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1st Edition Ketchen Test Bank
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Mastering Strategic Management vol1.1 1st Edition Ketchen Test Bank
Chapter 1
MASTERING STRATEGY: ART AND SCIENCE
True/False Questions
1. Strategy is a complex concept that involves many different processes and activities within an
organization.
True; Easy
2. Developing a viable business model requires that a firm sell goods or services for more than
it costs the firm to create and distribute those goods.
True; Easy
3. One important aspect of a business model is providing customers with a good or service more
cheaply than they can create it themselves.
True; Easy
4. For a small firm, licensing technology to larger firms provides a second income stream and
decreases the chances of imitation.
True; Easy
5. Unexpected twists and turns in the external as well as the internal environment place limits on
the value of strategic planning.
True; Easy
7. Strategic ploys can be especially beneficial when facing much stronger opponents.
True; Easy
10. Deciding what a firm is not going to do is just as important to strategy as deciding what it is
going to do.
True; Easy
11. Intended strategies are usually described in detail within an organization’s strategic plan.
True; Easy
12. Realized strategies are a product of a firm’s intended strategy, the firm’s deliberate strategy,
and its emergent strategy.
True; Easy
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© 2015 Flat World Knowledge, Inc.
14. The idea of “stratego,” from which the word strategy is derived, refers to the idea of defeating
an enemy by effectively using resources.
True; Easy
16. Executives who make assumptions about what an adversary can and cannot do put their
organizations’ performance in jeopardy.
True; Easy
17. The history of strategic management can be traced back several thousand years.
True; Easy
18. The book, “The Principles of Scientific Management,” was a response to Taylor’s
observation that most tasks within organizations were organized in a haphazard way.
True; Easy
19. Strategic management is a process that involves building a careful understanding of how
changes in the world might affect a particular firm.
True; Easy
21. Strategic management involves a single conceptualization of the concept of strategy drawn
from recent history.
False; Easy
22. Trends and events of the external environment seldom affect the overall state of an
organization.
False; Easy
23. Firms must evaluate their own resources to understand how they might react to changes in the
environment.
True; Easy
25. Strategy implementation entails crafting an effective organizational structure and corporate
culture.
True; Easy
26. There is only one single established method of conceptualizing the concept of strategy.
False; Easy
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© 2015 Flat World Knowledge, Inc.
27. The study of strategic management involves knowing how and when to apply creative
thinking.
True; Easy
Multiple-choice Questions
28. _____ examines how actions and events involving top executives, firms, and industries
influence a firm’s success or failure.
a. Developmental counseling
b. Disparate impact
c. Strategic management
d. Trend analysis
e. Attitude survey
c; Moderate
30. A strategic _____ is a carefully crafted set of steps that a firm intends to follow in order to be
successful.
a. pattern
b. perspective
c. ploy
d. plan
e. position
d; Moderate
31. A company that manufactures soaps could not sell its products despite spending a good
amount on advertisements. Therefore, management decided to use the concept of direct
marketing. They thought of appointing a large number of salespersons who would do door-to-
door selling of the product. This is an example of a strategic:
a. ploy.
b. plan.
c. position.
d. pattern.
e. perspective.
b; Moderate
32. Economies of _____ refer to a cost advantage that is created when a firm can produce a good
or service at a lower per unit price due to producing the good or service in large quantities.
a. scale
b. demand
c. scope
d. brand
3
© 2015 Flat World Knowledge, Inc.
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The Democratic Party of South Carolina itself took action to nullify the
effects of the court decision. If Negroes could not be legally barred from
primary election, they would be excluded from party membership. A state
Democratic convention, held shortly after the decision, adopted a rule
which provided that to be eligible for membership in the party, a person had
to be a “white Democrat” who subscribed to the principles of the
Democratic Party of South Carolina as declared by the state convention.[22]
In 1947 the newly enacted defenses for white supremacy in the
Democratic primary were tested in federal district court and found wanting.
