Strategic Management

All of the following are external stakeholders except which of the following? customers creditors alliance partners competitors

competitors

Several drawbacks exist when it comes to horizontal integration. Which of the following below is not one of the drawbacks? the possibility for legal repercussions from the FTC integration failure higher costs reduced flexibility

higher costs

The most challenging diversification strategy is likely to be one that combines new core competencies with new and emerging markets. True False

true

When smartphone manufacturers began including cameras and voice recorders in their products, that was an example of industry convergence. truue or false

true

A video-streaming service provider such as Amazon Prime is a complement to a manufacturer of streaming video devices such as Roku and the Amazon Firestick.

true or false

Product features, customer service, and complements are all examples of important cost curves. cost drivers. value curves. value drivers.

value drivers

________ is best described as a measure of how effectively capital is being used by a firm to generate revenue. Return on revenue Risk capital Working capital turnover Revenue per employee

working capital turnover

________, which captures the cultural fit between different firms, is one key element needed when selecting an alliance partner. Partner compatibility Partner commitment Joint ventures Partner competency

partner compatability

In the why, what, who, and how of business models framework, the why dimension asks "why does the business model create value?" True False

true

Platform business models are not organized as traditional linear pipeline business models. true or false

true

Product innovation is more strategically important than process innovation while a firm is in the growth stage of the industry life cycle. true or false

false

When performing internal analysis of firms, how would you answer the question, "why do companies exist?" Companies exist because they create value for customers in ways that customers are unable to replicate on their own. Companies exist because they provide a means of investment income for shareholders, who otherwise would be able to invest only in government securities. Companies exist because they provide a tax base for government to draw upon in creating and maintaining public works projects. Companies exist because they give college professors something to teach about.

Companies exist because they create value for customers in ways that customers are unable to replicate on their own.

How is differentiation parity different from cost parity? Differentiation parity deals with pricing not innovation. Differentiation parity deals with innovation not value. Differentiation parity deals with pricing not value. Differentiation parity deals with value not cost.

Differentiation parity deals with value not cost.

In nearly every case, which of the Five Forces is the most important in determining the relative power structure in an industry? No single force is dominant in most every case. current competitors potential entrants past participants

No single force is dominant in most every case.

The fact that both Whole Foods (a high-end grocery store) and Aldi (an inexpensive grocery store) have a competitive advantage in the grocery store industry is an indication that following a different generic business strategy within the same industry can lead to a competitive advantage for more than one organization. following the same generic business strategy can allow for two firms competing in the same industry to have a competitive advantage at the same time. in order to evaluate whether Whole Foods has a sustained competitive advantage it is useful to compare it to Aldi from a cost perspective. in order to evaluate whether Aldi has a sustained competitive advantage, it is useful to compare it to Whole Foods from a differentiation perspective.

following a different generic business strategy within the same industry can lead to a competitive advantage for more than one organization.

Which of following practices of a firm satisfies its ethical responsibilities? using plastic as the packaging material, even though it is harmful to the environment, yet legal outsourcing production to a less developed country and paying wages that are below its own country's accepted minimum wages using advertising and other forms of promotion to endorse luxurious lifestyles selling vaccines at a subsidized price in a less developed country even though this results in reduced shareholder returns

selling vaccines at a subsidized price in a less developed country even though this results in reduced shareholder returns

In terms of the build-borrow-or-buy framework, a firm's internal resources are considered to be relevant when they are similar to those that need to be developed and superior to those of competitors in the targeted area. similar to those that need to be developed and inferior to those of competitors in the targeted area. different from those that need to be developed and superior to those of competitors in the targeted area. different from those that need to be developed and inferior to those of competitors in the targeted area.

similar to those that need to be developed and superior to those of competitors in the targeted area.

Because Facebook receives almost all of its revenues from online advertising, we would conclude that Facebook would be characterized as a(n) ________ firm, which has the lowest levels of corporate diversification. single business dominate business related diversification unrelated diversification

single business

________________ allow(s) a firm to differentiate its products and services from those of its rivals, creating higher value for the customer or offering products and services of comparable value at lower cost. Core competencies Strengths A value chain Competition

Core competencies

Salesforce is one of the leading providers of platform as a service (PaaS) tools and services. They developed a new competency in delivering software development that allows its customers to better customize their future needs. Viewing this through the lens of the Core Competence-Market Matrix, which of the following four options below does Salesforce best exemplify? Salesforce leveraged existing core competencies to improve their current market position. Salesforce built new core competencies to protect and extend their current market position. Salesforce redeployed and recombined existing core competencies to compete in markets of the future. Salesforce built new core competencies to create and compete in markets of the future.

