BUS/475: Integrated Business Topics - Week 2
Which of the following statements about Airbnb is correct?
It handles more accommodations than the three biggest hotel chains combined.
Which of the following are essential questions that strategic leaders need to consider to increase the probability of entering an industry successfully? (Check all that apply.)
When to enter? What type of entry should be made? How to enter? Who are the players?
A(n) ______ is a unique strength, embedded deep within a firm, that is critical to gaining and sustaining competitive advantage.
core competency
If an MNE wishes to be responsive to the needs of its local consumers but also wants to attain a lowest-cost position, it should follow a(n) ______ strategy.
transnational
What are the characteristics of a strategic activity system as it applies to firms? (Check all that apply.)
It is causally ambiguous. It is socially complex. It consists of interconnected activities.
Which of the following statements about the CAGE distance framework is true?
It is designed to aid MNEs in deciding where to compete in the world.
Intellectual property protection and social complexity are examples of _____ mechanisms, which help a firm sustain a competitive advantage.
isolating or isolation
A multinational enterprise would likely be motivated to pursue a global-standardization strategy in order to ______. (Check all that apply.)
take advantage of economies of scale take advantage of location economies
The resource-based model views resources as ______.
the main driver of firm performance
A core competency can help a company achieve which of the following? (Check all that apply.)
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
A(n) ______ strategy focuses on integration at the business level by attempting to reconcile product differentiations at low cost.
transnational
True or false: The benefits of local responsiveness always outweigh the costs.
False
Sociocultural factors are constantly in flux and also differ across groups.
True
Many drivers find a GPS navigation system useful. Because installing a GPS system in an automobile adds value to the vehicle, the system functions as ______.
a complement
A customized strategy that considers the unique resources of the company while considering the external environment creates ______.
a strategic fit between them
The economic factors that affect a firm's external environment are ______.
largely macroeconomic
The threat of ______ is one of the five forces and can be exemplified by the threat that videoconferencing presents to business travel.
substitutes
According to Porter's model, which of the following should be considered when analyzing a firm's competition? (Check all that apply.)
suppliers the threat of substitutes buyers
As MNEs compete internationally, a focus on local responsiveness allows them to do which of the following?
tailor product offerings to fit local preferences and requirements
The pressure of rivalry increases when which of the following forces increase in intensity? (Check all that apply.)
the threat of entry the threat of substitutes the power of buyers and suppliers
The risk that potential competitors will enter the industry is known as the ______.
threat of entry
An industry analysis provides which of the following?
A rigorous way of identifying the industry's profit potential Insight into a firm's strategic position within an industry The level of profitability that can be expected for the average firm in the industry
Time compression diseconomies occur when a firm ______.
Attempts to reach an outcome in a reduced amount of time
Which of the following were resources and capabilities that helped Five Guys gain a competitive advantage and develop into a successful restaurant chain? (Check all that apply.)
Focusing on such details as store layout and design Carefully choosing the supplier of the potatoes for their fries
Which of the following statements about pursuing international expansion is true?
It can enhance a firm's competitive advantage.
Which of the following best defines national competitive advantage?
It is the extent to which a country can compete in international markets.
Which of the following are approaches for answering the question "How to enter?" when a firm is considering entering an industry? (Check all that apply.)
Leverage existing assets Establishing a niche Reconfiguring value chains
For a U.S. company doing business internationally, which of the following would be examples of local responsiveness? (Check all that apply.)
McDonald's selling teriyaki burgers in Japan Walmart selling live animals for food preparation in China
Which of the following statements regarding factor conditions in Porter's diamond framework is true?
Natural resources are not necessarily needed to generate world-leading companies.
Which of the following statements about industry dynamics is true?
Over time, industry structures are not stable. The five forces model is a static model.
______ describes a process in which the options one faces in the current situation are limited by decisions made in the past.
Path dependence
______ factors result from the processes and actions of government bodies that influence the decisions and behavior of firms.
Political
______ are any assets that a firm can draw on when formulating and implementing a strategy.
Resources
A multidomestic strategy is appropriate when which of the following conditions exist? (Check all that apply.)
The firm faces high demand for local responsiveness. Markets in the host country are idiosyncratic. The firm feels little need to reduce costs.
Which of the following are ways that powerful suppliers are a threat to firms?
They can force the cost of production to increase. They can reduce the industry's profit potential.
The ______ is a theoretical model that explains and predicts what resource attributes underpin competitive advantage. It identifies which types of resources are key to firm performance.
