returns. Returns can only be measured in accounting terms such as return on assets, return on equity, or return on sales. d. abilities; strategies. You can view this video here: https://youtu.be/o0U0gwvnhek. a. Perpetual In Chapter 2 "Assessing Organizational . a. the social energy that drives, or fails to drive, the organization. b. estimating the overall size of the pool. Certainly, part of Apples success is due to the unique products it offers the market, as well as how these products complement one another. The steps in the strategic management process include the seven - the development of vision and mission, external and internal environment analysis, establishing long-term objectives, generating, evaluating, and selecting strategies, implementation, and strategy evaluation and control. In the POLC framework, where does strategy implementation take place. A firm's ______ assets, such as patents, are becoming increasingly important to creating a firm's competitive advantage. - Evaluating efficiency and effectiveness . The culmination of the strategic management process is a. performance. d. located at different levels, but only in the operating area of the organization, . a. all resources have the potential to be the basis of sustainable competitive advantage. Definition. ______ innovation is a term used to describe how rapidly and consistently new, information-intensive technologies replace older ones. Broad Plans Shaping: In this continuous process, the formulation & implementation of broader plans are made and finally, these are also controlled. b. tighten loan covenants. vision. c. strategy . A(n) ______ includes both the company's purpose as well as the basis of competition and competitive advantage. Defining strategic management is important to build a cohesive and sustainable business model. how your business plans to achieve it goals and improves and sustains it position in the industry. Because strategic management is directed toward overall organizational goals and objectives, it has the perspective of organizational versus _______ rationality. Continuous learning YouTube. a. the core values of the school board as an organization. The strategic management process begins with an understanding of strategy and performance. a. vision True/False, Organizational stakeholders are the firm's internal resources, capabilities, and core competencies that are used to accomplish what may appear to be unattainable goals in the competitive environment. True/False, Organizational mission statements typically do not include statements about profitability and earning above-average returns. d. hypercompetition. The 5 stages of the strategic management process. b. expertise. It is important to emphasize that almost all strategic management process decisions have ______ because they are related to how a firm interacts with its stakeholders. (Check all that apply.). d. personality. d. accounting. a. pool of assets that is distributed to investors. successfully than does the competitor environment. a. values. Want to create or adapt books like this? Sun Tzu's best-known work is The Art of War. Devise a strategy. McDonald's has been able to a. earn above-average returns. a. suppliers. Which of the following was fastest in penetrating 25 percent of homes in the U.S. market? It involves assessing the external environment, developing a strategic plan, executing it, measuring its success, and tweaking it as necessary. The resource-based view of the firm b. The Snack Division's operating margin for the year was $6.5\$ 6.5$6.5 million, during which time its average invested capital was $50\$ 50$50 million. ____has become the second-largest economy in the world. Effective strategies Apple uses to create loyal customers. The number of different businesses that an organization is engaged in and the extent to which these businesses are related to one another. True/False, Hourly workers on the production line of a chicken-processing plant are considered organizational stakeholders. True/False, Resources are considered rare when they have no structural equivalent. As we have noted in this introductory chapter, strategic management is both an art and a science, and it involves multiple conceptualizations of the notion of strategy drawn from recent and ancient history. symbiosis; zero sum. University of Malta. Strategic management requires that ______. b. analyses, strategies, and performance. The economic interdependence among countries is reflected in the flow of goods, services, financial capital, and knowledge across country borders is defined as: higher performance standards including quality and cost. (C) rational. A ______ is an integrated and coordinated set of commitments and actions designed to exploit core competencies and gain a competitive advantage. The strategic management process consists of five steps you should perform thoroughly for the plan to be effective. A company competing in a single product market has Refer to the Terms to Know in the Summary & Study Guide on page 551. a method in which farmers move every one to three years to find better soil. a. the businesses in which the company intends to compete. The CEO of Ridgeway, Inc., realizes that the company's survival depends on developing and acquiring knowledge. Organizational stakeholders include Strategy Evaluation. d. inclusive. All of the following are resources of an organization except: All of the following are assumptions of the resource-based model except: capabilities are highly mobile across firms. Research shows that approximately___percent of a firm's profitability is explained by the industry in which it competes, whereas b. total profits earned in an industry along all points of the value chain. Dissatisfied capital market stakeholders may See the examples before. d. emphasize profit maximization. The primary drivers of hypercompetition are, All of the following are characteristic of the global economy EXCEPT, The economic interdependence among countries as reflected in the flow of goods, services, financial capital, and knowledge across country borders is defined as, . Determine organizational readiness. Identify your goals. d. suggests that vision and mission are closely linked to sustainable competitive advantage, The goal of the organization's come. b. a decision-making activity concerned with a firm's internal resources, capabilities, and competencies, independent of the conditions in its external environment. In situation analysis, organizations must scan and evaluate the organization's performance, corporate strategies, and internal and external . Reward c. Risk d. Revenue ANSWER: c 105. c. employees. Strategic management means managing the resources of an organization to reach its goals such as financial and operational objectives. b. located in different areas and levels. Owner/CEO, Strategy Director. c. personal computer Top management teams (TMTs) - comprising the most influential executives in an organization - are important because of their influence over strategic choices and performance. It defines organization's goals and fixes realistic objectives, which are in alignment with the company's vision. a. competitive resilience The value of SWOT analysis parallels ideas from classic military strategists such as Sun Tzu, who noted the value of knowing yourself as well as your opponent. Litigation. Although McDonald's is competing in an unattractive industry, it has improved its performance by focusing on product innovations and by enhancing existing facilities. a. a. overload middle managers. b. an important source of competitive advantage in virtually all industries. C) strategy formulation. True or false: The most effective organizations have strong leaders at the top who make all the decisions that the rest of the organization then carries out. Strategic Implementation is defined as "the process by which strategies and policies are put into action through the development of programs, budgets and procedures" (Strategy implementation, 2009, para.1). Which of the following are stakeholder groups that managers should consider when making decisions? en.wikipedia.org/wiki/Apple_Inc._ litigation, https://it.toolbox.com/blogs/inside-crm/11-effective-strategies-apple-uses-to-create-loyal-customers-100109, https://commons.wikimedia.org/wiki/File:Chapter_Layout_for_Strategic_Management.png, Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License. Name two benefits workers take for granted now that did not exist before labor organized. a. The external control view of leadership emphasizes the role of which of the following types of factors in the success or failure of a firm? Strategy execution management is the evolution of traditional project delivery. Reflects what a firm is doing to achieve its mission and vision as seen by its achievement of specific goals & objectives. determines how organization as a whole supports and enhances the value of the business units w/in it. It involves identifying internal and external factors and understanding how they affect an organization. PGG Mining is making a strategic decision whether to shut down a coal mine in Pennsylvania. strategic objectives. An assessment od strengths, weakness, opportunities and threats. 2. b. the resource-based model. One important element of strategy implementation entails crafting an effective organizational structure and corporate culture.