SEVI Exam 1

In which of the following ways can suppliers exert bargaining power? (Check all that apply.) By reducing the quality of purchased goods and services By threatening to raise prices of raw materials By squeezing the profitability of firms By threatening to lower prices of raw materials

By reducing the quality of purchased goods and services By threatening to raise prices of raw materials By squeezing the profitability of firms

______ consists of activities that support the entire value chain and not individual activities.

General administration

______ consists of activities involving recruiting, hiring, training, development, and compensating personnel.

Human resources management

______ is associated with receiving, storing, and distributing product inputs.

Inbound logistics

Which of the following are examples of what companies do to gain customers? (Check all that apply.) Increase warranties. Decrease product/service prices. Implement customer switching costs. Increase customer service.

Increase warranties. Decrease product/service prices. Increase customer service.

______ resources are organizational assets that are difficult to identify and account for and are typically embedded in unique routines and practices.

Intangible

True or false: A key to successful strategic management is gathering industry information and understanding the competitive dynamics of the industry's companies.

True

True or false: Firms should obey all the laws, including but not limited to labor, consumer protection, and the environment.

True

True or false: Trends in one segment of the general environment can have an effect on other segments.

True

When does a situation of competitive parity exist?

Two or more firms achieve the same performance results.

Which type of analysis views the organization as a sequential process of value-creating activities?

Value-chain

______ may exert bargaining power by threatening to raise prices of the materials needed by a firm or reduce the quality of goods and services.

Suppliers

______ resources are organizational assets that include physical and financial assets and are relatively easy to identify.

Tangible

______ includes activities that are associated with the development of new knowledge that is applied to the firm's operations.

Technology development

Which of the following are the relationships that a firm has with stakeholders? The actions of the firm can affect stakeholders. Stakeholders can affect the firm's actions. The firm controls the actions of stakeholders. The stakeholders generally have no interest in the firm.

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

The stakeholder view takes a(n) ______ approach than the financial ratio analysis in evaluating the firm.

broader

A(n) Blank______ occurs when a firm performs below the industry average or is outperformed by its competitors.

competitive disadvantage

If a firm has a 10% return on invested capital while the industry average return on invested capital is 18%, the firm has a(n) ______.

competitive disadvantage

______ helps firms define and understand their industry and identify rivals' strengths and weaknesses.

competitive intelligence

The idea that firms should voluntarily give back to society when they are able to do so is known as ______.

corporate citizenship

philanthropic responsibilities

corporate citizenship

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

corporate social responsibility

Which of the following are primary strategy objectives? creating value controlling costs maximizing sales strengthening relationships

creating value controlling costs

A firm's expanded value chain includes ______.

customers

______ tracks the evolution of environmental trends, sequences of events, or streams of activities.

environmental monitoring

______ involves surveillance of a firm's external environment to predict environmental changes and detect changes already underway.

environmental scanning

Which of the following are examples of tangible resources? (Check all that apply.) equipment innovation capacities cash brand name

equipment cash

economic responsibilities

gain and sustain competitive advantage

What is the overall purpose of strategic management?

gain competitive advantage

The ______ environment is composed of segments external to an industry that are usually beyond a firm's control, such as demographics and economic factors, that can affect a firm's strategy.

general

What are the four support activities in the value chain? (Check all that apply.) service general administration human resource management technology development procurement outbound logistics

general administration human resource management technology development procurement

A competitive advantage Blank______.

is assessed relative to other competitors in the industry

According to value-chain analysis, a firm ______.

is profitable when the value it receives exceeds total costs

A buying group is considered powerful when it ______.

is responsible for a large volume of a seller's sales

Among the various types of responsibilities a business firm has, which are specifically considered to be economic responsibilities?

repaying debts to creditors giving investors a return on invested capital

Which of the following describe activities associated with the technology development support function? (Check all that apply.) research and development activities that lead to new products developing a company-wide Intranet developing technologies that train personnel hiring technology workers who are internal consultants to various departments

research and development activities that lead to new products developing a company-wide Intranet developing technologies that train personnel

The ______ view of the firm states that a firm's competitive advantages are due to its endowment of strategic resources that are valuable, rare, costly to imitate, and costly to substitute.

resource-based

The concept, or framework, of corporate social ________ guides firms in identifying and addressing their economic, legal, ethical, and philanthropic obligations to society.

responsibility

The ______ segment of the general environment consists of the values, beliefs, and lifestyles of a society.

sociocultural

Increases in household income due to more women entering the workforce in white collar jobs is likely to affect which two segments the most?

sociocultural and economic

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

Two approaches to evaluate firm performance include which of the following? (Check all that apply.) stockholder perspective balance sheet method stakeholder view (balance scorecard) financial ratio analysis

stakeholder view (balance scorecard) financial ratio analysis

What term describes the groups or individuals who can impact or be impacted by a firm's actions?

stakeholders

What do shareholders receive from firms in return for their contribution of capital?

stock dividends

______ groups are clusters of firms that share similar strategies.

strategic

The ______ is the possibility that the profits of established firms in the industry may be eroded by new competitors.

threat of new entrants

SWOT stands for ______.

strengths, weaknesses, opportunities, and threats

______ products and services limit the potential returns of an industry by placing a ceiling on the prices that firms in that industry can profitably charge.

substitute

Procurement activities include the purchase of which of the following? (Check all that apply.) supplies raw materials machinery human resources

supplies raw materials machinery

A competitive advantage that lasts for a long period of time is said to be ______.

sustainable

Strategic resources must meet four criteria in order for them to provide a firm with the potential for a ______ competitive advantage.

sustainable

The ______ segment of the general environment is concerned with innovation and state of knowledge in industrial arts, engineering, applied sciences, and pure science, and their interaction with society.

technological

Resources that competitors can easily imitate generate ______.

temporary value

Operations includes which of the following activities? (Check all that apply.) testing shipping packaging machining

testing packaging machining

Examples of intangible resources include which of the following? (Check all that apply.) inventory and work in progress the company's brand name technical and scientific skills the experience and capabilities of employees

the company's brand name technical and scientific skills the experience and capabilities of employees

What is strategy?

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

Who among the following are considered internal stakeholders?

Employees, board members, stockholders

Which of the following are examples of organizational capabilities? Excellent product development capabilities A firm manufacturing process Outstanding customer service Operating a fleet of delivery trucks Superb innovation process

Excellent product development capabilities Outstanding customer service Superb innovation process

Companies enter foreign market to access which of the following? (Check all that apply.) Factors of production, such as raw materials and labor Technical professionals Easily influenced overseas governments Larger potential markets

Factors of production, such as raw materials and labor Technical professionals Larger potential markets

Which of the following are reasons managers should use Porter's five forces model? (Check all that apply.) It can help managers better understand social, legal, and technological trends. It can help them decide whether to enter, remain, or exit an industry. It can help them develop their supply chains through developing strong relationships with both suppliers and customers. It can help them assess how to improve the firm's competitive position within the industry.

It can help them decide whether to enter, remain, or exit an industry. It can help them develop their supply chains through developing strong relationships with both suppliers and customers. It can help them assess how to improve the firm's competitive position within the industry.

Which of the following are ways that resource inimitability (difficulty to imitate) is a key to value creation? (Check all that apply.) It removes barrier to entry. It constrains competition. It is likely to last forever. It makes profits more likely to be sustainable.

It constrains competition. It makes profits more likely to be sustainable.

Which of the following statements about an industry's composition are correct? (Check all that apply.) It includes companies that sell to similar customers. It includes companies that use similar methods of production. It includes companies in the same geographic area. It includes companies that produce similar products or services.

It includes companies that sell to similar customers. It includes companies that use similar methods of production. It includes companies that produce similar products or services.

Which of the following statements about using the balanced scorecard method of evaluating a firm's performance are true? (Check all that apply.) It includes financial and customer satisfaction measures. It include financial ratio analysis and comparisons to competitors. It takes into account organizational innovation and learning perspective. It provides managers with a fast but comprehensive view of the business.

It includes financial and customer satisfaction measures. It takes into account organizational innovation and learning perspective. It provides managers with a fast but comprehensive view of the business.

Which of the following statements about scenario analysis are true? (Check all that apply.) It depends on extrapolation of historical trends. It incorporates the ways in which societal trends may affect an issue. It draws on a range of disciplines. It is an in-depth approach to forecasting.

It incorporates the ways in which societal trends may affect an issue. It draws on a range of disciplines. It is an in-depth approach to forecasting.

Which of the following statements are correct regarding strategic groups? (Check all that apply.) No two firms are totally different. Strategic groups are clusters of firms that share similar strategies. Rivalry tends to be greater between companies in different strategic groups. No two firms are exactly the same.

No two firms are totally different. Strategic groups are clusters of firms that share similar strategies. No two firms are exactly the same.

Supplier groups are powerful under which of the following conditions? One or more suppliers have built-in switching costs for buyers. There are many suppliers producing similar or the same product. The industry is not an important customer of the supplier group. The supplier group poses a credible threat of forward integration.

One or more suppliers have built-in switching costs for buyers. The industry is not an important customer of the supplier group. The supplier group poses a credible threat of forward integration.

______ are the competencies and skills that a firm employs to transform inputs into outputs.

Organizational capabilities

______ is collecting, storing, and distributing products or services to buyers.

Outbound logistics

______ activities are the sequential activities of the value chain that refer to the physical creation of the product or service, its sale and transfer to the buyer, and its service after sale.

Primary

Support activities add value by themselves or through their relationships with which kinds of activities?

Primary and other support activities

Which of the following are examples of support activities? (Check all that apply.) Inbound logistics Procurement Human Resources management General administration

Procurement Human Resources management General administration

______ is when competitors sense pressure from others in the same industry or act on an opportunity to improve their position.

Rivalry

______ analysis is a framework for analyzing a company's internal and external environments.

SWOT

______ is an in-depth approach to environmental forecasting that involves experts' detailed assessments of social, economic, political, technology trends or other dimensions of the external environment.

Scenario analysis

______ includes the actions associated with providing assistance to enhance or maintain the value of the product.

Service

Which of the following is an example of when the bargaining power of suppliers may be low?

The suppliers provide an input that has many substitutes.

Burger Bomb has been outperforming other burger restaurants in recent years. This indicates that Burger Bomb has which of the following?

a competitive advantage

A good strategy consists of three elements. The first element is accomplished through analysis of the firm's external and internal environments. We also call this ______.

a diagnosis of the competitive advantage

A good strategy consists of three elements. The second element is accomplished through strategy formulation, resulting in the firm's functional, business-level, and corporate-level strategies. This is also called Blank______.

a guiding policy to address the competitive advantage

Which of the following are elements of a good strategy according to the AFI framework?

a guiding policy to address the competitive advantage a set of coherent actions to implement the firm's guiding policy a diagnosis of the competitive advantage

Substitute products or services must be ______ the industry's offerings.

able to perform the same function as

Valuable resources can be a source of competitive ______.

advantage

Which of the following are marketing and sales activities? (Check all that apply.) advertising warehousing pricing products delivery

advertising pricing products

Which attributes must a resource have to provide a firm with a sustainable competitive advantage? (Check all that apply.) be easy to imitate be rare among competitors have no substitutes ability to exploit opportunities

be rare among competitors have no substitutes ability to exploit opportunities

Two valuable firm resources are strategically equivalent (substitutes) when each ______.

can be exploited separately to implement the same strategies

Michael Porter's five forces model is the most commonly used analytical tool for examining which of the following type of environment?

competitive

legal responsibilities

define minimum standard under the law

The ______ segment of the general environment consists of changes in a market's characteristics such as age, race, ethnicity, and education.

demographic

Which of the following elements of the general environment is the easiest to understand and quantify?

demographic

Which of the following are included in the six segments of the general environment? (Check all that apply.) demographic and sociocultural political/legal and technological industrial and competitive economic and global

demographic and sociocultural political/legal and technological economic and global

ethical responsibilities

do what is right, just, and fair

Interest rate increases, currency exchange rates, and the Dow Jones are examples of factors to be considered in which segment of the general environment?

economic

Which of the four corporate social responsibilities is considered first and foremost for business enterprises?

economic

Starbucks's actions to educate its workers and management about racism indicates that the firm takes its ______ responsibilities seriously.

ethical

Customers, suppliers, creditors, unions, and governments are known as ______.

external stakeholders

Effective stakeholder management ______.

helps a firm build a strong public relationship

Competitive intelligence ______.

helps companies avoid surprises by anticipating competitors' moves and response time

Human resource management's activities include which of the following? (Check all that apply.) procuring goods employees use daily such as office products hiring employees engaged in support activities training employees negotiations with labor unions

hiring employees engaged in support activities training employees negotiations with labor unions

Environmental monitoring enables firms to evaluate ______.

how the dynamic competitive landscape is being changed by environmental trends

Which of the following is a support activity in the value chain? operations human resource management outbound logistics marketing and sales

human resource management

The bargaining power of buyers depends on the ______.

importance of purchases from that group compared with the industry's overall business

The stakeholders of a firm are ______.

individuals or groups that can affect and are affected by the actions of the firm

Which of the following elements of the pyramid of corporate social responsibility are required by society and shareholders? Multiple select question. Ethical responsibilities Legal responsibilities Philanthropic responsibilities Economic responsibilities

legal and economic responsibilities

Which of the following are the three important stakeholder attributes managers must pay particular attention to during stakeholder impact analysis?

legitimacy power urgency

A stakeholder has ______ when its needs are within the bounds of the law or are otherwise relevant to the firm. Multiple choice question.

legitimate claim

Procurement activities include the purchase of which of the following? (Check all that apply.) human resources machinery supplies raw materials

machinery supplies raw materials

Sustainable competitive advantage exists when a firm Blank______.

maintains superior performance relative to its industry over a long period of time

______ activities are associated with purchases of products and services by end users and the inducements used to get them to make purchases.

marketing and sales

Which of the following are among the primary activities of a firm's value chains? (Check all that apply.) operations marketing and sales inbound and outbound logistics procurement service

operations marketing and sales inbound and outbound logistics service

Which of the following would be substitutes for a soft drink? (Check all that apply.) orange juice alcoholic beverages water sports drinks

orange juice water sports drinks

Which of the following processes are associated with outbound logistics? (Check all that apply.) order processing delivery vehicle operation warehousing accounts receivable

order processing delivery vehicle operation warehousing

General administration is often seen ______.

overhead

What is the overall purpose of a firm's strategy?

perform better than other companies in the same industry

Microsoft donating more than $3 billion in cash and software to people in need is an example of which type of corporate social responsibility?

philanthropic

Which of the following elements of the pyramid of corporate social responsibilities are result from a society's expectations toward business?

philanthropic responsibilities, ethical responsibilities

The ______ segment of the general environment consists of how a society creates and exercises power, including rules, laws, and taxation policies.

political/legal

The ______ segment of the general environment consists of how a society creates and exercises power, including rules, laws, and taxation policies. Multiple choice question.

political/legal

The purpose of environmental forecasting is to ______.

predict change

Which of the following legal developments allow business to function as an institution?

property rights, contract enforcement

Shareholders

provide capital

Strategic positioning allows managers to ______.

provide customers value while controlling costs

creditors

provide financing in the form of loans

communities

provide real estate and public safety

employees

provide time and talent

Resources that not many firms possess are known as ______ resources.

rare

What is the field of management that focuses on attaining competitive advantage by combining analysis, formulation, and implementation?

strategic management

Andrew's Home Center has created a unique situation for itself in its industry that allows the company to not only provide excellent value to its customers but also control its costs. This is known as Blank______.

strategic positioning

Burger Bomb is a new hamburger restaurant. In order to compete successfully against its many competitors, Burger Bomb has decided to focus on quality and an interesting, unique menu that uses locally sourced, organic ingredients. These ideas are Burger Bomb's Blank______.

strategy

Examples of key elements of the global segment of the general environment include which of the following? (Check all that apply.) the Dow Jones shifts in the number of U.S. high school graduates trade agreements between nations currency exchange rates

trade agreements between nations currency exchange rates

Which of the following are service activities? (Check all that apply.) procurement training installation repair

training installation repair

Spotting key trends requires a combination of which of the following? (Check all that apply.) Understanding one's customers. Disregarding what your competitors will do next. Ignoring what policy makers are likely to do. Knowing one's business. Keeping an eye on what's happening.

understanding one's customers knowing one's business keeping an eye on what's happening