Capstone TxtBook Questions

Which of the following would be a good argument for why a resource or capability position would be rare?

A resource or capability is rare because it developed over time along a unique path.

During the AFI implementation stage, decisions about which of the following are made?

Design: Structure, Culture, and Control

Once the team reviews the results of the analysis, they will formulate or reformulate the firm's business strategy. Essentially, the firm has the choice between which of the following three strategies:

Differentiation, Cost Leadership, and Blue Oceans

The video explains the military origins of the term strategy, but then goes on to explain how Michael Porter closed the gap between military and business thinking with his definition of business strategy. Select the option that best defines strategy in the context of business.

Generals make battle plans based upon the forces available to them and their understanding of the enemy's forces. Business leaders create strategies based upon their firm's capabilities and their understanding of their competitor's capabilities.

In Jim Collins' Good to Great, the author found consistent strategic leadership patterns of behavior among the top companies as demonstrated by his Level-5 leadership pyramid. (Exhibit 2.2). Which level has a strong skill set, is an effective leader and can organize resources to accomplish organizational goals?

Level 3 - Competent Manager

PESTEL helps predict which of the following?

None of these choices are correct.

The textbook notes that the formulation stage of the AFI framework has parallels to the guiding policy of a good strategy. What is the key guiding policy developed by Nvidia, as mentioned earlier?

Nvidia would release a better chip in one-third the time of the traditional industry.

Before the pandemic, Panda Express was already developing its ______ program, but at the outset of the pandemic the company decided to fast-track the program to respond to changes in the environment.

Panda Delivers

The most "top down" of the three approaches to making strategy is strategic planning. Often, these plans will run in three- to five-year cycles. What happens once the plan has initially identified the strategic needs of the corporation?

Senior management allocates the corporate resources to match the plan.

As is evident from the strategic map in the case, the group of proprietary firms is able to command a much higher price for their patent-protected drugs than the generic group. What is the primary mobility barrier described in the case that prevents the firms in the generic group from ascending into the proprietary group of firms?

Strong R&D competence built over many years with large investments and complex alliances.

In the video, business strategy was identified as a decision to choose "a different set of activities to deliver a unique mix of value." Which of the automotive firms follows this proposition most closely?

Tesla

How did HumanGood make sure their strategic plan wouldn't get ignored on a shelf?

The company involved front-line team members.

Which of the following would be a good argument for why a resource or capability would be valuable?

The resource or capability enables the firm to address customer wants.

________Blank help firms guide employee behavior in novel situations.

Values

When Congress passed the Patient Protection and Affordable Care Act (PPACA), it created a (an) ________Blank responsibility for both individuals and firms of more than 50 people to carry health insurance.

legal

Non-market strategies employed by a firm may be used to exert some level of influence by the firm on the general environment. These may best fit in the political or legal factor categories of the PESTEL framework. Which of the following is an example of a non-market strategy?

lobbying to extend electric car tax credits

Which of the following represents a general aim of business strategy?

making tradeoffs

A monopolistic industry is characterized by

many firms, a differentiated product, medium entry barriers, and some pricing power.

A perfectly competitive industry is characterized by

many small firms, commodity products, and low barriers to entry.

Panda's "all in" culture that focused on taking care of its people drove the decision to

not furlough anyone during the pandemic.

The Panda Auto Wok (PAW) was a response to the pandemic that led to increases in

operational efficiency.

According to the upper echelon theory, the behaviors demonstrated by a strategic leader are a combination of everything except

opportunities for advancement and mentorship.

Industry structures are dynamic and tend to reshape themselves through all the following methods except

perfect competition.

In the case of Post-it Notes, the primary strategic process described came from which of the following?

planned emergence

Examples of isolating mechanisms include everything except

poorer expectations of future resource value.

"By making the world's greatest cauliflower-crust pizza" is an example of which type of mission statement?

product-oriented

Which of the following is NOT a factor in PESTEL analysis?

psychological

Successful business strategies generate value. Creating value lays the foundation for the important benefits that economies can provide. Superior performance allows the firm to

reinvest some of its profits in gaining more resources and thus grow.