George A. Elmore, under NAACP auspices, brought suit against the
Democratic Party. He claimed that its recent actions deprived him of his
right to vote. Federal District Judge J. Waties Waring[23] agreed and ruled
against the state of South Carolina and the Democratic Party. In
admonishing South Carolina to “rejoin the union,” he declared racial
discriminations illegal in the machinery that selected the officers and
lawmakers of the United States. All citizens were entitled to cast a “free and
untrammelled” vote in the election. If “the only material and realistic
elections” were “clothed with the name ‘primary,’” said the judge, they
were no less equally entitled to vote in them.[24]
In the face of the decision, the harrassed and beleaguered state
Democratic Party took two important steps to insure continuation of the
white primary. By the first a dual system of voting qualifications was
established which sought to disbar most Negro voters. Concomitantly a
lengthy oath, designed to discourage Negro voters and required of all
voters, was adopted. It compelled the voter to swear that he understood,
believed in, and supported “the principles of the Democratic Party of South
Carolina,” the “social, religious, and educational separation of the races,”
and “the principles of states rights,” and was opposed to the “proposed
federal so-called FEPC law.”[25]
These restrictions were quickly brought to a court test. In a second
decision, in the case of Brown v. Baskin, Judge Waring invalidated the white
primary. In a pointed and sharply worded opinion he termed the dual system
of voting qualifications “a clear and flagrant evasion of the law” as
enunciated in earlier court rulings against suffrage restrictions on the basis
of race. He also branded the oath required of all voters in the primary as a
“flagrant disregard of the rights of American citizens to exercise their own
views and opinions.” The oath was patently unconstitutional.[26] The United
States Supreme Court refused to review either of Judge Waring’s decisions,
thus in effect upholding them.[27]
Judge Waring, a prominent Charlestonian, was condemned on all sides
by white South Carolinians. His decisions were likewise criticized. After
the ruling in Brown v. Baskin, Representative William Jennings Bryan Dorn
asked Congress to investigate Judge Waring’s “conduct in office.” Under
his ruling, said Dorn, “a Communist, a Negro, a Fascist, or a Republican
could vote in the Democratic Party of South Carolina.”[28]
Only slowly had white South Carolina awakened to the threat to legal
school segregation contained in the repeated petitions and suits of
Clarendon Negroes. By the time the state legislature convened in January,
1951, the menace was fully realized. A definite fear had developed that the
courts might rule in favor of the Negro petitioners. Basis for this fear was a
long line of recent United States Supreme Court rulings outlawing
segregation in state university graduate and professional schools even when
facilities provided Negroes were in fact substantially equal to those for
whites. The legislators and other state officials clearly recognized that by no
criteria were white and Negro schools even remotely equal, not only in
Clarendon but over the entire state. White South Carolina’s only hope, they
reasoned, lay in an immediate and far reaching program to provide equal
facilities for each race. At the same time certain precautionary measures
had to be taken against the possibility that the courts might hold segregation
per se illegal.
Leadership in this program fell to Governor James F. Byrnes, who, after
a long career in the federal government, including a short period of service
on the Supreme Court, had broken with President Truman and the national
Democratic Party and had returned to South Carolina to vent his frustration
against the national government and the Democratic Party. Elected governor
in 1950, he was inaugurated in January, 1951. Almost immediately Byrnes
began a long range program which was to provide a basis for the state’s
defense of the racial status quo and the doctrine of separate-but-equal
schools. The program subsequently was enacted by the 1951 state
legislature. The position of Byrnes, as well as that of many of the state’s
other leaders, was summarized in a series of the governor’s speeches in
early 1951. South Carolina, he announced, would not then “nor for some
years to come mix white and colored children” in public schools. To
prevent this situation the state would, if necessary, “reluctantly” abandon its
public school system. “A lawful way” would be found to educate all
children “and at the same time provide separate schools for the races.”
While conceding the inferiority of Negro schools, Byrnes insisted that the
educational crisis facing the state was caused by “the politicians in
Washington and the Negro agitators in South Carolina” seeking to alter the
“Southern way of life.” But they would find that “what a Carpetbag
government could not do in the Reconstruction period” was likewise
impossible in 1951. The governor would protect the “innocent Colored
children,” the victims of those elements which sought to end segregation.
With a prescience characteristic of white spokesmen for racial separation,
he insisted that “the overwhelming majority of colored people in this state”
did not want integrated schools. Byrnes denied that new school policies
were based on the expediency of necessity rather than on high principle. He
righteously observed shortly after the district court ruling that “had there
been no suit ... I would have urged this school program to help the white
and colored children” of the state.[60]
The most important undertaking in the Byrnes educational approach was
the beginning of a tremendous school construction program. The cost was
estimated at $75,000,000 though the amount actually spent on the project
by 1957 was more than double the original figure. To finance new school
construction, Byrnes secured legislative passage of a three percent sales
tax.[61] This program, in which more than half the funds were spent for
Negro schools, had the result of giving the Negroes better physical school
facilities in some localities than those of the whites.
