CH8 - Strategy Formulation: Functional Strategy, Strategic Choice (MCQs)

Play an AI-generated podcast conversation about this lesson

What is the primary role of functional strategy in an organization?

Maximizing operational efficiency without considering corporate objectives.

Achieving corporate and business unit goals by optimizing resource productivity. (correct)

Focusing exclusively on cost-cutting measures across departments.

Replacing corporate strategy by focusing on short-term gains.

Which of the following is NOT a key functional strategy?

Financial Strategy

Research & Development Strategy

Marketing Strategy

Strategic Alliance Strategy (correct)

Which of the following is an example of a market development strategy?

Developing new products for new markets.

Capturing a larger share of an existing market for current products. (correct)

Entering an entirely unrelated industry.

Reducing operational costs by outsourcing production.

What is the primary difference between a push marketing strategy and a pull marketing strategy?

Push marketing emphasizes trade promotions to retailers, while pull marketing builds consumer demand through advertising. (B) Signup and view all the answers

Which of the following is an example of a pull marketing strategy?

Nike’s “Just Do It” campaign featuring world-famous athletes. (B) Signup and view all the answers

What is the key financial trade-off in corporate strategy?

Balancing the debt-to-equity ratio with reliance on internal financing via cash flow. (B) Signup and view all the answers

What is a leveraged buyout (LBO)?

Acquiring a company primarily through debt financing. (A) Signup and view all the answers

Which of the following is an example of selling a company’s patents for strategic gain?

Microsoft purchasing AOL’s patent portfolio for $1.1 billion in 2012. (A) Signup and view all the answers

What is the key difference between a technological leader and a technological follower?

Leaders pioneer innovations, while followers imitate successful products. (A) Signup and view all the answers

Which of the following is an example of open innovation?

P&G requiring that 50% of its innovations originate from outside the company. (A) Signup and view all the answers

Which of the following best describes a mass-production system?

Low-cost, standardized production with little customization. (B) Signup and view all the answers

Which production strategy focuses on continuous improvement?

Toyota Production System (TPS). (C) Signup and view all the answers

What is the key advantage of multiple sourcing in purchasing strategy?

Reduces supplier dependency and ensures competitive pricing. (A) Signup and view all the answers

What is the purpose of just-in-time (JIT) inventory management?

Ensuring parts arrive at the plant precisely when needed, reducing storage costs. (A) Signup and view all the answers

What is the primary benefit of a 360-degree appraisal in HRM strategy?

Gathers feedback from multiple sources for a well-rounded evaluation. (A) Signup and view all the answers

Which IT strategy allows multinational corporations to maintain round-the-clock productivity?

Follow-the-sun management. (A) Signup and view all the answers

Which strategy should companies avoid due to high risks and limited rewards?

Imitating a leading competitor without considering internal strengths. (B) Signup and view all the answers

What is the purpose of constructing corporate scenarios?

Forecasting the financial impact of alternative strategies. (A) Signup and view all the answers

Role of Functional Strategy

Optimizing resource productivity to achieve corporate and business unit goals.

Key Functional Strategies

Methods that guide specific resources toward achieving goals, excluding Strategic Alliance Strategy.