Test 1

d. Defining the company's corporate mission and major corporate goals

According to Hitt et al., which of these would be considered an important step in the ASP strategic management process? a. Building the company's organizational chart of strategic leaders b. Acquiring a new business unit to gain access to new markets and product lines c. Utilizing an outside consultant to lead the company through the planning process d. Defining the company's corporate mission and major corporate goals

b. an integrated and coordinated set of commitments and actions to gain an advantage by exploiting core competencies.

A business-level strategy is: a. a marketing and positioning program designed to explain a business to its customers. b. an integrated and coordinated set of commitments and actions to gain an advantage by exploiting core competencies. c. the actions a firm takes by selecting and managing a group of different businesses competing in different product markets. d. a set of actions and commitments through which a company sells its goods and services outside of its domestic market.

a. If the barrier for entry is low, and suppliers and buyers have strong bargaining power, the venture will most likely fail.

A company is debating on entering a new industry. The first order of business is to conduct an analysis of the five forces. Why is this a crucial first step in the decision-making process of entering into a new market or industry? a. If the barrier for entry is low, and suppliers and buyers have strong bargaining power, the venture will most likely fail. b. If the barrier for entry is high, and suppliers and buyers have low power, the venture will most likely fail. c. If the barrier for entry is low, and suppliers and buyers have high power, the venture will most likely succeed. d. If the barrier for entry is high, and suppliers and buyers have high power, the venture will most likely succeed.

b. An established competitor has announced it will begin offering its programs in an SaaS model next quarter.

A company president for a software firm has chosen to implement a differentiation strategy, offering his product in a Software as a Service (SaaS) platform with a monthly subscription. Most of his competitors are selling their products as a one-time purchase. Which of these represents the greatest risk to the strategy? a. There's a shortage of technical workers to maintain the software platform, causing HR to increase wages to attract quality employees. b. An established competitor has announced it will begin offering its programs in an SaaS model next quarter. c. As the number of users increases, the company will need to invest resources to scale the SaaS platform. d. The biggest company in this software market is slashing its prices to below your annual rate.

b. The company participates in competitive bidding processes, and despite often submitting a higher bid than competitors, it is awarded the job based on its expertise.

A construction company is pursuing a focused differentiation strategy, and after reviewing its core competencies, the leaders have decided to specialize in hospital construction. Which of these is an example of how that strategy is addressing the bargaining power of buyers - customers? a. The company accepts a lower profit margin rather than raise prices after its supplier of medical regulators raised prices. b. The company participates in competitive bidding processes, and despite often submitting a higher bid than competitors, it is awarded the job based on its expertise. c. In a year where only a few hospitals are being built, the company's leaders decide to offer discounted pricing to customers to ensure that they have a steady stream of work. d. Seeing the success of the hospital construction company, other construction firms decide to narrow their focus and create business units dedicated to this customer segment.

b. firms create products that have features customers value and are willing to pay a higher price for.

A differentiation strategy is one in which: a. firms concentrate on ways to reduce cost as their primary focus. b. firms create products that have features customers value and are willing to pay a higher price for. c. a company has core competencies in production and distribution efficiencies to reduce required inputs. d. A company divides its customers into clusters of people with similar needs.

b. Youth summer camps because the organization should use the knowledge of its passionate volunteer to their greatest advantage

A local community arts nonprofit organization is seeking to expand its programming and is considering putting just one new program in place this year. It may choose painting workshops, youth summer camps, a musical performing arts series or classes for seniors. The organization's most committed volunteer is a kindergarten art teacher who has offered to be the leader of whichever new program the organization implements. If the nonprofit is utilizing the resource-based model of above-average returns, it should expand its programming in the following way: a. Workshops because they are not currently being offered by any other organizations in the community b. Youth summer camps because the organization should use the knowledge of its passionate volunteer to their greatest advantage c. A musical performing arts series because it has the widest appeal in the community d. A class for seniors because it can be hosted during the day and have good attendance among those who are retired

b. what the company does in terms of its customers and their needs and what core competencies it utilizes to meet those needs.

A mission statement can describe: a. the strategic direction of the company and its major goals. b. what the company does in terms of its customers and their needs and what core competencies it utilizes to meet those needs. c. the competitive environment where a company is choosing to conduct its business. d. the company's marketing approach and slogan.

c. The company's research into a new railcar guideline that requires all tanker cars to be replaced or retrofitted over the next five years leads its leaders to start a business that manufactures tanker cars to capitalize on the new demand.

A multi-divisional corporation that manufactures large steel tanks is considering starting a new business unit to serve the transportation industry. The company is utilizing the I/O model to develop its strategy. Which of these decisions is consistent with this model? a. The company determines that it has an internal asset in a piece of software it developed for scheduling manufacturing processes and decides to make the software the centerpiece of its new business unit, selling it to transportation companies to manage their schedules. b. The company identifies a large steel tank it is currently selling to customers in the brewing industry and decides to begin selling it to customers in the transportation industry for transporting liquids. c. The company's research into a new railcar guideline that requires all tanker cars to be replaced or retrofitted over the next five years leads its leaders to start a business that manufactures tanker cars to capitalize on the new demand. d. The company decides to increase its investment in research and development to catch a competitor who has surpassed it in the technology it is using to produce steel tanks.

d. business-level strategy

A retail company feels that it has a mixed identity. Some of the leadership is focused on promoting the company as offering the highest quality, and other leaders argue they should be lowering prices to attract customers. The team is working through a strategic management process and determines that it needs better definition for the way it will compete against its rivals within the same industry and product category. This company needs to formulate and implement a(n): a. value chain strategy b. human resources strategy c. organizational strategy d. business-level strategy

c. be continually building its technological capabilities to develop new skills as technology advances so that it can offer constant upgrades to meet customers' needs.

