MGT401 Exam 1
A(n) ______ occurs when a firm performs below the industry average or is outperformed by its competitors.
competitive disadvantage
Michael's Deli is able to perform at the same level as its primary competitor. Michael's Deli has ______.
competitive parity
Which of the following legal developments allow a business to function as an institution?
contract enforcement property rights
A(n) ______ is a unique strength, embedded deep within a firm, that is critical to gaining and sustaining competitive advantage.
core competency
If a firm's resource is valuable, rare, costly to imitate, and the firm is organized to exploit it, this resource is a ______.
core competency
When identifying stakeholders, a firm should focus on those stakeholders that ______.
currently have, or could potentially have, a material effect on the firm
Andrew's Home Center has created a unique situation for itself in its industry that allows the company to not only provide excellent value to its customers but also control its costs. This is known as ______
strategic positioning
Which of the following elements of the pyramid of corporate social responsibility are required by society?
Legal responsibilities Economic responsibilities
Which of the following best describes the core competency of the Five Guys Burgers and Fries company?
Making high-quality burgers without limiting costs
______ describes a process in which the options one faces in the current situation are limited by decisions made in the past.
Path dependence
What are the categories of expectations that society has of the business enterprise as described in the CSR framework?
Philanthropic Legal Economic Ethical
When a stakeholder has power over a company it is ______.
able to influence the company to do something it would otherwise not do
The ______ describes the internal activities a firm engages in when transforming inputs into outputs.
value chain
One of the most popular tools used by firms to evaluate their current situation and future prospects is the ______
SWOT Analysis
______ describes a situation in which different social and business systems interact with each other.
Social complexity
_____ refers to the idea that a firm is a bundle of resources and capabilities that is unique to the firm.
resource heterogeneity
The concept of social complexity suggests that ______.
social and business systems that work for one firm may be hard to imitate because of complex interactions between these systems
Which of the following is a tool that managers can use to address the needs of stakeholders while maintaining a competitive advantage?
stakeholder impact analysis
A firm's attempts to manage the web of relationships between internal and external stakeholders in order to create value is known as ______.
stakeholder strategy
In the external analysis phase of the AFI strategy framework, managers should ask,
"How do external forces affect our strategy and competitive advantage?"
Which statement about strategies is true?
A statement of desire on its own often leads to goal conflict.
Stakeholder impact analysis is a decision tool that helps a company do which of the following?
Achieve a competitive advantage Act as a good corporate citizen
What is the first step in the AFI strategy framework? Multiple choice question.
Analysis
Who among the following are considered internal stakeholders?
Board members Stockholders Employees
Which of the following were resources and capabilities that helped Five Guys gain a competitive advantage and develop into a successful restaurant chain? (Check all that apply.)
Carefully choosing the supplier of the potatoes for their fries Focusing on such details as store layout and design
What must a firm do after diagnosing its specific competitive challenge?
Create an effective guiding policy
To which types of organizations can we apply the principles of strategic management?
all types of organization
"Time compression diseconomies" refers to the concept that ______.
attempting to get a good outcome in less time tends to be ineffective
According to the VRIO framework, to fully exploit the competitive potential of its resources, capabilities, and competencies, a firm must ______.
be organized to capture value
In order to be successful, a firm must have a resource that is valuable, rare, costly to imitate, and the firm must .......
be organized to capture value
Which of the following can help a firm extend its competitive advantage? (Check all that apply.)
better expectations of future resource value path dependence intellectual property protection
Which of the following are examples of resources for a firm? (Check all that apply.)
buildings, cash, intellectual property
The Bright Bulb light bulb company produces a line of LED bulbs that customers consider very similar to competitors' LED bulbs. Which of the following conditions must be true for Bright Bulb to have a competitive advantage?
bulbs must have a lower cost
How should managers prioritize stakeholder concerns in the final step of stakeholder impact analysis?
by considering the power, legitimacy, and urgency of stakeholder claims
The organizational and managerial skills necessary to orchestrate a diverse set of resources and deploy them strategically are called _____.
capabilities
Cowgirl Boots, inexpensive leather boots for women, are selling at record-high numbers. The CEO of the company, however, cannot figure out why. Was it caused by the company's recent advertisement campaign or the newly reduced price of the boots or some other unknown factor? Based on this information, what concept describes the CEO's confusion regarding Cowgirl Boots' recent success?
causal ambiguity
Enterprise Machinists is always improving upon its core competencies by training its machinists constantly so that they are equipped to deal with technological changes and advancements. Based on this information, this is an example of which concept?
dynamic capabilities
The ______ perspective is a model that emphasizes a firm's ability to modify and leverage its resource base in a way that enables it to sustain competitive advantage in a constantly changing environment.
dynamic capabilities
The expectations that society has toward business, in contrast to what society requires, result in which of the following elements of the pyramid of corporate social responsibility?
ethical responsibilities philanthropic responsibilities
Customers, suppliers, creditors, unions, and governments are known as ______.
external stakeholders
True or false: A statement such as, "We will be the biggest company in the world," is an example of strategy.
false
In the ______ step of a stakeholder impact analysis, firms identify those stakeholders that currently have, or potentially can have, a material effect on the company.
first
Stakeholder impact analysis is a _____-step process that allows managers to better understand and address stakeholders' needs.
five
The purpose of a SWOT analysis is to ______.
form a strategy that is tailored to the firm's unique strengths and weaknesses and the opportunities and threats in its environment
Which of the following elements comprise strategic management?
formulas, analysis, interpretation
In the _____ step of the stakeholder impact analysis, firms identify their various social responsibilities to stakeholders.
fourth
Resource ______ and resource ______ are the key assumptions behind the resource-based model of the firm.
