MBA 705 LSUS Mclaughlin Exam 1 2024

MBA 705 LSUS Mclaughlin Exam 1 2024 Blockholders Large shareholders who monitor firm strategies to ensure effective management. business model The economic mechanism by which a business hopes to sell its goods or services and generate a profit. CEO duality A situation in which an individual holds both the CEO and chair of the board title competitive advantage A state whereby a business unit's successful strategies cannot be easily duplicated by its competitors. comparative advantage The idea that certain products may be produced more cheaply or at a higher quality in particular countries due to advantages in labor costs or technology. Contingency Theory A view that states the most profitable firms are likely to be the ones that develop the best fit with their environment. Corporate Governance The board of directors, institutional investors, and blockholders who monitor firm strategies to ensure managerial responsiveness. distinctive competence Unique resources, skills, and capabilities that enable a firm to distinguish itself from its competitors and create competitive advantage. hedge fund An investment fund open to only a small number of investors but permitted by regulators to undertake riskier and more speculative investments Industrial Organization (IO): A view based in microeconomic theory that states firm profitability is most closely associated with industry structure. Intended Strategy: The original strategy top management plans and intends to implement. mission The reason for an organization's existence. The mission statement is a broadly defined but enduring statement of purpose that identifies the scope of an organization's operations and its offerings to affected groups (i.e., stakeholders, as defined later in the book). Realized Strategy the strategy that actually takes place Resource-Based Theory The perspective that views performance primarily as a function of a firm's ability to utilize its resources. Sarbanes-Oxley Act of 2002 created more detailed reporting requirements for boards and executives in public U.S. companies and accounting firms Strategic Management The continuous process of determining the mission and goals of an organization within the context of its external environment and its internal strengths and weaknesses, formulating and implementing strategies, and exerting strategic control to ensure that the organization's strategies are successful in attaining its goals. strategy a plan of action sustained competitive advantage A firm's ability to enjoy strategic benefits over an extended period of time. top management team A team of top-level executives—headed by the CEO—all of whom play instrumental roles in the strategic management process. T/F A strategy seeks to develop and sustain competitive advantage true T/F Strategic management refers to formulating successful strategies for an organization. false T/F Each step in the strategic management process is independent so that changes in one step will not substantially affect other steps. false T/F The intended strategy and the realized strategy can never be the same. false T/F Whereas IO theory emphasizes the influence of industry factors of firm performance, resource based theory emphasizes the role of firm factors. true false T/F Strategic decisions are made solely by and are ultimately the responsibility of the CEO alone. Strategies are formulated in the strategic management stage that occurs immediately after __________. A. the assessment of internal strengths and weaknesses B. implementation of the strategy C. control of the strategy D. none of the above A Strategies are formulated after the internal assessment but before implementation and The strategy originally planned by top management is called __________. A. grand strategy B. realized strategy C. emergent strategy D. none of the above D The strategy originally planned by top management is called the intended strategy. The notion that successful firms tend to be the ones that adapt to influences in their industries is based on __________. A. IO theory B. resource-based theory C. contingency theory D. none of the above A The need for adapting to industry influences is based on IO theory. The notion of distinctive competence is consistent with __________. A. IO theory B. resource-based theory C. contingency theory D. none of the above B According to resource-based theory, firms succeed primarily because they develop distinctive competencies. In order to contribute to sustained competitive advantage, firm resources should be __________. A. valuable and rare B. not subject to perfect imitation C. without strategically relevant resources D. all of the above D If resources are to be used for sustained competitive advantage—a firm's ability to enjoy strategic benefits over an extended period of time—those resources must be valuable, rare, not subject to perfect imitation, and without strategically relevant substitutes. Which of the following is not a characteristic of strategic decisions? A. They are long term in nature. B. They involve choices. C. They do not involve trade-offs. D. All of the above are characteristics of strategic decisions. D Strategic decisions are based on a systematic, comprehensive analysis of internal attributes and factors