A software company that is seeking a sustained competitive advantage will constantly be facing obsolescence because of environmental change. To generate a sustained competitive advantage, this company must: a. develop strategies to push competitors out of the business early so it is not faced with technological pressures. b. capture as much revenue as it can quickly, and then close the business when technology surpasses it. c. be continually building its technological capabilities to develop new skills as technology advances so that it can offer constant upgrades to meet customers' needs. d. always hire new people to gain new experience and knowledge into the firm.

b. Political and legal forces

A telecommunications company is impacted by government regulations of the wireless spectrum, cell tower locations, and internet accessibility. The company decides to hire a lobbying firm to represent its interests with the U.S. government, specifically the FCC, FTC, and Congress. This is an example of a company managing which forces in the macroenvironment? a. Social forces b. Political and legal forces c. Technological forces d. Global forces

c. speaks in broad terms of what the company ultimately would like to achieve.

A vision statement differs from a mission statement in that it: a. should be completed after a company formulates its strategic plan. b. is realistic, achievable, and measurable. c. speaks in broad terms of what the company ultimately would like to achieve. d. identifies which business and what customers the company intends to serve.

c. It's true we've seen our net sales decline, however, our gross profit has increased and our volumes are up year-over-year. Our patent for the sole has been approved and the legal department says we're good to go on our advertising claims about the new sole.

About six months ago, a mid-sized manufacturer of athletic shoes decided to pursue an integrated cost leadership and differentiation strategy. The company reduced its internal costs by consolidating the number of colors and variations it offers to customers. At the same time, the R&D team added a patented sole to all of its shoes. Which of these represents the best argument for the company to continue pursuing its current business-level strategy? a. We're getting some complaints from long-standing customers about the fact that they can only get shoes in hot pink or lime green. b. Our women's shoes are selling at higher volumes and at greater margins than our kid's and men's shoes. However, women represent 50 percent of the population but only 25 percent of our business. c. It's true we've seen our net sales decline, however, our gross profit has increased and our volumes are up year-over-year. Our patent for the sole has been approved and the legal department says we're good to go on our advertising claims about the new sole. d. We're getting a lot of pressure from our suppliers. They're telling us that they're going to increase the raw material cost for our soles. Even comparing against other suppliers, we simply can't get a better price at the volumes that we're purchasing.

c. Customers not placing enough value on the product to warrant premium prices

An apparel company is considering a change in its business-level strategy. The company has been making premium T-shirts known for their catchy slogans aimed at millennial customers. It wants to expand operations to include multiple casual clothing lines that will appeal across generations. The Board of Directors wants to clearly understand the risks of moving forward with this change. Which of these would be a risk for the firm's new strategy? a. Lack of suppliers to provide enough raw goods to fulfill orders for a broader market b. Social trends away from casual clothing and toward more formal attire c. Customers not placing enough value on the product to warrant premium prices d. Inability to pay workers enough to attract them to work for the company

d. Bargaining power of buyers

An industrial tool manufacturer relies on a particular distributor network. This distributor network has the largest online outlet and store network, and its product lines are aimed at construction workers. The distributor network is seeking a manufacturer to provide it with private label products, as it has decided to offer only its own product line in this category of industrial tools. Now, the industrial tool company must decide whether to agree to this proposition or lose this network as a customer. This is an example of which of the competitive forces at play in this industry? a. Industry competitive structure b. Rivalry among established companies c. Bargaining power of suppliers d. Bargaining power of buyers

d. Industry rivalry

An industry-leading technology firm utilizing a differentiation strategy has decided to increase prices on its patented product to bolster profit margins and deliver a higher return to investors. Consider the impact of this decision in light of the Five Forces of Competition. Which of these situations should the firm prioritize? a. Dealing with new entrants b. Bargaining power of suppliers c. Bargaining power of buyers d. Industry rivalry

a. the strategy, when executed effectively, offers the strengths of both the cost leadership strategy and the differentiation strategy.

An integrated cost leadership/differentiation strategy is able to address the competitive forces because: a. the strategy, when executed effectively, offers the strengths of both the cost leadership strategy and the differentiation strategy. b. all business-level strategies offer strengths to address all of the competitive forces. c. the strategy has no weaknesses and is inherently a better strategy than the other business-level strategy options for a company. d. it relies on market segmentation to address a specific niche of customers.

b. not all strategies will work for all firms; successful strategies must be aligned with a company's strengths.

An internal analysis is important because: a. it compares companies against their competitors so that they can copy competitors' successful strategies. b. not all strategies will work for all firms; successful strategies must be aligned with a company's strengths. c. the business environment is always changing, and the analysis provides insights about the future. d. company leaders do not have a good understanding of how their firms operate internally.

b. Cost leadership strategy

An oil company develops an innovative refining process that reduces the time required to produce gasoline by 25 percent. The company has identified its unique process as a core competency. Which of these strategies would be most beneficial for the company to pursue and would best be aligned with the firm's internal analysis? a. Differentiation strategy b. Cost leadership strategy c. Focused differentiation strategy d. Integrated cost leadership/differentiation strategy

a. Monitoring customer trends in the industry and of consumers as a whole

As a company works to build relationships with its customers, its leaders must determine which customer needs they will seek to satisfy. The company's leaders must also recognize that customer needs change over time. What might these leaders focus on to ensure they anticipate customers' changing needs? a. Monitoring customer trends in the industry and of consumers as a whole b. Utilizing the guidance of the Board of Directors to communicate the customers' needs c. Producing the same products and services that have been successful in the past d. Creating market segmentation to select a smaller group of customers to serve

c. the strength of the competitive forces in the industry change.

