Podcast
Questions and Answers
Functional-level strategies are primarily concerned with managing corporate-level resources.
Functional-level strategies are primarily concerned with managing corporate-level resources.
False
At the business level, firms focus on creating competitive advantage in product market domains within each strategic business unit (SBU).
At the business level, firms focus on creating competitive advantage in product market domains within each strategic business unit (SBU).
True
The corporate-level strategy involves questions regarding the firm's capabilities and potential for creating value in new business areas.
The corporate-level strategy involves questions regarding the firm's capabilities and potential for creating value in new business areas.
True
The SBU is defined as the overall corporate identity that encompasses all business units.
The SBU is defined as the overall corporate identity that encompasses all business units.
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Functional-level strategies aim to maintain competitive advantage through constant innovation and high customer satisfaction.
Functional-level strategies aim to maintain competitive advantage through constant innovation and high customer satisfaction.
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A strategic thinker is opportunistic and focused on the past only.
A strategic thinker is opportunistic and focused on the past only.
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The concept of strategy involves assessing both internal and external factors affecting a firm.
The concept of strategy involves assessing both internal and external factors affecting a firm.
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A situation analysis only focuses on the external environment of an organization.
A situation analysis only focuses on the external environment of an organization.
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Human resources refer to the monetary resources from which a firm can draw.
Human resources refer to the monetary resources from which a firm can draw.
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The establishment of strategic direction can be reflected in mission statements and organizational visions.
The establishment of strategic direction can be reflected in mission statements and organizational visions.
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Comprehensive master plans are not necessary for maximizing competitive advantage.
Comprehensive master plans are not necessary for maximizing competitive advantage.
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Organizational knowledge and learning are not considered part of an organization's internal environment.
Organizational knowledge and learning are not considered part of an organization's internal environment.
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Strategy formulation includes designing organizational structures and managing stakeholder relationships.
Strategy formulation includes designing organizational structures and managing stakeholder relationships.
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General organizational resources include patents and relationships with external stakeholders.
General organizational resources include patents and relationships with external stakeholders.
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The external environment does not significantly influence an organization.
The external environment does not significantly influence an organization.
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Financial intermediaries are part of a company’s internal stakeholders.
Financial intermediaries are part of a company’s internal stakeholders.
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The broad environment includes only technological influences.
The broad environment includes only technological influences.
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One organization can significantly influence the forces in the broad environment.
One organization can significantly influence the forces in the broad environment.
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Strategic surveillance involves collecting information from various environments.
Strategic surveillance involves collecting information from various environments.
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Business intelligence is not affected by strategic surveillance.
Business intelligence is not affected by strategic surveillance.
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Local and national government agencies are classified as external stakeholders.
Local and national government agencies are classified as external stakeholders.
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Business intelligence primarily focuses on the collection and analysis of information regarding markets and customers.
Business intelligence primarily focuses on the collection and analysis of information regarding markets and customers.
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Emergent strategies are planned responses to situations that were foreseen by strategists.
Emergent strategies are planned responses to situations that were foreseen by strategists.
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Deliberate strategies are designed for environments characterized by unpredictability.
Deliberate strategies are designed for environments characterized by unpredictability.
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The hierarchical levels of strategy include corporate, business, and operational strategies.
The hierarchical levels of strategy include corporate, business, and operational strategies.
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The essence of an emergent strategy is to react to changing conditions in a dynamic and competitive environment.
The essence of an emergent strategy is to react to changing conditions in a dynamic and competitive environment.
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Traditional strategies, which are deliberate strategies, follow a process that begins with idea generation.
Traditional strategies, which are deliberate strategies, follow a process that begins with idea generation.
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Business-level strategy formulation deals with how organizations should avoid competition.
Business-level strategy formulation deals with how organizations should avoid competition.
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Strategic management involves both deliberate strategies and those that emerge unpredictably.
Strategic management involves both deliberate strategies and those that emerge unpredictably.
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Study Notes
Characteristics of Strategic Thinking
- A strategic thinker possesses six key characteristics: intent-focused, comprehensive, opportunistic, long-term oriented, built on the past and present, and hypothesis-driven.
Intent-Focused
- Strategic intent builds on a managerial vision of the firm's future direction.
Comprehensive
- This involves viewing the firm as part of a larger system of value creation and understanding linkages.
Opportunistic
- Seizing unexpected opportunities is crucial for strategic thinking.
Long-Term Oriented
- Strategic thinking goes beyond immediate needs, considering future possibilities.
Built on Past and Present
- Learning from past experiences and building on current realities is essential.
Hypothesis-Driven
- Strategic thinking involves evaluating creative ideas critically and taking calculated risks.
The Concept of Strategy
- Strategy is the process an organization uses to assess future prospects and achieve its goals.
- It involves defining the company's objectives and the methods to reach them.
The Strategic Management Process
- The strategic management process involves key activities including situation analysis, defining strategic direction, formulating specific strategies and implementing strategy.
- This process analyzes broad and operating environments, internal resources, and stakeholders.
- Strategies define a company's mission and vision.
Internal Environment
- Internal environment consists of financial, physical, human resources, organizational knowledge/learning, and relationships.
Situational Analysis
- External environment includes stakeholders (competitors, suppliers, financial intermediaries, local communities, unions etc.), government, economic, sociocultural and technological factors that affect the company.
- Broad environment, which the firm operates in, includes societal trends, technological changes, political climate economic conditions, legal factors and cultural aspects.
- The broad environment can impact the firm significantly.
Levels of Strategy
- Corporate, business and functional levels of strategy are hierarchical levels to define a company's domain and activities.
- Corporate strategy is about a firm's overall direction and management of its business. This covers broader questions about what businesses the firm is in or wants to be in.
- Business strategy is about how a company competes in a specific market, defining its directions and how it navigates towards the identified domains.
- Functional strategies involve the details of how areas like marketing, operations, finance etc. are used to implement business level strategies, to support the achievement of competitive advantages.
Strategic Surveillance
- Strategic surveillance is a process of collecting information from broad, operating, and internal environments.
- This informs the firm's business intelligence, which involves analyzing information about new technologies, markets, consumers, competitors and social trends.
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Description
Explore the essential traits of strategic thinking in this quiz. You will learn about being intent-focused, comprehensive, and opportunistic, as well as the importance of long-term orientation. Understand how past experiences influence current strategies and how to evaluate hypotheses critically.
