ch 4

c

The company with the highest rating on a given measure has an implied competitive edge on that specific measure, with the size of its edge: A. providing the company with an overall net competitive score that is reduced by the weighted measure. B. signaling a weak position and competitive disadvantage. C. reflecting the difference between its weighted rating and rivals' weighted ratings. D. reflecting an area of potential improvement in order to achieve a sustainable competitive advantage. E. requiring reevaluation of the weighted measure.

c

When a company has a proficiency in performing a strategically and competitively important value chain activity better than its rivals, it is said to have: A. a company competence. B. a core competence. C. a distinctive competence. D. a key value chain proficiency. E. a competitive advantage over rivals.

c

When a company performs a particular competitively important activity truly well in comparison to its rivals, it is said to have: A. a company competence. B. a strategic resource. C. a distinctive competence. D. a core competence. E. a key success factor.

a

When an activity becomes something a company has learned to perform proficiently and capably, the company is said to have: A. a competence. B. a competitive advantage over rivals. C. a key value chain proficiency. D. a distinctive capability. E. a resource advantage.

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b

A company's resources and capabilities represent: A. the firm's net working capital and related determinants for measuring operating performance and capabilities. B. the firm's competitive assets, which are considered determinants of its competitiveness and ability to succeed in the marketplace. C. whether the firm has the industry's most efficient value chain. D. the management's source of funding of new strategic initiatives. E. positive trends with relevant cultural factors related to buyers' choices and product modifications

d,a

A core competence: A. detracts from a company's arsenal of competitive capabilities and competitive assets and is not a resource strength considered to be genuine. B. is typically results-based, residing in a company's tangible physical assets on the balance sheet. C. is often grounded in a single department's set of knowledge and expertise. D. is an activity that a firm performs proficiently that is also central to its strategy and competitive success. E. is a proficiently performed external activity. A core competence: A. is a more competitively valuable strength than a competence because of the key role the activities play in the company's strategy. B. typically has competitive value, the amount of which is reflected in the physical and tangible assets on a company's balance sheet. C. usually is grounded in the technological expertise of a particular department or work group. D. is more difficult for rivals to copy than a distinctive competence. E. refers to a company's lowest-cost and most efficiently executed value-chain activity.

e

A much-used and potent managerial tool for determining whether a company performs particular functions or activities in a manner that represents "the best practice" when both cost and effectiveness are taken into account is: A. competitive strength analysis. B. activity-based costing. C. resource cost mapping. D. SWOT analysis. E. benchmarking.

a

A powerful tool for sizing up the company's competitive assets and determining whether they can provide the foundation necessary for competitive success in the marketplace is termed: A. resource and capability analysis. B. SWOT. C. competitive analysis. D. financial and asset management analysis. E. value chain analysis.

a

A useful way to identify a company's resources is to view them as: A. divided into two main categories, tangible and intangible. B. productive inputs or competitive assets, except human assets and intellectual capital, which are considered capabilities or competencies. C. physical resources, such as the company's brand, image, and reputation assets. D. an inventory or a collection of the firm's strengths, weaknesses, opportunities, and threats. E. intangible resources such as patents, copyrights, and technological processes.

c,a

Activity-based costing is used to evaluate a company's cost-competitiveness and: A. determine whether the value chains of rival companies are similar or different. B. benchmark the costs of primary value chain activities against the costs of the support value chain activities. C. determine the costs of each primary and support activity comprising a company's value chain and thereby reveal the nature and makeup of a company's internal cost structure. D. determine the costs of each strategic action a company initiates. E. analyze the costs of each primary activity. Activity-based costing: A. is an accounting system that assigns a company's expenses to whichever activity in a company's value chain is responsible for creating the cost. B. involves using benchmarking techniques to develop cost estimates for the value chain activities of each major rival. C. is a powerful tool for identifying the different pieces of a company's value chain and classifying them as primary activities and support activities. D. involves determining which value chain activities represent variable costs and which represent fixed costs. E. is a tool for identifying the activities that cause a company's product to be strongly differentiated from the products of rivals.

e,c

Assigning a weight to each measure of competitive strength assessment is generally analytically superior because: A. a weighted ranking identifies which competitive advantages are most powerful. B. an unweighted ranking doesn't discriminate between companies with high and low market shares. C. it singles out which competitor has the most competitively potent core competencies. D. weighting each company's overall competitive strength by its percentage share of total industry profits produces a more accurate measure of its true competitive strength. E. all of the various measures of competitive strength are not equally important. Competitive strength can be determined by assigning measures based on perceived importance because: A. it provides a more accurate assessment of the strength of competitive forces. B. it eliminates the bias introduced for those firms having large market shares. C. the different measures of competitive strength are unlikely to be equally important. D. the results provide a more reliable measure of what competitive moves rivals are likely to make next. E. weighting each company's overall competitive strength by the size of its market share produces a more accurate measure of its true competitive strength.