As an industry environment evolves over time the: a. industry becomes more profitable. b. strategic groups become less attractive to new entrants. c. the strength of the competitive forces in the industry change. d. the number of companies is reduced and it becomes more consolidated.

a. how it will satisfy those customers' needs using its core competencies to implement value-creating strategies.

As part of its selection of a business-level strategy, a firm will decide which customers it will serve and what goods or services it will use to satisfy customers' needs. It must determine: a. how it will satisfy those customers' needs using its core competencies to implement value-creating strategies. b. when it will implement its strategies to best optimize its exposure to customers and achieve a competitive advantage. c. where it will locate its resources and facilities to best serve its targeted customers and obtain the lowest costs of production. d. which functional teams and strategic leaders will be responsible for implementation of the business-level strategy.

c. Habitat for Humanity: A world where everyone has a decent place to live.

Below are several statements from companies. Which of these is a vision statement? a. Nike: Just Do It. b. Disney: To be one of the world's leading producers and providers of entertainment and information. c. Habitat for Humanity: A world where everyone has a decent place to live. d. Allstate: You're in good hands with Allstate.

a. a company's returns align with the amount of risk they incurred by investing in a company or lending the company money.

Capital market stakeholders are most satisfied when: a. a company's returns align with the amount of risk they incurred by investing in a company or lending the company money. b. a company's product market stakeholders are dissatisfied. c. a company's leadership team is earning performance-based compensation. d. a company's employees have a low turnover rate and receive higher than labor market salaries.

d. Assessing

Car manufacturers have a large lead time on new products. If an idea for a feature on a vehicle is developed, it will likely be two years before consumers know about it and can decide if they want to buy it. Consumer trends are sometimes short lived as they are always evolving. Which external analysis element is a primary focus of car manufacturers? a. Scanning b. Monitoring c. Forecasting d. Assessing

d. He should start by thanking the team for their hard work on the project so far but explain the company is no longer pursuing it. He should clearly articulate his vision for the future of the company and the team and set a meeting to debrief on the project.

Christopher is the CEO of a company. Recently, he scheduled a meeting with a challenging objective - to discuss with a team of his employees a project that is failing. It is costing a lot of investment in time and money and does not appear to have any return on investment in sight. Which of these approaches would demonstrate successful strategic leadership? a. He should inform them that the project they are working on is no longer aligned with the company, he's killing it, and that all of their work has been in vain. b. He should keep the project going despite its failure because he doesn't have any better projects for them to work on. c. He should blame the markets for making the project unsuccessful. He'll then announce that the company is shifting customer targets and will work on the project in the context of a new industry. d. He should start by thanking the team for their hard work on the project so far but explain the company is no longer pursuing it. He should clearly articulate his vision for the future of the company and the team and set a meeting to debrief on the project.

d. A relatively stable economy with strong growth potential

Cisco is a technology company looking to diversify its portfolio and compete in a new market. After conducting a scan and forecast, the consultants hired by Cisco provided several options. In which of the following economic segments should Cisco seek to compete? a. A very stable economy with low growth potential b. An unstable, new economy that has an attractively high-growth potential c. A stable economy with a declining growth potential d. A relatively stable economy with strong growth potential

c. Kodak revolutionized the automatic snapshot camera more than 100 years ago, making photography accessible to everyone. When innovators brought digital cameras to the marketplace, Kodak focused on making it easy for people to print their photos using this technology

Companies must be aware of technological advances within their industry and make strategic management decisions that take into account perpetual innovation and disruptive technologies. Which of these is an example of a company that did not respond strategically to technological changes? a. After Google introduced the concept of Pay-Per-Click advertising, a competing search engine, Bing, introduced a similar advertising model. b. Samsung, LG and other cell phone manufacturers continued to innovate their products after the introduction of the Apple iPhone to keep up with customer expectations of smartphones. c. Kodak revolutionized the automatic snapshot camera more than 100 years ago, making photography accessible to everyone. When innovators brought digital cameras to the marketplace, Kodak focused on making it easy for people to print their photos using this technology. d. Amazon's decision to enter into the online streaming video market with Amazon Instant Video to compete directly with NetFlix.

c. they must satisfy customers' needs to achieve a competitive advantage.

Companies must effectively manage their relationships with customers because: a. they are the only stakeholders that matter. b. their rivals are managing customer relationships. c. they must satisfy customers' needs to achieve a competitive advantage. d. it's the most effective use of their core competencies.

c. a company selects a more narrow group, or niche, of customers on which to concentrate its efforts.

In a focused strategy: a. A company focuses on a broad, integrated group of customers. b. A company produces goods or services with features that are acceptable to customers at the lowest cost. c. a company selects a more narrow group, or niche, of customers on which to concentrate its efforts. d. A company produces goods or services that customers perceive as being different in ways that are important to them.

d. study all of its internal resources with an understanding of which capabilities offer value to meet the needs of U.S., Japanese, European and Korean automakers.

If a start-up U.S.-based automobile parts supplier were to apply a global mind-set to its internal analysis, it would: a. review sales data of its North American dealerships to determine its most popular vehicles. b. research the history of the invention of the car and the evolution of the automobile industry. c. find information about the transportation infrastructure in emerging automobile markets around the world, including Asia and Africa. d. study all of its internal resources with an understanding of which capabilities offer value to meet the needs of U.S., Japanese, European and Korean automakers.

d. the higher margins of the firm can reduce the influence of increases in supplier costs.