Competitive advantage must be determined by comparing performance against other members of the same industry because competitive advantage is ________

relative

The final and perhaps hardest part of a good strategy is to deploy a set of coherent actions for the implementation of the strategy. Which of the following is not an implementation action taken by Nvidia?

releasing a new chip every 6 months rather than every 18 months

System 2 way of thinking

relies on analytical and logical reasoning.

In responding to Covid-19, HumanGood used data to help with which aspect of strategic planning?

scenario planning

Dr. Arthur Fry's idea about a method to hold the bookmark in his hymnal is best described as which of the following?

serendipity

The essential functions of strong ethical values and norms do everything except

serve as a statement of values for the purpose of public relations

How did HumanGood evolve their strategic plan in response to increased social media use by seniors?

shared stories and successes

Which of the following is not a key attribute to consider with regard to stakeholders' claims?

size

To help with strategy formulation, Lupita's managers may choose to use a decision tool that can recognize and prioritize the needs of different stakeholders. This tool is called a(n)

stakeholder impact analysis

The impact to a company that does not craft a strategy that passes the test of moral scrutiny might be everything except

stock appreciation.

When a company identifies an attractive industry that offers a higher-than-normal profit potential, it is a

strategic process that develops over time.

In the case discussing the electric car industry, which PESTEL factor is highlighted as the most important factor favoring a startup firm such as Tesla, Inc.?

technological factors

Innovations in process efficiencies such as Six Sigma quality, and service innovations such as social media are primarily elements of which macro environmental force?

technological factors

In 2015, Volkswagen (VW) got a caught in an emissions scandal termed "Dieselgate." VW illegally installed so-called "defeat devices" which limited emissions when the vehicle was on a test stand. They were also cited for disabling emissions controls when the vehicle was in daily driving mode. Who ultimately was responsible for this scandal?

the C.E.O. and leader of Volkswagen

In the 'Art of War' Sun Tzu emphasized the fluid nature of competitive situations and the need for the strategist to recognize and incorporate that reality into their strategic planning. Which of the following has created the greatest uncertainty in the business environment across industries over the last 20 years?

the Internet

Cognitive limitations are

the brain's inability to process large amounts of data within a short period of time.

A vision represents

the future that the firm is trying to create.

Values represent

the guardrails that keep the firm from making bad decisions.

Which of the following items would be an important mobility barrier preventing proprietary drug firms from moving into the generic strategic group in the pharmaceutical industry?

the lower-cost structure of the generic drug firms

A key insight of the Five Forces Model is that the more profitable the industry, the more attractive it becomes. To increase the probability of a successful entry, strategic leaders need to consider everything except

the products or services they offer.

A mission represents

the strategic actions the firm takes.

An example of a firm effect factor impacting a company's performance would be

the strategic positioning of the company.

The intensity of rivalry is dependent upon a competitive industry structure which are elements and features common to all industries. They include everything except

the targeted demographic customer group.

A strategic inflection point is

the turning point in determining the company's future.

Which of the following is NOT an entry barrier?

threat of backward integration

Vision statements often begin with ________Blank and are connected to mission statements with the word ________Blank.

to; by

According to the text, superior performance within the strategic business unit (SBU) is sought by asking which major question?

How to compete?

Why is a clearly articulated core values statement important?

It establishes behavioral expectations and a moral compass for the employees.

The Austrian company Red Bull successfully entered the U.S. soft drink market by using which form of entry?

establishing a niche

Industry convergence is often brought about by

external shocks to the industry or by technological advancements.

In the case, the software engineers present at the meeting would concern themselves with ________Blank-level strategy.

functional

Implementing the strategy is often overlooked by senior managers especially in large organizations. What level of manager is often responsible for making sure the strategy gets implemented in alignment with the corporate goals?

functional manager

PESTEL helps firms understand what is going on in the ________Blank environment.

general

Honda Motor Company used its competitive advantage in small engines for lawnmowers to ___________Blank in resources and capabilities to build automobiles.

generate a feedback loop and invest

For KFC, what competitive challenge was identified?

get new customers to come to KFC

Analysis, the first step in the AFI Framework, includes all of the following EXCEPT

global strategy for competing around the world.

Which of the following does not impact the bargaining power of buyers?

government regulation

What does the price-performance tradeoff describe?

how close a substitute product is to the industry's products and how much they cost

What is the first step in the stakeholder impact analysis?

identify stakeholders

Intangible resources or capabilities may be a good basis for creating a competitive advantage because

intangible resources or capabilities are generally sticky to the firm.

