C483 EXAMINATION QUESTIONS AND ANSWERS
What are the six components in the strategic management process? - The strategic
management process has six major components:
1. Establishment of mission, vision, and goals.
2. Analysis of external opportunities and threats.
3. Analysis of internal strengths and weaknesses.
4. SWOT (strengths, weaknesses, opportunities, and threats) analysis and strategy formulation.
5. Strategy implementation.
6. Strategic control.
Explain the term mission. - An organization's basic purpose and scope of operations. A
clear and concise expression of the basic purpose of the organization.
Strategic vision - The long-term direction and strategic intent of a company. It provides a
perspective on where the organization is headed and what it can become.
Stakeholders - Groups and individuals who affect and are affected by the achievement of
the organization's mission, goals, and strategies.
Resources - Inputs to a system that can enhance performance.
Benchmarking - The process of assessing how well one company's basic functions and
skills compare with those of another company or set of companies.
SWOT Analysis - A comparison of strengths, weaknesses, opportunities, and threats that
helps executives formulate strategy.
Corporate strategy - The set of businesses, markets, or industries in which the
organization competes and the distribution of resources among those businesses.
Concentration strategy - Focuses on a single business competing in a single industry.
Vertical intergration - The acquisition or development of new businesses that produce
parts or components of the organization's product. Involves expanding the domain of the
organization into supply channels or to distributors.
, Concentric diversification - A strategy used to add new businesses that produce related
products or are involved in related markets and activities. Involves moving into new businesses
that are related to the company's original core business.
Conglomerate diversification - A strategy used to add new businesses that produce
unrelated products or are involved in unrelated markets and activities. A corporate strategy that
involves expansion into unrelated businesses.
Business Strategy - The major actions by which an organization builds and strengthens its
competitive position in the marketplace. The major actions by which a business competes in a
particular industry or market.
Functional strategy - Strategies implemented by each functional area of the organization
to support the organization's business strategy.
Strategy Implementation Steps - Step 1: Define strategic tasks. Articulate in simple
language what a particular business must do to create or sustain a competitive advantage.
Define strategic tasks to help employees understand how they contribute to the organization,
including redefining relationships among the parts of the organization.
Step 2: Assess organization capabilities. Evaluate the organization's ability to implement the
strategic tasks. A task force typically interviews employees and managers to identify specific
issues that help or hinder effective implementation. Then the results are summarized for top
management. In the course of your career, you will likely be asked to participate in a task force.
Step 3: Develop an implementation agenda. Management decides how it will change its own
activities and procedures; how critical inter-dependencies will be managed; what skills and
individuals are needed in key roles; and what structures, measures, information, and rewards
might ultimately support the needed behavior. A philosophy statement, communicated in terms
of value, is the outcome of this process.
Step 4: Create an implementation plan. The top management team, the employee task force,
and others develop the implementation plan. The top management team then monitors
progress. The employee task force continues its work by providing feedback about how others
in the organization are responding to the changes.
What are the six components in the strategic management process? - The strategic
management process has six major components:
1. Establishment of mission, vision, and goals.
2. Analysis of external opportunities and threats.
3. Analysis of internal strengths and weaknesses.
4. SWOT (strengths, weaknesses, opportunities, and threats) analysis and strategy formulation.
5. Strategy implementation.
6. Strategic control.
Explain the term mission. - An organization's basic purpose and scope of operations. A
clear and concise expression of the basic purpose of the organization.
Strategic vision - The long-term direction and strategic intent of a company. It provides a
perspective on where the organization is headed and what it can become.
Stakeholders - Groups and individuals who affect and are affected by the achievement of
the organization's mission, goals, and strategies.
Resources - Inputs to a system that can enhance performance.
Benchmarking - The process of assessing how well one company's basic functions and
skills compare with those of another company or set of companies.
SWOT Analysis - A comparison of strengths, weaknesses, opportunities, and threats that
helps executives formulate strategy.
Corporate strategy - The set of businesses, markets, or industries in which the
organization competes and the distribution of resources among those businesses.
Concentration strategy - Focuses on a single business competing in a single industry.
Vertical intergration - The acquisition or development of new businesses that produce
parts or components of the organization's product. Involves expanding the domain of the
organization into supply channels or to distributors.
, Concentric diversification - A strategy used to add new businesses that produce related
products or are involved in related markets and activities. Involves moving into new businesses
that are related to the company's original core business.
Conglomerate diversification - A strategy used to add new businesses that produce
unrelated products or are involved in unrelated markets and activities. A corporate strategy that
involves expansion into unrelated businesses.
Business Strategy - The major actions by which an organization builds and strengthens its
competitive position in the marketplace. The major actions by which a business competes in a
particular industry or market.
Functional strategy - Strategies implemented by each functional area of the organization
to support the organization's business strategy.
Strategy Implementation Steps - Step 1: Define strategic tasks. Articulate in simple
language what a particular business must do to create or sustain a competitive advantage.
Define strategic tasks to help employees understand how they contribute to the organization,
including redefining relationships among the parts of the organization.
Step 2: Assess organization capabilities. Evaluate the organization's ability to implement the
strategic tasks. A task force typically interviews employees and managers to identify specific
issues that help or hinder effective implementation. Then the results are summarized for top
management. In the course of your career, you will likely be asked to participate in a task force.
Step 3: Develop an implementation agenda. Management decides how it will change its own
activities and procedures; how critical inter-dependencies will be managed; what skills and
individuals are needed in key roles; and what structures, measures, information, and rewards
might ultimately support the needed behavior. A philosophy statement, communicated in terms
of value, is the outcome of this process.
Step 4: Create an implementation plan. The top management team, the employee task force,
and others develop the implementation plan. The top management team then monitors
progress. The employee task force continues its work by providing feedback about how others
in the organization are responding to the changes.
