MG 630 Exam 1 (CH 1-6) Questions With 100% Correct Detailed Answers

Mission - correct answers The reason for an organization's existence. The mission statement is a broadly defined but enduring statement of purpose that identifies the scope of an organization's operations and its offerings to affected groups. Strategy - correct answers Top management's plans to attain outcomes consistent with the organization's mission and goals. Strategic Management - correct answers The continuous process of determining the mission and goals of an organization within the context of its external environment and its internal strengths and weaknesses, formulating and implementing strategies, and exerting strategic control to ensure that the organization's strategies are successful in attaining its goals. Business Model - correct answers The economic mechanism by which a business hopes to sell its goods or services and generate a profit. Intended Strategy - correct answers The original strategy top management plans and intends to implement. Strategic Thinking - correct answers The application of the process and principles utilized in strategic planning sessions to ongoing strategic challenges. Industrial organization - correct answers A view based in microeconomic theory that states firm profitability is most closely associated with industry structure. Resource-based theory - correct answers The perspective that views performance primarily as a function of a firm's ability to utilize its resources. Distinctive Competence - correct answers Unique resources skills and capabilities that enable a firm to distinguish itself from its competitors and create competitive advantage. Sustained competitive advantage - correct answers A firm's ability to enjoy strategic benefits over extended time. Contingency theory - correct answers A view which states that the most profitable firms are likely to be the ones that developed the best fit with their environment. Corporate governance - correct answers The board of directors, institutional investors, and blockholders who monitor firm strategies to ensure managerial responsiveness. Blockholders - correct answers Large shareholders who monitor firm strategies to ensure effective management. Sarbanes-Oxley Act - correct answers Legislation passed in 2002 that created more detailed reporting requirements for boards and executives in public US companies and accounting firms. CEO duality - correct answers A situation in which the CEO also serves as the chair of the board. Hedge fund - correct answers An investment fund open to only a small number of investors but permitted by regulators to undertake riskier and more speculative investments. Top-management team - correct answers A team of top-level executives-headed by the CEO-all of whom play instrumental roles in the strategic management process. Comparative advantage - correct answers The idea that certain products may be produced more cheaply or at higher quality in specific countries due to advantages in labor costs or technology. Industry - correct answers A group of competitors that process similar products or services. Critical success factors (CFSs) - correct answers Elements of the strategy that are essential for success among most or all competitors within a given industry. Market share - correct answers The percentage of total market sales attributed to one competitor (i.e., firm sales divided by total market sales.) Relatively market share - correct answers A firm's share of industry sales when only the firm and its key competitors are considered (i.e., firm sales divided by sales of the key firms in the industry.) Industry Life Cycle - correct answers The stages (introduction, growth, shakeout, maturity, and decline) through which industries are believed to pass. Hypercompetition - correct answers The notion that industries emerge, develop, and evolve so rapidly that identifying the current life-cycle state may not be possible nor worthwhile. Herfindahl-Hirschman Index (HHI) - correct answers A sophisticated measure of market concentration calculated by summarizing the squares of the market shares for each firm competing in an industry. Switching costs - correct answers One-time costs that buyers of an industry's outputs incur as they switch from one company's products or services to another's. Exit Barriers - correct answers Economic, strategic, or emotional obstacles to leaving an industry. Barriers to entry - correct answers Obstacles to entering an industry, including economies or scale, brand identify and product differentiation, capital requirements, switching costs, access to distribution channels, cost disadvantages independent of size, and government policy. Substitute products - correct answers Alternative offerings produced by firms in another industry that satisfy similar consumer needs. Macroenvironment - correct answers The general environment that affects all business firms in an industry, which includes political-legal, economic, social, and technological forces. PEST - correct answers An acronym referring to the analysis of the four macroenvironmental forces, Political, Economic, Social, and Technological. Ecology - correct answers Relationship between humans and their surrounding environment, including other living creatures, plants, air, and water. Anthropogenic climate change - correct answers The notion that human activity (e.g., heavy manufacturing) has a substantial effect on a global weather patterns. Societal values - correct answers Concepts and beliefs that members of a society tend to hold in high esteem. Culture - correct answers A society's generally accepted values, traditions, and patterns of behavior.