Ch 1 Sevi

A firm's overall efforts to gain and sustain competitive advantage is referred to as which of the following?

a competitive strategy

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 Blank______.

a competitive advantage

When identifying stakeholders, a firm should focus on those stakeholders that Blank______.

currently have, or could potentially have, a material effect on the firm

Customers, suppliers, creditors, unions, and governments are known as Blank______.

external stakeholders

Michael's Deli is able to perform at the same level as its primary competitor. Michael's Deli has Blank______.

competitive parity

The idea that firms should voluntarily give back to society when they are able to do so is known as Blank______.

corporate citizenship

Which framework helps firms to identify their economic, legal, ethical, and philanthropic obligations to society?

corporate social responsibility

Which of the following are primary strategy objectives?

creating value controlling costs

Using a(n) Blank______ strategy formulation, managers examine where and how the firm should compete around the world. Multiple choice question.

global

A competitive advantage Blank______.

is assessed relative to other competitors in the industry

Among the various types of responsibilities a business firm has, which are specifically considered to be economic responsibilities?

repaying debts to creditors giving investors a return on invested capital

The concept, or framework, of corporate social _____ guides firms in identifying and addressing their economic, legal, ethical, and philanthropic obligations to society.

responsibility

Stakeholder strategy argues that focusing exclusively on the needs of Blank______ places the firm at risk of failure.

shareholders

Why should a firm define a clear competitive challenge?

so that employees can assess their progress toward addressing it

In the external analysis phase of the AFI strategy framework, what should managers ask?

"How do external forces affect our strategy and competitive advantage?"

What is the first step in the AFI strategy framework?

Analysis

Which of the following statements is true about Tesla, the manufacturer of all-electric cars?

It has a high market valuation.

Which of the following statements regarding tasks in the AFI strategy framework is true?

The tasks are very interdependent.

In a(n) Blank______ strategy formulation, managers focus on deciding HOW the firm should compete.

business

When a firm works to gain a competitive advantage by providing better goods and services than its rivals, it is employing a _____ strategy.

differentiation

Which of the following legal developments allow business to function as an institution?

property rights contract enforcement

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 Blank______.

the trade-offs required by strategic positioning

In the Blank______ step of the stakeholder impact analysis, the firm identifies the opportunities and threats that stakeholders present to the firm.

third

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 term describes the groups or individuals who can impact or be impacted by a firm's actions?

stakeholders

What do shareholders receive from firms in return for their contribution of capital?

stock dividends

Effective guiding policy is supported by and stays consistent through the use of Blank______.

strategic commitments

Which of the following indicates that investors expect future growth for Tesla? Multiple choice question.

the increasing value of the company's stock

In order to determine if Home Depot has a competitive advantage, we must compare Home Depot's performance to Blank______.

the performance of other firms in its industry

What is strategy?

the set of actions a firm takes to achieve a competitive advantage

Managers often have to make decisions between two conflicting strategic options, otherwise known as Blank______

trade-offs

In the Blank______ step of the stakeholder impact analysis, managers need to decide the appropriate course of action for the firm in relation to stakeholder concerns.

fifth

Stakeholder impact analysis is a Blank______-step process that allows managers to better understand and address stakeholders' needs

five

In the Blank______ step of the stakeholder impact analysis, firms identify their various social responsibilities to stakeholders.

fourth

What is one significant challenge that Tesla faces?

gaps in the infrastructure needed to keep its vehicles on the road all over the country

The question "How do we implement the formulated strategy through an organizational structure, culture, and control system that values and encourages ethical behavior?" would most likely be examined by managers in the Blank______ phase of the AFI strategy framework. Multiple choice question.

implementation

The high market valuation achieved by Tesla by 2019 can be largely attributed to its Blank______.

implementation of its secret strategy

The stakeholders of a firm are Blank______

individuals or groups that can affect and are affected by the actions of the firm

In the second step of the stakeholder impact analysis, managers need to identify and understand stakeholders'

interests and claims

The third step of stakeholder impact analysis requires managers to identify the Blank______ presented by internal and external stakeholders.

opportunities and threats

Firms should obey all the laws, including but not limited to labor, consumer protection, and the environment.

True

When does a situation of competitive parity exist?

Two or more firms achieve the same performance results.

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?

Burger Bomb has been outperforming other burger restaurants in recent years. This indicates that Burger Bomb has which of the following? Multiple choice question.

A competitive advantage

Which of the following traits are Tesla specifically aiming to include in its vehicles to achieve competitive advantage?

Attractiveness Affordability New technology

Who among the following are considered internal stakeholders

Board members Employees Stockholders

What are the categories of expectations that society has of the business enterprise as described in the CSR framework?

Ethical Legal Philanthropic Economic

Which statement is true about pricing strategies, internet strategies, alliance strategies, and brand strategies?

They may be a necessary part of a firm's initiatives to support its competitive strategies.

