SEVI EXAM 1 QUESTIONS & ANSWERS
What is strategy? - Answer -a set of actionable goals a firm takes to gain or sustain
superior performance and edge out competitors.
What is strategic Management? - Answer -an integrative management field that
combines analysis, formulation, and implementation in the quest for competitive
advantage
Three elements that provide the basis of a good strategy? - Answer -1. a diagnosis to
identify the competitive challenge
2. a guiding policy to address the competitive challenge through strategy formulation
3. a set of coherent actions to implement the firm's guiding policy
competitive advantage - Answer -achieved why a firm's performance exceeds that of its
competitors or the industry average.
relative, not absolute
competitive parity - Answer -achieved when two or more firms perform at the same
level.
Competitive disadvantage - Answer -a firm underperforms its rivals or industry average.
sustainable competitive advantage - Answer -how well a firm is able to cut out other
competitors for a long period of time.
How can firms gain a competitive advantage? - Answer -1) consumers value your
product more
2) similar to competitors at lower cost
Why is it important for a firm to establish a unique strategic positioning? - Answer -
enhances the likelihood of your firm being able to gain the competitive advantage
Stakeholders - Answer -All the people who stand to gain or lose by the policies and
activities of a business and whose concerns the business needs to address.
steps in a stakeholder impact analysis - Answer -1. Identify stakeholders
2. Identify stakeholder interests
3. Identify opportunities and threats
4. Identify social responsibilities
5. Address stakeholder concerns
, pyramid of social responsibility - Answer -a model that suggests corporate social
responsibility is composed of economic, legal, ethical, and philanthropic responsibilities
and that the firm's economic performance supports the entire structure.
Economic -> Legal -> Ethical -> Philanthropic
Vision - Answer -What is your purpose? What is your ultimate goal?
Mission - Answer -How will you achieve your goals and vision?
Values - Answer -How will you ensure your work is legal and ethical to achieve your
vision and mission?
Vision Statement - Answer -expresses what the organization should become, where it
wants to go strategically.
Mission Statement - Answer -a statement of the organization's purpose - what it wants
to accomplish in the larger environment
Perceptual Acuity - Answer -the ability to sense what is coming before the fog clears.
SWOT Analysis - Answer -One of the most basic techniques for analyzing a company's
internal and external environments
Strengths
Weaknesses
Opportunities
Threats
environmental scanning - Answer -surveillance of external environment which allows
companies to anticipate future changes and detect changes already occurring.
Monitoring - Answer -tracks the evolution of environmental trends, sequences of events
and streams of activities.
competitive intelligence - Answer -allows firms to define and understand their industry
and rival's strengths and weaknesses.
environmental forecasting - Answer -development of plausible projections about the
direction, scope, speed, and intensity of environmental change
Scenario Analysis - Answer -in depth approach to forecasting
Six Areas of General Environment - Answer -Factors external to an industry, usually
beyond a frim's control
What is strategy? - Answer -a set of actionable goals a firm takes to gain or sustain
superior performance and edge out competitors.
What is strategic Management? - Answer -an integrative management field that
combines analysis, formulation, and implementation in the quest for competitive
advantage
Three elements that provide the basis of a good strategy? - Answer -1. a diagnosis to
identify the competitive challenge
2. a guiding policy to address the competitive challenge through strategy formulation
3. a set of coherent actions to implement the firm's guiding policy
competitive advantage - Answer -achieved why a firm's performance exceeds that of its
competitors or the industry average.
relative, not absolute
competitive parity - Answer -achieved when two or more firms perform at the same
level.
Competitive disadvantage - Answer -a firm underperforms its rivals or industry average.
sustainable competitive advantage - Answer -how well a firm is able to cut out other
competitors for a long period of time.
How can firms gain a competitive advantage? - Answer -1) consumers value your
product more
2) similar to competitors at lower cost
Why is it important for a firm to establish a unique strategic positioning? - Answer -
enhances the likelihood of your firm being able to gain the competitive advantage
Stakeholders - Answer -All the people who stand to gain or lose by the policies and
activities of a business and whose concerns the business needs to address.
steps in a stakeholder impact analysis - Answer -1. Identify stakeholders
2. Identify stakeholder interests
3. Identify opportunities and threats
4. Identify social responsibilities
5. Address stakeholder concerns
, pyramid of social responsibility - Answer -a model that suggests corporate social
responsibility is composed of economic, legal, ethical, and philanthropic responsibilities
and that the firm's economic performance supports the entire structure.
Economic -> Legal -> Ethical -> Philanthropic
Vision - Answer -What is your purpose? What is your ultimate goal?
Mission - Answer -How will you achieve your goals and vision?
Values - Answer -How will you ensure your work is legal and ethical to achieve your
vision and mission?
Vision Statement - Answer -expresses what the organization should become, where it
wants to go strategically.
Mission Statement - Answer -a statement of the organization's purpose - what it wants
to accomplish in the larger environment
Perceptual Acuity - Answer -the ability to sense what is coming before the fog clears.
SWOT Analysis - Answer -One of the most basic techniques for analyzing a company's
internal and external environments
Strengths
Weaknesses
Opportunities
Threats
environmental scanning - Answer -surveillance of external environment which allows
companies to anticipate future changes and detect changes already occurring.
Monitoring - Answer -tracks the evolution of environmental trends, sequences of events
and streams of activities.
competitive intelligence - Answer -allows firms to define and understand their industry
and rival's strengths and weaknesses.
environmental forecasting - Answer -development of plausible projections about the
direction, scope, speed, and intensity of environmental change
Scenario Analysis - Answer -in depth approach to forecasting
Six Areas of General Environment - Answer -Factors external to an industry, usually
beyond a frim's control
