Strategic Management Chapter 5 Quiz

Strategic Management Concepts

• This document is a textbook chapter (Chapter 5), titled "Strategies in Action," within a strategic management textbook, which explains different strategic concepts and types of strategies.

Learning Objectives (Page 2, 3)

• Cover various topics related to strategic management, including characteristics and benefits of clear objectives, different types of strategies, integration strategies, the effectiveness of specific strategies (market penetration, market development, product development), diversification strategy, retrenchment, divestiture and liquidation, Porter's five generic strategies, cooperation among competitors, joint ventures & partnerships, mergers/acquisitions, strategy facilitation tactics, differences in strategic planning for for-profit, not-for-profit, and small firms.

Figure 5.1 A Comprehensive Strategic-Management Model (Page 4)

• Presents a visual model illustrating the interconnectedness of different strategic management elements. Shows chapters covering external assessment, business mission, strategies in action, analysis and choice, implementation of strategies, strategy evaluation and governance, global and international issues, and strategy formulation. The model depicts a feedback loop, emphasizing the cyclical nature of these processes.

Long-Term Objectives (Page 5)

• Expected results of pursuing certain strategies, typically spanning 2-5 years. Long-term objectives are often followed or influenced by shorter-term objectives.

The Nature of Long-Term Objectives (Page 6)

• Describes the purpose of long-term objectives. They provide direction, foster synergy, support evaluation, define priorities, minimize uncertainty and conflict, stimulate effort, aid in resource allocation, and improve job design.

Table 5.1 Five Characteristics of Objectives (Page 7)

• Enumerate five essential characteristics of effective objectives: quantitative, understandable, challenging/achievable, compatible, and obtainable.

Financial Versus Strategic Objectives (Page 8)

• Differenciates financial goals (revenue growth, earnings, dividends, profit margins etc.) from strategic objectives (market share growth, delivery time, costs, product quality, geographic expansion, technological leadership etc.).

Not Managing by Objectives (Page 9)

• Identifies common management approaches that do not focus on objectives (Crisis Management, Hope Management, Extrapolation Management, and Mystery Management), which results in a lack of planning and focus in management.

Types of Strategies (Page 10)

• Most organizations use a combination of strategies. No single strategy is universally appropriate and organizations must make difficult decisions to choose and prioritize their strategic pursuits, as choosing a combination of multiple strategies can be risky.

Table 5.3 Alternative Strategies Defined and Exemplified (Pages 11, 12)

• Describes and exemplifies various alternative strategies (forward integration, backward integration, horizontal integration, market penetration, market development, product development, diversification - related and unrelated, retrenchment, divestiture, and liquidation). Includes examples illustrating the use of these strategies.

Learning Objectives Recap (Pages 2, 3)

• Summarises the key study ideas that are present for each learning objective, again going over different types of market and product strategies.

Intensive Strategies (Page 20)

• Lists and defines market penetration strategies, market development, and product development strategies.

Market Penetration Guidelines (Page 21)

• States various reasons when market penetration is an effective strategy. (e.g., when the market is not saturated).

Market Development Guidelines (Page 22)

• Describes when market development is a suitable strategy. (e.g., when new channels of distribution are available; when an organization excels).

Product Development Guidelines (Page 23)

• Explains when it is strategic to develop new products. (e.g., when in the maturity stage of the product life cycle, in a high-growth industry).

Diversification Strategies (Pages 24, 26, 27, 28)

• Defines related and unrelated diversification strategies. Explores when each strategy might be appropriate.

Synergies of Related Diversification (Page 25)

• Points out various benefits and synergies of related diversification strategies.

Related Diversification Guidelines (Page 26)

• Offers guidelines for when to implement a related diversification strategy.

Unrelated Diversification Guidelines (Pages 27, 28)

• Provides reasons for choosing an unrelated diversification strategy.

Defensive Strategies (Pages 29, 30, 31)

• Defines retrenchment, divestiture, and liquidation as defensive strategies, which are used when strategies are not working.

Retrenchment Guidelines (Page 31)

• Provides guidelines on when to use and consider potential retrenchment strategy.

Divestiture Guidelines (Page 32)

• Provides guidelines on when to consider a divestiture strategy.

Liquidation Guidelines (Page 34)

• Explains when to consider a liquidation strategy.

Value Chain Analysis and Benchmarking (Page 35)

• Defined and described value chain analysis and benchmarking including their purposes.

Figure 5.3 A Value Chain Illustrated (Page 36), Figure 5.4 An Example Value Chain for a Typical Manufacturing Company (Pages 37, 38)

• Illustrates value chain diagrams.

Figure 5.5 Transforming Value Chain Activities into Sustained Competitive Advantages (Page 39)

• Explains converting value chain activities to become a competitive advantage.

Michael Porter's Two Generic Strategies (Pages 40, 41, 42)

• Covers cost leadership (both types) and differentiation strategies. Further defines types based on market targeting (wide or narrow or focus).

Means for Achieving Strategies (Page 43)

• Highlights three methods for implementing strategies: building, borrowing, or buying.

Table 5.6 Six Reasons Why Many Mergers and Acquisitions Fail (Page 44)

• Outlines six common reasons why mergers and acquisitions fail.

Table 5.7 12 Potential Benefits of Merging With or Acquiring Another Firm (Page 45)

• Details the potential benefits of mergers and acquisitions.

Table 5.8 Six Benefits of a Firm Being the First Mover (Page 46)

• Outlines advantages for organizations who are a first mover in the market.

Strategic Management in Nonprofit and Small Firms (Page 47)

• Differentiates strategic management in nonprofits compared to for-profit organizations (e.g., nonprofits do not pay taxes, do not have shareholders).

Figure 5.6 How to Gain and Sustain Competitive Advantages (Page 48)

• Presents a cyclical approach to achieving competitive advantage involving steps such as establishing a clear vision and mission, evaluating and monitoring results, formulating strategies, and implementing strategies.

Copyright Information (Page 49)

• Contains copyright information regarding the textbook and its materials, emphasizing restrictions on distribution or sale of the materials.

Test your understanding of Chapter 5, 'Strategies in Action', from your strategic management textbook. This chapter covers various strategic concepts, types of strategies, and their effectiveness. From market penetration to Porter's five generic strategies, explore the nuances of strategic management through this engaging quiz.