A1: The Strategy Process Part 2 (Timed)

1. Question

1 point(s)

Which of the following are disadvantages associated with formal long-term planning?

Select ALL that apply:

Formal long-term planning forces managers in an organisation to look ahead

Correct Incorrect Correct answer

Formal long-term planning can be a costly and time-consuming exercise

Correct Incorrect Correct answer

Formal long-term planning can be subject to bounded rationality

Correct Incorrect Correct answer

Formal long-term planning can lead to strategic drift over the long-term

Correct Incorrect Correct answer

Formal long-term planning can encourage rigidity in the organisation

Correct Incorrect Correct answer

2. Question

1 point(s)

All of the following statements are likely true of logical incrementalism, EXCEPT:

Strategy can drift away from the organisation's environment

Correct Incorrect Correct answer

It achieves radical or revolutionary change

Correct Incorrect Correct answer

Organisations survive by muddling through

Correct Incorrect Correct answer

Strategic planning and direction takes small gradual steps

Correct Incorrect Correct answer

3. Question

1 point(s)

ONE characteristic of emergent strategies is:

Long-term direction and focus over strategic development

Correct Incorrect Correct answer

Involvement of staff lower down in the organisation's hierarchy

Correct Incorrect Correct answer

Supports a stable and routine environment

Correct Incorrect Correct answer

Strategy is developed by gradual alteration to courses of action followed

Correct Incorrect Correct answer

4. Question

1 point(s)

A freewheeling opportunism approach to strategic formulation would be advantageous in which of the following types of environment?

Stable

Correct Incorrect Correct answer

Static

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Simple

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Complex

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Hostile

Correct Incorrect Correct answer

5. Question

1 point(s)

The part of a formal planning process or rational strategic plan that was actually accomplished, would be referred to by Henry Mintzberg as:

The emergent strategy

Correct Incorrect Correct answer

The planned or intended strategy

Correct Incorrect Correct answer

The unrealised strategy

Correct Incorrect Correct answer

The deliberate strategy

Correct Incorrect Correct answer

6. Question

1 point(s)

Which of the following statements in regard to the position-based approach to strategic planning is/are TRUE? Select ALL that apply:

One of the main criticisms of this approach is that it is too inward-looking

Correct Incorrect Correct answer

This approach involves drafting strategic plans that are a good “fit” with the external environment

Correct Incorrect Correct answer

This approach focuses the firm’s strategy on its internal competencies and capabilities

Correct Incorrect Correct answer

Adopting this approach involves analysing the external environment before setting objectives

Correct Incorrect Correct answer

This approach is entirely driven by the demands and objectives of stakeholders

Correct Incorrect Correct answer

7. Question

1 point(s)

Which of the following statements is/are TRUE? Select ALL that apply

Static business environments and industries tend to favour formal planning

Correct Incorrect Correct answer

Dynamic business environments and industries tend to favour formal planning

Correct Incorrect Correct answer

A strategy for a large multinational firm may be complex and require localised knowledge, strategies like this should be developed using a top-down approach

Correct Incorrect Correct answer

Accounting-led approaches to strategy development tend to focus too much on the external environment

Correct Incorrect Correct answer

8. Question

1 point(s)

Select TWO options to fill in the blanks below:

A tool used to assist the positional audit process is …………….

Another tool that can provide a useful framework to analyse a company is the competitor analysis framework.

To many, the starting point for the process of strategic choice is known as…………….. and it asks the question ‘where are we now?’

SWOT analysis

Correct Incorrect Correct answer

key performance indicators

Correct Incorrect Correct answer

position auditing

Correct Incorrect Correct answer

brainstorming

Correct Incorrect Correct answer

critical success factors

Correct Incorrect Correct answer

9. Question

1 point(s)

Review the following statements and decide which is/are correct:

(1) Strategic management accountants tend to focus on internal and external factors in their analysis.

(2) Traditional management accountants typically focused on historic business performance, while strategic management accountants need to be more forward-looking.

Statement (1) only

Correct Incorrect Correct answer

Both statements

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Statement (2) only

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Neither

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10. Question

1 point(s)

Jorge is an entrepreneur whose business has participated in various areas throughout the years. In Jorge’s partnership with his team, he changes from one idea to another using his personal judgment and discretion to identify ways to earn money. Sometimes they are not successful, but most times this flexible approach allows the business to respond quickly to the latest trends. As of late, Jorge and his team have initiated efforts to develop a GPS system for bikers. His team has seen a large increase in the number of people biking during their free time and competitively.

What is Jorge’s approach to strategy?

