Chapter 1, Chapter 2: The External Environment, Chapter 3: The Internal Organization

Which of the following capabilities meets the criteria for being a core competency, in that it is rare, valuable, costly to imitate, and nonsubstitutable? a. A company history and brand b. The human resources function c. The CEO d. A manufacturing facility

A company history and brand

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.

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 the following statements is true about the strategic group in which these companies compete?

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. 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.

Myspace, the social networking site, was a leader and innovator for modern social networking. However, not long after Myspace's peak, a new social networking site, Facebook, began quickly gaining ground. Myspace quickly became obsolete because of Facebook's superior functionality, design, and features. Which of the following was Myspace lacking that resulted in the company losing its competitive advantage?

Costly-to-imitate capabilities because it became inexpensive to start a social networking site

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

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

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. 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.

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.

A company is debating whether to enter 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 a new market or industry?

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

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.

Apple, a leader in mobile technology products, wasn't always focused on mobile technology. In 2007, the company changed its name from Apple Computers to Apple Inc. This change was indicative of a shift in the industry. Apple began introducing iPods, iPhones, iPads, iTunes, and the App Store. Apple recognized its core competencies in hardware design and software engineering should serve as the foundation of its future strategy. Which of the following tools did Apple use to determine its competitive advantage?

Internal analysis

A hospital system operates 22 physicians' offices, five skilled nursing facilities, and two hospitals. The system employs more than 500 people directly and is affiliated with more than 100 additional physicians. The system offers a wide breadth of medical services, including all of the major specialties. The system was recently recognized as the top cardiac hospital in the state. Which of the following represents the company's capabilities?

Its complete list of medical services

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?

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

Which of the following might be a definition for a value-generating activity?

The core competencies that a company holds that make it possible for it to serve customers in a different way from its competitors

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.

The country's largest landscape company is the result of a merger between two multistate 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?

Threat of New Entrants: 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.

In 2011, Apple and Samsung were in a legal battle over patenting. Apple and Samsung mutually accused 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?

To neutralize a threat that could hinder strategic competitiveness

BlackBerry, a one-time leader in secure cell phones, has lost its edge. Without significant upgrades or innovation, the company quickly lost market share to iPhones and Android devices. The company attempted to imitate these advances with the Blackberry Storm product, which flopped. Blackberry was criticized as trying to leverage capabilities beyond its core competencies. Which of the following tools should Blackberry use to regain a scope of their core competencies and determine potential sources of competitive advantage?

Value chain analysis

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.

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

Value is measured by:

a product's performance characteristics and by its attributes for which customers are willing to pay.

Check My Work 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 provide several options. In which of the following economic segments should Cisco seek to compete?

a relatively stable economy with strong growth potential

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?

bargaining power of buyers

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:

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

Capabilities are the:

combination of tangible and intangible resources to complete the organizational tasks required to produce, distribute, and service the goods or services for customers.

Strategic groups exist because:

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

A company has identified a core competency in providing telecommunications services for mid-sized businesses through a combination of simple technology and software, excellent customer service, and low-cost hardware. As competitors gain ground in competing for mid-sized companies, this core competency might become a core rigidity if the:

company doesn't keep up with advances in technology and customers begin to expect greater value from the technology.

General Electric (GE), 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 as to how to gain a competitive advantage. Which of the following is GE performing?

competitor analysis

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. Which of the following is the term for the report being analyzed?

competitor intelligence

A company is analyzing its value chain to discover its value-creating activities. While formulating its strategy, the firm will:

consider the operational functions and support functions to determine which activities contribute the greatest value in the product or service being sold to customers.

A CEO is in an argument with his board of directors over the direction of the software company he is leading. The CEO wants to branch out and take advantage of its competencies and capabilities to pursue opportunities enabled by new technology that are forecasted to be very profitable. However, these activities are not what the company is used to, and it would have to develop hardware alongside its specialty in software. The board is arguing that the company is a software company and should remain a software company. Which of the following concepts must the CEO overcome?

core rigidity

Through research and development (R&D), 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?

customer switching costs

Which of the following would be deemed unethical when developing competitor intelligence? a. Analyzing competitors' financial reports b. Attending trade shows solely to obtain knowledge of 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.

d. All of these actions are ethical

What is the term that is concerned with a population's size, age structure, geographic distribution, ethnic mix, and income distribution?

demographic segment

A sporting goods company developed an innovative material for the manufacture of baseball bats. For many years, the material and its process for manufacturing served as a rare and valuable capability, distinguishing it from competitors. Unfortunately, many of the baseball leagues have been changing their regulations to outlaw bats made of this material because they constitute an unfair advantage for players. As part of its internal analysis, its leaders might:

determine if the company's core competency is in research and development of different materials or only in working with this material specifically

Capabilities develop into core competencies that can serve as the source of competitive advantage when:

employees, or human capital, integrate them and deploy them to deliver value to customers.

