Test Bank for Crafting and Executing Strategy Concepts and Cases 22nd
Edition Thompson
Crafting and Executing Strategy, 22e (Thompson)
Chapter 2 Charting a Company's Direction
1) The five basic tasks of the strategy-making, strategy-executing process DO NOT include
A) developing a strategic vision of where the company needs to head and what its future
business makeup will be.
B) strategic management to convert the strategic vision into specific strategic and financial
performance outcomes for the company to achieve.
C) crafting a strategy to achieve the objectives and get the company where it wants to go.
D) developing a profitable business model.
E) executing the chosen strategy efficiently and effectively.
Answer: D
Explanation: The process of crafting and executing a company's strategy is an ongoing,
continuous process consisting of five interrelated stages: developing a strategic vision that charts
the company's long-term direction; strategic management for measuring the company's
performance and tracking its progress in moving in the intended long-term direction; crafting a
strategy for advancing the company along the path management has charted and achieving its
performance objectives; executing the chosen strategy efficiently and effectively; and monitoring
developments, evaluating performance, and initiating corrective adjustments in the company's
vision and mission statement, objectives, strategy, or approach to strategy execution in light of
actual experience, changing conditions, new ideas, and new opportunities.
Difficulty: 1 Easy
Topic: The Roles of Vision, Mission, and Values in the Strategic Management Process
Learning Objective: 02-01 Why it is critical for managers to have a clear strategic vision of
where the company needs to head.
Bloom's: Remember
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
,2) A company's strategic plan
A) maps out the company's history.
B) links the company's financial targets to control mechanisms.
C) outlines the competitive moves and approaches to be used in achieving the desired
business results.
D) focuses on offering a more appealing product than rivals.
E) lists methods of making money in its chosen business.
Answer: C
Explanation: A strategic plan maps out where a company is headed, establishes strategic and
financial targets, and outlines the competitive moves and approaches to be used in achieving
the desired business results.
Difficulty: 1 Easy
Topic: Strategy and the Strategic Management Process
Learning Objective: 02-01 Why it is critical for managers to have a clear strategic vision of
where the company needs to head.
Bloom's: Remember
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
3) An integral part of the managerial process of crafting and executing strategy includes
A) developing a proven business model.
B) deciding how much of the company's resources to employ in the pursuit of
sustainable competitive advantage.
C) developing a strategic vision.
D) communicating the company's values and code of conduct to all employees.
E) deciding on the company's strategic intent.
Answer: C
Explanation: The process of crafting and executing a company's strategy is an ongoing,
continuous process consisting of five interrelated stages: developing a strategic vision that charts
the company's long-term direction; utilizing strategic management for measuring the company's
performance and tracking its progress in moving in the intended long-term direction; crafting a
strategy for advancing the company along the path management has charted and achieving its
performance objectives; executing the chosen strategy efficiently and effectively; and monitoring
developments, evaluating performance, and initiating corrective adjustments in the company's
vision and mission statement, objectives, strategy, or approach to strategy execution in light of
actual experience, changing conditions, new ideas, and new opportunities.
Difficulty: 1 Easy
Topic: Strategy and the Strategic Management Process
Learning Objective: 02-01 Why it is critical for managers to have a clear strategic vision of
where the company needs to head.
Bloom's: Remember
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
,4) Integral parts of the managerial process of crafting and executing strategy include
A) developing a strategic vision, strategic management, and crafting a strategy.
B) developing a proven business model, deciding on the company's strategic intent, and
crafting a strategy.
C) strategic management, crafting a strategy, implementing and executing the chosen
strategy, and deciding how much of the company's resources to employ in the pursuit of
sustainable competitive advantage.
D) coming up with a statement of the company's mission and purpose, strategic management,
choosing what business approaches to employ, selecting a business model, and monitoring
developments.
E) deciding on the company's strategic intent, setting financial objectives, crafting a strategy,
and choosing what business approaches and operating practices to employ.
Answer: A
Explanation: The process of crafting and executing a company's strategy is an ongoing,
continuous process consisting of five interrelated stages: developing a strategic vision that charts
the company's long-term direction; utilizing strategic management for measuring the company's
performance and tracking its progress in moving in the intended long-term direction; crafting a
strategy for advancing the company along the path management has charted and achieving its
performance objectives; executing the chosen strategy efficiently and effectively; and monitoring
developments, evaluating performance, and initiating corrective adjustments in the company's
vision and mission statement, objectives, strategy, or approach to strategy execution in light of
actual experience, changing conditions, new ideas, and new opportunities.
Difficulty: 1 Easy
Topic: The Roles of Vision, Mission, and Values in the Strategic Management Process
Learning Objective: 02-01 Why it is critical for managers to have a clear strategic vision of
where the company needs to head.
Bloom's: Remember
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
, 5) The strategy-making, strategy-executing process is shaped by
A) management's strategic vision, strategic and financial objectives, and strategy.
B) the decisions made by the compensation and audit committees of the board of directors.
C) external factors such as the industry's economic and competitive conditions and
internal factors such as the company's collection of resources and capabilities.
D) the challenges of developing a sound business model.
E) top executives and the board of directors; very few managers below this level are involved
in the process.
Answer: C
Explanation: Management's decisions that are made in the strategic management process are
shaped by the prevailing economic conditions and competitive environment and the company's
own internal resources and competitive capabilities, as shown in Figure 2.1 and described in
detail in Table 2.1.
Difficulty: 2 Medium
Topic: Strategy and the Strategic Management Process
Learning Objective: 02-01 Why it is critical for managers to have a clear strategic vision of
where the company needs to head.
Bloom's: Understand
AACSB: Knowledge Application
Accessibility: Keyboard Navigation
6) When companies adopt the strategy-making and strategy-execution process, it requires
they start by
A) developing a strategic vision, mission, and values.
B) developing a proven business model, deciding on the company's top management team,
and crafting a strategy.
C) strategic management, developing a business model, crafting a strategy, and deciding how
much of the company's resources to employ in the pursuit of sustainable competitive
advantage.
D) coming up with a statement of the company's mission and communicating it to all employees,
strategic management, selecting a business model, and monitoring developments and initiating
corrective adjustments to the business model when necessary.
E) deciding on the company's board of directors, setting financial objectives, crafting a strategy,
and choosing what business approaches and operating practices to employ.
Answer: A
Explanation: Figure 2.1 displays the five-stage process. The first step is developing a strategic
vision, mission, and values.
Difficulty: 2 Medium
Topic: Strategy and the Strategic Management Process
Learning Objective: 02-01 Why it is critical for managers to have a clear strategic vision of
where the company needs to head.
Bloom's: Understand
AACSB: Analytical Thinking
Accessibility: Keyboard Navigation
