BEC Strategic Planning and Risk Management 3

Question 1

Which of the following is an example of a strategic risk?

Accepted Answer

A major competitor launching a disruptive technology that renders the company's products obsolete

Answer

Strategic risk arises from events or trends that threaten the organization's ability to achieve its long-term goals, such as competitive disruption, regulatory shifts, or changes in customer preferences.

Question 2

Corporate social responsibility (CSR) in a business context means:

Accepted Answer

Companies integrating social and environmental concerns into operations beyond legal requirements

Answer

CSR refers to a company's voluntary commitment to operate ethically and contribute positively to society and the environment, beyond what is legally mandated.

Question 3

A risk heat map (risk matrix) plots risks by:

Accepted Answer

Probability of occurrence versus potential impact

Answer

A risk heat map is a visual tool that plots each identified risk on a grid based on its likelihood of occurring and the severity of its impact, helping prioritize risk responses.

Question 4

Vertical integration as a corporate strategy involves:

Accepted Answer

A company expanding into supply chain stages it previously outsourced (upstream or downstream)

Answer

Vertical integration is a strategy where a company takes ownership of its supply chain — backward integration (acquiring suppliers) or forward integration (acquiring distribution channels).

Question 5

The balanced scorecard's 'learning and growth' perspective focuses on:

Accepted Answer

Employee skills, organizational culture, and IT infrastructure needed for future success

Answer

The learning and growth perspective addresses the organizational foundation — human capital, information systems, and culture — required to support the other three scorecard perspectives.

BEC - Business Environment and Concepts Practice Test

BEC - Business Environment and Concepts Practice Test

BEC Strategic Planning and Risk Management 3