Select T (True) or F (False): 3 points each

1) Cost pressures and intensified competition will NOT lead to further consolidation within the health care industry.
T F

2) Competitive advantage is the means by which the organization seeks to develop cost advantage or to differentiate itself from other organizations.
T F

3) The implementation of Medicare's prospective payment system in 1983 initiated dramatic changes in the health care industry.
T F

4) The three elements of service delivery (pre-service, point-of-service, and after-service) incorporate the production or creation of the service (product) of health care and include primarily operational processes and marketing activities.
T F

5) The identification of distinctiveness through a focus on the internal environment is intended to answer the strategic question "What should the organization do?"
T F

6) The organization itself may be affected directly by the legislative/political, economic, social/demographic, technological, and competitive change initiated and fostered by organizations in the general environment.
T F

7) One problem in performing competitor analysis is the tendency to be concerned only with the visible activities of competitors.
T F

8) The objective of long-range planning is to predict for some specified time in the future the size of demand for an organization's products and services and to determine where demand will occur.
T F

9) Cost position is the extent to which it seeks the low-cost position through efficiency programs and cost-minimizing facilities and equipment.
T F

10) Developing implementation plans is not an essential part of strategic planning.
T F

11) The service area is considered to be the geographic area surrounding the health care provider, from which it pulls the majority of its customers/patients.
T F

12) Customer perceptions of the organization's service category are NOT an important determination for a beneficial service area competitor analysis.
T F

13) Strategic management is a technique that will provide a "quick fix" for an organization that has fundamental problems.
T F

14) The evaluation of competitors' strengths and weaknesses provides clues as to their future strategies and to areas where competitive advantage might be achieved.
T F

15) Capability is the ability of an organization to deploy resources and competencies.
T F

16) The Delphi method is the development, evaluation, and synthesis of individual points of view through the systematic solicitation and collation of individual judgments on a particular topic.
T F

17) Competency is an infrastructure-based component of sustainable competitive advantage.
T F

Multiple Choice: Write your selection

1) Strategic management is NOT:
a. A "quick fix" for organizations with fundamental problems.
b. A process of completing paperwork.
c. A process of extending the organization's current activities into the future.
d. All of the above.

2) Organizational strengths represent competitive advantages when they:
a. Are present in the organization.
b. Are more intense than the same strength in a competitor.
c. Are marshaled in a way that allows them to become genuine strategic assets.
d. Are arranged into a matrix of resources and the manner in which they are allocated.

3) General and health care trends and issues, service area competitor analysis must be synthesized into which of the following:
a. Strategic issues facing the organization.
b. Price sensitivity analysis.
c. Categories of competitive analysis.
d. Periodic, comprehensive, and reliable mission statements.

4) The fundamental nature of strategic management requires the awareness and understanding of outside forces and encourages strategic managers to:
a. Adopt new ideas.
b. Maintain receptivity to new ways of doing things.
c. Expose themselves to a broad view.
d. All of the above

5) The forces driving service area completion (the five forces model of service area structural analysis) are:
a. Threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat of substitute products or services, and rivalry among existing firms.
b. Market share, bargaining power of employee groups, threat of regulation, quality of products or services, and similarities among existing firms.
c. Threats of internal weaknesses, weakness of suppliers, customer satisfaction, quantity of products or services, and diversity of existing firms.
d. Internal strengths, quality of the management team, bargaining power of customers, earnings per share, and cooperation among existing firms

6) Which of the following is an example of the threat of substitute products and services?
a. Self-administered dental examinations for dentist examinations.
b. Outpatient surgery for inpatient surgery.
c. Adults being treated in pediatric specialty hospitals.
d. Massage therapy substituted for acupuncture.

7) The two categories into which capabilities may be classified are:
a. The ability to make dynamic improvements to the organization's activities through learning, renewal, and change over time.
b. The ability to develop strategic insights and recognize and arrange resources and competencies to develop novel strategies before or better than competitors.
c. Both a and b.
d. Neither a nor b.

8) In addition to defining its service area, a health care organization must analyze in detail relevant and important aspects of the service area including:
a. Competitor service categories, prices, and strategic initiatives.
b. Economic, demographic, psychographic (lifestyle), and disease pattern characteristics
c. Politically active groups, faith preferences of the service area, and emerging health issues.
d. Product types, service delivery techniques, transportation networks, and critical infrastructure