Test bank of fred r david – strategic management, 13th edition ch07

The Strengths-Weaknesses-Opportunities-Threats SWOT Matrix, the Strategic Position and Action Evaluation SPACE Matrix, the Boston Consulting Group BCG Matrix, the Internal-External IE Ma

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix, the Strategic Position and Action

Evaluation (SPACE) Matrix, the Boston Consulting Group (BCG) Matrix, the Internal-External (IE) Matrix and the Grand Strategy Matrix are included in stage two of the strategy-formulation framework

The major overall benefit of the BCG Matrix is that it draws attention to the cash flow, investment

characteristics and needs of an organization's various divisions

28)

29)

Viewing businesses as star, cash cow, dog or question mark is an oversimplification

To objectively evaluate feasible alternative strategies identified in Stage 2, the QSPM uses input

information derived from Stage 1

C) Stage 2

D) Stage 3

E) Stage 5

C) IFE

QSPM

E) CPM

A)

Output

B) Matching

C) Analysis

D) Input

E) Decision

WT

64)

Which strategies, defined by the SWOT matrix, are defensive tactics directed at reducing internal

weaknesses and avoiding environmental threats?

C) Six

D) Two

E) Nine

66)

Which of the following is not a step of a SWOT Matrix?

Environmental stability and competitive advantage

D)

IV

89)

90)

According to the Grand Strategy Matrix, organizations in which quadrant have a strong competitive

position but are in a slow-growth industry?

BCG Business Portfolio Matrix

C) BCG

D) TOWS

E) QSPM

C) Strategy

D) Objectives

E) QSPM

All of the following are part of the Corporate Governance Code that was jointly isssued by the Ministry of

Industry and Commerce with the Central Bank in Bahrain in 2010, except

the company shall disclose its corporate governance

ESSAY Write your answer in the space provided or on a separate sheet of paper

TRUE 8) FALSE 9) TRUE 10) FALSE 11) FALSE 12) TRUE 13) FALSE 14) TRUE 15) FALSE 16) TRUE 17) TRUE 18) TRUE 19) TRUE 20) FALSE 21) TRUE 22) TRUE 23) FALSE 24) TRUE 25) TRUE 26) FALSE

27) FALSE 28) TRUE 29) TRUE 30) TRUE 31) TRUE 32) TRUE 33) FALSE 34) FALSE 35) TRUE 36) FALSE 37) TRUE 38) FALSE 39) TRUE 40) FALSE 41) FALSE 42) TRUE 43) FALSE 44) TRUE 45) FALSE 46) TRUE

TRUE 48) FALSE 49) TRUE 50) FALSE 51) TRUE 52) TRUE 53)

C 54)

C 55)

D 56)

D 57)

B 58)

D 59)

D 60)

B 61)

C 62)

C 63)

C 64)

D 65)

E 66)

A

67)

E 68)

C 69)

E 70)

C 71)

D 72)

D 73)

B 74)

D 75)

E 76)

E 77)

B 78)

A 79)

B 80)

B 81)

E 82)

C 83)

D 84)

D 85)

C 86)

E

Matching external and internal critical success factors is the key to effectively generating feasible

alternative strategies Students could provide examples from Table 7-1

105)

If the directional vector points to the lower-left quadrant of the SPACE Matrix, firms should focus on rectifying internal weaknesses and avoiding external threats Defensive strategies include retrenchment, divestiture, liquidation and concentric diversification

Question Marks have a low relative market share position, yet they compete in a high-growth industry Stars have a high relative market share and a high industry growth rate, and represent the organization's best long-term opportunities for growth and profitability Cash Cows have a high relative market share position but compete in a low-growth industry Dogs have a low relative market share position and

compete in a slow- or no-market-growth industry

in time; and 3) other variables besides relative market share position and industry growth rate in sales are important in making strategic decisions about various divisions

108)

A firm that is a weak competitor in a slow-growing market would be located in Quadrant III Quadrant III strategies include retrenchment, concentric diversification, horizontal diversification, conglomerate

diversification, divestiture and liquidation

Student answers will vary when elaborating on what these strategies could mean for a college or

university However, students should mention that the college or university might possibly have to be closed, or facilities and staff may have to be drastically reduced, which leads to unhappy students in very large classes

109)

Positives

1) sets of strategies can be examined sequentially or simultaneously and there is no limit to the number ofstrategies that can be evaluated or the number of sets of strategies that can be examined at once using the QSPM; 2) it requires strategists to integrate pertinent external and internal factors into the decision-making process; 3) Developing a QSPM makes it less likely that key factors will be overlooked or weighted inappropriately; 4)A QSPM draws attention to important relationships that affect strategy decisions; 5) It requires making a number of decisions along the way, which enhanses the probability that the decisions will be best for the organization.; 6) It can be applied to virtually any type of organization; 7) It can

enhance strategic choice in multinational firms because many key factors can be considered at once.Limitations

1) it always requires intuitive judgments and educated assumptions; 2) it can be only as good as the prerequisite information and matching analyses upon which it is based

110)

Equifinality It is often possible to achieve similar results using different means or paths Strategists should

recognize that achieving a successful outcome is more important than imposing the method of achieving

it It may be possible to generate new alternatives that give equal results but with far greater potential for gaining commitment

Satisfying Achieving satisfactory results with an acceptable strategy is far better than failing to achieve

optimal results with an unpopular strategy

Generalization Shifting focus from specific issues to more general ones may increase strategists' options

for gaining organizational commitment

Focus on Higher-Order Issues By raising an issue to a higher level, many short-term interests can be

postponed in favor of long-term interests For instance, by focusing on issues of survival, the airline and automotive industries were able to persuade unions to make concessions on wage increases

Provide Political Access on Important Issues Strategy and policy decisions with significant negative

consequences for middle managers will motivate intervention behavior from them If middle managers do not have an opportunity to take a position on such decisions in appropriate political forums, they are capable of successfully resisting the decisions after they are made Providing such political access provides

development In recent years, NGOs have become fully-fledged actors on a par with the state and private sector in the development and regulation of societies

112)

Students should list the four categories (control and oversight of Management, adherence to legal

prescriptions, considerations of stakeholders' interests, and advancement of stockholder's rights) and an outline the roles and responsibilities can be taken from table 7-7 in the textbook