MAN4720 Exam 1 Study.docx

1. Which of the following is a new competitive dimension that is affecting competition in multiple industries throughout the world?
Answer: Technological change

2. Which of the following is one in which goods, services, people, skills, and ideas move freely across geographic borders?
Answer: Global economy

3. Which of the following increases the range of opportunities for companies competing in the current competitive landscape?
Answer: Globalization

4. “Liability of foreignness” describes what?
Answer: The costs associated with operating in a foreign market

5. Which of the following is not one of the three categories of technology-related trends and conditions affecting today’s firms?
Answer: Customer information and technology

6. What term is used to describe how rapidly and consistently new, information-intensive technologies replace older ones?
Answer: Perpetual innovation

7. What does one call the technologies that destroy the value of an existing technology and create new markets?
Answer: Disruptive technologies

8. Knowledge is which of the following?
Answer: An intangible resource

9. Strategic flexibility is which of the following?
Answer: The set of capabilities used to respond to various demands and opportunities

10. Which of the following explains the external environment’s dominant influence on the choice of strategy and the actions associated with it?
Answer: The I/O Model of Above-Average Returns

11. Which of the following are inputs into a firm’s production process, such as capital equipment, the skills of individual employees, patents, finances, and talented managers?
Answer: Resources

12. Which of the following is the capabilities that serve as a source of competitive advantage for a firm over its rivals?
Answer: Core competencies

13. According to the resource-based model, differences in firms’ performances across time are due primarily to what?
Answer: Resources and capabilities

14. When are a firm's resources considered valuable?
Answer: When they allow the firm to exploit opportunities or neutralize threats

15. Which of the following is NOT a trait of resources?
Answer: Easily substitutable

16. Which of the following informs stakeholders of what the firm is, what it seeks to accomplish, and who it seeks to serve?
Answer: Mission

17. Normally, who is responsible for working with others to form the firm’s vision?
Answer: CEO and top-level managers

18. Which of the following is a vital part of the firm’s discussions to decide what it wants to become as well as who it intends to serve and how it desires to serve those individuals and groups?
Answer: Vision

19. Who are the individuals, groups, and organizations that can affect the firm’s vision and mission, are affected by the strategic outcomes achieved, and have enforceable claims on the firm’s performance?
Answer: Stakeholders

20. Which of the following is comprised of the firm’s primary customers, suppliers, host communities, and unions representing the workforce?
Answer: Product market stakeholders

21. Which of the following is a rational approach firms use to achieve strategic competitiveness and earn above-average returns?
Answer: Strategic management process

22. On the basis of the new information, firms take actions in hopes of buffering themselves from any negative environmental effects and to pursue opportunities to better serve their stakeholders’ needs. Which of the following constitute those actions?
Answer: Strategies

23. The following segments—demographic, economic, political/legal, sociocultural, technological, global, and sustainable physical—make up which of the following?
Answer: General environment

24. Which of the following is the set of factors that directly influences a firm and its competitive actions and responses: the threat of new entrants, the power of suppliers, the power of buyers, the threat of product substitutes, and the intensity of rivalry among competing firms?
Answer: Industry environment

25. One of the following focuses on the factors and conditions influencing an industry’s profitability potential. Which is it?
Answer: Five Forces of Competition

26. To cope with often ambiguous and incomplete environmental data and to increase understanding of the general environment, firms complete an external environmental analysis. This analysis has four parts, which of the following is not one of those parts?
Answer: Core competency analysis

27. Which of the following is a true statement about opportunities and threats?
Answer: They arise from the external environment

28. Which of the following do firms use to identify early signals of potential changes in the general environment and detect changes that are already under way?
Answer: Scanning

29. Which of the following requires the firm to identify important stakeholders and understand its reputation among these stakeholders as the foundation for serving their unique needs?
Answer: Assessing

30. One of the following is concerned with a population’s size, age structure, geographic distribution, ethnic mix, and income distribution.
Answer: Demographic segment