An industrial fabrication firm has purchased a facility capable of housing large-scale projects—as long as 120 feet. The firm could develop this tangible resource into a capability by:

employing engineers who can design large projects and welders who have expertise in these projects.

A nonprofit organization is focused on providing mental health services to the homeless in its geographic area. It serves people by ensuring they receive the public assistance they are eligible for and then connects them with care providers that have expertise working with transient patients. The company's primary expenses are the salary and benefits for its staff of social workers, and it receives government funding to cover those. However, the organization does not have enough people to fill its open positions and has a waiting list of homeless people in need of case workers. Which of the following represents a weakness for the nonprofit organization?

human resources

The _____ environment is the set of factors that directly influences a firm and its competitive actions and responses within the industry.

industry

A capability is nonsubstitutable when:

it does not have strategic equivalents.

A capability can be considered costly to imitate when:

it is developed because of unique historical conditions.

A resource or capability can be classified as a core competency that can be a source for a sustainable competitive advantage if:

it is different and better than the way a competitor is executing the same capability.

An attorney has grown his law firm, gaining new clients in two diverse areas—estate law and immigration law. He's not sure which specialty will become his focus in the long run. At the same time, he believes he has enough work to support hiring a paralegal. However, he is having trouble hiring a paralegal who can manage both types of clients. He was able to find a freelance paralegal referral service that connects attorneys to paralegals who have experience in a variety of specialties. He might consider outsourcing through the referral service because:

it provides him with the flexibility to gain capabilities to serve both types of clients without making a long-term investment.

A firm should study its internal organization as part of the strategic management process because:

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

An internal analysis is important because:

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

In an external environmental analysis, there are two important elements that need to be identified. What are those two elements?

opportunities and threats

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 _____ forces in the macroenvironment.

political/legal

Many large corporations have a presence in Washington D.C. 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 of the following segments is this process referring to?

political/legal segment

Outsourcing is the:

purchase of a value-creating activity or support function activity from an external supplier.

A company owns a patent, with six more years of protection, on a prescription medication that is used by people around the world. This resource is:

rare and valuable.

A core rigidity arises when a:

resource becomes an obstacle, generating inertia and stifling innovation, often because of conditions in the external environment.

An intangible resource is one that is:

rooted deeply in the company history, is gathered over time, and is difficult for competitors to analyze or imitate.

What is a set of competitive firms emphasizing similar strategic dimensions and using a similar strategy?

strategic group

Identifying internal strengths and weaknesses is important because:

strategies are more successful when they are aligned with a company's resources, capabilities, and core competencies.

As an industry environment evolves over time, the:

strength of the competitive forces in the industry change

If a start-up U.S.-based automobile parts supplier were to apply a global mind-set to its internal analysis, it would:

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.

The five competitive forces include all of the following forces that shape competition within an industry EXCEPT: a. threat of new entrants. b. bargaining power of suppliers. c. threat of substitute products. d. rate of innovation and change.

the rate of innovation and change

Suppliers are most powerful when a company:

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

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.

Which of the following would be considered an example of a tangible resource?

A network of distribution centers in strategic locations around the world

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.

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

What is a competitor analysis?

An analysis of companies with which a firm competes directly

Which of the following describes the relationship between Apple, the leading cell phone manufacturer and applications provider, and King, the developers behind the Candy Crush Saga app?

Apple and King are complementors

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.

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.

You are hired as a 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?

Contact the Strategy and Competitive Intelligence Professionals association

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.

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.

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.

TaylorTech, a high-quality metals finishing company, is struggling with its margins. TaylorTech has raw materials delivered to its foundry in Pittsburgh, where the company melts the metals into castings. The firm then polishes them as a value-added process before selling the custom castings to customers. Its unique process is rare in the United States, is very secretive, and results in a more efficient cast that commands a premium price. Unfortunately, the casting process is becoming more expensive due to increased wage pressure from the workers specializing in casting. With these issues, TaylorTech has to make a decision. Which of the following is the most viable option for TaylorTech to increase its margins?

Outsource the casting process

Procter & Gamble (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. Which of the following could be the reason for P&G's competitiveness?

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

What are the possible repercussions of a company that performs unethically in order to receive competitive intelligence to gain an advantage?

Possible jail time or fines, but not always

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"?

Possibly, as the "white space" could be a place that is competitive but has been neglected or could also be a space that is not competitive or profitable

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.

Potential competitors may enter an industry and begin to take market share from existing companies. Which of the following is one of the largest challenges a new entrant needs to overcome to be successful when entering an industry?

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

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.

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 environmental analysis element is a primary focus of car manufacturers?

assessing