Strat homework

Time compression diseconomies

trying to achieve the same outcome in a short time period, even with higher investments, tends to lead to inferior results

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

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

Which of the following are examples of sociocultural factors?

- Growth of the Hispanic population - The widespread adoption of smart phones - An increased demand by consumers for gluten-free products

An industry analysis provides which of the following?

- Insight into a firm's strategic-position within an industry - A rigorous way of identifying the industry's profit potential - The level of profitability that can be expected for the average firm in the industry

Which of the following are situations in which a resource is considered valuable?

- The resource helps the firm increase its economic value creation (V-C). - The resource helps a firm exploit an external opportunity.

Which of the following are ways in which the power of buyers affects producers?

- by obtaining price discounts - by requesting more services - by demanding higher quality

A core competency can help a company achieve which of the following?

- to differentiate its products and services - to offer products of comparable value at lower cost than rivals can - to create higher value for the consumer

Which of the following are characteristics of the strategic plan that makes up an intended strategy?

- top down - structured - rational

social complexity

describes a situation in which different social and business systems interact with each other.

A(n) ______ strategy attempts to increase the perceived value of a product while controlling costs.

differentiation

For a firm to sustain any competitive advantage over time, the fit between its internal strengths and external environment needs to be ______.

dynamic

Growth rates, interest rates, and levels of employment would be considered ______ factors in a firm's general environment.

economic

How to compete on a business level is defined by the variables value and cost. Together they define the ______.

economic value created

Which of the following elements comprise strategic management?

formulation, implementation, analysis

The stage during which a new product has gained some acceptance, thus causing first-time buyers to eagerly acquire the product and accelerate demand, is the ______ stage

growth

If the problem with a business strategy results in causal ambiguity, managers will ______.

have a difficult time developing a theory to deal with the problem

The ______ identifies how industries tend to develop and change over time.

industry life cycle

Which of the following is a primary factor in avoiding creative destruction?

innovation

Which of the following are components of a cost-leadership strategy?

lowest costs in the industry, acceptable value

In the ______ stage of the industry life cycle, a few number of large firms compete for a share of a market that has reached its maximum size.

maturity

The executives of a computer software company developed an intended strategy to make the company more competitive. The company's ultimate ______ strategy contained elements not only of the intended strategy but also unplanned elements from a(n) ______ strategy.

realized, emergent

The intensity with which companies in an industry jockey for market share and profitability is known as ___.

rivalry

A firm's attempts to manage the web of relationships between internal and external stakeholders in order to create value is known as

stakeholder strategy

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

strategic commitments

The resource-based model views resources as ______.

the main driver of firm performance

What are cognitive biases?

obstacles in thinking that result in systematic errors in decision making and hinder rational thinking

Unlike capabilities, resources can be both ______.

tangible and intangible

What is System 1 of the brain according to Daniel Kahneman and Amos Tverksy?

the brain's default mode

In terms of productivity, which of the following is true of learning curves?

they go down

A resource is considered ______ if it helps a firm to deal with an external threat.

valuable

Which two of the following variables can managers primarily manipulate in order to answer the question, "How should we compete?"

value, cost

In crafting a strategic management plan, leaders must first determine the company's long-term objective. This means leaders must first define the organization's ______.

vision

When a new firm enters an industry, which of the following often occur?

- incumbent firms spend more to satisfy customers - incumbent firms lower prices - industry profit potential declines

Early adopters

Customers who desire a product because it stokes their imagination and creativity

What is one of the benefits of pursuing a differentiation strategy when it comes to the power of suppliers?

Differentiation provides protection against an increase in input prices.

Network effects

Increases in the value of a product or service that result from a corresponding increase in the number of users

Which of the following statements about scenario planning is true?

It starts with a top-down approach.

After creating a vision as part of the strategic management process, a firm must next establish a(n) ______.

mission

When managers understand the forces in the external environment, they are better able to ______.

mitigate threats and leverage opportunities

Many firms of all sizes actively compete in the computer hardware industry, and there are no firms with a large market share. Product offerings tend to be similar but are differentiated in ways that enable some firms to raise or impact pricing. The computer hardware industry is an example of ______.

monopolistic competition

What should a successful vision do for an organization?

-It should make employees feel that their work is important. -It should inspire employees

What are the approaches that can be utilized when strategizing for competitive advantage?

-Strategy as planned emergence -scenario planning -strategic planning

Which competitive forces can result in the erosion of margins for both differentiation and cost-leadership business strategies?

-power of buyers -power of suppliers -threat of entry

Place in order from first to last the steps in the devil's advocacy decision framework.

1. Team one formulates a course of action 2. Team 2 questions the assumptions of and critiques the proposed course of action 3. Team 1 revised the proposed course of action based on the input from team 2 4. Team 2 questions the assumptions of and critiques the revised course of action and team 1 makes additional revisions 5. Team 1 and 2 agree upon a course of action

Place the five steps of the stakeholder impact analysis in order, with the first step at the top.