31. Which of the following refers to the nature and direction of the economy in which a firm competes or may compete?
Answer: Economic segment

32. _______________ is the arena in which organizations and interest groups compete for attention, resources, and a voice in overseeing the body of laws and regulations guiding interactions among nations as well as between firms and various local governmental agencies.
Answer: Political/legal segment

33. What is concerned with a society’s attitudes and cultural values?
Answer: Sociocultural segment

34. When studying the _______________, firms should recognize that globalization of business markets may create opportunities to enter new markets, as well as threats that new competitors from other economies may also enter their market.
Answer: Global segment

35. _______________ often is used by firms with moderate levels of international operations who increase their internationalization by focusing on global niche markets.
Answer: International strategy

36. What is the key objective of analyzing the general environment?
Answer: Identify opportunities and threats

37. The Five Forces of Competition model is made up of all of the following except which one?
Answer: Technological change

38. When using ______________ the cost of producing each unit declines as the quantity of a product produced during a given period increases.
Answer: Economies of scale

39. When using product differentiation, companies will combat the perception of uniqueness by offering products at lower prices. This decision, however, may result in what?
Answer: Lower margins or perceived lower quality

40. _______________ are companies or networks of companies that sell goods or services that are compatible with the focal firm’s good or service.
Answer: Complementors

41. Those with a _______________ recognize that their firms must possess resources and capabilities that allow understanding of and appropriate responses to competitive situations that are influenced by country-specific factors and unique cultures.
Answer: Transnational mindset

42. Firms create _____________ by innovatively bundling and leveraging their resources to form capabilities and core competencies.
Answer: Capabilities

43. Three conditions affect managers as they analyze the internal organization and make decisions about resources. Which of the following is that condition?
Answer: Uncertainty

44. Which of the following is the foundation of competitive advantage?
Answer: Capabilities and core competencies

45. Production equipment, manufacturing facilities, distribution centers, and formal reporting structures are examples of what type of resources?
Answer: Tangible resources

46. Knowledge, trust between managers and employees, managerial capabilities, organizational routines, scientific capabilities, capacity for innovation, brand name, reputation, and organizational culture are what type of resources?
Answer: Intangible resources

47. Which resources require nurturing to maintain their ability to help firms engage in competitive battles?
Answer: Intangible resources

48. The value of which resources is constrained because they are hard to leverage—it is difficult to derive additional business or value from them?
Answer: Tangible resources

49. The more unobservable a _________________ resource is, the more valuable that resource is to create capabilities and their use can be leveraged.
Answer: Intangible

50. When the firm combines individual tangible and intangible resources it creates something that can be used to complete the organizational tasks required to produce, distribute, and service the goods or services the firm provides to customers for the purpose of creating value for them. What is created?
Answer: Capabilities

51. _________________ provide the capacity to take action, act as the “crown jewels of a company,” are the activities the company performs especially well compared to competitors, and through which the firm adds unique value to the goods or services it sells to customers.
Answer: Core competencies

52. Discussing the four criteria of sustainable competitive advantage does what for the firm?
Answer: Helps evaluate if core competencies lead to sustainable advantage

53. _______________ capabilities are capabilities that do not have strategic equivalents.
Answer: Nonsubstitutable capabilities

54. Which of the following includes the activities or tasks the firm completes in order to support the work being done to produce, sell, distribute, and service the products the firm is producing?
Answer: Support functions

55. When firms have strong positive relationships with suppliers and customers, they are said to have what?
Answer: Social capital

56. What is the purchase of a value-creating activity or a support function activity from an external supplier?
Answer: Outsourcing

57. Firms engaging in effective outsourcing increase what?
Answer: Flexibility

58. Deciding to outsource to a foreign supplier is commonly called what?
Answer: Offshoring

59. Some firms do what when they decide they are weak in certain areas in order to improve their ability to use remaining resources to create value?
Answer: Outsource

60. Which resources are those with the potential to be formed into core competencies as the foundation for creating value for customers and developing competitive advantages because of doing so?
Answer: Strategic resources