MAN4720 Exam 1 - Chapter 1 - 3 - FSU Testing Center / OAS

The observation that a foreign country reached automotive production overcapacity last year is an aspect of the BLANK segment of the general environment.

global

Best Buy is attempting to focus on its core competencies as a source of its competitive advantage. Which of the following can help Best Buy in that quest?

When firms are selecting and implementing strategies based on core competencies they have to compete primarily on the basis of what?

Firm-specific differences

GlenOak Corp. is conducting an analysis to determine which strategies would best enable the firm to achieve above-average returns. How might the firm best make use of the different models available to select strategies and determine how to implement them?

The firm should use both the I/O model and the resource-based model to focus on factors outside and inside the firm at the same time.

What does it take to satisfy Product Market Stakeholders?

Product Market Stakeholders are satisfied when a firm's profit margin reflects at least a balance between the returns to capital market stakeholders and the returns in which they share.

When one is carrying out an analysis of the economic segment of the external environment which one of the following would not be in the outcome of that analysis?

Income distribution

Which of the following pairs of companies would be LEAST likely to be examined together as part of competitor analysis?

Netflix and Microsoft

What do strategic leaders' decisions and actions shape within the firm?

Organizational culture

Compared to intangible resources, in terms of their value, tangible resources are more constrained because they are BLANK to leverage.

harder

Todd works at EnergyOne and also owns shares of stock in the company and is a member in the union there. Todd himself is a(n) BLANK stakeholder; the union is a(n) BLANK stakeholder.

capital market and organizational stakeholder, product market stakeholder.

Which of the following is NOT a dimension that a firm seeks to understand in a competitor analysis?

The competitor's target customer segment

The strategic management process integrates formulation and implementation as a basis for a successful strategic management process. Integration occurs as decision-makers review implementation issues:

when formulating strategies and analyzing the external environment

One important source of competitive advantage is executive judgment. Why is executive judgment important?

One reason executive judgment can be a particularly important source of competitive advantage is that judgment allows a firm to build a strong reputation.

Which of the following activities constitutes a value chain activity?

Conducting customer feedback surveys

A key purpose of a vision and mission statement is to define what a firm is, what it seeks to accomplish, and who it seeks to serve. Who is this statement meant to inform?

Stakeholders

One of the major strategies a firm wants to implement is a value creating strategy. What do they achieve when they create such strategy?

Strategic competitiveness

Often, companies utilize strategic groups in order to understand and industries competitive structure. What is the primary purpose of strategic groups?

To analyze how certain companies are competing similarly along strategy-based dimensions

Which part of the strategic management process focuses on the actions that firms take to exploit their competitive advantage(s)?

business level strategy

Which of the following activities would be best suited for detecting early signals of potential changes in the general environment?

Scanning

Many firms nowadays are very concerned with their "social capital." This can have links that are external to the company and can be thought of as the value of a firm's

relationship with stakeholders

hat are the potential benefits of outsourcing for firms?

Increase in flexibility and reduction in capital investments.

Which of the following in characterizes a strategic leaders work?

ambiguous decision situations.

Because firms combine tangible and intangible resources to create capabilities:

capabilities are often based on developing, carrying, and exchanging information and knowledge through the firm's human capital.

Green design, sustainable packaging, waste management, and energy efficiency are aspects of the BLANK segment of the general environment that companies have sought to address with environmental sustainability initiatives.

physical

As live streaming and downloading of digital content increased, a manufacturer of CD and DVD players experienced a downturn. The managers felt that the firm's capability in producing these players was a core competence. They increased their investment to improve the playback quality, add more playback features, and change the design of the players to make them more appealing to the eye. Even with these investments, the firm had to lower prices, and was still unable to maintain sales volume. Clearly, mistakes were made in managing the firm's resources. What should the firm have learned from this failure?

When to quit

Which of the following is a challenge faced by firms in today's competitive landscape due to digitalization?

Understanding the strategic implications associated with digitalization

Alibaba has improved its performance in the Internet services industry by focusing on its unique abilities in the area of service diversification and innovation. This performance improvement can be explained by which of the following?

The resource-based model

Which of the following is a reason why the CEO should involve other people in developing the mission statement?

Employees interact frequently with customers and the markets the firm serves

Clarissa is a sales representative for a large pharmaceutical firm. While calling on one of her major clients, the purchasing director of a hospital, the client told her confidential information that a sales representative from a competing firm had passed on to him. The information completely contradicts Clarissa's firm's understanding of the competitor's business strategy and would allow Clarissa's employer to gain many of the competitor's clients. Which of the following ethical implications may result from this situation?

