Page 1 of 85
STRATEGIC MANAGEMENT: CREATING COMPETITIVE
ADVANTAGES EXAM QUESTIONS LATEST VERSION QUESTIONS
AND ANSWERS 2026 EDITION
STRATEGIC MANAGEMENT: CREATING COMPETITIVE ADVANTAGES
EXAMINATION
250 Multiple Choice Questions with Rationales
SECTION 1: STRATEGY & THE STRATEGIC MANAGEMENT PROCESS (Questions 1-30)
1. Strategic management is defined as:
A) A set of activities that ensures the company is profitable
B) The analyses, decisions, and actions an organization undertakes in order to create
and sustain competitive advantages
C) The process of hiring and firing employees
D) A system for managing financial resources
E) The annual budgeting process
Rationale: Strategic management consists of the analyses, decisions, and actions an
organization undertakes in order to create and sustain competitive advantages . This
definition encompasses the entire process of strategy formulation and implementation,
not just isolated activities or financial management.
2. According to the "romantic" view of leadership, organizational success or failure
is attributed to:
A) External environmental factors
B) The quality of the leader's decisions and vision
C) Luck and chance
D) Employee performance only
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E) Market conditions
Rationale: In the romantic view of leadership, the implicit assumption is that the leader
is the key force in determining an organization's success or lack thereof . This
perspective attributes success or failure primarily to leadership qualities and decisions.
3. Which of the following is NOT one of the four key attributes of strategic
management?
A) Directional and broad in scope
B) Involves trade-offs between effectiveness and efficiency
C) Focuses exclusively on short-term profitability
D) Involves the entire organization
E) Requires continuous monitoring and adaptation
Rationale: Strategic management does NOT focus exclusively on short-term
profitability . Strategic management involves the recognition of trade-offs between
effectiveness and efficiency . It is directional, involves the entire organization, and
requires continuous monitoring.
4. Effectiveness in strategic management refers to:
A) Doing things right
B) Doing the right things
C) Minimizing costs
D) Maximizing efficiency
E) Reducing employee turnover
Rationale: Effectiveness refers to doing the right things, while efficiency refers to doing
things right . Strategic management involves trade-offs between these two concepts,
recognizing that organizations must balance being effective (achieving goals) with being
efficient (using resources optimally).
5. According to Henry Mintzberg, the intended strategy of a firm:
A) Always translates exactly into realized strategy
B) Rarely survives in its original form
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C) Is never influenced by external factors
D) Is the same as emergent strategy
E) Cannot be changed once formulated
Rationale: Henry Mintzberg states that the intended strategy rarely survives in its
original form . Unforeseen environmental developments, unanticipated resource
constraints, or changes in managerial preferences may result in parts of the intended
strategy remaining unrealized. Good managers adapt to new opportunities.
6. The final realized strategy of a firm is:
A) Purely deliberate and planned
B) A combination of deliberate and emergent strategies
C) Determined solely by the board of directors
D) Unchanged from the original intended strategy
E) Based only on time-tested approaches
Rationale: Realized strategy is that strategy of a firm in which organizational decisions
are determined by both analysis and unforeseen environmental developments,
unanticipated resource constraints, and/or changes in managerial preferences . It
represents the actual implementation, combining intended and emergent elements.
7. A company's plan to create and capture value in a marketplace is defined as:
A) Business model
B) Business strategy
C) Competitive advantage
D) Value proposition
E) Mission statement
Rationale: Business strategy is defined as a company's plan to create and capture
value in a marketplace . This definition emphasizes the dual focus on value creation (for
customers) and value capture (for the firm).
8. The difference between a customer's willingness to pay for a product and the
firm's total costs to provide the product is known as:
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A) Profit margin
B) Value
C) Competitive advantage
D) Market share
E) Return on investment
Rationale: Value is the difference between a customer's willingness to pay for a
product and the firm's total costs to provide the product . This creates value for both the
customer (consumer surplus) and the firm (profit).
9. A strategic leader is someone who:
A) Follows orders without question
B) Initiates strategies and motivates employees to follow through
C) Only implements strategies developed by others
D) Avoids risk at all costs
E) Focuses solely on operational tasks
Rationale: A strategic leader initiates strategies and motivates and encourages
employees to follow through with the plan . Strategic leaders are proactive in shaping
the organization's direction and inspiring others to achieve strategic goals.
10. Strategy implementation is the process of:
A) Analyzing the external environment
B) Translating strategic decisions into organizational action
C) Setting long-term objectives
D) Evaluating competitor performance
E) Developing corporate-level strategies
Rationale: Strategy implementation involves adopting a set of organizational processes
that enables the company to effectively carry out strategic decisions . It translates
decisions into organizational action in a successful manner.