a

Benchmarking involves: A. comparing how different companies perform various value chain activities and then making cross-company comparisons of the costs and effectiveness of these activities. B. checking whether a company has achieved more of its financial and strategic objectives over the past five years relative to the other firms it is in direct competition with. C. studying whether a company's resource strengths are more/less powerful than the resource strengths of rival companies. D. studying how a company's competitive capabilities stack up against the competitive capabilities of selected companies known to have world-class competitive capabilities. E. comparing the best practices in one industry against the best practices in another industry.

a

Benchmarking provides a company with which of the following? A. Hard evidence of cost competitiveness B. Proof of resource availability C. A company strategy D. Verification of total cost ownership E. Improvements to internal processes

a

Calculating competitive strength ratings for a company and comparing them against strength ratings for its key competitors helps indicate: A. which weaknesses and vulnerabilities of competitors the company might be able to attack successfully. B. which competitors are in profitable strategic groups and which competitors are in unprofitable strategic groups. C. which competitors are employing offensive strategies and which competitors are employing defensive strategies. D. which competitors are likely to make money and which are likely to lose money in the years ahead. E. what the industry's key success factors are.

d

Costs and price differences among competing companies can have origins in activities performed by: A. the company's internally performed activities (its own value chain) compared to the cost structure of the internally performed activities of rival companies. B. value chains of the company's suppliers. C. value chains of a company's distributors and retail dealers and forward channel allies. D. the company's internally performed activities (its own value chain), but also on costs in the value chain of its suppliers and distribution channel allies. E. whether the company has a longer or shorter value chain than its close rivals.

b

How are a company's organizational capabilities developed and enabled? A. By strengthening the traditions that company executives are committed to maintaining B. Through deployment of a company's resources or some combination of its resources C. By talking openly about the problems of the present company and determining how new behaviors will improve performance D. By shifting from decentralized to centralized decision-making E. By urging company personnel to search outside the company for work practices and operating approaches that may be an improvement over what the company is presently doing

c

If a company doesn't possess standalone resource strengths capable of contributing to competitive advantage: A. all potential for competitive advantage is lost. B. it is unlikely to survive in the marketplace and should exit the industry. C. it may have a bundle of resources that can be leveraged to develop a distinctive competence. D. it is virtually blocked from using offensive strategies and must rely on defensive strategies. E. its best strategic option is to revamp its value chain in hopes of creating stronger competitive capabilities.

d

The best indicator of how well a company's strategy is working is whether the company: A. is achieving its stated financial objectives, its financial performance equates to the industry average, and market share gains reflect short-term preferences for capacity maximization. B. is attentive to its poor execution in functional areas, business goals are stretch, and the value proposition has a product focus. C. is geared to initiatives designed to build market share and to promote corporate responsibility. D. is achieving its stated financial and strategic objectives, its financial performance is better than the industry average, and it is gaining customers and increasing its market share. E. is geared to initiatives to promote corporate social responsibility.

e

Obtaining cost information is a primary difficulty associated with benchmarking. The following are typical sources for collecting information, EXCEPT: A. from published reports, industry research firms, and trade groups. B. from talking to knowledgeable industry leaders. C. from field trips to the facilities of competitors or non-competing firms. D. from independent firms and consulting firms to gather best practices and comparative cost data without identifying competing firms. E. from the classified government documents.

c

One important indicator of how well a company's present strategy is working is whether: A. it has more core competencies than close rivals. B. its strategy is built around at least two of the industry's key success factors. C. the company is achieving its financial and strategic objectives and whether it is an above-average industry performer. D. it is customarily a first-mover in introducing new or improved products (a good sign) or a late-mover (a bad sign). E. it is subject to weaker competitive forces and pressures than close rivals (a good sign) or stronger competitive forces and pressures (a bad sign).

a

Resource and capability analysis is achieved by: A. probing the caliber of a firm's competitive assets relative to those of rival firms. B. attaining price stability. C. analyzing only internal strengths and weaknesses through a matrix comparison model. D. cost-benefit analysis of the company's core product sales. E. performing resource-specific activities within the organization to allocate available capital.

c

Tangible resources do not include: A. physical resources. B. financial resources. C. human assets. D. technological assets. E. organizational resources.

d

Tangible resources include: A. human assets and intellectual capital, which can include the talent of the work force and the creativity and innovativeness of certain personnel. B. reputational assets, which can include the company's reputation for quality, service, and reliability as well as their reputation for fair dealings with suppliers. C. relationships such as alliances that provide access to technologies, specialized know-how, or geographic markets. D. technological assets such as patents, copyrights, and innovation technologies. E. company culture and incentive system, which includes the norms of behavior and business principles.