The ethical dilemma here is the right of competitors not to reveal certain information.

An investor is considering buying a restaurant that has been in operation for a number of years. The restaurant has a highly regarded chef and many long-term kitchen and wait staff who work together smoothly. It has a reputation for dishes of consistently high quality and an appealing dining atmosphere. Which of the following should the investor consider when making a decision?

The investor may find that the restaurant's financial statements undervalue the true value of its resources.

As a strategic leader in your organization, what should you focus on when selecting actions for the firm?

Creating value for all stakeholder groups

Apex Auto Repair has a thriving business based on its reputation for high-quality work, honesty, and skilled employees. For continued long-term success, Apex's owner should

focus on developing Apex's future competitive advantages.

A major U.S. manufacturer of children's toys believes its main competitive advantage lies in its continuing development of innovative toys and games. The company is facing increasing competition on price, and it is strongly considering outsourcing to offshore firms as a means of reducing costs. The LAST function this firm should consider outsourcing is

research and development

The owner of a store that sells fine-quality fabrics for home seamstresses bemoans the fact that few young women know how to do fine tailoring, much less simple dressmaking. Many potential customers are unable to appreciate the premium quality of the fabrics and are deterred by the high prices, as well as the complexity of fine sewing. In the past, the store had a strong demand for fabrics, large classes for women learning the fine points of sewing, and a reputation for excellent service and technical advice. Now the store is earning lower-than-average returns. This case is an example of

core competencies that have become core rigidities

What is the relationship between a firm's industry environment and the firm's earning potential?

the more a firm can favorably influence its industry environment, the more likely it is to achieve above average returns.

Because of threats and risks in the global environment, some firms choose to take a more cautious approach

by the more a firm can favorably influence its industry environment, the more likely it is to achieve above average returns

Where do capabilities come from typically?

Combining resources

Bella's Boutique used to be a brick-and-mortar store exclusively. It has gradually increased its Internet sales, and online sales now account for most of its revenue. This change in sales model illustrates the importance of monitoring which segment of the environment?

technological

Which of the following best defines value as it relates to a product?

The performance characteristics and attributes for which customers are willing to pay

Which of the following is NOT a part of a firm's external environment that influences its competitive actions and responses?

The internal environment

Who plays a role in choosing and implementing a firm's strategy according to the text?

People throughout the firm who influence the use of organizational resources

Which of the following industry characteristics are NOT considered in the industrial organization (I/O) model of above-average returns?

ESG scores

Which of the following factors can limit the formation of strategic groups within an industry?

lesser threats to each firm's profitability

Consider the criteria necessary for sustainable competitive advantage. Which of the following combinations would most likely bring about a temporary competitive advantage and the possibility for above-average returns?

valuable, rare, not costly to imitate, and possibly substitutable.

Variations in income distribution occur with demographic changes. Which one of the following statements is true about these changes?

The general loss in real income has been somewhat offset by the increase in dual-career couples

Charmed by Claire is a successful retail boutique that sells women's accessories. Claire, the owner/manager, knows that women have many options when buying jewelry. When customers enter her store, they are greeted by name and given prompt, friendly attention. Customers return to the store because the service is excellent. Claire says the most important decision she makes is hiring the best staff because customer service is vital to her business. Customer service is a(n)

core competence

Which of the following is not a characteristics of the global economy?

Stability and predictability

Subscriptions to many newspapers in America have been decreasing as more customers receive their news through other media. As a result, advertisers have shifted portions of their spending to other media. The newspaper's managers are making decisions under which assumption?

Uncertainty

What is the primary reason firms need to develop effective competitive actions and responses on a timely basis?

Technological changes and the growth of information gathering and processing capabilities

How do firms create value for customers?

by exploiting their core competencies or competitive advantages and by innovatively bundling and leveraging their resources and capabilities. BENEFITS OUTWEIGH PRICE

What are the three main areas of a firm's external environment that influence its competitive actions and responses?

General, industry, competitor

Jan is the CEO of GlenOak Corp. After analyzing GlenOak's vision statement and aligning it with new environmental conditions, Jan rewrote GlenOak's mission. Which of the following best characterizes Jan's action?

Jan should have involved managers at all levels in the firm as well as employees who interact with customers and the markets for input when rewriting the mission statement.

What is the relationship between resources and capabilities in creating value for customers?

Bundled resources create capabilities → core competencies → value, they work in tandem put simply

Which of the following statements is true regarding a vision statement?

A vision statement is a future-oriented declaration of the organization's purpose and aspirations.

When do buyers have power?

