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Exam 3: The Organizational Environment and Culture

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Question 1

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For the past two years, Swen Johannsen, owner/general manager of Swen's Fine Duds, a local men's clothing store, has fought to stay in business. In the face of increasing competition, Swen has tried several tactics: aggressively promoting price-slashing sales to drive his competitors' customers to his doors; attempting to cut costs by leveling out sales and inventory through seasonal sales; as well as lining up contracts with wholesalers in advance of seasonal rushes (e.g., summer swimwear) to prevent inventory depletion. He has even recruited the president of the chamber of commerce to sit on his board. None of these tactics have been successful. Now, Swen is considering a deviation from his current business to one that might be more suitable, perhaps a formal wear/tuxedo rental and retail shop or a boutique Western wear store. Swen is using ________ as his final tactic.

A) independent action
B) domain selection
C) cooptation
D) buffering
E) smoothing

F) A) and E)
G) A) and D)

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Question 2

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The main difference between final consumers and intermediate consumers is that the final consumers

A) pay cash.
B) use products themselves.
C) purchase more than intermediate consumers.
D) are not as flexible as intermediate consumers.
E) do not have any bargaining power.

F) A) and B)
G) A) and C)

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Question 3

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A ________ is powerful if a buyer has few other sources of supply or if the supplier has many other buyers.

Provide an example of a technology changing a business function, and provide supporting evidence of the value of that technology in that application.

________ includes searching for and sorting through information about the environment.

Discuss any three independent strategies that a firm may use as a proactive response to its environment.

________ is a barrier to entry.

A useful clue about an organization's culture is

Claire presented to her boss the possibility of building a new manufacturing plant to serve a new, hot market. Her boss replied, "Claire, I can't support that. Three multinational firms, who are world-class in terms of global reach, influence, stability, and financial depth, will be competing for that market. Not only would we be a new entrant to the playing field, the barriers to entry are just too high for us. We are small and financial resource-limited, so we would be challenged to meet the market's ________ requirements."

The founders of Richardson Corporate pride themselves on their commitment to a stewardship of the environment, displaying a photo montage in the lobby that displays before-and-after pictures of the site where the headquarters complex is built-from an ugly landfill into a parkland. As a reflection of the company's culture, the photo montage represents a

________ is exploiting a distinctive competence or improving efficiency for competitive advantage.

Differentiate among the following four strategic maneuvers: domain selection, diversification, merger and acquisition, and divestiture.

Steve, long-term and successful sales professional for Durham Inc., has gained a vast degree of competitive intelligence in his 25 years with Durham. He walked into his manager's office and said, "David, for family reasons, I need to move out of state. Therefore, I've accepted a position with a competitor. I'm submitting my two weeks' notice. This isn't personal; you've been a great friend." David replied, "Steve, I'm sorry to hear this. I will truly miss you and your contributions. However, your two weeks' notice will not be required. I will walk with you to human resources right now to process your resignation, and then we will escort you to the door." David's rather terse response was intended to quickly remove Steve from Durham's premises. Why?

A centralized, organic approach with direct supervision for managing uncertainty is ideal for which of the following environments?

Dennis, a senior manager at VST Corporation, is considering the acquisition of a revolutionary water treatment technology from a small development firm. The asking price is $5 million. However, the environmental uncertainty of the water treatment marketplace is both complex and dynamic. Dennis wants to acquire the new technology but seeks to manage the risk associated with his decision, or "hedge his bets." Key elements of his risk management strategy might be to

________ is the first level of organization culture.

Mike Jones-Smith, a division manager for Rubon Corporation, told his subordinate, "Sheila, because this is your first year of budget planning for your department, I need you to ________, defining a best-case, a worst-case, and a plausible-case business, or middle-ground business, outlook. The plausible-case business outlook will be what you will use for budget planning."

Netflix, Amazon, and YouTube have recently emerged as serious and successful content providers, attracting viewers away from traditional networks such as ABC, CBS, and NBC. The success of these nontraditional providers demonstrates the power in the competitive environment held by new competitors, or new entrants to the marketplace. To effectively compete with these new entrants, executives at traditional networks will take advantage of barriers to entry, such as

The five-by-eight inch card with one rule on it-Use good judgment in all situations-that employees at J. R. Williams Corporation receive along with the employee handbook tells the employees a great deal about their company's

Great American Farms Corp. announced that it was selling off its cereals division in order to realign itself more competitively in the marketing of its other products. This is an example of managing the task environment through