Strategic Management and

Strategic Management and

Business Policy:

Globalization, Innovation and Sustainability Sixteenth Edition, Global Edition Charles E. Bamford Thomas L. Wheelen Alan N. Hoffman J.David Hunger Test Bank For By 1 / 4

Strategic Management and Business Policy, 16e, Global Edition (Wheelen) Chapter 1 Basic Concepts of Strategic Management 1) What was strategic management originally called?A) Business policy B) Planning C) Marketing strategy D) Short-term planning E) Operational planning

Answer:

A

Difficulty:

Easy

Learning Obj.:

1.1: Discuss the benefits of strategic management

AACSB:

Application of knowledge 2) Research suggests that strategic management evolves through four sequential phases in corporations. The first phase is

• externally oriented planning.

B)b asic financial planning.C)i nternally oriented planning.

• forecast-based planning.
• strategic management.

Answer:

B

Difficulty:

Easy

Learning Obj.:

1.1: Discuss the benefits of strategic management

AACSB:

Application of knowledge 3) The time horizon involved with regard to forecast-based planning is usually

• one year.

B)o ne quarter.C)t hree to five years.

• less than one month.

E) five to ten years.

Answer:

C

Difficulty:

Easy

Learning Obj.:

1.1: Discuss the benefits of strategic management

AACSB:

Application of knowledge 4) A difference between basic financial planning and forecast-based planning is

• the time horizon is shorter in forecast-based planning.

B)f orecast-based planning incorporates environmental data and extrapolates current trends.C)b asic financial planning utilizes consultants with sophisticated techniques.

• basic financial planning utilizes scenarios and contingency strategies.

E) basic financial planning relies heavily on input from lower levels in the organization.

Answer:

B

Difficulty:

Moderate

Learning Obj.:

1.1: Discuss the benefits of strategic management

AACSB:

Analytical thinking 1

. 2 / 4

5) Top-down planning that emphasizes formal strategy formulation and leaves the implementation issues to lower management levels is known as

• forecast-based planning.
• externally oriented planning.
• strategic management.
• basic financial planning.
• none of the above.

Answer: B

Difficulty: Moderate

Learning Obj.: 1.1: Discuss the benefits of strategic management

AACSB: Application of knowledge

6) In the final phase of strategic management, strategic information is available to

• people throughout the organization.
• the top management responsible for decision-making.
• middle management.
• operational personnel.
• only those responsible for implementing the strategy.

Answer: A

Difficulty: Moderate

Learning Obj.: 1.1: Discuss the benefits of strategic management

AACSB: Application of knowledge

7) In a survey of 50 corporations, which of the following was rated as one of the three top benefits of strategic management?

• Clearer sense of strategic direction for the firm
• Higher levels of employee motivation
• Higher levels of job satisfaction
• Improved productivity
• Lower employee turnover

Answer: A

Difficulty: Moderate

Learning Obj.: 1.1: Discuss the benefits of strategic management

AACSB: Application of knowledge

8) When an organization is involved in formal strategic planning, which is not one of the strategic questions that an organization generally may ask itself?

• Where is the organization now?
• Are we on target to hit our financial objectives next year?
• If no changes are made, where will the organization be in one year?
• If the evaluation is negative, what specific actions should management take?
• If no changes are made, where will the organization be in 10 years?

Answer: B

Difficulty: Moderate

Learning Obj.: 1.1: Discuss the benefits of strategic management

AACSB: Analytical thinking

2

. 3 / 4

9) In the Bain & Company survey of executives from more than 70 countries, which of the following was the number one tool used by decision makers?

• Customer relationship management

B)S trategic planning

• Marketing planning
• Financial management

E) Budgeting

Answer:

B

Difficulty:

Challenging

Learning Obj.:

1.1: Discuss the benefits of strategic management

AACSB:

Application of knowledge 10) Strategic planning within a small organization

• may be informal and irregular.
• must be elaborate to allow for future growth.
• should always be formalized and explicitly stated.
• should be done by the president only.
• is unnecessary and a waste of time.

Answer:

A

Difficulty:

Moderate

Learning Obj.:

1.1: Discuss the benefits of strategic management

AACSB:

Application of knowledge 11) Strategic planning in a large firm

• should be informal to allow complete understanding by the many participants.
• should be instigated only from the main corporate office.
• should be accomplished quickly to decrease the likelihood of it becoming outdated.
• should encourage a clear delineation between top management and lower-level managers.
• should be a formalized and

sophisticated system.

Answer:

E

Difficulty:

Moderate

Learning Obj.:

1.1: Discuss the benefits of strategic management

AACSB:

Application of knowledge 12) Strategic management is the set of managerial decisions that help determine the long-term performance of a corporation.

Answer:

TRUE

Difficulty:

Easy

Learning Obj.:

1.1: Discuss the benefits of strategic management

AACSB:

Application of knowledge 13) As annual budgets become less useful at stimulating long-term success, managers attempt to propose five-year plans.

Answer:

TRUE

Difficulty:

Easy

Learning Obj.:

1.1: Discuss the benefits of strategic management

AACSB:

Application of knowledge 3 .

• / 4