1. Who are our stakeholders? 2. What are our stakeholders' interests? 3. What opportunities and threats do our stakeholders present? 4. What economic, legal, ethical, and philanthropic responsibilities do we have to our stakeholders? 5. What should we do to effectively address the stakeholder concerns?

AFI strategy framework

Analysis, Formulation, Implementation

Why does the learning curve go down when productivity is considered?

As workers repeatedly engage in an activity, they become more efficient, driving down costs.

Which of the following can help a firm extend its competitive advantage?

Better expectations of future resource value. Path dependence Casual ambiguity Intellectual property protection

Which of the following are important factors in determining the intensity of rivalry among existing competitors?

Competitive industry structure Industry growth Exit barriers

Isolating mechanism examples

Path dependency Casual ambiguity Better expectations of future resource value Social complexity

Which of the following are factors in a firm's legal environment?

Regulations Mandates Laws

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

Which of the following are the relationships that a firm has with stakeholders?

Stakeholders can affect the firm's actions. The actions of the firm can affect stakeholders.

The ___ the forces, the ___ the expected competitive intensity, which in turn limits the industry's profit potential.

Stronger Stronger

Strategy is ______.

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

Which of the following best defines economies of scope?

They are the savings that come from producing two or more outputs at less cost than producing each output individually.

A firm's network of interconnected activities is referred to a strategic activity system because activities that are interconnected are very difficult for competitors to copy effectively.

True

According to the resource-based model, a firm is assumed to be a unique bundle of resources, capabilities, and competencies.

True

VRIO resources can lay the foundation of a competitive advantage, no competitive advantage can be sustained indefinitely.

True

Which of the following identifies the resources that can lead to a competitive advantage?

VRIO framework

According to Michael Porter, the profit potential of an industry is ______.

a function of five forces related to competition

The long tail

a new approach to segmentation based on the idea that companies can make money by selling small amounts of items that only a few people want, provided they sell enough different items

path dependence

a situation in which the options one faces in the current situation are limited by decisions made in the past

When a stakeholder has power over a company it is ______.

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

In a perfectly competitive industry, firms have difficulty ______.

achieving competitive advantage

Emergent Strategy

any unplanned strategic initiative bubbling up from the bottom of the organization

A key feature of an oligopoly is that the competing firms in the industry ______, meaning the actions of any one firm will influence the behaviors of the other firms.

are interdependent

Which term refers to strategic initiatives that lower-level employees undertake of their own volition, typically in response to unanticipated events?

autonomous actions

A ______ outlines the steps a manager will take to achieve competitive advantage in a single product market.

business level strategy

______ factors result from the processes and actions of government bodies that influence the decisions and behavior of firms.

political

When suppliers can demand higher prices for their inputs or reduce the quality of the input factor delivered, they demonstrate that they are ______.

powerful

Two important features that managers can adjust in an effort to improve the firm's strategic position are ______.

product features and customer service

What type of vision statement focuses on the good or service provided?

product oriented

It is common for firms to get their start by introducing a(n) ______ innovation.

radical

Which of the following contribute to consumer buying power?

real time, accurate price comparisons low switching costs

Core competencies of a business are generated by the interaction of ______.

resources and capabilities

The external forces called technological factors ______.

capture the application of knowledge to create new process and products

Realized Strategy

combination of intended and emergent strategy the strategy that actually takes place

During the decline stage of the industry life cycle, product innovation efforts ______.

come to a halt

Shakeout

competition become more intense, forcing weaker firms out of the industry

A(n) ______ is a unique strength, embedded deep within a firm, that is critical to gaining and sustaining competitive advantage.

core competency

A statement of guiding principles that typically provides very specific ethical considerations is a(n) ______.

core values statement

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

corporate social responsibility

Cost advantages that accrue for firms with larger output because they can spread fixed costs over more units and can employ technology more efficiently are called ______.

economies of scale

Technology enthusiasts

enjoy testing product prototypes and providing voluntary feedback that companies use to perfect their products.

The concept of a(n) ______ attempts to combine both learning effects and process improvements.

experience curve

the four steps of the innovation process

idea, invention, innovation, imitation

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

the tasks are very interdependent

Which theory proposes that when faced with decisions, we tend to satisfice rather than optimize?

theory of bounded rationality

A firm's attempts to shorten the length of time a process takes, may lead to disappointing outcomes because of ______.

time compression diseconomies.

What is the overall purpose of strategic management?

to gain a competitive advantage

Serena is the CEO of an online retailer. She and her immediate staff have decided to implement a company-wide marketing strategy to improve online sales in Central and South America. What type of strategic approach is Serena engaging in?

top-down strategic planning