VRIO framework
Which of the following identifies the resources that can lead to a competitive advantage?
VRIO framework
Global warming would be an example of ___ factor in a firm's external environment.
an ecological
The most rigorous means of analyzing the profit potential within a specific industry is to conduct ______.
an industry analysis
"Time compression diseconomies" refers to the concept that ______.
attempting to get a good outcome in less time tends to be ineffective
The pressures that industry suppliers can exert on an industry's profit potential, is also called the ______.
bargaining power of suppliers
Which of the following are examples of resources for a firm? (Check all that apply.)
buildings intellectual property cash
The oldest form of internationalization is ______, which involves producing goods in one country to sell in another country.
exporting
A country's natural, human, and other resources can be expressed in terms of ______.
factor conditions
The benefits of competing on a global scale exist ______.
for an increasing number of firms
Multinational enterprises that manufacture commodity products that focus on cost leadership tend to use a(n) ______ strategy.
global-standardization
If a firm's goal is to leverage home-based core competencies in foreign markets, it should pursue a(n) ______ strategy.
international
An example of a recent innovation in process technology is ______.
lean manufacturing
MNEs pursuing a multidomestic strategy hope that ______.
local consumers will perceive them to be a domestic company
The benefits to be accrued from locating value chain activities in the world's optimal geographies for a specific activity are known as _____ economies.
location or locations
Rising wages and other costs are likely to negate any benefits MNEs have of access to:
low-cost inputs.
When managers understand the forces in the external environment, they are better able to ______.
mitigate threats and leverage opportunities
Despite a growing belief in the death-of-distance hypothesis, there remains evidence that certain countries remain leaders in specific industries and maintain a kind of ______ advantage.
national competitive
If the economic value creation of international expansion is negative, a firm should ______.
not expand internationally
Which of the following contribute to consumer buying power?
real time, accurate price comparisons low switching costs
According to the resource-based model, a firm is assumed to be a unique bundle of resources, capabilities, and competencies.
True
True or false: The value chain concept is applicable primarily to high-tech firms in rapidly changing environments.
False
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
The power of ______ is the pressure they can put on the margins of producers in the industry by demanding a lower price or higher product quality.
buyers
Firms have a tendency to change the industry structure in their favor, making it more __ through horizontal mergers and acquisitions, since this tends to be more profitable than a fragmented one.
consolidated
Along which of the following dimensions do strategic groups differ from one another? (Check all that apply.)
customer service research and development market segments distribution channels
A company is a complementor to your company if ______.
customers value your product more when they can use it with the other company's product
Which of the following are important strategic dimensions in mapping strategic groups? (Check all that apply.)
expenditures on research and development cost structure product and service offerings
When looking at the modes of foreign-market entry, one could conclude that ______.
exporting might be the earliest stage of commitment because it allows the firm to test whether a foreign market is ready for its products
The purpose of a SWOT analysis is to ______.
form a strategy that is tailored to the firm's unique strengths and weaknesses and the opportunities and threats in its environment
Before World War II, business strategy, implementation, and knowledge typically flowed ______.
from domestic headquarters to outposts abroad
Which of the following dimensions are considered in the CAGE distance framework? (Check all that apply.)
geographic distance economic distance cultural distance
Since expanding internationally, IKEA has shifted focus, concentrating on effectively managing a global supply chain in order to achieve economies of scale. This is reflective of a(n) ______ strategy.
global-standardization
As the standard of living rises in emerging economies, MNEs are hoping that ______.
increased purchasing power will enable workers to purchase the products previously made only for export
Companies seek to access international markets as a means of ______.
increasing their economic value creation
Due to globalization, the world's market economies are becoming more ______.
integrated and interdependent
The relationship between the natural environment and business organizations can best be described as ______.
interdependent
The value chain describes ______ of a firm.
internal activities
Strategic leaders use internal and external analyses in tandem to create a customized fit between a company's ______.
internal resources and external environment
IKEA offers the same products in every market. This indicates that IKEA has followed a(n) ______ strategy.
international
Managers have ______ direct influence over external forces in the firm's general environment than those in the firm's task environment.
less
Industry-specific factors known as ______ separate one strategic group from another.
mobility barriers
Although the five forces model is useful in understanding an industry's profit potential, it provides only a ___.
point-in-time snapshot of a moving target
What are examples of intangible resource stock a company may have? (Check all that apply.)
reputation for quality dynamic capabilities engineering expertise
Core competencies of a business are generated by the interaction of ______.
resources and capabilities
A(n) _____ group is a set of companies within a specific industry that seek to achieve competitive advantage in similar ways.
strategic
The resource-based view classifies all resources as ______.
tangible or intangible
In performing a SWOT analysis to generate insights from external and internal analysis, internal strengths and weaknesses can be determined by applying ______ and external strengths can be evaluated in part by applying ______.
the VRIO framework; PESTEL
A company should only expand abroad if ______.
the benefits outweigh the costs
___ suggests that sometimes even random events may have a large impacts on an outcome.
Path dependence
Which of the following statements about legal factors as an external force is true?
