WorksheetsStrategic Management Course
Total questions: 16
Worksheet time: 16mins
Why might a CEO, a consultant, or an investor conduct a strategic analysis?
To determine future profitability
To choose a single method of analyzing data
To better understand and make decisions about an industry
To assess an organization's current competitive position
An organization's strategy is embodied in its ...
Chief executive officer
Declared sales and targets
Mission, plan, and actions
Mission statement
The strategist’s challenge is to…
Determine the most effective marketing plan for an organization
Build bridges between operations and outside investors
Balance workload with other commitments
Identify valuable competitive positions at the intersection of values, capabilities, and opportunities
In the real world...
Businesses rarely have a competitive advantage
Profits are consistent over time
Product markets are perfectly competitive
Average industry returns vary even after controlling for risk.
Would you complete a SWOT, competitor or environmental analysis to understand at the broadest level a firm's internal capabilities and its external competitive environment?
Competitor analysis
SWOT analysis
Environmental analysis
Which of the following cases BEST illustrates the generation of rents/economic profits?
A firm’s revenues exceed its costs
A firm has higher returns than an established, less risky competitor
A firm has higher returns than an investment of similar risk
A firm has the greatest market share in its industry
Why do strategy analysts care about economic profits and not just accounting profits?
Economic profits are the same as accounting profits.
Economic profits calculate a firm's profits after operating costs.
Economic profits reflect the opportunity cost of deploying capital.
Economic profits reveal a firm's market share.
What might a strategist learn about a nonprofit's strategy based on its mission statement: To provide dignified care to our city's aging population?
Market opportunities and needs
Values, purpose, and scope
Capabilities and strengths
How might an analyst use the environmental analysis tool?
To understand the broad societal forces that impact a firm
To understand a firm's competitive strengths
To understand and evaluate current or potential competitors
To test a strategic position
Which of the following describes a perfectly competitive market?
Barriers to entry and exit are non-existent.
Products are varied.
Knowledge is limited.
There are few firms competing in an industry.
When is a firm more likely to earn higher profits?
There are barriers to entry or imitation
A firm and its rivals produces similarly designed products as that of a rival firm
The firm's key resources and capabilities are easily imitated
Another firm holds a patent to a unique process or product
Imagine several potato farmers operate in a competitive market. Farmer Jane decides to enter the market, shifting her 500 acre farm from corn to potatoes. What impact will her entry have on the profitability of the potato market?
The profitability of the potato market will increase.
The profitability of the potato market will decrease.
The profitability of the potato market will remain the same.
In a perfectly competitive market, economic profits…
Will increase as firms learn about customer preferences
Are competed away as new entrants imitate incumbent firms
May persist for long periods
Are a byproduct of low cost, efficient production processes
A pharmaceutical company is issued a patent on a powerful new arthritis medication. What impact might that patent have on its profitability in the pharmaceutical industry?
A patent makes it less likely the firm will earn a profit.
A patent makes it more likely the firm will earn a profit.
A patent likely will have little impact on the firm's profitability.
Which of the following best describes a strategist's main challenge?
Understand the capabilities of firms and industries in order to maximize their future profits
Understand a firm's values and how they affect decision-making
Understand opportunities within an industry to improve a firm's competitive position
Understand answers to the three fundamental questions in order to recognize a firm's best competitive position
Which of the following best describes who conducts a strategic analysis?
Strategic analyses are performed within a company by leadership and other employees.
Strategic analyses are conducted by a range of primary stakeholders.
Strategic analysts could be a wide variety of individuals within or associated with a firm as well as secondary stakeholders.
Most strategic analyses are conducted by business unit general managers, such as a manager reviewing a marketing plan.