11. The "case analysis phase" of strategic management involves:
STRATEGIC MANAGEMENT: CREATING COMPETITIVE
ADVANTAGES EXAM QUESTIONS LATEST VERSION QUESTIONS
AND ANSWERS 2026 EDITION
STRATEGIC MANAGEMENT: CREATING COMPETITIVE ADVANTAGES
EXAMINATION
250 Multiple Choice Questions with Rationales
SECTION 1: STRATEGY & THE STRATEGIC MANAGEMENT PROCESS (Questions 1-30)
1. Strategic management is defined as:
A) A set of activities that ensures the company is profitable
B) The analyses, decisions, and actions an organization undertakes in order to create
and sustain competitive advantages
C) The process of hiring and firing employees
D) A system for managing financial resources
E) The annual budgeting process
Rationale: Strategic management consists of the analyses, decisions, and actions an
organization undertakes in order to create and sustain competitive advantages . This
definition encompasses the entire process of strategy formulation and implementation,
not just isolated activities or financial management.
2. According to the "romantic" view of leadership, organizational success or failure
is attributed to:
A) External environmental factors
B) The quality of the leader's decisions and vision
C) Luck and chance
D) Employee performance only
, Page 2 of 85
E) Market conditions
Rationale: In the romantic view of leadership, the implicit assumption is that the leader
is the key force in determining an organization's success or lack thereof . This
perspective attributes success or failure primarily to leadership qualities and decisions.
3. Which of the following is NOT one of the four key attributes of strategic
management?
A) Directional and broad in scope
B) Involves trade-offs between effectiveness and efficiency
C) Focuses exclusively on short-term profitability
D) Involves the entire organization
E) Requires continuous monitoring and adaptation
Rationale: Strategic management does NOT focus exclusively on short-term
profitability . Strategic management involves the recognition of trade-offs between
effectiveness and efficiency . It is directional, involves the entire organization, and
requires continuous monitoring.
4. Effectiveness in strategic management refers to:
A) Doing things right
B) Doing the right things
C) Minimizing costs
D) Maximizing efficiency
E) Reducing employee turnover
Rationale: Effectiveness refers to doing the right things, while efficiency refers to doing
things right . Strategic management involves trade-offs between these two concepts,
recognizing that organizations must balance being effective (achieving goals) with being
efficient (using resources optimally).
5. According to Henry Mintzberg, the intended strategy of a firm:
A) Always translates exactly into realized strategy
B) Rarely survives in its original form
, Page 3 of 85
C) Is never influenced by external factors
D) Is the same as emergent strategy
E) Cannot be changed once formulated
Rationale: Henry Mintzberg states that the intended strategy rarely survives in its
original form . Unforeseen environmental developments, unanticipated resource
constraints, or changes in managerial preferences may result in parts of the intended
strategy remaining unrealized. Good managers adapt to new opportunities.
6. The final realized strategy of a firm is:
A) Purely deliberate and planned
B) A combination of deliberate and emergent strategies
C) Determined solely by the board of directors
D) Unchanged from the original intended strategy
E) Based only on time-tested approaches
Rationale: Realized strategy is that strategy of a firm in which organizational decisions
are determined by both analysis and unforeseen environmental developments,
unanticipated resource constraints, and/or changes in managerial preferences . It
represents the actual implementation, combining intended and emergent elements.
7. A company's plan to create and capture value in a marketplace is defined as:
A) Business model
B) Business strategy
C) Competitive advantage
D) Value proposition
E) Mission statement
Rationale: Business strategy is defined as a company's plan to create and capture
value in a marketplace . This definition emphasizes the dual focus on value creation (for
customers) and value capture (for the firm).
8. The difference between a customer's willingness to pay for a product and the
firm's total costs to provide the product is known as:
, Page 4 of 85
A) Profit margin
B) Value
C) Competitive advantage
D) Market share
E) Return on investment
Rationale: Value is the difference between a customer's willingness to pay for a
product and the firm's total costs to provide the product . This creates value for both the
customer (consumer surplus) and the firm (profit).
9. A strategic leader is someone who:
A) Follows orders without question
B) Initiates strategies and motivates employees to follow through
C) Only implements strategies developed by others
D) Avoids risk at all costs
E) Focuses solely on operational tasks
Rationale: A strategic leader initiates strategies and motivates and encourages
employees to follow through with the plan . Strategic leaders are proactive in shaping
the organization's direction and inspiring others to achieve strategic goals.
10. Strategy implementation is the process of:
A) Analyzing the external environment
B) Translating strategic decisions into organizational action
C) Setting long-term objectives
D) Evaluating competitor performance
E) Developing corporate-level strategies
Rationale: Strategy implementation involves adopting a set of organizational processes
that enables the company to effectively carry out strategic decisions . It translates
decisions into organizational action in a successful manner.
11. The "case analysis phase" of strategic management involves:
