E-Man Chapter 4
104. Which of the following would qualify as a main goal of a sustainable business? A. Carbon reduction B. Profit maximization C. Global warming D. Scaling E. Greenhouse effect
A
87. Which of the following steps in the innovation process involves thinking about new possibilities? A. Imagining B. Experimenting C. Assessing D. Designing E. Scaling
A
36. Which of the following involves outsourcing of jobs to foreign locations? A. Reshoring B. Offshoring C. Repatriation D. Nationalization E. Backshoring
B
39. Which of the following would qualify as a reason for reshoring? A. Low costs in the target country B. Complicated logistics in the target country C. Excellent customer service in the target country D. Low shipping costs in the target country E. Low labor costs in the target country
B
86. Micro-credit lending is an example of ________ innovation. A. reverse B. social business C. disruptive D. environmental E. green
B
32. ________ environment consists of economic, legal-political, sociocultural, technological, and natural environment conditions. A. Specific B. Task C. General D. Stakeholder E. Customer
C
48. The marketing executives of Brown Inc. observe the demographics of the population at its different areas of operation. They work toward satisfying the needs and preferences of individuals belonging to various demographic groups. The factors that they analyze include age, ethnicity, income levels, and gender. This implies that Brown Inc. focuses on the ________ conditions in the general environment to make sales. A. technological B. legal C. philosophical D. sociocultural E. political
D
34. A country faced a severe recession that resulted in loss of jobs and low income levels, which in turn affected the lifestyles of the consumers. Which of the following conditions are influencing the environment of the country? A. Political conditions B. Legal conditions C. Technological conditions D. Sociocultural conditions E. Economic conditions
E
60. Stakeholders: A. are described as employees who move to foreign locations to reduce costs to the organization. B. are individuals who propose laws and regulations, government policies, and the philosophy and objectives of political parties. C. are owners of organizations who take risks motivated by desperation to get out of bad situations. D. refer to the employees who return from different host countries and help in establishing new domestic operations. E. are the persons, groups, and institutions directly affected by an organization.
E
71. Competitive advantage can be achieved through ________ by finding ways and using technology to adjust and tailor products and services to fit customer needs in ways that are difficult for one's competitor to match. A. quality B. costs C. flexibility D. delivery E. durability
C
73. Innovation refers to the: A. lack of information regarding what exists in the environment. B. people and groups with whom an organization interacts. C. process of taking a new idea and putting it into practice. D. return of jobs from foreign locations as companies establish new domestic operations. E. things that an organization does extremely well and that give it an advantage.
C
74. Lucy Inc. introduced a new line of deodorized clothes produced with natural ingredients such as flowers and fruits, to reduce the impact of the environmental hazards caused by the production of deodorants. This implies that Lucy Inc. was engaging in _________. A. process innovation B. business model innovation C. product innovation D. skimming E. performance innovation
C
78. Which of the following is an example of a process innovation? A. A firm putting coupons on the Web B. A firm introducing a new social media site C. A firm introducing "ready to assemble" furniture D. A firm converting the movie rental business into a subscription business E. A firm creating the world's largest online marketplace
C
82. Jade Inc., a photography firm, entered into other activities such as cinematography, advertisement creations, and short film making, to make more money for the firm. This implies that Jade Inc. had engaged in ________ innovation. A. product B. process C. business model D. reverse E. pricing
C
90. Starship Inc., an automobile manufacturer, developed a new car model. The firm worked on identifying the strengths and weaknesses of the new model, the costs that would be incurred in its manufacture, and its target markets. Which of the following steps of the innovation process was the firm involved in? A. Imagining B. Experimenting C. Assessing D. Designing E. Scaling
C
94. Which of the following is true of reverse innovation? A. It taps the potential for innovation existing at higher organizational levels. B. It emphasizes recognition of innovations developed in well-established markets. C. It recognizes innovations existing in diverse settings or locations. D. It involves a lack of complete information regarding what exists in the environment. E. It focuses on identifying strengths and weaknesses, potential costs and benefits, and potential markets or applications of innovations.
C
95. Which of the following concepts got its start as global firms moved away from viewing innovation as a "home market" activity that creates new products and services for distribution to "foreign markets"? A. Disruptive innovation B. Product innovation C. Reverse innovation D. Incremental innovation E. Social business innovation
C
100. Which of the following is true of sustainability? A. It is a lack of information regarding what exists in the environment and what developments may occur. B. It is a system by which an organization is directed or controlled. C. It refers to the relationship between an organization's management, its employees, its stakeholders, and the government. D. It is a commitment to live and work in ways that protect the rights of both present and future generations. E. It does not apply to the non-living things present on earth.
D
105. Maze Pvt. Ltd. focuses on providing maximum support to its employees as it considers them its most important organizational stakeholders. The firm has a system of flexible working hours to reduce the stress of employees and zero-day notice periods. It permits employees to work from home through its virtual network. From this information, we can infer that Maze Pvt. Ltd.: A. has a high rate of sustainable innovation. B. focuses on the differences of generational cohorts. C. highlights the importance of the triple bottom line. D. has a high rate of human sustainability. E. both meets the needs of customers and protects the natural environment for future generations.
D
31. Which of the following falls on the positive side of risk-taking behavior of organizations? A. Risk taking from position of performance difficulty B. Risk taking motivated by desperation to get out of bad situation C. Risk taking from hard time dealing with problems without losing focus D. Risk taking with the ability to deal with problems as they arise E. Risk taking from little staying power
D
33. Which of the following represents the economic conditions in the general environment? A. Patents B. Infrastructure C. Internet access D. Unemployment rate E. Norms
D
37. Which of the following examples illustrates the economic conditions in the general environment? A. An organization conducting virtual meetings B. An organization holding a session on business ethics C. An organization providing Broadband facilities at its workplace D. An organization raising the pay of its employees E. An organization discussing the philosophy and objectives of political parties
D
38. Mayer Inc., an automobile corporation based in London, shifts its manufacturing activities to China in order to minimize its cost of production. Which of the following is Mayer Inc. engaging itself in? A. Repatriation B. Nationalization C. Backshoring D. Offshoring E. Reshoring
D
42. The government of Lubnia imposes certain rules and regulations regarding interest rates and other transactions. This is an example of the ________ conditions of the general environment. A. natural B. technological C. sociocultural D. legal-political E. educational
D
46. Diversity issues relating to educational opportunity, access to technology, housing options, and so on are parts of the ________ conditions in the general environment. A. economic B. legal C. technological D. sociocultural E. political
D
54. Bart has a diverse collection of the latest video games. He owns a mobile phone with a number of applications. His school is well equipped with Internet facilities. Which of the following generational cohorts does Bart most likely belong to? A. Baby Boomer Generation B. Gen X Generation C. Baby Buster Generation D. Millennial Generation E. Golden Boomer Generation
D
58. A sustainable business: A. is involved in risk-taking from position of performance difficulty. B. has a lack of information regarding what exists in the business environment and what developments may occur. C. creates products or services that become so widely used that they largely replace prior practices and competitors. D. meets the needs of customers and protects the natural environment for future generations. E. is an organization motivated by desperation to escape existing difficulties.
D
68. Fittleworth Inc., an online retail firm, owns a patented technology that ensures that its goods and services reach customers on time. The firm also has the ability to develop timely new products. Fittleworth Inc. has gained competitive advantage through ________. A. quality B. costs C. flexibility D. delivery E. adaptability
D
83. Which of the following is an example of a business model innovation? A. A firm introducing a new model of its smartphone B. A corporation introducing "ready to install" software C. A firm introducing a range of meals that can be cooked instantly D. A firm introducing the concept of "paying for extras" profitable in free online games E. A firm introducing a new social networking website
D
88. Which of the following steps in the innovation process involves building initial models, prototypes, or samples? F. Imagining G. Experimenting H. Assessing I. Designing J. Scaling
D
98. Foster Inc. created a new line of cameras that work on solar energy. These solar cameras reduced the demand for digital cameras and gradually replaced the use of digital cameras and ended competition. Which of the following is prominent in this instance? A. Positioning innovation B. Incremental change C. Process improvement D. Disruptive innovation E. Process innovation
D
103. Which of the following holds true regarding sustainable businesses? A. A sustainable business operates with nature by exploiting it. B. A sustainable business strives for a win-lose outcome where the environment gains and the organization loses. C. A sustainable business creates products or services that become so widely used that they result in the exhaustion of the resources. D. A sustainable business can result in an environmental uncertainty. E. A sustainable business works by meeting the needs of customers while advancing the well-being of our natural environment.
E
40. AZB Inc., a software corporation based in the United States, used to operate from several countries with lower labor costs. When the firm started to incur high costs in the foreign countries and received complaints and criticisms about the loss of local jobs, the firm decided to return to its home country. The change made to the firm's global strategy is an example of ________. A. offshoring B. outsourcing C. nationalization D. privatization E. reshoring
E
45. Which of the following is a part of the sociocultural conditions in the general environment? A. Inflation B. Financial markets C. Government policies D. Intellectual properties E. Demographics
E
72. Which of the following is true of environmental uncertainty? A. The less uncertain the environment, the harder it is to analyze environmental conditions and predict the future states of affairs. B. The least challenging situation is an environment that is both complex and dynamic. C. High-uncertainty environments require less flexibility in organizational designs and work practices as different circumstances arise every now and then. D. High-uncertainty environments require people to make decisions gradually since new circumstances arise constantly. E. The uncertainty of an organization can be analyzed using degree of complexity and rate of change.
E
84. Glory Pvt. Ltd. specializes in preparing eco-friendly products out of solid waste, old newspapers, and waste plastic. The firm employs individuals belonging to the weaker economic sections of the city. Glory Pvt. Ltd. is engaged in ________ innovation. A. product B. process C. reverse D. pricing E. social business
E
92. Indigo Inc., a firm that specializes in animation, released its latest patented animation software in the market to increase its profits by improving sales. Which of the following steps of the innovation process was executed by Indigo Inc.? A. Imagining B. Experimenting C. Assessing D. Designing E. Scaling
E
93. Which of the following is the final step of the wheel of innovation? A. Imagining B. Experimenting C. Assessing D. Designing E. Scaling
E
12. Sustainable business practices generate substantial amounts of waste and toxic materials.
False
15. Competitive advantage is something that an organization does extremely well, that can be copied by its competitors, and help them gain an advantage.
False
18. The more uncertain the environment, the easier it is to analyze environmental conditions and predict future states of affairs.
False
19. The number of different factors in the environment is referred to as the rate of change.
False
2. The general environment comprises the actual organizations, groups, and persons with whom an organization interacts and conducts business.
False
20. The least challenging and certain situation is an environment of organizations that is both complex and dynamic.
False
22. Innovation is a low priority when executives and leaders try to steer organizations through complex and uncertain environments.
False
23. Product innovations result in better ways of doing things.
False
25. The final step of assessing in the innovation process involves commercializing innovation by turning it into actual products, services, or processes that increase profits by improving sales or lowering costs.
False
3. Offshoring is the return of jobs from foreign locations as companies establish new domestic operations.
False
5. The legal-political conditions in the global business environment are uniform across all countries.
False
7. Inflation, income levels, and job outlook are part of the sociocultural conditions in the general environment.
False
9. The Baby Boomers are "digital natives" who grew up in technology-enriched homes, schools, and friendship environments.
False
35. Lubnia experienced a high rate of inflation. This led to a significant rise in prices, fluctuating market conditions, and a sharp decline in investments and savings. This implies that the inflation had created a negative impact on the ________ conditions in the environment of Lubnia. A. economic B. legal C. technological D. sociocultural E. political
A
43. Which of the following examples illustrates the legal-political conditions in the general environment? A. Bureaucratic decisions made in a nation B. Financial market situation existing in a nation C. Job outlooks of different individuals of a nation D. Information technology systems or infrastructure of a nation E. Population demographics of a nation
A
50. ________ are "digital immigrants" that have had to learn about technology as it became available. A. Baby Boomers B. Gen Ys C. Gen Xs D. Millennials E. Gen Zs
A
51. Which of the following are characterized by ease of multitasking, desire for immediate gratification, continuous contact with others, and less concern with knowing things than with knowing where to find out about things? A. Millennials B. Gen Xs C. Baby Busters D. Golden Boomers E. Baby Boomers ``
A
56. Which of the following examples illustrates the technological conditions in the general environment? A. Features and applications available on an individual's phone B. Income levels of an individual C. Housing options for an individual D. Job options for an individual E. Educational opportunities for an individual
A
61. Which of the following is true of stakeholders? A. Members of the specific or task environment are often described as stakeholders. B. Stakeholders are influenced by their stakes but they are not allowed to influence it in return. C. An organization's performance does not affect the stakeholders. D. All stakeholders belong to the generational cohort of Baby Boomers. E. All stakeholders are "digital natives" who grew up in technology enriched homes, schools, and friendship environments.
A
65. Striker Corporation produces mobile phones, smart phones, and laptops. In terms of longevity and user-friendliness, the firm's products are rated the best. Also, it offers applications and features with the latest technology. Which of the following has enabled Striker Corporation to achieve a competitive advantage over its competitors? A. Quality B. Costs C. Flexibility D. Delivery E. Adaptability
A
67. Which of the following examples displays a firm with a competitive advantage achieved through quality? A. An organization that is famous for its durable products B. A corporation that reduces its expenses by finding new production processes C. A firm that delivers goods and services faster than its competitors D. An organization that gains profits by charging less prices E. A company that tailors its goods and services to fit consumer needs and preferences
A
70. Which of the following illustrates a firm that has achieved competitive advantage through flexibility? A. A firm that creates customized products based on each of its customer's preferences B. A firm that produces goods by maintaining high quality standards C. A firm that ensures speedy delivery of goods compared to its competitors D. A firm that develops products with unique features that are not made available by any of its competitors E. A firm that develops timely new products
A
75. Which of the following is an example of a product innovation? A. A firm launching a new range of candies B. A firm allowing customers to mail the desired designs of goods C. A firm introducing a new online shopping model D. A firm introducing new technology to ease the installation process E. A firm changing its line of business from manufacturing automobiles to producing music
A
81. A business model innovation results in: A. ways for firms to make money. B. better ways of doing things. C. new or improved goods. D. the creation of new services. E. environmental uncertainty.
A
85. Which of the following is an example of a social business innovation? A. An organization working on maintaining cleanliness in the cities B. A firm specializing in producing customized clothes and bags based on preferences of the purchasers C. A firm introducing a range of meals that can be cooked instantly D. A firm removing the use of intermediaries to deal with customers directly E. A record label using an exclusive process to record music albums
A
91. Which of the following steps in the innovation process consists of implementing what has been learned and commercializing new products or services? A. Scaling B. Experimenting C. Assessing D. Designing E. Imagining
A
97. Which of the following creates products or services that become so widely used that they largely replace prior practices and competitors? A. Disruptive innovation B. Sustainability C. Sustaining innovation D. Transformational innovation E. Incremental change
A
108. What are the three types of innovation? What do they result in?
Answer: (1) Product innovations result in the creation of new or improved goods and services. (2) Process innovations result in better ways of doing things. (3) Business model innovations result in new ways of making money for the firm.
109. Describe the five steps of the wheel of innovation.
Answer: Gary Hamel describes the five steps in the wheel of innovation. Step 1 is imagining—thinking about new possibilities. Step 2 is designing—building initial models, prototypes, or samples. Step 3 is experimenting—examining practicality and financial value through experiments and feasibility studies. Step 4 is assessing— identifying strengths and weaknesses, potential costs and benefits, and potential markets or applications. Step 5 is scaling—implementing what has been learned and commercializing new products or services.
107. What are the dimensions of environmental uncertainty?
Answer: The first dimension of environmental uncertainty is the degree of complexity, or the number of different factors in the environment. An environment is typically classified as relatively simple or complex. The second is the rate of change in and among these factors. An environment is typically classified as stable or dynamic. The most challenging and uncertain situation is an environment that is both complex and dynamic. High-uncertainty environments require flexibility and adaptability in organizational designs and work practices, as well as an ability of decision makers to respond quickly as new circumstances arise and new information becomes available.
106. Describe the most important aspects of each dynamic force that surrounds and influences the general environment of an organization.
Answer: Things like the overall health of the economy in terms of financial markets, inflation, income levels, and job outlook are important economic conditions in the general environment. Legal-political conditions in the general environment are represented by existing and proposed laws and regulations, government policies, and the philosophy and objectives of political parties. Diversity issues relating to educational opportunity, access to technology, housing options, job options, are part of the sociocultural conditions in the general environment. The sociocultural conditions also include norms, customs, and demographics of a society or region, as well as social values on such matters as ethics, human rights, gender roles, and life styles. The ongoing wave of technological conditions in the workplace ranges from new product development and advertising to employee networking and data sharing to virtual meetings and always-available chats. Environmental conditions include the abundance of natural resources that the environment provides for organizations and society, and the need to protect the availability of those resources for the future.
102. The storehouse of natural resources which sustain life and produce goods and services for society is referred to as ________. A. global warming B. environmental capital C. green innovation D. triple bottom line E. greenhouse effect
B
41. The patent attorney of EII Inc. was accused of stealing the organization's invention. This scenario is an example of the ________ conditions of the general environment. A. natural B. legal-political C. technological D. sociocultural E. educational
B
52. Meg has the ability to multitask and maintain continuous contact with others. She believes in receiving immediate gratification. This implies that Meg is most likely a ________. A. Baby Boomer B. Millennial C. Gen X D. Baby Buster E. Golden Boomer
B
55. Synergy Inc. implements the use of social media, digital sharing of presentations, data, files, and holds regular virtual meetings. This indicates that the firm has reasonably well-equipped ________ conditions in the organizational environment. A. natural B. technological C. legal D. sociocultural E. political
B
57. Which of the following examples would qualify as a potential problem of the existing ever-present technological condition? A. An organization advertising its products on social networking websites B. An organization's employees regularly engaging in online pastimes during work hours C. An organization conducting regular virtual meetings D. A musician promoting his debut musical project on the Internet through media Websites E. An organization implementing digital sharing of files, presentations, and projects
B
62. Which of the following is true of value creation by businesses? A. Businesses create value for customers through realized profits and losses. B. Businesses create value for employees by wages earned and job satisfaction. C. Businesses create value for competitors through the benefits of long-term business relationships. D. Businesses create value for suppliers by the citizenship they display. E. Businesses create value for local communities by stimulating markets and innovations that didn't exist before.
B
63. Ben Cars Pvt. Ltd. achieves a competitive advantage by spending less than its competitors on labor, operations, promotions, and features offered. This enables the firm to charge relatively lower prices from its customers. Which of the following is a competitive advantage of the firm? A. High quality B. Low costs C. Flexibility D. Delivery E. Adaptability
B
66. Which of the following examples illustrates a firm that has achieved competitive advantage through quality? A. A firm that invests less on its production processes B. A firm that focuses on producing zero defect products C. A firm that uses technology to deliver products to its customers well in advance D. A firm that has adequate resources to adapt to different customer needs and preferences E. A firm that incurs less expenditures than its competitors, enabling it to charge lower prices than its competitors
B
69. Which of the following illustrates a firm that has achieved competitive advantage through delivery? A. A firm that uses technology to produce durable products B. A firm that develops timely new products C. A firm that has the flexibility to operate successfully in any business environment D. A firm that makes small financial investments at the time of production E. A firm that can adapt and change according to the needs of different customers
B
76. TBZ Inc. introduced a new generation of shoes that prevent any type of injury to the wearer's feet. This is an example of a: A. process innovation. B. product innovation. C. business model innovation. D. social business innovation. E. paradigm innovation.
B
77. Which of the following forms of innovation focuses on better ways of doing things? A. Product innovation B. Process innovation C. Business model innovation D. Social business innovation E. Paradigm innovation
B
79. Saturn Electronics Inc. offers computer programs and software programs including software drivers and plug-ins that can be self-installed easily. The firm's introduction of programs that can be self-installed is an example of ________ innovation. A. product B. process C. business model D. reverse E. social business
B
80. Which of the following is an example of process innovation? A. A firm launching a new car model B. A restaurant where customers are allowed to taste samples of dishes and then get their orders customized C. A footwear manufacturer introducing a unique range of shoes D. A firm introducing a new software to protect computers from viruses E. A firm changing its line of business from manufacturing eyewear to producing watches
B
89. A group of employees of Jonas Inc., a software firm, were analyzing the practicality and feasibility of a software program by releasing a few samples of the program on the Internet for a month. Which of the following steps of the innovation process were the employees engaging themselves in? A. Imagining B. Experimenting C. Assessing D. Designing E. Scaling
B
96. ________ innovation pulls new products and services from settings, where they are often created under pricing constraints, and pushes them into use elsewhere. A. Disruptive B. Reverse C. Luxurious D. Product E. Business model
B
99. The commitment to protect the rights of present and future generations as co-stakeholders of present-day natural resources is termed as ________. A. disruptive innovation B. sustainability C. environmental uncertainty D. reverse innovation E. scaling
B
101. The process of using environmental resources to support societal needs today while also preserving and protecting them for future generations is referred to as ________. A. triple bottom line experiment B. global warming C. sustainable development D. scaling E. greenhouse effect
C
44. BNQ Pvt. Ltd., a media corporation headquartered in California, has its operations across different nations. The activities of the firm are affected by the government policies and the ideologies of the legislative institutions existing in the host countries. Which of the following factors are affecting the firm's operations? A. Economic conditions B. Sociocultural conditions C. Legal-political conditions D. Technological conditions E. Natural environment conditions
C
47. The managers of Axis Inc. emphasize the importance of team norms, business ethics, and respect for human rights in the organization. This implies that the organization is working on the ________ conditions in the organizational environment. A. economic B. legal C. sociocultural D. technological E. political
C
49. Which of the following aspects of demographics comprises of generational cohorts? A. Income levels B. Race C. Age D. Ethnicity E. Gender
C
53. F5, a financial services organization, advertises its financial products and instruments on social networking sites and other Websites. This implies that the firm is utilizing the ________ conditions in the general environment. A. natural B. legal C. technological D. sociocultural E. political
C
59. The ________ environment includes the people and groups with whom an organization interacts. A. general B. natural C. specific D. macro E. external
C
64. Which of the following examples illustrates a firm that has achieved competitive advantage through costs? A. A firm that uses patented technology to deliver goods and services to customers on time B. A firm's ability to adjust and adapt to different demographic segments and satisfy their needs C. A firm that invests only a small amount on promotion and maximizes profits by charging low prices D. A firm's technology that creates high quality products and services E. A firm that specializes in developing timely new products
C
1. Risk taking is a way to step forward and try new things.
True
10. The Millennials are characterized with the ease of multitasking, desire for immediate gratification, continuous contact with others, and less concern with knowing things than with knowing where to find out about things.
True
11. A sustainable business both meets the needs of customers and protects the natural environment for future generations.
True
13. A sustainable business can be initiated by recycling and reusing materials in order to minimize waste and pollution of the environment.
True
14. Stakeholders are the persons, groups, and institutions directly affected by an organization.
True
16. Competitive advantage can be achieved through quality by finding ways and using technology to create products and services that are of consistently higher quality for customers than what is offered by one's competitors.
True
17. Competitive advantage achieved through costs will help an organization earn profits with prices that one's competitors have difficulty matching.
True
21. High-uncertainty environments require an ability of decision makers to respond quickly as new circumstances arise and new information becomes available.
True
24. Business model innovations result in new ways of making money for the firm.
True
26. The concept of reverse innovation got its start as global firms moved away from viewing innovation as a "home market" activity that creates new products and services for distribution to "foreign markets."
True
27. Environmental capital is the storehouse of natural resources that we use to sustain life and produce goods and services for society.
True
28. The executives of Acme Ltd. pay equal attention toward maximizing profits of the firm, maintaining the well-being of its employees, satisfying its customers, and preserving the environment. This indicates that Acme Ltd. uses the triple bottom line approach.
True
29. An organization that does not provide health insurance to employees can be categorized as one with poor human sustainability.
True
30. Human sustainability emphasizes the importance of employees as they are organizational stakeholders.
True
4. Rising labor costs, higher shipping costs, and public criticisms about destroying local jobs can cause global firms to return to their home countries.
True
6. Internet censorship is the deliberate blockage and denial of public access to information posted on the Internet.
True
8. Generational cohorts consist of people born within a few years of one another and who experience somewhat similar life events during their formative years.
True