Salesforce built new core competencies to create and compete in markets of the future.

Which of the following tasks in the AFI strategy framework involves evaluating the internal and external environments in which a firm operates? analysis formulation implementation competitive advantage

analysis

Bill's Auto & Airplane Repair shop is able to generate a positive net income of $10,000 a week; this is the industry average. We can conclude that since he has a positive net income, he also has a competitive parity in the industry. competitive advantage is achieved through profitability alone. competitive advantage is achieved since Bill's Auto & Airplane Repair shop has a positive net income. competitive parity is achieved by generating average returns, relative to competition in a given industry. Bill's Auto & Airplane Repair shop more than likely has a sustained competitive advantage since his business is diversified.

Correct—competitive advantage is achieved through profitability alone. Correct—competitive advantage is achieved since Bill's Auto & Airplane Repair shop has a positive net income. Correct! Correct—competitive parity is achieved by generating average returns, relative to competition in a given industry. Incorrect: Incorrect—Bill's Auto & Airplane Repair shop more than likely has a sustained competitive advantage since his business is diversified.

Which of the following statements accurately brings out the difference between tangible and intangible resources? Tangible resources contribute to a company's competitive advantage, whereas intangible resources have little effect on competitive advantage. Tangible assets can be bought on the open market by anyone with the necessary cash, whereas intangible assets cannot be easily purchased. Tangible resources take a longer time to build, whereas intangible assets can be built comparatively easily. Tangible assets are difficult for competitors to imitate, whereas intangible assets can be easily replicated.

Tangible assets can be bought on the open market by anyone with the necessary cash, whereas intangible assets cannot be easily purchased.

Which of the following is NOT considered an important macro-environmental influence on businesses (that is, a potential influence beyond that of the industry alone)? bargaining power of suppliers economic factors political changes technological factors

bargaining power of suppliers

In a focused cost-leadership strategy, a firm caters to the segment of the market that is least cost sensitive. provides high-priced products for many different segments of the mass market. delivers low-cost products and services to a specific, narrow part of the market. focuses on reducing the economic value created to drive down costs.

delivers low-cost products and services to a specific, narrow part of the market.

The type of customers vital to a firm introducing a new innovation are the ________, who are willing to pay higher prices and like to tinker with new products. laggards early majority early adopters late majority

early adopters

Jerry is the proud owner of American BBQ Eateries LLC. They currently operate in the southeast and have recently entered into a nonequity alliance with Big Bills BBQ Grills Inc., with a promise of sharing codified information via a licensing agreement. Which of the following best represents this level of sharing knowledge? core competency knowledge strategic alliance knowledge tacit knowledge explicit knowledge

explicit knowledge

BuyNow Inc. is an e-commerce retail firm that sells a variety of merchandise online. Through services like cash on delivery, easy return, and online tracking, the company has created more customer value than its competitors (brick-and-mortar businesses) at the same price. Also, the company's costs are substantially lower than its competitors because of minimal investments in operation and administration. In this scenario, BuyNow Inc. has most likely been able to provide superior value and cost control through strategic parity. strategic profiling. strategic liquidation. strategic positioning.

strategic positioning.

Tom is attempting to measure how his customers views his firm. To do this, he uses the balanced-scorecard framework because he knows that customer surveys will help him determine future industry attractiveness. this will guarantee his company a sustainable competitive advantage. the framework will help him increase his stock price. the customer perspective is directly linked to firm revenues and profits.

the customer perspective is directly linked to firm revenues and profits.

The internet service provider industry in the country of Wakanda is an industry characterized by the presence of strong network effects, high brand loyalty, high economies of scale, and proprietary technology among incumbent firms. Thus, in the internet service provider industry, the threat of substitutes is most likely high. threat of new entrants is most likely low. bargaining power of buyers is most likely low. entry barriers are most likely nonexistent.

threat of new entrants is most likely low.