Few large buyers, buyers face little to no switching cost, each buyer purchases large quantities relative to the size of a single seller

A company is trying to determine how quickly changes in government taxation policies will affect consumers' purchasing patterns. What activity should the company engage in?

Forecasting

Firms within strategic groups

are a cluster of rival firms that compete in an industry by adopting similar strategies along key strategic dimensions, such as product quality, price, product line breadth, or distribution. The rivalry / competition is high as they compete in the same spaces and use similar strategies

Why is trust necessary to build social capital?

partners must be confident that neither party will take advantage of the other

Technologies are the underlying tool in the development of products such as iPads and Wi-Fi and these new products have created new markets as a result of what?

Disruptive technologies

Refuge Nursing Homes, Inc., (RNH) has been highly profitable in the past 10 years, providing its investors with higher returns than those earned by its direct competitors' investors. RNH has a reputation for providing high-paying managerial and hourly-employee jobs. However, recent investigations have revealed that the nursing home residents have been provided substandard care, including non-nutritious and unappetizing meals, non-functional medical equipment, and inadequate patient-care staffing. Which of the following statements best describes the situation?

RNH has prioritized the demands of capital market stakeholders over the demands of product market stakeholders

Which of the following statements about a vision and mission is true?

A vision statement should be clearly tied to the conditions in the firm's external environment and internal organization. Vision statements focus on the future and mission statements define present purpose

Government agencies are known for having so many layers and rules that decisions are made slowly and inefficiently. In this case, which of the following resources is a detriment to taxpayers using and paying for the bureaucracy?

organizational resource.

In order to maintain strategic distinctiveness and earn above-average returns within a strategic group, a firm should focus on

differentiating their products from other firms in the group and maintain strategic distinctiveness

Which of the following is an example of strategic human capital in a multinational firm?

Employees with multicultural knowledge, skills, and abilities who are not in a position to use them in helping the firm with its international strategies and operations

EnergyOne wants to install a high-capacity gas pipeline extension in the region. Shareholders anticipate better delivery of energy at lower costs, which will increase profitability. State and local governments are expecting increased tax revenue as well as new jobs in the region during construction of the expansion. Some customers look forward to lower gas rates as a result of more efficient delivery. Residents of the area, including customers and environmental groups, are opposed to the pipeline because of the increased risk for explosion and danger to the surrounding area. If EnergyOne cannot meet the needs of each stakeholder, what is the most critical way for the firm to prioritize them?

By identifying its level of dependence on each stakeholder

Siemens, a leading technology company focused on industry, infrastructure, mobility, and healthcare files an average of 25 patents a day. The patents are which type of resource?

technological

The CEO of Ridgeway, Inc., realizes that the company's survival depends on developing and acquiring knowledge. Which of the following actions by the CEO would be MOST consistent with this need?

The most consistent action by the CEO to develop and acquire knowledge would be investing in sophisticated databases in relevant knowledge areas / Planning extensive employee training and hiring educated and experienced employees

Which of the following best describes the potential negative consequence of overdependence on a particular core competence?

Core rigidities

How does analyzing complementors contribute to a firm's understanding of its competitive environment?

it expands the set of competitors that firms must evaluate / expanding the set of entities it must evaluate, revealing opportunities for strategic alliances, and providing crucial customer information.

If a firm is trying to identify strategies to remain successful as market conditions change due to demographic shifts, which part of the external environment should the firm focus on?

The general environment

What is an opportunity in the context of a firm's external environment?

a favorable condition, trend, or event that a company can exploit to achieve strategic competitiveness and gain an advantage / A condition that, if exploited effectively, helps a company achieve strategic competitiveness

Which of the following factors affects where and how firms choose to compete?

the nature of products that consumers demand, governmental policies and laws, rapid sociological changes, and changes in financial regulatory systems

There is extreme intensity between the fast food hamburger companies. What explains why the rivalry is so intense?

These companies are trying to find ways to differentiate their products explains, in part, why rivalry among McDonald's, Wendy's, and burger king is intense. Option D is the correct answer. The intense rivalry among McDonald's, Wendy's, and Burger King can be partly explained by their efforts to differentiate their products. Differentiation refers to the process of making a product or service unique in some way to attract customers and stand out from competitors. Option D is the correct answer.

What is the purpose of analyzing a firm's internal organization?

By identifying strengths, the firm can leverage them to gain competitive advantages. One of the conditions associated with analyzing a firm's internal organization is the reality that in today's global economy, some of the resources that were traditionally critical to firms' efforts to produce, sell, and distribute their goods or services, such as labor costs, access to financial resources and raw materials, and protected or regulated markets, although still important, are now less likely to be the source of competitive advantages

Which of the following would be categorized as a support function

training employees