Which of the following is not included in measuring organizational performance

Strategic Management: A Competitive Advantage Approach, 14e (David) Chapter 9 Strategy Review, Evaluation, and Control

1. Most strategists believe that an organization's well being depends on evaluation of the strategic-management process. Answer: TRUE Diff: 1 Page Ref: 286 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

2. Adequate and timely feedback is important to effective strategy evaluation. Answer: TRUE Diff: 1 Page Ref: 287 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

3. Too much emphasis on evaluating strategies may be expensive and counterproductive. Answer: TRUE Diff: 2 Page Ref: 287 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

4. Strategy evaluation should have a long-run focus and avoid a short-run focus. Answer: FALSE Diff: 2 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

5. According to Richard Rumelt, consonance and consistency are mostly based on a firm's external assessment. Answer: FALSE Diff: 2 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

6. According to Rumelt, consistency and feasibility are largely based on a firm's internal assessment. Answer: TRUE Diff: 2 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

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1. Consistency, distinctiveness, advantage, and feasibility are Richard Rumelt's four criteria for evaluating a strategy. Answer: FALSE Diff: 2 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

2. Strategy evaluation is becoming increasingly easier with the passage of time, given technological advances. Answer: FALSE Diff: 3 Page Ref: 289 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

3. The decreasing time span for which planning can be done with any degree of certainty is a reason strategy evaluation is more difficult today. Answer: TRUE Diff: 2 Page Ref: 290 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

4. Strategies may be inconsistent if policy problems and issues continue to be brought to the top for resolution. Answer: TRUE Diff: 1 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

5. Competitive advantages normally are the result of superiority in one of three areas: feasibility, consistency, or consonance. Answer: FALSE Diff: 2 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

6. Regardless of the size of the organization, a certain amount of "management by wandering around" at all levels is essential to effective strategy evaluation. Answer: TRUE Diff: 2 Page Ref: 291 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

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1. Criteria for evaluating strategies should be measurable and easily verifiable. Answer: TRUE Diff: 1 Page Ref: 292 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

2. Financial ratios are rarely used as criteria to evaluate strategies. Answer: FALSE Diff: 2 Page Ref: 294 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

3. Measuring organizational performance includes comparing expected results to actual results, investigating deviations from plans, evaluating individual performance, and examining progress being made toward meeting stated objectives. Answer: TRUE Diff: 2 Page Ref: 292 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

4. Intuitive judgments are almost always involved in deriving quantitative criteria. Answer: TRUE Diff: 2 Page Ref: 294 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

5. Most quantitative evaluation criteria are geared to long-term objectives rather than annual objectives. Answer: FALSE Diff: 2 Page Ref: 294 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

6. Measuring organizational performance requires making changes to reposition a firm competitively for the future. Answer: FALSE Diff: 2 Page Ref: 292 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

7. Taking corrective actions does not necessarily mean that existing strategies will be abandoned, or even that new strategies must be formulated. Answer: TRUE Diff: 2 Page Ref: 295 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

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1. Corrective action in strategy evaluation is necessary to keep an organization on track toward achieving stated objectives. Answer: TRUE Diff: 1 Page Ref: 295 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

2. Alvin Toffler argues that environments are becoming so dynamic and complex that they threaten people and organizations with future shock, in his thought-provoking books entitled Future Shock and The Third Wave. Answer: TRUE Diff: 2 Page Ref: 295 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

3. Future shock occurs when the nature, type, and speed of changes overpower an individual's or organization's ability and capacity to adapt. Answer: TRUE Diff: 2 Page Ref: 295 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

4. According to research, participation in strategy-evaluation activities is one of the best ways to overcome individuals' resistance to change. Answer: TRUE Diff: 2 Page Ref: 295 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

5. The form of a Balanced Scorecard does not vary for different organizations or industries. Answer: FALSE Diff: 1 Page Ref: 296 Objective: 9 Discuss the Balanced Scorecard. Learning Outcome: Describe how organizational performance is measured