Jorge identifies where he is, where he wants to be, how is going to get there and how he is doing

Correct Incorrect Correct answer

Jorge develops a short term strategy based on the consensus of opinion of his team

Correct Incorrect Correct answer

Jorge has no formal approach to strategy development. He takes whatever opportunities are available at that particular point in time

Correct Incorrect Correct answer

Jorge follows a strategy that emerges out of the course of the business rather than having been formally planned

Correct Incorrect Correct answer

11. Question

1 point(s)

Choose the ONE approach below which proclaims that competitive advantage is achieved through utilisation of the organisation’s core competences:

Positioning approach

Correct Incorrect Correct answer

Emergent

Correct Incorrect Correct answer

Incrementalism

Correct Incorrect Correct answer

Immanent competition

Correct Incorrect Correct answer

12. Question

1 point(s)

Described as ‘patterns or consistencies realised despite, or in the absence of, intentions’, Mintzberg was speaking of which type of strategy?

System based strategies

Correct Incorrect Correct answer

Emergent strategies

Correct Incorrect Correct answer

Positioning strategies

Correct Incorrect Correct answer

Opportunistic strategies

Correct Incorrect Correct answer

13. Question

1 point(s)

Which option below best describes the basis of the stakeholder view?

Only members that an organisation officially recognises are stakeholders

Correct Incorrect Correct answer

Only creditors and shareholders are legitimate stakeholders

Correct Incorrect Correct answer

Persons, groups and organisations with an interest in the organisation are stakeholders

Correct Incorrect Correct answer

Only shareholders are legitimate stakeholders

Correct Incorrect Correct answer

14. Question

1 point(s)

Hendrick is a manager at TechSolutions and he wants the company to be a world-leader in the manufacture of refrigerators. He has been working out a strategy to effectively beat all of the company’s main rivals in the industry. The strategy he devised includes establishing new factories on the outskirts of several US urban areas, first in Houston, and subsequently in Los Angeles, Manhattan, and Stanford, in that order.

The new factories will eventually employ 550, 430, 300, 250 and 200 employees respectively, over the next 6 years and it is estimated that Hendrick will need €350 million to finance this strategy from start to finish. Hendrick knows that he will have to be flexible in hiring staff for each factory. Furthermore, he has advised management that an additional €60 million should be set aside as a reserve fund to ensure flexible and effective establishment of each new factory.

Choose the drop down list to choose what the above scenario is an example of

Logical Incremental Approach

Correct Incorrect Correct answer

Muddling through incremental approach

Correct Incorrect Correct answer

15. Question

1 point(s)

Choose THREE of the following that are characteristics of the freewheeling opportunism approach for strategic formulation:

Encourages environmental analysis as an integral part of decision making

Correct Incorrect Correct answer

Sets clear objectives for performance to be measured and controlled

Correct Incorrect Correct answer

Focuses on exploiting product and market opportunities.

Correct Incorrect Correct answer

Gradual adjustment rather than any transformational change

Correct Incorrect Correct answer

Strategy is naturally more creative and innovative

Correct Incorrect Correct answer

Scope of decisions are over a long time horizon and are complex in nature

Correct Incorrect Correct answer

Ensures that everyone is aware and personally engaged to ensure achievement

Correct Incorrect Correct answer

Supports dynamic and uncertain environments

Correct Incorrect Correct answer

16. Question

1 point(s)

A strategic question is an open-ended question that is critical for an organization to answer or address as part of developing its strategy.

True

Correct Incorrect Correct answer

False

Correct Incorrect Correct answer

17. Question

1 point(s)

Sipho has decided to implement a strategic review of his chain of electronic stores and has included his senior team, as well as all of the store managers. He had the goal of creating a planned strategy that would include clear objectives and a long-term perspective for the company. Twelve months have went by and the strategy is still not successfully finished.

Sipho determined that his store managers were too busy to attend meetings and this led to quite a bit of the meetings to be rescheduled. Sipho also utilised a few consultants to oversee the strategic process, yet due to all of the delays the process was beginning to be more costly than expected. Sipho grew concerned that the output was obsolete because of the issues he had encountered and also because of the rapidly changing business environment since a new chain of electronic stores had recently launched.

Choose ALL reasons that may contribute to the lack of success of Sipho’s planned strategy approach:

Time commitment by Sipho's team

Correct Incorrect Correct answer

No corporate appraisal in the process

Correct Incorrect Correct answer

Unexpected costs incurred

Correct Incorrect Correct answer

Lack of flexibility

Correct Incorrect Correct answer

Quality of the work undertaken by the team and consultants

Correct Incorrect Correct answer

18. Question

1 point(s)

A top-down, formalised and centrally planned approach is known as which ONE of the following?

Emergent strategies

Correct Incorrect Correct answer

Freewheeling opportunism

Correct Incorrect Correct answer

Rational planning

Correct Incorrect Correct answer

Incremental planning

Correct Incorrect Correct answer

19. Question

1 point(s)

A potential problem with formal planning processes, known as………….. , is when an organisation’s analysis of its position is likely to be incomplete, causing ineffective strategies to be selected.

