IBS-Mumbai

PGPM Sem III (2011-2012) Course : Business Strategy I A few Samples of MCQs of most of the topics PART A Basic Concepts

1.

In 1990, Prof. C.K. Prahalad and Prof. G. Hamel co-authored the most reprinted article in the HBR on The core competency of Corporation. What is this core competency they were talking about? The thing that an organization can do better than its competitors Always based on key expertise of individual personnel of the organization Only differentiates activities within the firm Is more focused on collective learning and coordination skills behind the product/service of the corporation. e. An area of generalized expertise that gets built
a. b. c. d.

1.

An organization where people continually expand their capacity to create the results they truly desire and where new expansive patterns of thinking are nurtured can be termed as: a Organization with internal thinking b Organization with potential for excellence c The strategic corporation d Learning Organization e The fifth discipline

2.

Strategic fit means positioning of the firm by matching its organizational resources to its environment. The only strategic fit that is almost certain to be achieved is -------------------a. b. c. d. e.

Marketing Operational Financial Personnel Both (a) & (b)

3.

According to the BCG Growth Share Matrix, new products which need a lot of cash for development, with the potential signs for success, are called

a. b. c. d. e.

Cash cows Cost leaders Dogs Question marks Stars

4.

When a Companys capabilities & competencies are superior to those of competitors they are called
a. b. c. d. e.

Resources Distinctive Competencies Core Competencies Critical success factor Key Performance factor

5.

_______ occurs when the organizations strategy gradually moves away from relevance to the forces at work in its environment.
a. b. c. d. e.

Paradigm shift Strategic drift Vertical Integration Horizontal Integration Both ( c) and (d)

6.

A strategic vision for a company

a. b. c. d. e.

Involves how fast to pursue the chosen strategy and reach the targeted levels of performance Consists of thinking through what it will take to make the chosen strategy work as planned Consists of managements view of the kind of company it is trying to create and its intent to stake out a specific business position Is pretty much the same thing as a companys strategy Concerns managements view of how to transition the companys business model from where it is now to where it needs to be.

7.

The overall roles of a mission statement are to

a. b. c. d. e.

Identify the key competitor groups in the firms industry and better understand who the companys closest competitors are now and will probably be later Give the organization its own special identity, business emphasis, and path for development To help key executives arrive at a consensus as to what the companys underlying strategic intent should be and to clarify for employees why it is important to earn a profit. To decide how big a risk to take in choosing where to concentrate the companys resources To create a statement for customers, investors, and employees that clarifies where the industry is headed, how fast the industry is likely to grow, and what competition will be like, and the critical importance of earning a profit.

8.

Concern for Green Supply chain Management in terms of a PESTEL framework can be categorized undera..Political b Economic c Socialogical d Technological e Enviornment & Legal

9. a.

Which statement best describes threshold resources of an organization Resources of an organization which it appears to have b. Resources that enable organization attain critical success factors c. Resources that give competitive advantage d. Resources that the organization currently possesses e. Resources that enable the organization to stay in the business

10.

Manufacturers of Personal Computers (PC) depend heavily on Intel for microprocessor. This is an example of
a. b. c. d. e.

Bargaining power of buyers Threat of substitute products Rivalry among existing firms Bargaining power of suppliers Possibility of new entrants

11.

Maruti Suzuki India Ltd,(MSIL) a leader in passenger car industry in India ,has established a relationship between vertically related businesses somewhere between long-term contracts and full

ownership such as minority investment in equity. Which of the following statement is right regarding Strategic choice-Corporate Level for MSIL :a. b. c. d. e.

MSIL chosen a strategic choice MSIL chosen a strategic choice MSIL chosen a strategic choice MSIL chosen a strategic choice Concentric Integration

of Tapered Integration strategy its with Soppier companies of Horizontal Integration of Quasi Integration strategy through its Associated companies of Vertical Forward Integration

12. a. b. c. d. e.

The attributes of Strategic Intent are: Sense of Direction & Sense of Discovery Sense of Direction & Sense of Destiny Sense of Destiny & Sense of Discovery Sense of Direction, Sense of Discovery & Sense of Destiny None of the above

The best of a successful strategy implementation is: Whether structure is well matched to strategy. Whether strategies and procedures are observed in a strategy supportive fashion. Whether actual organizational performance matches or exceeds the target spelled out in strategic plan. d. Whether it is made after the strategy is formulated so that it is supportive of the strategy. e. The extent to which managers and employees fully support the companys strategy and long term direction.
13. a. b. c.

14. a. b. c. d. e.

Which of the following ratios reveals a firms financial risk statement: Leverage ratio Liquidity ratio Activity ratio Profitability ratio Both (c) & (d)

16. The Strategy development in Strategic Planning Systems deploy a. The strategy lens - experience b. The strategy lens - design c. The strategy lens ideas d. Both a and b above

c. Both b and c above 17. The ------------------- strategy involves the identification of a segment of the declining industry that will not only offer a stable market but also high returns.
a. b. c. d. e.

