Management 8th Edition By Kinicki – Test Bank

Management 8th Edition By Kinicki – Test Bank

Chapter 06
Test Bank
True / False Questions
1. Donna’s Restaurant is a popular café that specializes in home-cooked meals, friendly service, and a menu that contains vegan and vegetarian dishes, (menu items that no other restaurant in the area offers). Donna’s Restaurant is engaging in strategic positioning by offering the unique menu items of vegan and vegetarian dishes.
TRUE AACSB: Knowledge Application Accessibility: Keyboard Navigation Blooms: Apply Difficulty: 3 Hard Learning Objective: 06-01 Identify the three principles underlying stategic positioning. Topic: Strategic Positioning Feedback: Strategic positioning means performing different activities from rivals, or performing similar activities in different ways. Donna’s Restaurant is meeting the broad needs of relatively few customers (vegans and vegetarians).
2. A and B Office Supply, a small family-owned company, sells high-priced desks, some as expensive as $10,000, to executives in its area. Very few companies have chosen to market this product, and A and B has enjoyed record profits over the last 25 years. A and B Office Supply is an example of a company that would typically not choose to utilize strategic planning.
TRUE AACSB: Knowledge Application Accessibility: Keyboard Navigation Blooms: Apply Difficulty: 3 Hard Learning Objective: 06-01 Identify the three principles underlying stategic positioning. Topic: Strategic Planning Feedback: Research results indicate that for small companies strategic planning is probably not worth the effort unless the company is in a highly competitive industry where small differences in performance may affect the firm’s survival potential.
3. The strategic-management process is often touched off by a crisis. TRUE AACSB: Analytical Thinking Accessibility: Keyboard Navigation Blooms: Understand Difficulty: 2 Medium Learning Objective: 06-02 Outline the five steps in the strategic management process. Topic: Strategic Management Feedback: The strategic-management process is often touched off by a crisis, such as the one Takata faced in having to recall millions of automotive airbags.
4. The first three steps in the strategic-management process are establishing the mission and the values statement, assessing the current reality, and formulating the grand strategy. TRUE AACSB: Knowledge Application Accessibility: Keyboard Navigation Blooms: Apply Difficulty: 3 Hard Learning Objective: 06-02 Outline the five steps in the strategic management process. Topic: Strategic Management Feedback: The first three steps in the strategic-management process are (1) establishing the mission and the values statement, (2) assessing the current reality, and (3) formulating the grand strategy. The next two steps are implementing the strategy and maintaining strategic control, along with a feedback loop (see Figure 6.1).
5. Frank is interested in rewriting the vision statement for his antique shops, and he wants his employees and his business to grow. Therefore, the vision for Frank’s stores should be positive and inspiring, and it should stretch the company and his employees to achieve objectives that they believe are not possible. TRUE AACSB: Knowledge Application Accessibility: Keyboard Navigation Blooms: Apply Difficulty: 3 Hard Learning Objective: 06-03 Identify the characteristics of good mission, vision, and values statements. Topic: Vision Statement Feedback: A vision should be positive and inspiring, and it should stretch the organization and its employees to achieve a desired future state that appears beyond its reach.
6. When Pablo and his partner wrote the mission statement for their fitness center, P&P Fitness, it did not include descriptions of their customers or the products and services they offer, because those descriptions belong in a vision statement. FALSE AACSB: Knowledge Application Accessibility: Keyboard Navigation Blooms: Apply Difficulty: 3 Hard Learning Objective: 06-03 Identify the characteristics of good mission, vision, and values statements. Topic: Mission Statement Feedback: Mission statements may include information about customers and products or services.
7. The vision statement is an organization’s purpose or reason for being, and a company’s mission statement is its long-term goal of what it wants to become.
FALSE AACSB: Analytical Thinking Accessibility: Keyboard Navigation Blooms: Understand Difficulty: 2 Medium Learning Objective: 06-03 Identify the characteristics of good mission, vision, and values statements. Topic: Mission Statement Feedback: The mission statement is an organization’s purpose or reason for being, and a company’s vision statement is its long-term goal of what it wants to become. (See Table 6.1.)
8. Competitive intelligence means gaining information about one’s competitors’ activities so that you can anticipate their moves and react appropriately. For example, managers gain competitive intelligence by reading business publications, such as the, in order to understand competitors’ business plans, goals, and strategies. TRUE AACSB: Analytical Thinking Accessibility: Keyboard Navigation Blooms: Understand Difficulty: 1 Easy Learning Objective: 06-04 Explain how an organization assesses the competitive landscape. Topic: Competitive Intelligence Feedback: Practicing competitive intelligence means gaining information about one’s competitors’ activities so that you can anticipate their moves and react appropriately. If you are a manager, one of your worst nightmares is that a competitor will surprise you with a service or product that will revolutionize the market and force you to play catch-up.
9. The managers of a small bakery, Butter & Batter, decided to do a SWOT analysis to study the strengths and weaknesses within the organization and the external environment. A key benefit of conducting a SWOT analysis is being able to better formulate strategies in pursuit of the firm’s mission. TRUE AACSB: Knowledge Application Accessibility: Keyboard Navigation Blooms: Apply Difficulty: 3 Hard Learning Objective: 06-04 Explain how an organization assesses the competitive landscape. Topic: Environmental Scanning Feedback: SWOT analysis should provide a realistic understanding of the organization in relation to its internal and external environments so you can better formulate strategy in pursuit of the firm’s mission.
10. Organizational threats are an environmental factor that can hinder an organization’s ability to achieve a competitive advantage. For example, managers may realize that the government is about to place restrictions on exports, which will limit the company’s ability to sell its products overseas (which will in turn greatly reduce its profits). TRUE