Choose the two-word term that correctly fills the blank above.

Bounded rationality

Correct Incorrect Correct answer

Rational model

Correct Incorrect Correct answer

Management distrust

Correct Incorrect Correct answer

Operational inefficiency

Correct Incorrect Correct answer

20. Question

1 point(s)

BrandCo Inc has been granted permission to begin building in a region of rainforest within Uganda that is known for its unique biodiversity. These rights were obtained after lobbying the minister for energy in Uganda (BrandCo Inc also made a generous donation to a private club that the minster was a member of).

The company’s staff has developed a modular system for deployment of its construction sites, which means they can have all the necessary machinery and equipment in place within a few days. Globally, the demand for construction is up 15% in the last 2 years and is expected to rise another 7% in the next year.

Select ALL of the potential strategy analysis results from the scenario above:

It's ethical

Correct Incorrect Correct answer

It's unsustainable

Correct Incorrect Correct answer

It's fair to all stakeholders

Correct Incorrect Correct answer

It's unethical

Correct Incorrect Correct answer

It's profitable

Correct Incorrect Correct answer

It's illegal

Correct Incorrect Correct answer

It’s sustainable

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It's legal

Correct Incorrect Correct answer

21. Question

1 point(s)

Which of the following four companies, which have taken varying approaches to strategic planning, have adopted a traditional approach? Choose ALL that may apply.

Company Q’s major customer accounts for around 45% of Q’s sales. They have recently told Q that they wish to see significant changes to Q’s product. Q has not discussed this with their other customers, but has begun considering how to implement the requested changes.

Correct Incorrect Correct answer

Company J has identified that its shareholders want to see a 5% increase in dividends in the coming year.

Correct Incorrect Correct answer

Company X has a strong relationship with its staff. It wishes to use this to increase the amount of work each staff member undertakes, enabling significant cost savings to be made.

Correct Incorrect Correct answer

Company P has undertaken a detailed analysis of customer needs and competitor prices in its market. It has decided that it needs to reduce selling prices significantly to make itself more competitive.

Correct Incorrect Correct answer

22. Question

1 point(s)

Lesego runs a lawn care service in his local town for the past 15 years. She has a very loyal clientele and an excellent reputation for providing top-notch lawn care service at a reasonable price. Within the past few months a second lawn care service has entered into Lesego’s area and it is offering quality service at even lower prices than Lesego’s. Although that was the new company’s offer, it ultimately was unable to succeed in convincing customers to use their services instead of Lesego’s.

The most likely reason Lesego was able to maintain her clientele was:

Superior service

Correct Incorrect Correct answer

Better quality of products

Correct Incorrect Correct answer

Home service

Correct Incorrect Correct answer

Value for money

Correct Incorrect Correct answer

His reputation and brand

Correct Incorrect Correct answer

Better location

Correct Incorrect Correct answer

23. Question

1 point(s)

In which of the following circumstances would the rational model of strategy development be a preferable method of strategy development? Select ALL that apply:

The industry in which the firm operates is relatively stable

Correct Incorrect Correct answer

The firm is small and wholly-owned and run by an entrepreneurial, experienced and risk-taking CEO who seizes opportunities as they arise

Correct Incorrect Correct answer

The industry in which the firm operates in is rapidly changing and highly dynamic

Correct Incorrect Correct answer

The firm’s management team has a strong preference for bottom-up approaches to planning

Correct Incorrect Correct answer

A significant amount of external finance is required to execute the firm’s desired strategy

Correct Incorrect Correct answer

24. Question

1 point(s)

A manufacturer of bicycle tyres, Trek Bicycles Corporation, has developed a new set of bike tyres that are to be resistant to wear and tear, environmental factors, and are sealed with a protectant that prevents the tyres from being penetrated by external elements like nails or rocks. The company patented this design and it is currently a large part of their strategy.

Trek Bicycles Corporation’ strategy is most likely to be which ONE of the following?

A position approach

Correct Incorrect Correct answer

A resource-based view

Correct Incorrect Correct answer

Strategy as a ploy

Correct Incorrect Correct answer

Strategy as a pattern

Correct Incorrect Correct answer

25. Question

1 point(s)

to promote a new strategy. This strategy will include the direction for the whole business, and for all of its subsidaries and all functions within each business unit.

Choose ALL levels of business strategy that the restaurant chain is initiating:

Freewheeling Strategy

Correct Incorrect Correct answer

Business Strategy

Correct Incorrect Correct answer

Long-term Strategy

Correct Incorrect Correct answer

Incremental Strategy

Correct Incorrect Correct answer

Corporate Strategy

Correct Incorrect Correct answer

Emergent Strategy

Correct Incorrect Correct answer

Operational Strategy

Correct Incorrect Correct answer

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