29 Questions
Which component of a mission statement focuses on the firm's distinctive competence or major competitive advantage?
Self-concept
What aspect does the philosophy component of a mission statement cover?
Basic beliefs and values of the firm
Which characteristic of a vision statement focuses on motivating and rallying stakeholders around a shared vision?
Inspirational
What does the concerns for survival, growth, and profitability component of a mission statement signify?
The firm's commitment to growth and financial soundness
Which component of a mission statement indicates whether the firm is responsive to social, community, and environmental concerns?
Concern for public image
What characteristic of a vision statement describes its focus on the future and long-term goals of the organization?
Forward-looking
What is the purpose of a vision statement?
To answer the question 'what do we want to become'
Who are the individuals most responsible for the success or failure of an organization?
Strategists
Which term refers to economic, social, and technological trends that could benefit or harm an organization in the future?
External opportunities and threats
What is the primary focus of strategy evaluation?
Reviewing external and internal factors
Which term describes anything that a firm does exceptionally well compared to its rivals?
Competitive advantage
Why is it important to take corrective actions in strategic management?
Because the success of today is no guarantee of success tomorrow
What are internal strengths and weaknesses of an organization?
Controllable activities performed well or poorly
Which term refers to specific results that an organization seeks to achieve in pursuing its basic mission?
Long-Term Objectives
What are annual objectives in an organization?
Short-term milestones to achieve long-term objectives
Why might some organizations not engage in strategic planning according to the text?
Content with success
What is one of the reasons for not engaging in strategic planning mentioned in the text?
Laziness
What is the primary purpose of a vision statement?
To provide a foundation for developing a mission statement
Why is it important for a vision statement to be short?
To ensure clarity and conciseness
What is a common pitfall in strategic planning related to employees?
Failing to communicate the plan to employees
Why should the vision statement be established before the mission statement?
To establish a clear direction before defining specific activities
What happens if top managers make intuitive decisions that conflict with the formal plan?
The organization lacks control over decisions and resources
Why should many managers have input into developing the vision statement?
To gain diverse perspectives and buy-in
What factor can put a ceiling on the price that can be charged before consumers switch to a substitute product?
Potential development of substitutional products
What can increase the intensity of competitiveness among firms in an industry?
Potential saturation of the market
Which factor can affect the intensity of competition in an industry due to the cost of switching raw materials?
Bargaining power of suppliers
What can be considered a barrier to entry for new firms in an industry?
Large capital requirements
Which condition can lead to increasing competitive pressures for producers of eyeglasses and contact lenses?
Potential development of substitutional products
What can impact the intensity of competition in an industry due to a large number of suppliers or few good substitute raw materials?
Bargaining power of suppliers
Test your knowledge on strategy formulation by exploring the development of vision and mission statements, identifying external opportunities and threats, evaluating internal strengths and weaknesses, setting long-term objectives, and selecting appropriate strategies. Also, assess your understanding of strategy evaluation through reviewing external and internal factors, measuring performance, and implementing corrective actions.
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