Differentiation strategies are successful in addressing the competitive force of the bargaining power of suppliers because: a. the company is operating at such high volumes that it can leverage its buying position to receive lower prices. b. they prevent new companies from entering into the industry through economies of scale. c. brand loyalty is a byproduct of this strategy, leading customers to choose the company's product over its rivals' products. d. the higher margins of the firm can reduce the influence of increases in supplier costs.

d. All of these

Every organization has groups of people that it must establish and manage relationships with to be successful. These groups include: a. Customers b. Shareholders and investors c. Employees d. All of these

d. Opportunities and threats

In an external analysis, there are two important elements that need to be identified. What are those two elements? a. Strengths and weaknesses b. Threats and strengths c. Opportunities and weaknesses d. Opportunities and threats

d. it provides the insights the firm requires, to match what a firm can do, with what a firm might do when formulating strategies.

Firms should study their internal organization as part of the strategic management process because: a. they are required to report their results to the government. b. it is the only method for identifying threats and opportunities to the business. c. without this study, strategic leaders do not have a working understanding of how their business operates. d. it provides the insights the firm requires, to match what a firm can do, with what a firm might do when formulating strategies.

d. meet the needs of its stakeholders and achieve financial goals.

Firms use the strategic management process to: a. make hiring decisions about key leadership positions. b. plan financial resources and define annual budgets. c. identify the organization's stakeholders. d. meet the needs of its stakeholders and achieve financial goals.

c. To neutralize a threat that will hinder strategic competitiveness

In 2011, Apple and Samsung were in a legal battle over patenting. Apple and Samsung were mutually accusing each other of infringing on intellectual property and each took action legally. Why would both parties want to spend the time and resources to reclaim their intellectual property? a. To ruin the reputation of the other company b. To distract the competition and hopefully gain a competitive edge in the meantime c. To neutralize a threat that will hinder strategic competitiveness d. To receive compensation as both companies were struggling financially

a. Competitor analysis

General Electric, the multinational conglomerate, is researching rivals in the appliance industry by analyzing the financials, current product offerings, and strategies of competitors in order to gain insight on how to act to gain a competitive advantage. What is GE performing? a. Competitor analysis b. Industry analysis c. External environment analysis d. General analysis

b. the industry is constantly changing with global competition and innovative competitors.

Hypercompetition describes a competitive landscape where: a. there are thousands of companies competing within the same industry for the same group of customers. b. the industry is constantly changing with global competition and innovative competitors. c. the business is dominated by a single company, pushing all competitors to imitate its strategies and develop similar resources. d. the industry has a high cost of entry in capital investment, research and development or hiring of talented employees.

d. something that gives a company an edge over the competition, something that the company possesses that its competitors do not have, and something that is too difficult or costly for competitors to copy or produce an alternative.

In the resource-based model of above-average returns, a core competency is a. something that a company is really good at internally and customers are willing to pay a premium for. b. something that prevents a company from producing above-average returns. c. something that positions strategic leaders for success in managing people, processes and resources. d. something that gives a company an edge over the competition, something that the company possesses that its competitors do not have, and something that is too difficult or costly for competitors to copy or produce an alternative.

b. the unique capabilities and resources of the company.

In the resource-based model of above-average returns, differences in company performance can be attributed to: a. the strength and effectiveness of managers. b. the unique capabilities and resources of the company. c. the structural characteristics of the company's industry. d. the effective implementation of pricing strategies.

d. By competing in the same strategic group, the two companies are dealing with customers who view their products as direct substitutes for each other.

In the toy industry, Mattel is one of the world leaders, especially with their line of Barbie dolls. However, it has faced competition from MGA Entertainment, who has produced Bratz dolls since the 1990s. Which of these statements is true about the strategic group in which these companies compete? a. The two companies occupy different strategic groups and will likely have very different competitive forces and different strategies. b. The companies are dealing with the same competitive forces as all the other companies in the toy industry. c. Since they are both toy companies, they both have the ability to quickly pursue the toy truck market with minimal investment. d. By competing in the same strategic group, the two companies are dealing with customers who view their products as direct substitutes for each other.

a. promoting exploratory and exploitative learning as well as innovation as a strategic leader.

Logan is an entrepreneur and president of his own company with a new software product that manages benefits administration for large multinational corporations. His start-up company grew quickly to a team of about 25. A new federal law recently passed by Congress will cause small business owners to invest in software like his to manage employee healthcare. Logan announces that the company will be investing in training for employees to better understand small business owners and research and development to create a small business version of the software. This is an example of: a. promoting exploratory and exploitative learning as well as innovation as a strategic leader. b. utilizing the I/O model to determine the strategic direction of the firm. c. answering to demands made by capital market stakeholders for greater profitability. d. revising a company's vision statement to reflect changes in the competitive environment.

a. invest in developing total quality management systems and improving marketing effectiveness.

