Strategic Management MCQs

✅ The correct answer is option D.
Environmental forecasting involves the development of projections about the direction, scope, speed and intensity of environmental change. Environmental forecasting is the process of predicting and calculating the potential intensity, duration, timeframe, and nature of various external forces that can affect the business activities of a company, interrupt its plans, and force it to introduce changes to its objectives and strategies.

✅ The correct answer is option C.
The organization will change strategy to seek to fully exploit its power is the danger of excessive monopoly power. A pure monopoly is a single supplier in a market with no competitors, whereas monopoly power exists when a single firm dominates a particular market.

✅ The correct answer is option D.
Cash cows are SBU’s that typically generate a lot of competition. A Cash Cow is a metaphor used for a business or a product, which exhibits a strong potential in terms of returns in a low-growth market. The rate of return from this business is usually greater than the market growth rate. A company does not have to invest much in the business apart from the initial outlay. Once the company recovers its initial investment, it does not have to put in more cash to keep the business growing.

✅ The correct answer is option B.
Rate of growth is not a factor in the positioning of an organization in an industry. A process through which the structure of a multigent system organization increases the number of its roles and links. Organizational growth is essentially a quantitative process.

✅ The correct answer is option D.
A marketing department that promises delivery quicker than the production department’s ability to produce is an example of a lack of understanding of the interrelationships among functional areas and firm strategies. The Marketing Department is the key to good marketing and sales. It promotes and establishes a business in its niche, based on the products or services the business is offering. It identifies the areas in which the product fits and where the business should focus its marketing strategy and, therefore, spend its budget for the maximum coverage and results.

✅ The correct answer is option B.
According to Ringbakk (1971) and Steiner (1972) Seeing planning as a once-a-year ritual should be avoided when creating a formal plan. In formal planning, the managers look forward for a change when it is to be made use of.

✅ The correct answer is option A.
Corporate strategies are also known as grand or root strategies. A corporate strategy entails a clearly defined, long-term vision that organizations set, seeking to create corporate value and motivate the workforce to implement the proper actions to achieve customer satisfaction.

✅ The correct answer is option C.
Structural and stylistic flaws is likely to be the effect of a logical corporate strategy but poor strategy implementation.

✅ The correct answer is option B.
Corporate resource allocation may be different depending on the speed of growth of the organization. Past allocations and budgets is inappropriate when facing rapid growth. Resource allocation is a process and strategy involving a company deciding where scarce resources should be used in the production of goods or services. A resource can be considered any factor of production, which is something used to produce goods or services.

✅ The correct answer is option D.
Small, sophisticated service companies one of the following types of organizations would benefit from a matrix structure. A matrix organizational structure is a company structure in which the reporting relationships are set up as a grid, or matrix, rather than in the traditional hierarchy. In other words, employees have dual reporting relationships – generally to both a functional manager and a product manager.