Based on its long dominance as a coffeehouse chain, Starbucks has Blank______.

a sustainable competitive advantage

When a stakeholder has power over a company that stakeholder is

able to influence the company to do something it would otherwise not do

How should managers prioritize stakeholder concerns in the final step of stakeholder impact analysis?

by considering the power, legitimacy, and urgency of stakeholder claims

Which of the four corporate social responsibilities is considered first and foremost for business enterprises?

economic

Which of the following incentivize workers by offering them discounted shares or retirement plans based on company stock?

employee stock ownership plans

Internet privacy, genetic engineering, and stem-cell research are examples of areas in which a firm's Blank______ responsibilities exceed its legal responsibilities.

ethical

Effective stakeholder management Blank______.

helps a firm build a strong public reputation

Microsoft donating more than $3 billion in cash and software to people in need is an example of which type of corporate social responsibility?

philanthropic

In the Blank______ step of the stakeholder impact analysis the firm identifies their stakeholders' interests and claims according to the power, legitimacy, and urgency framework

second

A good strategy consists of three elements. The first element is accomplished through analysis of the firm's external and internal environments. We also call this______.

a diagnosis of the competitive advantage

Which of the following are elements of a good strategy according to the AFI framework?

a diagnosis of the competitive challenge a guiding policy to address the competitive challenge a set of coherent actions to implement the firm's guiding policy

Which statement about strategies is true?

A statement of desire on its own often leads to goal conflict.

True or false: A statement such as, "We will be the biggest company in the world," is an example of strategy.

False

True or false: A strategic leader's job is to focus like a laser on shareholders.

False

Which of the following are outcomes of effective stakeholder management?

It lowers the cost of business transactions by building trust. It leads to beneficial cooperation from stakeholders. It helps the firm achieve predictable and stable returns.

What is the best definition of a cost leadership strategy?

Offering similar goods and services at a lower price.

To which types of organizations can we apply the principles of strategic management?

all types of organizations

A(n) Blank______ occurs when a firm performs below the industry average or is outperformed by its competitors.

competitive disadvantage

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 Blank______.

strategic positioning

In a nutshell, strategy is the art and science of

success and failure

A well-devised strategy is about which two things?

what to do what not to do

What must a firm do after diagnosing its specific competitive challenge?

Create an effective guiding policy

Which of the following elements comprise strategic management?

analysis implementation formulation

Shareholder activists, such as Bill Ackman and Carl Icahn, have much more power over a firm than individual investors, because they

can exercise block-voting rights or otherwise influence the corporate governance process are able to buy or sell a much larger number of shares than individuals can

Firms should identify a Blank______ so that employees can determine if they are making progress in addressing it.

clear competitive challenge

Starbucks's actions to educate its workers and management about racism indicates that the firm takes its Blank______ responsibilities seriously.

ethical

Which of the following elements of the pyramid of corporate social responsibilities are result from a society's expectations toward business?

ethical responsibilities philanthropic responsibilities

Which of the following are the three important stakeholder attributes managers must pay particular attention to during stakeholder impact analysis?

legitimacy power urgency

Managers have Blank______ resources in their quest for competitive advantage.

limited

In the Blank______ step of the strategy implementation phase of the AFI strategy framework, managers would examine how the firm should be structured in order to implement the desired strategy.

organizational design

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. These ideas are Burger Bomb's ______.

strategy

Which of the following topics should be considered during the analysis phase of the AFI framework?

the external environment and associated challenges the firm's internal strengths and resources the role of strategic leadership and the strategy process the firm's business model and competitive advantages

In which step of a stakeholder impact analysis do firms identify those stakeholders that currently have, or potentially can have, a material effect on the company?

First

What are negative outcomes of the Red Queen effect?

Companies copy each other, which reduces customer choice. Companies have fewer resources to improve product lines. Companies expend energy to gain little advantage.

Which of the following elements of the pyramid of corporate social responsibility are required by society and shareholders?

Economic responsibilities Legal responsibilities

Which statement about shareholders and employees is true?

Employees are often made into shareholders through employee stock ownership plans.

What is the best definition of the Red Queen effect?

Companies copy each other but do not change strategic positions.

Although they are more vocal, activist investors have the same amount of power as individual investors.

False

What is one explanation for why Tesla underperforms when the company's profits are compared to the profits of established car companies? Multiple choice question.

Startups often lose money early on.

Which of the following is the best indicator that Tesla's startup master plan has worked as intended?

Tesla generated 500,000 preorders for an unseen model.

A good strategy consists of three elements. The first element is accomplished through analysis of the firm's external and internal environments. We also call this Blank______

a diagnosis of the competitive advantage

Which of the following are elements of a good strategy according to the AFI framework?

a guiding policy to address the competitive challenge a set of coherent actions to implement the firm's guiding policy a diagnosis of the competitive challenge

A stakeholder has Blank______ when its needs are within the bounds of the law or are otherwise relevant to the firm

a legitimate claim

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

Strategic positioning allows managers to Blank______.

provide customers value while controlling costs

A firm that successfully executes a strategy benefits society by Blank______.

reinvesting profits and increasing employment creating value

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 competitive advantage that lasts for a long period of time is said to be Blank______.

sustainable

A successful business strategy creates Blank______ for both producers and consumers.

value