BUSA 4980 Chapter 1 Quiz
What is a vital part of the firm's vision and mission?
business ethics
Functional strategy
functions organization participates in
Product Market Stakeholders
primary customers, suppliers, host communities, unions
What are the 3 groups of stakeholders?
- Capital market stakeholders - Product market stakeholders - Organizational stakeholders
External model
- I/O model - popular '60s - '80s - resources are considered highly mobile
Internal model
- Resource based model - Resources are not considered highly mobile
Gloablization
- goods and services flow across country borders - performance standards are higher w/ globalization - increased importance of developing countries
How did McDonald's succeed in an unattractive market?
- product innovation (resource based model)
Capital Market Stakeholders
- shareholders - major suppliers of capital
Mission
- specifies who the firm intends to serve and how they serve those individuals
What are the four strategy levels?
1. Corporate level 2. Business level 3. Functional level 4. Operational level
What are the 2 models of strategic decision making?
1. External (I/O model) 2. Internal (Resource based model)
What are the 2 drivers of hyper-competition?
1. Technology 2. Globalization
2 commonalities between the models
1. focus on superior returns 2. compete in an attractive industry
Hyper-competition is characterized by:
1. market instability and change 2. rapidly escalating competition 3. aggressive challengers
Why did CC fail?
1. too focused on short term profits 2. laid off essential staff like salespeople 3. didn't think Best Buy was a serious threat
What are the four criteria for capabilities to become core competencies?
1. valuable 2. rare 3. costly to imitate 4. non-substitutable
What % of profitability is explained by the I/O model?
20%
What % of profitability is explained by the resource based model?
36%
What does the five forces model show?
Analytical tool used to help firms decide what industry is most attractive for them
#11 answer
B
What is the largest consumer market?
European Union
Liability of foreignness
The risk of participating in international markets
T/F: resources alone are not enough to get competitive advantage
True
Strategic competiveness
achieved when a firm successfully formulates and implements a value-creating strategy
What do profit pools matter?
all managers to locate most profitable point along a value chain to help better position the firm
strategic flexibility
an important tool in hyper-competition
Operational strategy
day to day operations
What occurs because of globalization?
delegation of strategic responsibility
Developing countries are also known as
emerging markets
organizational stakeholders
employees, managers, nonmanagers
Profit pool
entails the total profits earned in an industry at all points along the value chain ex: De Biers (diamonds)
Business strategy
how should we compete in this product *keyword* exploite
what is the key to competitive advantage?
information
disruptive technology creates
new industries
Organizational culture is
not a resources but a competitive advantage
Stakeholders
people who are affected by a firm's performance and who have claims on its performance
Resources --> comp. adv.
resources *intergrate* to create capabilities, which then must meet 4 criteria to become core competencies which become foundation of competitive advantage
What does an industry analysis tell us?
the attractiveness of an industry to determine profitability
Vision
what the firm whats to be achieve ultimately in broad terms - enduring - foundation for the mission
Corporate strategy
which or what businesses should we compete in