Leadership Niche Harvest Quick divestment Both (c) and (d)

18. To give ordinary folks the feeling of buying like rich is the vision statement of: a. Future group b. Wal Mart c. Tisco d. Carrefour e. Reliance Industries 19. A visionary management guru and strategy expert who was Professor of Strategic Management at London Business School & author of Managing Across Borders & Transnational Management was
a. b. c. d. e.

Rajat Gupta Gita Piramal Bala Balachandran Sumantra Ghosal C.K.Prahlad

20. Who added a new dimension to strategic management by bringing personal side of manager and coined the term strategy as a craft?
a. b. c. d. e.

Arthur Sharplin Henry Mitzberg William Glueck Henry Ford Sumanatra Ghosal

21. Which of the following provides the basis for comparing relative strengths of different businesses in their respective markets?
a. b.

Five forces model Game theory

c. d. e.

BCG Matrix GE ninecell model PESTEL framework

22. Which of the following is not a feature of a maturing industry?

a. b. c. d. e.

Intense competition for market share Highly experienced, and often repeated customers High concentration Frequent launch of new products & applications Price War

23. The Experience curve helps a company to reduce cost due to

a. b. c. d. e.

Manpower . Volume Effects Learning Effects Both b and c above Structure

24. Factors that are essential for successfully gaining and maintaining competitive advantage are known as
a. b. c. d. e.

Competitive success factors Key success factors Critical Evaluation Factors Business success factors Vital factors

25. BPO, Bottled Water; Consumer Banking industries can be categorized as:a. b. c. d. e.

Emerging Industry Fragmented industry Matured Industry Industry in Transition Declining Industry

26. Which is main difference between cost leadership, differentiation & focus strategies:-

a. b. c. d. e.

Cost leadership and differentiation are highly expensive strategies whereas Focus Strategy is a low cost strategy. Cost leadership and differentiation focus on one particular market segment whereas Focus Strategy concentrates on all market segments. Cost leadership and differentiation strategies aim at Total industry, whereas Focus strategy aims at particular target market. Aim of Cost leadership and differentiation is to reduce cost of product, where as cost of Focus Strategy aim to provide extra service. No difference

27. Reliance Industries limited going from Polyester to Petroleum to Oil rigdrilling is called
a. b. c. d. e.

Horizontal Integration Vertical Backward Integration Product Development Vertical Forward Integration Concentric Integration

28. A large multi-divisional business has three levels in its hierarchy of strategy:
a. b. c. d. e.

Environmental Corporate Functional Environmental Enterprise - Corporate Corporate Business Functional Business Divisional - Functional Corporate Zonal Branch

29. The government directive on price control of certain life saving drugs, from time to time is an example of ------------------- for the pharmaceutical industry. a. Emergent strategy. b. Imposed strategy. c. Integrative strategy. d. Intensive strategy. e. Hybridstrategy.

31. Companies that compete in the global market place typically face which of the following strategic pressures? a. Language barriers & cultural differences. b. Pressures to reduce costs & cultural sensitivity. c. Cultural sensitivity & varying exchange rates.

d. Varying exchange rates & language barriers. e. Pressures to reduce costs & to be locally responsive. 32. Core competencies and focus are not the best strategy in emerging markets and conglomerates or diversified firms are better suited in emerging markets and if groups do not add value they should consider a focus strategy. This view is advocated by: a. Goshal b. Khanna and Palepu c. Porter d. Prahlad and Hamel e. Mckinsey Article 33.Automobile manufacturer Hondas expertise in Formula 1 Racing Car engines used in other products such as lawn mowers to luxury cars. Which of the following is a prime characteristic of core competency? a. It may yield competitive advantage b. It is the final step in building corporate strategy c. It is always impossible for competitors to imitate d. It reduces the entry barrier to a wide variety of markets e. It automatically puts competitors on a strategic disadvantage 34.In which of the following international entry strategies, the company retains the most control? Franchising Direct Exporting Licensing Foreign Direct Investment Indirect Exporting 35.Concentric mergers differ to managerial conglomerate mergers in transferability of which of the following functions? General management functions Specific management functions Both Specific and General management functions Generic management functions All of the above

36. Which of the following mostly influences an international business? Growth Diversification Technology Exchange Rates

Synergy 37. The hard Ss of Mckinseys 7s model are: ___________ Style, strategy & structure Staff, structure & strategy Strategy, structure & system Skills, strategy & structure Shared values, structure & strategy 38. An international or global competitive strategy is inherently more complex to formulate and manage because of: Differences in markets from country to country Differences in competitors and competition from country to country Differences in labour costs, energy costs, transportation costs, tariffs and import restrictions, foreign exchange rate fluctuations, and the roles of government from country to country All of these None of these because global strategies are no more or no less complex than other strategies 39. Which of the following statements describes a reason why firms go international? New product development is unnecessary Promoters desire to have international presence Foreign markets provide greater market opportunities Piracy can be avoided in foreign markets Regional trade eliminates foreign competition 40.What provides a powerful tool of strategy implementation when linked with operation strategies and long term objectives? Objectives Strategies Policies Mission Both (a) and (b)

41. Which of the following organizational structures maximizes the CEOs control over the organization? Functional organization Divisional organization Strategic organization

Matrix organization Simple organization