c

The difference between a core competence and a distinctive competence is that: A. a distinctive competence refers to a company's strongest resource or competitive capability, whereas a core competence refers to a company's lowest-cost and most efficiently executed value-chain activity. B. a core competence usually resides in a company's base of intellectual capital, whereas a distinctive competence stems from the superiority of a company's physical and tangible assets. C. a core competence is a competitively and strategically relevant activity that a firm performs well compared to its other activities, whereas a distinctive competence is a competitively relevant activity a firm performs well compared to other rival firms. D. a core competence represents a resource strength, whereas a distinctive competence is achieved by having more resource strengths than rival companies. E. a core competence usually resides in a company's technology and physical assets, whereas a distinctive competence usually resides in a company's know-how, expertise, and intellectual capital.

a

The difference between a resource and a capability is: A. a resource is a productive input or competitive asset, whereas a capability is the capacity of the firm to perform some internal activity competently. B. a resource is a reserve supply or back-up supply function, whereas a capability is the ability to manage the resource function. C. a resource is a mechanism used for carrying out some responsibility, whereas a capability possesses the ability to monitor the resource D. a resource represents the firm's fixed assets, whereas a capability defines whether the firm is competent to perform some function with these assets. E. a resource represents the firm's human assets, whereas a capability defines the skills and knowledge of these human resources.

b

The most difficult part of benchmarking is: A. the decision of whether to do it at all. B. how to gain access to information regarding rivals' practices and costs. C. when to initiate the process. D. what information to utilize in the analysis process. E. when to stop the process and move forward with strategy.

c

The three main areas in the value chain where significant differences in the costs of competing firms can occur include: A. age of plants and equipment, number of employees, and advertising costs. B. operating-level activities, functional area activities, and line of business activities. C. the nature and makeup of their own internal operations, the activities performed by suppliers, and the activities performed by wholesale distribution and retailing allies. D. human resource activities (particularly labor costs), vertical integration activities, and strategic partnership activities. E. variable cost activities, fixed cost activities, and administrative activities.

a

The two approaches that can make the process of uncovering and identifying a firm's capabilities more systematic are: A. resources assessment and the functional approach. B. strengths valuations and weaknesses estimations. C. sustainability resource allocation and resource bundling. D. cross-functional analysis and collaborative resource methodology. E. financial statement analysis and management support analysis.

d

The value of doing competitive strength assessment is to: A. determine how competitively powerful the company's core competencies are. B. learn if the company's market opportunities are better than those of its rivals. C. learn whether a company has a distinctive competence. D. learn how the company ranks relative to rivals on each of the important factors that determine market success and ascertain whether the company has a net competitive advantage or disadvantage vis-à-vis key rivals. E. determine whether a company's resource strengths are sufficient to allow it to earn bigger profits than rivals.

d

Which of the following does NOT represent a potential core competence? A. Skills in manufacturing a high-quality product at a low cost B. Know-how in creating and operating systems for cost-efficient supply chain management C. The capability to fill customer orders accurately and swiftly D. Having a sprawling factory E. The capability to speed new or next-generation products to the marketplace

b

Which of the following is NOT accurate as concerns a distinctive competence? A. A distinctive competence is a competitively important activity that a company performs better than its rivals. B. A distinctive competence is typically less restrictive for rivals to copy than a core competence. C. A distinctive competence can be a basis for sustainable competitive advantage. D. A distinctive competence qualifies as a superior internal strength. E. A distinctive competence enables delivering stand-out value to customers (in the form of lower prices, better product performance, or superior service).

d

Which of the following is NOT an analytical tool for revealing a company's competitiveness and for helping to match the strategy to the company's own particular circumstances? A. Resource and capability analysis B. SWOT C. Value chain analysis D. Best practice concept E. Competitive strength analysis

c

Which of the following is NOT one of the objectives of benchmarking? A. To identify the best practices in performing various value chain activities B. To learn how best practice companies achieve lower costs or better results in performing benchmarked activities C. To help construct a company value chain and identify which activities are primary and which are support activities D. To develop cross-company comparisons of the costs of performing specific value chain activities E. To take actions to improve a company's cost competitiveness when benchmarking reveals that its costs and results of performing an activity are not as good as what other companies have achieved

a

Which of the following is NOT one of the six questions that comprise the task of evaluating a company's resources and competitive position? A. What are the company's most profitable geographic market segments? B. How well is the company's present strategy working? C. How do a company's value chain activities impact its cost structure and customer value proposition? D. Is the company competitively stronger or weaker than key rivals? E. What strategic issues and problems merit front-burner managerial attention?

b

nderstanding where the company is competitive requires: A. determining whether a company has a cost-effective value chain. B. developing quantitative strength ratings for the company and key rivals on each industry key success factor and each pivotal resource, capability, and value chain activity. C. identifying a company's core competencies and distinctive competencies (if any). D. analyzing whether a company is well positioned to gain market share and be the industry's profit leader. E. developing quantitative measures of a company's chances for future profitability.