6. The Balanced Scorecard approach deals with the question, "How satisfied are the firm's customers?" Answer: TRUE Diff: 2 Page Ref: 296 Objective: 9 Discuss the Balanced Scorecard. Learning Outcome: Describe how organizational performance is measured

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1. Contingency plans are alternative plans that can be put into effect if certain key events do not occur as expected. Answer: TRUE Diff: 2 Page Ref: 299 Objective: 9 Discuss the importance of contingency planning in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

2. Organizations should prepare contingency plans just for unfavorable events. Answer: FALSE Diff: 3 Page Ref: 299 Objective: 9 Discuss the importance of contingency planning in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

3. Strategists should try to cover all bases by planning for all possible contingencies. Answer: FALSE Diff: 2 Page Ref: 299 Objective: 9 Discuss the importance of contingency planning in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

4. Contingency plans should be as simple as possible. Answer: TRUE Diff: 1 Page Ref: 299 Objective: 9 Discuss the importance of contingency planning in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

5. Alternative strategies not selected for implementation should be discarded, as they have a tendency to contaminate the contingency plans. Answer: FALSE Diff: 2 Page Ref: 299- AACSB: Reflective Thinking Skills Objective: 9 Discuss the importance of contingency planning in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

6. Identifying both beneficial and unfavorable events that could possibly derail the strategy or strategies is the first step of effective contingency planning. Answer: TRUE Diff: 2 Page Ref: 300 Objective: 9 Discuss the importance of contingency planning in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

7. A frequently used tool in strategy evaluation is the audit. Answer: TRUE Diff: 2 Page Ref: 300 Objective: 9 Discuss the role of auditing in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

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1. The U. Chamber of Commerce is against the accounting switch from GAAP to IFRS, saying it will cause cross-border commerce to decline. Answer: FALSE Diff: 1 Page Ref: 301 AACSB: Dynamics of the Global Economy Objective: 9 Discuss the role of auditing in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

2. Public accounting firms usually avoid strategy-evaluation services. Answer: FALSE Diff: 2 Page Ref: 300 Objective: 9 Discuss the role of auditing in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

3. The accounting switch from GAAP to IFRS in the U. is going to cost businesses millions of dollars in fees and upgraded software systems and training. Answer: TRUE Diff: 1 Page Ref: 300 Objective: 9 Discuss the role of auditing in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

4. Unless the timetable is changed, all companies will be required to use the IFRS procedures in

1. Answer: FALSE Diff: 2 Page Ref: 301 Objective: 9 Discuss the role of auditing in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

1. The U. Chamber of Commerce supports the change from GAAP to IFRS, saying it will help the U. compete in the world economy. Answer: TRUE Diff: 2 Page Ref: 300 AACSB: Dynamics of the Global Economy Objective: 9 Discuss the role of auditing in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

2. IFRS standards comprise 25,000 pages, whereas GAAP standards comprise 5,000 pages. Answer: FALSE Diff: 3 Page Ref: 300 Objective: 9 Discuss the role of auditing in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

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1. What is the cornerstone of effective strategy evaluation? A) Adequate and timely feedback B) Quality and quantity of managers C) Smaller ratio of top- to lower-level management D) Evaluation preceding implementation stage E) Punitive corrective actions Answer: A Diff: 3 Page Ref: 287 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

2. All of these are Richard Rumelt's criteria to evaluate a strategy EXCEPT A) advantage B) consistency C) feasibility D) distinctiveness E) consonance Answer: D Diff: 2 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

3. With the passage of time strategy evaluation is becoming A) increasingly difficult. B) much simpler. C) very convenient. D) an unnecessary activity. E) less important. Answer: A Diff: 2 Page Ref: 289 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