heterogeneity, immobility
The stakeholders of a firm are ______.
individuals or groups that can affect and are affected by the actions of the firm
A firm's culture, brand equity, and intellectual property are examples of ______.
intangible resources
The third step of stakeholder impact analysis requires managers to identify the ______ presented by internal and external stakeholders.
opportunities and threats
The expectations that society has toward business, in contrast to what society requires, result in which of the following elements of the pyramid of corporate social responsibility?
philanthropic responsibilities ethical responsibilities
What are the categories of expectations that society has of the business enterprise as described in the CSR framework? (Check all that apply.)
philanthropic, legal, ethical, economic
Which of the following are the three important stakeholder attributes managers must pay particular attention to during stakeholder impact analysis?
power legitimacy urgency
Marketing, sales, and distribution are ______ activities in a firm's value chain.
primary
______ activities add value directly by transforming inputs into outputs as the firm moves a product or service horizontally along the internal value chain.
primary
The internal activities of a firm that for transforming inputs into outputs consist of ____________ activities, which add value directly, and ___________ activities, which add value indirectly.
primary, support
Burger Bomb is a new hamburger restaurant. In order to compete successfully against its many competitors, Burger Bomb has decided to focus on quality and an interesting, unique menu that uses locally sourced, organic ingredients. This is known as Burger Bomb's ______.
strategy
Research and development, information systems and human resources are examples of ______ activities.
support
In order to avoid making costly mistakes due to the potential shortcomings of the SWOT analysis, a manager should ______.
take results from the SWOT analysis with "a grain of salt"
Which of the following topics should be considered during the analysis phase of the AFI framework?
the firm's business model and competitive advantages the external environment and associated challenges the role of strategic leadership and the strategy process the firm's internal strengths and resources
The resource-based model views resources as ______.
the main driver of firm performance
Walmart and Nordstrom maintain very different strategic profiles, one based on cost-leadership and the other based on differentiation through superior customer service. This is an example of ______.
the trade-offs required by strategic positioning
In the ______ step of the stakeholder impact analysis, the firm identifies the opportunities and threats that stakeholders present to the firm.
third
Strategy is ....
a sustainable and dominant market share
Which of the following statements are true about the capabilities of a firm? (Check all that apply.)
they include managerial skills, they concern the deployment of resources, they include organizational skills
How are intangible resource stocks acquired?
through investments over time in intangible resources
Which of the following are intangible resources that can be protected as intellectual property?
trade secrets, trademarks, copyrights
Competitive parity occurs when ______.
two or more firms achieve the same performance results
A resource is considered ______ if it helps a firm to deal with an external threat.
valuable
Which of the following elements of the pyramid of corporate social responsibility are required by society?
Economic responsibilities Legal responsibilities
True or false: A competitive advantage is most often maintained indefinitely.
False
True or false: The value chain concept is applicable primarily to high-tech firms in rapidly changing environments.
False
What is one explanation for why Tesla underperforms when the company's profits are compared to the profits of established car companies?
Startups often lose money early on.
______ resources have physical attributes and are visible.
Tangible
Which of the following are situations in which a resource is considered valuable? (Check all that apply.)
The resource helps the firm increase its economic value creation (V-C). The resource helps a firm exploit an external opportunity.
Which of the following statements regarding tasks in the AFI strategy framework is true?
The tasks are interdependent
Which of the following are aims of stakeholder strategy?
To gain and sustain competitive advantage To manage various stakeholders effectively
A firm's network of interconnected activities is referred to a strategic activity system because activities that are interconnected are very difficult for competitors to copy effectively.
True
Which of the following identifies the resources that can lead to a competitive advantage?
VIRO Framework
Which of the following questions are part of the five steps in stakeholder impact analysis?
What are our stakeholders' interests and claims? Who are our stakeholders? What opportunities and threats do our stakeholders present?
Capabilities include which of the following? (Check all that apply.)
a company's organizational structure, a company's culture, a company's routines
When a firm implements a strategy that leads to superior performance relative to other companies in the same industry, it is said to have achieved ______.
a competitive advantage
A stakeholder has ______ when its needs are within the bounds of the law or are otherwise relevant to the firm.
a legitimate claim
Based on its long dominance as a coffeehouse chain, Starbucks has ______.
a sustainable competitive advantage
In the second step of the stakeholder impact analysis, managers need to identify and understand stakeholders' ______.
interests and claims
Strategic leaders use internal and external analyses in tandem to create a customized fit between a company's ______.
internal resources and external environment
A competitive advantage _____.
is assessed relative to other competitors in the industry
Intellectual property protection and social complexity are examples of -------- mechanisms, which help a firm sustain a competitive advantage.
isolating
Which of the following elements of the pyramid of corporate social responsibility are required by society?
legal, economic
Which of the following are the three important stakeholder attributes managers must pay particular attention to during stakeholder impact analysis? (Check all that apply.)
legitimacy urgency power
Managers have ______ resources in their quest for competitive advantage.
limited
Strategic positioning allows managers to ______.
provide customers value while controlling costs
A resource is ______ if the number of firms that possess it is less than the number of firms required to reach a state of perfect competition.
rare
at are examples of intangible resource stock a company may have? (Check all that apply.)
reputation for quality engineering expertise dynamic capabilities
Core competencies of a business are generated by the interaction of ______.
resources and capabilities
In the ______ step of the stakeholder impact analysis the firm identifies their stakeholders' interests and claims according to the power, legitimacy, and urgency framework.
second
A well-devised strategy is about which two things?
what not to do what to do
In the dynamic capabilities perspective, competitive advantage derives from ______.
actively modifying of the resource base
If a firm has a 10% return on invested capital while the industry average return on invested capital is 18%, the firm has a(n) ______.
competitive disadvantage