Many companies pursue an integrated cost leadership/differentiation strategy, working to lower cost structures while also enhancing their products and services. To successfully pursue this strategy, companies could: a. invest in developing total quality management systems and improving marketing effectiveness. b. concentrate all efforts on cost-saving projects within their production processes. c. increase exposure and brand awareness through digital and print marketing campaigns. d. develop new products every year to continue attracting customers and meet their upgrade expectations.

b. Political/legal segment

Many large corporations have a presence in Washington in the form of lobbyists. These individuals attempt to have their voice, and the voice of the company they represent, heard. If there is a potential advantage to be had due to new legislation or implementation/abolition of laws and rules, it is the lobbyists' duty to ensure it is in their company's favor. Which segment is this process referring to? a. Governmental segment b. Political/legal segment c. Economic segment d. Sociocultural segment

b. Focused differentiation and focused cost leadership strategies

Market segmentation is a part of all business-level strategies and is used to determine which customers to serve. This is most critical for which business-level strategies? a. Broad segment and integrated cost leadership/differentiation strategies b. Focused differentiation and focused cost leadership strategies c. Cost leadership and focused cost leadership strategies d. Differentiation and focused differentiation strategies

b. Marquis should bring this issue to the attention of the CEO and other top leadership immediately. He has a personal, ethical objection to child labor and believes that it is also inconsistent with the company's core values.

Marquis is the international operations manager for an athletic clothing line. As part of his responsibilities, he regularly tours the factories of the company's suppliers. He recently took a tour of one of the most efficient plants that delivers low-cost clothing. This gives his company a greater profit margin. However, on the tour, he noticed an 8-year-old child operating one of the machines. Which of these best describes how Marquis should report back to his CEO about the plant tour? a. Marquis should present a glowing recommendation for the supplier based on their financial performance and ability to help the company deliver above-average returns through higher profitability. b. Marquis should bring this issue to the attention of the CEO and other top leadership immediately. He has a personal, ethical objection to child labor and believes that it is also inconsistent with the company's core values. c. Marquis should assume that the CEO is aware of the child labor practices at the supplier because the two companies have done business together for several decades. His report should focus on the operational improvements at the plant. d. Marquis should quit. He can't work for a company that employs child labor in any way. He should contact the media immediately after he leaves the company and tell them the whole story.

d. a decision that would benefit from using the entire strategic management process

Michael is the CEO of a manufacturer with plants in three countries. He currently has a product line that is manufactured only in the company's U.S. plant. That product has experienced a steady increase in its export sales to Europe over the last three years. The international sales director is recommending that the company expand manufacturing capabilities at the European plant to include this product line. Michael and his management team must consider whether to pursue this strategy. This is: a. a decision driven by the industrial organization model of above-average returns. b. a conflict between two of the company's stakeholder groups. c. the diffusion of technology and perpetual innovation to help the company achieve its goals. d. a decision that would benefit from using the entire strategic management process.

d. As renewable energy continues to gain popularity, mainstream residential heating and cooling companies that are larger and have more resources decide to offer more geothermal options.

Michelle opens a residential heating company dedicated to geothermal heating systems. She is pursuing a focused differentiation strategy, serving the needs of customers who are looking for environmentally-friendly solutions to heat and cool their homes. Which of these represents a risk to the company because Michelle is using a focused strategy rather than a broad strategy? a. Competitor residential heating and cooling companies offer mainstream options at lower prices than Michelle's company is offering geothermal solutions. b. The cost of geothermal technology comes down and it is more aligned with mainstream options, increasing the number of customers who consider geothermal options. c. New technology in the solar energy business is developed that makes efficient heating and cooling solutions based on power available to customers. d. As renewable energy continues to gain popularity, mainstream residential heating and cooling companies that are larger and have more resources decide to offer more geothermal options.

b. HBO - It's not TV, It's HBO

Often a company's business-level strategy can be easily identified by reviewing its marketing materials. Consider the marketing slogans of the following companies and identify which one is pursuing a business-level strategy of differentiation. a. Walmart - Save Money. Live Better. b. HBO - It's not TV, It's HBO c. Days Inn - The Best Value Under the Sun d. Payless Shoesource - Everybody Loves to Payless

a. the complex set of ideologies, symbols and core values that are shared throughout a firm that influence how the firm conducts business.

Organizational culture is: a. the complex set of ideologies, symbols and core values that are shared throughout a firm that influence how the firm conducts business. b. the structure of a business' organizational chart of strategic leaders, including their roles and responsibilities. c. the attitude of a company's owners or shareholders. d. the policies and procedures detailed in the company's employee handbook.

a. P&G's ability to take action on ambiguous, incomplete, or unconnected data

P&G is a consumer products company that is consistently implementing scanning systems of the environment. They want to identify early signals of environmental changes and trends. P&G's competitors also frequently utilize scanning systems but are not as competitive as P&G. What could be the reason for P&G's competitiveness? a. P&G's ability to take action on ambiguous, incomplete, or unconnected data b. The competitors are less concerned with competitive advantages c. P&G's reports are more robust and contain insider information d. The competitors are not as educated as P&G's executives

c. Production costs are high and require high volumes to achieve profitability

Potential competitors may enter an industry and begin to take market share from existing companies. What would be one of the largest challenges a new entrant would need to overcome to be successful when entering an industry? a. Very few customers are currently buying a product b. Several powerful retailers provide the only access to customers c. Production costs are high and require high volumes to achieve profitability d. Lack of products that go along with the product

a. Protesters swarmed and picketed Hobby Lobby after it won a U.S. Supreme Court decision allowing it an exemption from covering employees' contraceptives on religious grounds.

