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MGMT Exam #2 With 100% Correct And Verified Answers
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MGMT Exam #2 With 100% Correct And Verified Answers
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MGMT Exam #2 With 100% Correct AndVerified Answers
What are the 3 steps in planning? - Correct Answer-1) Determining
the organization's mission and goals
define the business and establish major goals
2) Formulating strategy
Analyze current sitation and develop strategies
3) Implementing Strategy
Allocate resources and responsibilities to achieve strategies
Where are we, where do we want to go, and how do we get get
there?
What is the relationship between planning and strategy? - Correct
Answer-Planning is the first step in developing a strategy. Planning
is indentifying and selecting appropriate goals and courses of action
for an organization. It is both goal-making and and a strategy
making process.
Strategy: a cluster of descision about what goals to pursue, what
actions to take, and how to use resources to achieve goals.
Define formualting strategy: - Correct Answer-Strategy
formulation: The development of a set of corporate-, business-, and
functional strategies that allow an organization to accomplish its
mission and achieve its goals.
What are the two tools associated with formulating strategy? -
Correct Answer-1) SWOT analysis
2) the Five Forces Model
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,What is a SWOT Analysis? - Correct Answer-A planning exercise to
identify strenghts and weaknesses inside an organization and
opportunities and threats in the environment.
What is a corporate-level strategy? - Correct Answer-A plan of
action to manage the growth and development of an organization so
as to maximize its long-run ability to create value.
What is a business-level strategy and 3 examples? - Correct Answer-
A plan of action to take advantage of favorable opportunities and
find ways to counter threats so as to complete effectively in an
industry.
1) low-cost strategy: driving the organization's total costs down
below the total costs of rivals-Wal-Mart
2) differentiation: distinguishing an organization's products from
the competition's products, e.g., product design, quality, or after-
sales service.
*Marketing plays a key role in helping an organzation to distinguish
its product(s) from other(s) out there-Brand Identity and
positioning.
3) Stuck in the (freaking) Middle
Attempting to simultaneously pursue both a low-cost strategy and
differentition.
Organizations stuck in the middle tend to have lower levels of
performance than those using other strategies.
EXCEPTIONS: TARGET, Toyota, Dell...
What are the five forces in the Five Forces Model? - Correct
Answer-1) Level of Rivalry-increased competition leads to lower
profits.
2) Potential for Entry-easy entry leads to lower prices and profits.
3) Power of Suppliers-If there are only a few suppliers of important
items, supply costs rise.
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, 4) Power of Customers-If there are only a few large buyers, they can
bargin down prices.
5) Substitutes: More available substitutes tend to drive down prices
and profits.
Differentiate between the main types of business-level strategies and
explain how they give an organization a competitive advantage that
may lead to superior performance? - Correct Answer-Michael
Porter, the researcher who developed the five forces model, argued that
business-level strategy creates a competitive advantage because it allows
an organization (or a division of a company) to counter and reduce the
threat of the five industry forces. Porter suggests that managers must
choose between two basic ways in order to increase profits: (1)
differentiating the product to increase its value to customers or; (2)
lowering the costs of making the product.
Managers must choose one of the four business-level strategies:
1) low cots 2) focused low cost 3) differentiation 4) focused differentiation
Focused low-cost-serving only one market segment and being the lowest-
cost organization serving that segment.
Focused differentiation-serving only ONE market
segment like the rich or a particular region-
Midwest
examples: Rolex, Bentley
What are the 4 corporate-level strategies? - Correct
Answer-Corporate-level strategy: plan of action that
involves choosing in which industries and countries
a company should invest its resources to achieve its
mission and goals.
1) concentration on a Single Industry:
-reinvesting company profits to strengthen its
competitive position in its current industry
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