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SGMA 591 Strategy and Global Management Exam Questions With Verified Answers
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SGMA 591 Strategy and Global Management ExamQuestions With Verified Answers
Chapter 1 - Answer Concept of strategy
What's the problem with strategy? (2) - Answer - too many corporate executives,
including CEOs cannot summarize their company strategy
- If they can, they are not sure if people throughout the ranks understand it in the same
way they do
Two components of strategy: - Answer - the mission
- the vision
The Mission Statement - Answer A mission statement focuses on today and what an
organization does to achieve its vision
- It is what a Company does, the core of the business
The Vision Statement - Answer Focuses on tomorrow and gives an organization direction
Strategy: - Answer - A firm's competitive game plan that assists the firm in figuring out
how best to get from here to there, or find a path-which may well be unforeseeable-to
realize a vision
The essential elements of a strategy statement: (3) - Answer - Corporate objectives [ends]
- Scope (domain)
- Competitive advantage (means)
,The corporate objective: - Answer - Defines the ends that the strategy is designed to
achieve within a specific time frame
- One clear objective to which the firm shall rally
- SMART: specific, measurable, actionable, realistic, time bound
The scope: - Answer - Is the area of operations, the aspect of the business world in which
your company will operate
Competitive advantage-Answer-The heart of your strategy. it's how you'll be doing what
you want to achieve uniquely/better than competition to reach your goal
Objective? -More specific-Answer-One sharp goal that will guide the company
- SMART: specific, measurable, actionable, realistic, time bound
Objective not? -More specific-Answer- Not the same as mission or vision
- Generic (ex. we want to increase profitability)
What is Scope? (in other words) 4 - Answer Where the firm competes on three
dimensions
- Product scope: extend the product line horizontally
- Vertical scope: extend the firm forward or backward in the value chain
- Geographic scope: extend the firm geographically or globally
+ transparent about where it will not compete
Vertical integration: - Answer - forward: the firm integrates activities closer to the
end-customer (ex. Tesla owns retail stores)
, - reverse: to the side of the maker Tesla battery
What is scope not? - Answer - A clear spelling out of how to do what is to be done in the
specified boundary. In fact, a company's scope invites experimentation and initiative
Restructuring and break-ups: corporate growth through divestitures, splits and spin-offs
- Answer lecture 1 slide 16
divestitures: sale of subsidiary
splits: splitting into two companies
spin off: type of divesture where the spin off company is supposed to be worth more on
it's own than as part of a whole
Two parts of competitive advantage: - Answer - unique activities
- value proposition
Unique activities: - Answer - A description of how internal activities must be aligned so
that only your company can deliver the customer value proposition
Value Proposition-Answer What sets a company apart, and potentially superior to
competition. It is comprised of features and benefits.
Competitive advantage example-Answer Walmart:
-took all the amenities out of department stores
-put fewer sales people out on the floor
-entered into rural towns that were so isolated nobody else would service
-Offered national brands instead of second-tier brands
Unique activities and value proposition example: - Answer - IKEA
How is strategy actually made? (3) - Answer First, intended strategy: carefully thought
out by top management (top down, emphasize commitment)
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