Product market stakeholders often have very different priorities, but each can exert power and influence over a company. Which of these correctly describes a way that a product market stakeholder exerted its power to the potential detriment of a company? a. Protesters swarmed and picketed Hobby Lobby after it won a U.S. Supreme Court decision allowing it an exemption from covering employees' contraceptives on religious grounds. b. During the Great Recession, the United Auto Workers (UAW) union agreed to a pension restructuring with the three big U.S. car manufacturers. c. AIG's shareholders sued the U.S. government, arguing that the bailout the company received wasn't beneficial enough to financial investors. d. McDonald's announced wage increases for employees at its corporate-owned stores after months of protests by employees.

d. Competitor intelligence

The executive leadership team of a large corporation is analyzing a report. The report's contents have information that can be used to better understand and anticipate a competitor's objectives, strategies, assumptions, and capabilities. What is the term for the report being analyzed? a. External analysis b. Internal analysis c. SWOT analysis d. Competitor intelligence

a. Supply chain

Research indicates that a competitive advantage in logistics is a primary strategy that creates the most value for a cost leadership strategy. Choose which of these value-creating activities should be a focus for a company pursuing a cost leadership strategy. a. Supply chain b. Human resources c. Marketing d. Customer service

a. companies within the same industry may position themselves differently regarding distribution channels, market segments, and other differentiators. This affects their strategies.

Strategic groups exist because: a. companies within the same industry may position themselves differently regarding distribution channels, market segments, and other differentiators. This affects their strategies. b. government regulators have different rules for companies, based on the size of the company, geographic headquarters, and number of employees. c. customers want variety in the products and services they select, and different brands can serve customers' needs differently. d. industries are one dimensional, and all businesses within an industry utilize the same resources and same strategies to achieve their goals.

c. promote exploratory and exploitative learning as well as innovation.

Strategic leaders: a. can only be people in the C-suite of a company, such as the CEO, CFO, and COO. b. answer only to the demands made by capital market stakeholders for greater profitability. c. promote exploratory and exploitative learning as well as innovation. d. revise a company's vision statement on an annual basis.

b. would have switching costs if it went to a different supplier because the current supplier's products are unique.

Suppliers are most powerful when a company: a. buys from a supplier in large quantities, making up 50 percent or more of the supplier's total sales. b. would have switching costs if it went to a different supplier because the current supplier's products are unique. c. has the capability of producing the end product without the supplier. d. has multiple suppliers to choose from who produce similar components at similar quality.

a. Complementors

What is the term that would describe the relationship between Apple, the leading cellphone manufacturer and applications provider, and King, the developers behind the Candy Crush app? a. Complementors b. Competitors c. King is a supplier to Apple d. Apple is a customer of King

b. Risk of Entry by Potential Competitors: BrightView may be able to lessen the impact of this force in a low-barrier industry through economies of scale, specifically discounts on bulk purchases of raw material inputs

The country's largest landscape company is the result of a merger between two multi-state firms, Brickman Group and ValleyCrest. Now called BrightView, the $2 billion firm was created in 2015. The company is operating in a fragmented industry dominated by small, local businesses. Which of the following identifies a relevant competitive force and a way the company might leverage it? a. Bargaining Power of Buyers: BrightView can expect customers to purchase from them because of brand loyalty b. Risk of Entry by Potential Competitors: BrightView may be able to lessen the impact of this force in a low-barrier industry through economies of scale, specifically discounts on bulk purchases of raw material inputs c. Bargaining Power of Suppliers: BrightView will have difficulty leaving the landscape industry because of its investment in this merger and the cost of all of the landscape equipment included among both companies' assets d. Complementors: BrightView will need to collaborate with other companies to develop outdoor products because there are not enough complementary products in the marketplace to make homeowners value their landscaping

b. the opportunities and threats in a firm's external environment and the strengths and weaknesses of a firm's resources.

The effectiveness of a business-level strategy is contingent on: a. selection of the best business-level strategy - an integrated cost leadership/differentiation strategy. b. the opportunities and threats in a firm's external environment and the strengths and weaknesses of a firm's resources. c. a firm's decision to pursue a focused strategy developed through market segmentation. d. the external communication of the strategy to a company's customers.

c. rate of innovation and change.

The five competitive forces includes all of the following forces that shape competition within an industry except: a. risk of entry by a potential competitor. b. power of suppliers. c. rate of innovation and change. d. substitutes to an industry's products.

a. puts emphasis on the external environment, which plays a role in determining a company's ability to achieve above-average returns.

The industrial organization (I/O) model of above-average returns: a. puts emphasis on the external environment, which plays a role in determining a company's ability to achieve above-average returns. b. concentrates on the internal assets, resources, and capabilities of a firm to direct its strategic management process. c. is a new approach to strategic management that emphasizes technological advancement. d. is critical to competing in the global economy and the information age because of its emphasis on organizational development.

a. the way that businesses formulate initiatives that will create superior value for customers and then implement them to out-perform competitors.

The strategic management process is a. the way that businesses formulate initiatives that will create superior value for customers and then implement them to out-perform competitors. b. the analysis of internal and external forces at work on a company that may prevent it from achieving average returns. c. the utilization of the resource-based model of above-average returns to identify the internal resources a company should leverage to achieve strategic competitiveness. d. the identification of the industry in which a company should compete due to the attractiveness of that industry's profitability.

d. Possibly, as the "white space" could be a place that is competitive but was neglected. It could also be a space that is not competitive or profitable.