4. All of the following are reasons strategy evaluation is more difficult today EXCEPT A) a dramatic increase in the environment's complexity B) the increasing number of variables C) the increase in the number of both domestic and world events affecting organizations D) the decreasing difficulty of predicting the future with accuracy E) the rapid rate of obsolescence of even the best plans Answer: D Diff: 1 Page Ref: 290 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

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1. Which of the following is NOT a reason for the increasing difficulty of evaluating strategies? A) Product life cycles are longer. B) Domestic and world economies are less stable. C) Product development cycles are shorter. D) Technological advancement is more rapid. E) Change is occurring more frequently. Answer: A Diff: 2 Page Ref: 290 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

2. Success today A) guarantees success tomorrow. B) is no guarantee of success tomorrow. C) should lull a firm into complacency. D) is all that really matters. E) none of the above. Answer: B Diff: 2 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

3. According to Rumelt, the final broad test of strategy is its A) advantage. B) feasibility. C) consonance. D) consistency. E) distinctiveness. Answer: B Diff: 2 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

4. Competitive advantage normally is the result of superiority in resources, skills, and A) employees. B) position. C) consistency. D) feasibility. E) governance. Answer: B Diff: 1 Page Ref: 288 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

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1. Modern organizational realities demand that employees demonstrate greater A) flexibility. B) innovation. C) creativity. D) initiative. E) all of the above Answer: E Diff: 2 Page Ref: 290 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

2. Strategy-evaluation activities should ideally be performed A) just on a periodic basis. B) only at the onset of a problem. C) on a continuous basis. D) solely upon completion of major projects. E) annually only. Answer: C Diff: 1 Page Ref: 291 Objective: 9 Explain why strategy evaluation is complex, sensitive, and yet essential for organizational success. Learning Outcome: Describe how organizational performance is measured

3. Corrective actions are almost always ________ except when external and internal factors have not significantly changed and the firm is progressing satisfactorily toward achieving stated objectives. A) unnecessary B) needed C) undesirable D) prohibitively expensive E) futile Answer: B Diff: 2 Page Ref: 291 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

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1. If you discover during the course of strategy evaluation that major changes have occurred in the firm's internal strategic position, you should A) continue on the present strategic course. B) wait until the next quarter to see if things revert. C) take corrective actions. D) follow the original strategic plan. E) none of the above Answer: C Diff: 3 Page Ref: 292 AACSB: Analytic Skills Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

2. Changes in the organization's management, marketing, finance/accounting, production/operations, R&D, and MIS strengths and weaknesses should be the focus of a revised A) mission. B) IFE matrix. C) vision. D) EFE matrix. E) EPM matrix. Answer: B Diff: 2 Page Ref: 290- Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

3. A revised ________ should indicate how effective a firm's strategies have been in response to key opportunities and threats. A) IFE matrix B) mission C) EFE matrix D) vision E) CPM matrix Answer: C Diff: 2 Page Ref: 291 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

4. Which of the following is NOT included in measuring organizational performance? A) Comparing results to competitors' expectations B) Examining progress being made toward meeting stated objectives C) Investigating deviations from plans D) Evaluating individual performance E) Comparing expected results to actual results Answer: A Diff: 2 Page Ref: 292 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

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1. Financial ratios are used to compare a firm's performance over different time periods, to compare the firm's performance to industry averages, and to compare a firm's performance with A) overall business standards. B) projected goals. C) the performance of suppliers. D) non-financial ratios. E) the performance of competitors. Answer: E Diff: 3 Page Ref: 294 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

2. Most quantitative criteria are geared to ________ objectives rather than ________ objectives. A) top-management; employee B) short-term; annual C) annual; long-term D) environmental; community E) profit; social Answer: C Diff: 2 Page Ref: 294 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

3. What corrective actions might a firm take during strategy evaluation? A) Revising the business mission B) Issuing stock C) Revising objectives D) Selling a division E) All of the above Answer: E Diff: 2 Page Ref: 295 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