In addition to these constructive measures, the state legislature, upon
Byrnes’s recommendation, enacted several “preparedness measures” for use
in the event the federal courts outlawed segregation. Local school officials
were given authority to sell or lease school property. Churches or other
private groups thus would be enabled to maintain schools under some sort
of private school plan. Another strategem provided that pupils could be
transferred from one school to another only with the approval of the
superintendents of both schools affected.[62]
A measure that caused understandable hesitation on the part of many
public officials and civic groups was the repeal of the constitutional
provision requiring a state supported public school system. The NAACP
and other Negro groups vigorously opposed repeal, but in February, 1952,
the legislature approved a referendum on the proposal. In the referendum,
held the following November, 68 percent of those voting favored repeal.
Opponents of the measure considered the 32 percent against repeal
something of a moral victory for their side.[63]
To coordinate state policy on the segregation issue, the legislature
created a special 15-member committee. This group came to be known as
the Gressette Committee, after its chairman, State Senator L. Marion
Gressette, a fifty-three year old Phi Beta Kappa, farmer-lawyer from the
low country Calhoun County. The committee had a double function. First, it
was directed to study the conditions that would confront the state should the
federal courts direct an end to segregation in public schools. Second, it was
to recommend to the legislature a course of action which would “alleviate
the serious condition which would result” from such an eventuality.[64] This
committee, after assisting Byrnes in developing his program in 1951, was
inactive from that time until the Supreme Court ruling of May 17, 1954.
Following the circuit court’s ruling the Clarendon case was immediately
appealed to the United States Supreme Court. By the time the highest
tribunal considered the case, the six months period allowed by the circuit
court for school officials to furnish bona fide equality for Negroes had
elapsed. Consequently, on January 26, 1952, the case was remanded to the
circuit court which was directed to take whatever action it deemed
appropriate in view of its findings. In the meanwhile Judge Waring had
retired and had been replaced on the court by Judge Armisted M. Dobie of
Virginia. At the rehearing counsel for the school officials reported on the
steps taken by the county and on other plans contemplated under the
statewide school equalization program. These plans, when completed,
would provide equality in all areas for white and Negro schools, claimed
school authorities. Though equality admittedly as yet had not been attained,
such would be forthcoming within a “reasonable” time. Accepting these
arguments at face value, the circuit court ruled unanimously that “the
defendants have complied with the decree of the court to equalize facilities
as soon as humanly possible and no good could be accomplished for
anyone” by ordering an end to segregation.[65] The NAACP again
immediately appealed to the Supreme Court.
Arguments before the Supreme Court took place in December, 1952, in
conjunction with four similar cases. Clarendon County was represented by
John W. Davis, noted constitutional lawyer and Democratic presidential
candidate in 1924. Davis, a twentieth century “Northern man with Southern
principles,” based his case mainly on grounds of constitutionalism and
states rights. “What is the great national policy underlying this whole
question?” he asked. “Is it not that the very strength and fiber of our federal
system is local self-government in those matters for which local action is
competent?”[66] Again the appellees stressed three main points. They
maintained that the state was proceeding to remove “all inequalities
between its white and colored schools,” as had been found by the lower
court. Further, school authorities argued that the legality of school
segregation had been exercised and recognized so continuously that the
question was “no longer open for debate.” As for the testimony of “sundry
academic persons” offered in opposition to segregation, such “opinions”
presented questions of legislative policy only and formed no sufficient basis
for any conclusions on the subject, least of all for a judicial finding.[67]
Thurgood Marshall, chief counsel for appellants, presented the same
arguments he had used in the lower courts.
Unable to arrive at a decision on the basis of arguments advanced at the
first hearing, the Supreme Court in June, 1953, asked for further pleadings
on five questions. These involved essentially two points: (1) In the light of
the history of the Fourteenth Amendment, was school segregation per se
violative of that amendment? (2) Assuming that segregation was
unconstitutional, would it necessarily follow that schools should be
integrated “forthwith” or could the Court in the exercise of its equity
powers remit the cases to lower courts and permit a “gradual adjustment” to
integration?
Answers to these questions were prepared under the supervision of T. C.
Callison, South Carolina’s Attorney General. The state maintained that the
“overwhelming preponderance of the evidence” demonstrated that the
Fourteenth Amendment could not be construed as forbidding racial
segregation. In reply to the second query, the state held that on the
assumption stated, the Court could permit gradual integration to be carried
out within broad policy limitations by the lower federal courts. However, in
this connection, the state argued that even assuming that the courts could
declare segregated schools unconstitutional, it was not within the judicial
power to determine what, if any, non-segregated system should be
substituted in their place.[68]