The term "white space" has become a very popular term over the last few years. This term describes a space in the competitive landscape that competitors are not occupying. Pricing, quality, and distribution channels are examples of what may be plotted along strategic dimensions to determine points of parity and points of difference. As a company, do you want to be in the "white space"? a. Yes, as you will be easily identifiable from the competition as having vastly different capabilities. b. No, as the void in that space mostly likely is due to a disadvantage. c. No, as you will not be associated with the competition. d. Possibly, as the "white space" could be a place that is competitive but was neglected. It could also be a space that is not competitive or profitable.

c. Integration cost leadership/differentiation strategy

When pursuing a business-level strategy, sometimes a company is unable to fulfill elements of the strategy because it has a split focus, resulting in a strategy that fails to satisfy customers' needs. This is a major risk of which business-level strategy? a. Focused cost leadership strategy b. Differentiation strategy c. Integration cost leadership/differentiation strategy d. Focused differentiation strategy

c. Customer switching costs

Through research and development, a cable company has found a way to use its existing network lines to serve customers with a new product offering - home security systems. The company is offering the service with a lower monthly fee than most other security companies. However, the sales force didn't see a lot of interest among its customers who had an existing security system from a competitor until they ran a promotion for reduced prices on equipment and free installation. Which of the competitive forces is at play? a. Cost conditions b. Bargaining power of suppliers c. Customer switching costs d. Complementors

b. Possible jail time or fines, but not always

What are the possible repercussions of a company that performs unethically in order to receive competitive intelligence to gain an advantage? a. Significant prison sentence b. Possible jail time or fines, but not always c. No threat of legal action, as unethical actions are not necessarily illegal d. No threat as unethical actions will be kept secret

a. An analysis of companies in which a firm competes directly

What is a competitor analysis? a. An analysis of companies in which a firm competes directly b. A robust analysis of one specific competitor c. An internal report of what a competitor may discover if the competitor analyzed the company d. A SWOT report of a competitor

c. Strategic group

What is a set of competitive firms emphasizing similar strategic dimensions and using a similar strategy? a. Collusion group b. Business partners c. Strategic group d. Complementors

a. The company will most likely fail because the competitor might neutralize their competitive advantage.

What is the most likely outcome for a company if the executives never analyze a competitor's possible reaction to competitive actions the firm takes? a. The company will most likely fail because the competitor might neutralize their competitive advantage. b. The company will most likely fail due to unlawful actions that it was unaware of. c. The company will still succeed, as long as they have an efficient corporate structure. d. The company will still succeed if they have effective marketing.

b. not all strategies will work for all firms; successful strategies must be aligned with a company's strengths.

What is the set of factors that directly influences a firm and its competitive actions and responses within the industry? a. Internal environment b. not all strategies will work for all firms; successful strategies must be aligned with a company's strengths. c. Political environment d. Competitor environment

b. Demographic segment

What is the term that is concerned with a population's size, age structure, geographic distribution, ethnic mix, and income distribution? a. Economic segment b. Demographic segment c. Political/legal segment d. Sociocultural segment

b. Data on what the competitor's available funds are for innovation, as shown by their balance sheet

Which of the following is not a concern of a competitive analysis? a. Information about what drives the competitor, as shown by its future objectives b. Data on what the competitor's available funds are for innovation, as shown by their balance sheet c. Information about what the competitor is doing and can do, as revealed by its current strategy d. Intelligence about what the competitor believes about the industry, as shown by its assumptions

d. All of these actions are ethical

Which of the following would be deemed as unethical when developing competitor intelligence? a. Analyzing competitors' financial reports b. Attending trade shows solely to obtain knowledge of their competitors' new products c. Obtaining court records in an attempt to find statements that may not be found anywhere else d. All of these actions are ethical

b. The ability of a firm to outperform its rivals by forming and executing a strategy that creates value for its stakeholders.

Which of these could be a definition of strategic competitiveness? a. The status of a company with the largest top line sales number in an industry. b. The ability of a firm to outperform its rivals by forming and executing a strategy that creates value for its stakeholders. c. A solid company with predictable sales and profitability every year, delivering predictability for its shareholders. d. A start-up company with an innovative new product that changes an industry.

b. A review of a company's competitive landscape, identifying competitors, naming their differentiations and detailing a profile of those competitors' customers

Which of these could be a part of the analysis stage of the strategic management process? a. A mission and vision task force developing these foundational statements for the company b. A review of a company's competitive landscape, identifying competitors, naming their differentiations and detailing a profile of those competitors' customers c. The collection of financial data used to track the success of the strategic plans the company is pursuing d. The selection of strategies the company will pursue to achieve its financial goals and satisfy its shareholders

b. A tool manufacturer that announced it will increase its dividend payment - the highest dividend amongst all of its industry competitors - for the upcoming quarter due to market share gains in overseas markets.

Which of these describes a company that has delivered above-average returns to its investors? a. A biotech firm that recently announced it has received FDA approval for its new orphan drug to treat a rare heart condition. The company will be able to sell the treatment for $10,000 per year per patient beginning in the fall. b. A tool manufacturer that announced it will increase its dividend payment - the highest dividend amongst all of its industry competitors - for the upcoming quarter due to market share gains in overseas markets. c. A retail company that announced it saw growth in same store sales from last year to this year and will open 250 new stores to capitalize on its growing popularity. d. An airline that reported weaker than projected earnings this year because of increased maintenance costs for its aging fleet of planes.

b. The introduction of Global Positioning System (GPS) technology, which is used in standalone and hand-held navigation tools, smartphone apps, and in-car navigation systems

Which of these is an example of a disruptive technology? a. The introduction of television boxes that enable recording of shows and on-demand content for playback at the viewers' convenience b. The introduction of Global Positioning System (GPS) technology, which is used in standalone and hand-held navigation tools, smartphone apps, and in-car navigation systems c. The use of touch screens on mobile phones and tablets for selecting apps, texting and dialing d. The invention of laser eye surgery for corrective vision procedures

d. The spread of 4G technology between Verizon, AT&T, and Sprint, so that the high-speed network is available to nearly all mobile phone customers.