Regulatory changes tend to affect entire industries at once.
The external forces called technological factors ______.
capture the application of knowledge to create new process and products
What do the best firms in an industry seek to identify and manage on an ongoing basis as sources to respond to their external environment? (Check all that apply.)
core competencies capabilities resources
Click and drag on elements in order Place the three frameworks used in industry analysis in the order they should be used, with the first at the top. Instructions Choice 1 of 3. PESTEL analysis toggle button PESTEL analysis Choice 2 of 3. strategic group mapping toggle button strategic group mapping Choice 3 of 3. Porter's five forces toggle button Porter's five forces
1. Pestel analysis 2. Porter's 5 forces 3. strategic group mapping
Isolating mechanisms are considered to be ______.
barriers to imitation
Spex is a leading manufacturer of eyeglasses. Spex is based in the United States but opens a facility in a Japanese city known for cutting-edge eyeglass innovations. Spex is counting on which of the following?
benefiting from location economies
Production costs can increase when ______.
buyers demand higher quality and more service
For a firm to sustain any competitive advantage over time, the fit between its internal strengths and external environment needs to be ______.
dynamic
Enterprise Machinists is always improving upon its core competencies by training its machinists constantly so that they are equipped to deal with technological changes and advancements. Based on this information, this is an example of which concept?
dynamic capabilities
Growth rates, interest rates, and levels of employment would be considered ______ factors in a firm's general environment.
economic
Michael Porter developed the five forces model to help firms do which of the following? (Check all that apply.)
gain and sustain a competitive advantage determine the profit potential of different industries
The process of closer integration and exchange between different countries and peoples worldwide, made possible by falling trade and investment barriers, advances in telecommunications, and reductions in transportation costs, is known as ______.
globalization
In the PESTEL model, political factors are those that relate to ______.
government bodies
Resource ______ and resource ______ are the key assumptions behind the resource-based model of the firm.
heterogeneity; immobility
In the airline industry, the ______________ of offering international routes restricts movement between hub-and-spoke and point-to-point airlines.
mobility barrier
Which of the following are examples of sociocultural factors?
A growing number of U.S. consumers have become more health-conscious about what they eat. The growth of the Hispanic population.
Which of the following are approaches for answering the question "How to enter?" when a firm is considering entering an industry? (Check all that apply.)
Establishing a niche Leverage existing assets Reconfiguring value chains
Which of the following innovative ideas helped Airbnb develop a successful business in the peer-to-peer rental space?
Fortuitous timing that led to growing demand Presenting a well-designed website Ensuring a smooth transaction between hosts and guests
When a new firm enters an industry, which of the following often occur? (Check all that apply.)
Incumbent firms spend more to satisfy customers. Industry profit potential declines. Incumbent firms lower prices.
In addition to the static nature of the PESTEL, Porter's five forces, and strategic group mapping frameworks, what is their other shortcoming?
It does not help us understand why there are performance differences among firms in the same strategic group.
Which of the following reduces profit margins for air carriers?
Large corporate customers contracting with the U.S. airline industry
Which of the following best describes the core competency of the Five Guys Burgers and Fries company?
Making high-quality burgers without limiting costs
The _______ is the idea that products or services available from outside the given industry will come close to meeting the needs of current customers.
threat of substitutes
How are intangible resource stocks acquired?
through investments over time in intangible resources
What are the three aspects of mapping strategic groups?
graphing the firms in the strategic group and indicating each firm's market share choosing two key dimensions for the horizontal and vertical axes identifying the most important strategic dimensions
Which of the following are examples of economic factors in the firm's general environment? (Check all that apply.)
growth rates price stability interest rates
Which of the following are factors in a firm's legal environment? (Check all that apply.)
regulations mandates laws
The intensity with which companies in an industry jockey for market share and profitability is known as ___.
rivalry
During the first stage of globalization, business functions that took place abroad were limited to which of the following? (Check all that apply.)
sales distribution
When pursuing an international strategy, a company ______.
sells the same product in both domestic and foreign markets