4. According to author Alvin Toffler, what occurs when the nature, types, and speed of changes overpower an individual's or organization's ability and capacity to adapt? A) Corporate insecurity B) Corrective actions C) Future shock D) Corporate agility E) Projected performance Answer: C Diff: 2 Page Ref: 295 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

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1. Corrective actions should always A) strengthen an organization's competitive position in its industry. B) streamline asset holdings. C) have no risk. D) involve abandoning existing strategies. E) all of the above Answer: A Diff: 2 Page Ref: 295- AACSB: Reflective Thinking Skills Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

2. Research suggests that which of the following is one of the best ways to overcome individuals' resistance to change in strategy evaluation? A) Participation B) Command-and-control C) Laissez-faire system D) Rational argument E) Emotional reactions Answer: A Diff: 2 Page Ref: 295 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

3. According to researchers, all of the following encourage individuals to accept change EXCEPT A) when they have a cognitive understanding of the changes B) when they have a sense of control over the situation C) when they have an awareness that necessary actions are going to be taken to implement change D) when they participate in strategy-evaluation activities E) when the nature, types, and speed of changes overpower their ability and capacity to adapt Answer: E Diff: 1 Page Ref: 295 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

4. Corrective action should do all of the following EXCEPT A) capitalize upon internal strengths B) avoid external opportunities C) avoid external threats D) improve internal weaknesses E) strengthen an organization's competitive position Answer: B Diff: 2 Page Ref: 296 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

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1. The strategy-evaluation process should A) dominate decisions. B) be complex. C) be cumbersome. D) foster mutual understanding and trust. E) be restrictive. Answer: D Diff: 2 Page Ref: 298 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

2. Controls need to be ________ rather than ________. A) action-oriented; information-oriented B) cultural; political C) qualitative; quantitative D) measurable; timely E) universal; diverse Answer: A Diff: 2 Page Ref: 298 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

3. The strategy-evaluation process should foster A) mutual understanding. B) doubt. C) corporate culture. D) complexity. E) division. Answer: A Diff: 2 Page Ref: 298 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

4. Which of the following is true regarding the design of a firm's strategy-evaluation system? A) There is a one-size-fits-all system that works for all companies. B) It does not need to take into account the organization's size. C) The management style of a firm has no bearing on the design. D) It should be determined based on the unique characteristics of a company. E) There is one ideal system. Answer: D Diff: 1 Page Ref: 299 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

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1. ________ organizations require more elaborate and detailed strategy-evaluation systems than ________ ones because it is more difficult to coordinate efforts among different divisions and functional areas. A) Non-profit; for-profit B) For-profit; non-profit C) Large; small D) Small; large E) Foreign; domestic Answer: C Diff: 2 Page Ref: 299 Objective: 9 Describe a practical framework for evaluating strategies. Learning Outcome: Describe how organizational performance is measured

2. What activity is defined as having alternative plans that can be put into effect if certain key events do not occur as expected? A) Corporate agility B) Scenario planning C) Strategy evaluation D) Contingency planning E) Forecasting Answer: D Diff: 1 Page Ref: 299 Objective: 9 Discuss the importance of contingency planning in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

3. Which of the following statements about contingency plans is NOT true? A) Contingency plans should be as simple as possible. B) Only high-priority areas require the insurance of contingency plans. C) Contingency plans should be developed for favorable and unfavorable events. D) Strategists should plan for all possible contingencies. E) Contingency plans minimize the impact of potential threats. Answer: D Diff: 2 Page Ref: 299 Objective: 9 Discuss the importance of contingency planning in strategy evaluation. Learning Outcome: Describe how organizational performance is measured

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Which one of the following is not a measure of organizational performance?

When measuring organizational performance a comparison should be made between expected results and actual results?

Which of the following is not a reason for the increasing difficulty of evaluating strategies group of answer choices?

Which one of Rumelt's criteria for evaluating strategies refers to the need for strategists to examine sets of trends?