COM Strategic Planning & Analysis 2 — Questions and Answers
Question 1: Which analytical tool evaluates a company's Strengths, Weaknesses, Opportunities, and Threats to inform strategic decisions?
- PESTLE Analysis
- SWOT Analysis (Correct answer)
- Porter's Five Forces
- Balanced Scorecard
Correct answer: SWOT Analysis
SWOT Analysis is a foundational strategic planning tool that assesses internal strengths/weaknesses and external opportunities/threats.
Question 2: A company's mission statement primarily communicates:
- Financial targets for the next fiscal year
- The organization's core purpose and reason for existence (Correct answer)
- Specific operational tactics for each department
- Competitive pricing strategies
Correct answer: The organization's core purpose and reason for existence
A mission statement defines why the organization exists and what it fundamentally does, guiding all strategic decisions.
Question 3: In strategic planning, a 'stretch goal' is best described as:
- A target set below current performance to ensure achievement
- An ambitious objective that requires significant effort and innovation to reach (Correct answer)
- A rolling average of past performance metrics
- A goal set exclusively by external stakeholders
Correct answer: An ambitious objective that requires significant effort and innovation to reach
Stretch goals are ambitious targets that push organizations beyond incremental improvement, often driving breakthrough innovation.
Question 4: Which of the following best describes a 'strategic gap'?
- The difference between planned and actual operating costs
- The shortfall between where an organization is and where it wants to be strategically (Correct answer)
- The time lag between strategy formulation and implementation
- The variance in competitor market share
Correct answer: The shortfall between where an organization is and where it wants to be strategically
A strategic gap represents the difference between an organization's current state and its desired future state, driving strategic action.
Question 5: A company uses a 'Blue Ocean Strategy' when it:
- Aggressively competes in existing high-competition markets
- Creates uncontested market space by making competition irrelevant (Correct answer)
- Focuses exclusively on cost reduction to undercut rivals
- Copies the market leader's strategy
Correct answer: Creates uncontested market space by making competition irrelevant
Blue Ocean Strategy focuses on creating new market space rather than competing in existing saturated markets.
Question 6: The primary purpose of a strategic audit is to:
- Comply with financial reporting requirements
- Systematically review whether the current strategy is working and why (Correct answer)
- Set employee performance targets for the year
- Approve capital expenditure budgets
Correct answer: Systematically review whether the current strategy is working and why
A strategic audit assesses the effectiveness of the current strategy by examining internal capabilities and external alignment.
Question 7: When using scenario planning, an operations manager is primarily trying to:
- Predict a single most-likely future with precision
- Prepare the organization for multiple possible future states (Correct answer)
- Eliminate all uncertainty from the planning process
- Assign blame for past strategic failures
Correct answer: Prepare the organization for multiple possible future states
Scenario planning develops multiple plausible future narratives so organizations can prepare adaptive strategies for various outcomes.
COM Strategic Planning & Analysis 2
Which analytical tool evaluates a company's Strengths, Weaknesses, Opportunities, and Threats to inform strategic decisions?