Which of these is an example of the mobility of strategies and resources across firms in the mobile network industry, one of the assumptions of the industrial organization (I/O) model of above-average returns? a. Sprint utilizes an innovative marketing strategy to illustrate its price competitiveness compared to Verizon and AT&T. b. Verizon utilizes its high capital availability to invest in a higher quantity of cell towers to achieve a broad geographic network, serving both urban and rural areas. c. A high-level engineer from AT&T is prevented from working for Verizon for five years by a non-compete agreement. d. The spread of 4G technology between Verizon, AT&T, and Sprint, so that the high-speed network is available to nearly all mobile phone customers.

b. A plan for how the company will compete in its industry against its rivals to achieve a competitive advantage

Which of these might be an alternative definition of business-level strategy? a. A picture of what the firm wants to be in broad terms and what it hopes to achieve b. A plan for how the company will compete in its industry against its rivals to achieve a competitive advantage c. The inputs into a firm's production process, including physical, human and organizational capital d. The source of competitive advantage for a firm to deliver above-average returns

c. The company's diversification of web services tailored to the Chinese market directly, which has resulted in transactions that account for more than 2 percent of China's GDP.

Which of these represents a core competency for Alibaba as presented in the opening case in the chapter? a. The company's controls surrounding fraudulent, banned and recalled goods. b. The company's purchase announcement of ChinaVision Media for online media streaming and video services. c. The company's diversification of web services tailored to the Chinese market directly, which has resulted in transactions that account for more than 2 percent of China's GDP. d. The company's strategic position compared to brick and mortar retailers because 90 percent of China's marketplace sales are online.

b. The model assumes that most firms operating in an industry have similar valuable resources that are mobile across companies, which is not necessarily true.

Which of these represents a criticism of the industrial organization (I/O) model of above-average returns? a. Research indicates that 20 percent of a firm's profitability is explained by the industry in which it chooses to compete. b. The model assumes that most firms operating in an industry have similar valuable resources that are mobile across companies, which is not necessarily true. c. The model suggests that firms must adopt strategies to address the structural characteristics of the industry in which they operate. d. The model puts too much emphasis on the effectiveness and personality of the firm's managers and not enough on the characteristics of the industry.

b. A local pipefitters union dealing with a plumbing contractor

Which of these represents a product market stakeholder: a. A private equity firm investing in a biomedical firm b. A local pipefitters union dealing with a plumbing contractor c. A member of an ownership family in a privately owned company d. A store manager of a retail chain

d. Competitors' innovations resulting in their ability to drive costs lower

Which of these represents a risk for companies pursuing a cost leadership strategy? a. Buyers choosing to purchase lower priced products during a recession b. Counterfeit versions of a company's products c. Pricing that is higher than customers' perceived value of a quality product d. Competitors' innovations resulting in their ability to drive costs lower

a. Buyers choosing to purchase lower priced products during a recession

Which of these represents a risk for companies pursuing a differentiation strategy? a. Buyers choosing to purchase lower priced products during a recession b. Failing to meet customers minimal level of acceptable service c. Competitors' imitation of the value-chain activities that make up the company's strategy d. Competitors' innovations resulting in their ability to drive costs lower

d. Provide email updates on shipping status and satisfaction surveys following the arrival of a produce

Which of these strategies could be implemented to improve a company's richness in its customer relationships? a. A radio and billboard advertising campaign featuring a celebrity endorsing your product b. Offer a customer loyalty program with multiple fine print requirements c. Announce a baby products sale through a mailed postcard to your entire database of customers d. Provide email updates on shipping status and satisfaction surveys following the arrival of a produce

a. A grocery store chain that is converting their local neighborhood stores to warehouses. The chain eliminates shopping in the aisles and instead has customers select items online or through an app. The customer can then pick up their items in a drive through without having to leave their vehicles.

Which of these strategies represents a company that has selected a differentiation strategy? a. A grocery store chain that is converting their local neighborhood stores to warehouses. The chain eliminates shopping in the aisles and instead has customers select items online or through an app. The customer can then pick up their items in a drive through without having to leave their vehicles. b. A company that is developing a tablet device that sells features, such as speed and memory, as add-ons to produce a base model of its device that is below the typical market cost. c. A tool manufacturer that is investing in R&D to develop modifications to existing tools so that they can be used more effectively and safely in the oil and gas industry. d. A restaurant entrepreneur announces a new fast-food chain where every item on the menu is just $1.

c. Contact Strategy and Competitive Intelligence Professionals

You are hired as strategic analyst for a Fortune 500 company. Your first task is to develop a competitive intelligence report to find key insights on the rivals' latest actions, current capabilities, and potential future actions. Being new to this type of report and the ethical protocols, what should be your first action? a. Calling the competitors' CEO for an interview b. Infiltrate the competitors' headquarters and plant devices to receive information c. Contact Strategy and Competitive Intelligence Professionals d. Analyze the publically released financial records from 6 months ago

c. rivals are hesitant to slash their own prices, and often their profitability, to compete with a low cost leader.

b. the opportunities and threats in a firm's external environment and the strengths and weaknesses of a firm's resources.

b. companies use process innovations, such as advanced production or distribution methods, to operate efficiently.

cost leadership strategy is one in which: a. customers perceive a company's products to be superior to competitor products. b. companies use process innovations, such as advanced production or distribution methods, to operate efficiently. c. a firm produces non-standardized products that deliver superior value to customers through innovation. d. A firm must consistently upgrade its product features to keep pace with customers' expectations for value.