Multiple Choice QuestionsTrue/False Questions

Chapter 1

The Nature and Scope of Strategic Management

Multiple Choice Questions

1. When defining strategic management the most important thing to remember is that it is:

a. Not as easy as you thinkb. Mainly the province of senior managersc. A living evolving processd. More conceptual than practicale. A way of determining responsibilities

2. As a general statement it can be said that the earliest strategic managers were generally involved in:

a. the militaryb. ruling countriesc. developing from craft to industrial situationsd. the development of systems for large corporationse. any organisations that require management of large groups

1. c

2. a

Multiple Choice Questions

3. In recent years the teachings and writings of Sun Tzu have enjoyed a revival because of the perceived relevance to:

a. the worldwide problems with terrorismb. the fact that his strategic teachings are timelessc. the ability to deal with competitorsd. the emphasis on management structurese. none of the above

4. Which of the following was responsible for a model of strategy which attempted to create a balance between efficiency and effectiveness?

a. Sun Tzub. Max Weberc. Frederick Winslow Taylord. Carl Von Clausewitze. Adam Smith

3.b

4.d

Multiple Choice Questions

5. Which of the following developed systems which combined both the physical and psychological needs of workers?

a. Max Weberb. Frederick Winslow Taylorc. Frank and Lillian Gilbrethd. Henri Fayole. Adam Smith

6. Which of the following is not a feature of Max Weber’s ideal type of bureaucracy?

a. Clearly defined hierarchical structuresb. Efficiency and rationalityc. Clearly defined psychological needs and profilesd. Clearly defined spheres of competencese. Clearly defined roles of responsibility

5. c

6. c

Multiple Choice Questions

7. Henry Mintzberg was responsible for developing a multidimensional approach to strategy based on the five Ps. Which of the following are the correct five Ps?

a. Plan, ploy, pattern, position perspectiveb. Plan, plot, pattern, position perspectivec. Plan, ploy, pattern, position performanced. Plan, ploy, pattern, participation perspectivee. Passion, ploy, pattern, position perspective

8. Which of the following is not one of Porter’s five forces that impact on competition?

a. New rivals entering the industryb. Competition amongst sellers in the industryc. A clearly defined management structured. The bargaining power of buyerse. The bargaining power of suppliers

8. c

7. a

Multiple Choice Questions

9. An organisation's strategy:a. remains set in place longer than the mission and objectivesb. generally forms over a period of time as events unfoldc. tends to be formed at the same time the mission is developed

and objectives are formulatedd. is usually conceived at a single time when managers sit down

and work out a comprehensive strategic plan for the next 3-5 years

e. none of these is true

10. The primary focus of strategic management is:a. strategic analysisb. the total organisationc. strategy formulationd. strategy implementatione. competitive advantage.

10.b

9.b

Multiple Choice Questions

11. Which of the following applies to strategic issues?a. Require only top management decisionsb. Consider only the organisation's external environmentc. Future-orientedd. Concern allocation of small amounts of resourcese. Do not have long-term impact on the organisation

12. Which of the following is not an advantage of strategic management?a. It provides organisations with a clearer sense of direction and purposeb. It helps improve the political, economic, social and technological

environment of the organisationc. It helps orientate management decisions to relevant environmental

conditionsd. It helps organisations be proactive rather than reactivee. Organisations using it significantly outperform their own past results

and the results of those organisations not using it

12.b

11. c

Multiple Choice Questions

13. Which of the following defines what business or businesses the firm is in or should be in?

a. Business strategyb. Corporate strategyc. Functional strategyd. National strategye. None of the above

14. Which of the following defines how each individual business unit will attempt to achieve its mission?

a. Business strategyb. Corporate strategyc. Functional strategyd. National strategye. Corporate mission

13.b

14. a

Multiple Choice Questions

15. Which of the following focuses on supporting the corporate and business strategies?

a. Competitive strategyb. Corporate strategyc. Operational strategyd. National strategye. Mission strategy

16. Which one of the following is not a primary task of strategic managers?

a. Establishing strategic objectivesb. Developing the steps to follow in implementing operational

level plansc. Defining the business and developing a missiond. Developing a strategye. Implementing and evaluating the chosen strategy

15. c

16. b

Multiple Choice Questions17. The task of strategy choice involves:a. developing plans and activities which will improve the

organisation's performance and competitive positionb. determining how the organisation can be more market and

efficiency orientedc. monitoring whether the organisation is achieving good financial

performanced. keeping the organisation free of debte. none of these are really central to strategy choice18. Which one of the following is at the core of strategic management?a. Choosing which organisational objectives to focus onb. Being alert for opportunities to change work responsibilitiesc. Adapting the organisation to a changing external environmentd. Choosing whether to make decisions autocratically or on the basis

of participatione. Promoting responsiveness to changes in organisational norms and

values18. c

17. a

Multiple Choice Questions19. Jobs with strategic management responsibility:a. seldom exist within a functional department or in an operating unitb. exist at the line of business level, the product line level, and are

also found in not-for-profit organisationsc. are found only at the general manager level and aboved. entail operating and administrative responsibilities but do not

involve entrepreneurial responsibilitiese. none of these20. The process of strategic management is characterised by:a. the tendency of managers to develop a strategy before they set

target performance objectivesb. the systematic fashion with which managers implement the

strategy they have chosenc. the steps that strategic planners always go through in writing the

strategic pland. the sequence with which managers move from one phase of the

process to the nexte. none of these

19. b

20. e

True/False Questions

1. Certain principles of strategic management are timeless and can be used in many different organisations.

2. Military strategy may have been where it all began but the principles are really only relevant to military situations.

3. Adam Smith is best remembered for the pig iron experiment.

4. The book, The Wealth of Nations is Mintzberg’s most important contribution to strategic management.

5. Determining the best way of performing a task was directly related to the author of Principles of Scientific Management written by Frederick Winslow Taylor.

2.F

5.T

3.F

4.F

1.T

True/False Questions

6. Maslow’s hierarchy of needs proposes that the point at which they have been met will determine the best approach for managers to take.

7. The resource based view of the firm measure the physical and tangible assets held by an organisation to determine its ability to compete in the market place.

8. Strategic management is irrelevant to non-profit organisations.

9. Strategic management advocates a strictly functional, operational or activity based approach to management.

10. Strategic management is a process.

6.T

7.F

8.F

9.F

10.T

True/False Questions

11. Strategic management is based on a short-term approach, which can offer a quick fix.

12. Organisations exist because they perform some function that society demands.

13. Corporate strategy refers to how an organisation operates.

14. Operational strategy refers to how an organisation implements its strategic decisions.

15. Competitive strategy refers to the type of activity an organisation concerns itself with.

12.T

11.F

13.F

15.F

14.T

True/False Questions

16. Strategic management improves organisational effectiveness.

17. It is more important to be efficient than effective.

18. Strategic managers believe there is no real need to differentiate their product or service.

19. Differentiation, low cost or targeting a specific segment of the market forms the basis of competitive advantage.

20. Satisfying needs of customers more efficiently and effectively than their competitors is the basis of sustained competitive advantage.

18. F

17. F

16. T

19. T

20. T

True/False Questions

21. Innovation is an essential part of successful organisations.

22. The process of innovation in an organisation is not a natural one.

23. Strategic management is a process that does not require strong leadership.

24. Strategic management is best described as an intellectual, technical pursuit.

25. Strategic management is a complex process.

22. T

21.T

23. F

24. F

25. T