System 1 way of thinking

is automatic, fast, and efficient.

Navigating a company's inflection point is hard for senior managers because

it requires a fundamental change in the company's strategy.

In the strategic groups discussed in the preceding pharmaceutical case, each of the following is a differential relevant to the proprietary group of firms except which one?

large-scale manufacturing

A central principle of stakeholder strategy is that single-minded pursuit of shareholder value

leaves a firm open to undue risks.

Managers must ensure that their firms obey all relevant laws, including labor, consumer, and environmental regulations. This is a firm's ________Blank responsibility.

legal

What is the most effective way strategic leaders have found to communicate with their employees across all levels of the organization?

Face to face meetings

Properly completing a stakeholder analysis will result in all stakeholders approving of the strategic decision.

False

Nvidia went through a major rethinking of its strategy after its initial market failures. Based on the case just mentioned, what is the major diagnosis of the competitive challenge they found?

Customers would be willing to buy new and better graphics solutions frequently.

The distinct differences across strategic groups reflect the strategies that firms pursue. How would you describe the strategy of firms in the same strategic group?

Firms in the same strategic group follow a similar strategy.

When managers envision different "what-if" future alternatives and develop strategic plans to address them, they are engaging in scenario planning. The process of planning scenarios can be considered a microcosm of the overarching framework of this textbook. Analysis is identifying a variety of future scenarios. Formulation is developing strategic plans to address many of those future scenarios. What is the final Implementation phase of scenario planning?

Executing a dominant strategic plan. Strategy is meaningless if it is not actionable.

As demonstrated in the 3M example, senior managers have a vital role in the planned emergence process. Which of the following best describes that role?

Executives decide which projects to shut down and which to continue.

In KFC's strategy process, designing stores that fit their geography, such as more walk-in space in bigger cities, is an example of ________

a coherent action

A core competency can turn into a core rigidity if

a company relies too long on the competency.

Strategic dissonance occurs when

a firm's static fit no longer matches competitive realities.

Whole Food's choice to develop strict standards and labeling for seafood can best be categorized as

a mission component.

Not all stakeholder groups are created equal. Their differential power can influence how economic value is both created and captured. As noted in the textbook, in the ________Blank industry, one of the most powerful external stakeholders has historically been unions.

aerospace

Many companies incentivize employees through stock options (ESOPs). This practice allows employees to buy stock at discounted prices or use stock as a retirement investment. This has the effect of

aligning employee and stockholder interests.

The example of investment in Starbucks Frappuccino represents which strategy?

autonomous action

What does the Porter's five forces model predict?

average industry profitability

In keeping with its vision and values, Whole Foods could have

bought its own fishing vessels and processing capacity.

How has a strategic leader like Mark Zuckerberg guided his company to gain and sustain a competitive advantage for the future?

by allocating resources to create an operating system for the metaverse

Core competencies derive from the combination of resources and

capabilities.

The March 2020 agreement between Pfizer and BioNTech to jointly develop a COVID-19 vaccine is an example of

co-opetition.

Lupita knows that benefits of a well-chosen and executed stakeholder strategy can result in all of the following ways EXCEPT

competitive advantage is severely weakened.

Resources fall broadly into two categories: tangible and intangible. Tangible resources have physical attributes and are visible. Intangible resources have no physical attributes and thus are invisible. Examples of intangible resources are a firm's culture, its knowledge, brand equity, and reputation. Which of the following is another example of an intangible resource?

copyright

Isolating mechanisms are related to which criteria used to assess the basis of competitive advantage?

costly or difficult to imitate

What is the last step in developing a strategy?

create a set of coherent actions

The following cognitive biases can lead to systematic errors in decision making except

de-escalating commitment and lack of control.

Strategic groups typically follow different business strategies. In the pharmaceutical example in this case, the high-risk, high-return strategy of the proprietary group would be characterized as

differentiation.

Which responsibilities are the most important for a company to fulfill?

economic

An example of an industry effect factor impacting a company's performance would be

entry and exit barriers.

Competitive parity represents performance that is ______Blank your competitors.

equal to