Strategic Management Exam 2

1. Valuable 2. Rare 3. Costly to Imitate 4. Organized to capture value

According to the RBV a firm can achieve a competitive advantage if it possesses resources & capabilities that are:

A) intangible resources.

According to the resource-based view, a firm's competitive advantage often stems from its A) intangible resources. B) tangible resources. C) dynamic strengths. D) external environment.

C) tangible resources.

Amazon.com's network of distribution centers allow it to drastically reduce its delivery times compared to other online retailers. These distribution centers are examples of Amazon's A) core competency. B) intangible resources. C) tangible resources. D) capabilities.

B) Buzztronic will have a resource that is valuable but no longer rare.

Buzztronic is a market leader in consumer electronics. If Ficolee and Ficola, companies that manufacture televisions, develop the same customer knowledge base and create products with the same customer appeal as Buzztronic, then A) Ficolee and Ficola will have a VRIO resource. B) Buzztronic will have a resource that is valuable but no longer rare. C) Buzztronic will have a sustainable competitive advantage in the industry. D) Buzztronic will have a resource that is rare but no longer valuable

A) product uniqueness

Customer service and ________ are two of the value drivers that managers can utilize when trying to improve a firm's differentiation strategic position. A) product uniqueness B) experience curve C) cost of input factors D) economies of scale

internal factors

Do internal or external factors have the bigger impact?

B) differentiation

Gr8t Food is a chain of "fast casual" restaurants that sells its menu items at higher prices than its competitors. The restaurant has a large customer base due to its wide product portfolio and superior customer service. Which of the following generic business strategies has Gr8t Food adopted in this scenario? A) cost-leadership B) differentiation C) market penetration D) product diversification

A) core rigidities.

One of the reasons that Kodak filed for bankruptcy was due to its inability to reinvest, hone, and upgrade its once impressive film camera capabilities. Ultimately, Kodak's core competences became A) core rigidities. B) value chain activities. C) strategic resources. D) costly to imitate.

A) resource heterogeneity

Southwest Airlines(SWA) and Alaska Airlines both compete as point-to-point airlines, but they draw upon different resource bundles. This example best illustrates which of the following assumptions regarding the resource-based view? A) resource heterogeneity B) resource homogeneity C) resource allocation process D) resource immobility

A) primary activities and support activities.

Value chain analysis consists of systematically analyzing a firm's key activities that for analysis purposes are categorized into two groups: A) primary activities and support activities. B) products and service activities. C) customers and suppliers. D) profits and losses.

A) valuable

WeComput Inc.'s competency in designing and manufacturing efficient microprocessors has made its laptops the most advanced computers in the market. This competency, along with the just-in-time manufacturing system, has enabled WeComput Inc. to increase its profitability by lowering its production costs. Thus, WeComput's competency in designing and manufacturing microprocessors will be considered a(n) _____ resource in the VRIO framework. A) valuable B) substitute C) imitable D) organized

support activities and primary activities

What activities are involved in a generic chain value?

Capabilities are the organizational and managerial abilities to orchestrate a diverse set of resources and deploy them strategically. Capabilities are born out of the Resources that a firm has.

What are capabilities?

Unique strengths Embedded deep within a firm-results in creating higher value for the customer OR results in products and services offered at lower cost EXPRESSED THROUGH STRUCTURES, PROCESSES, ROUTINES

What are core competencies?

Invisible, No Physical Attributes culture, knowledge, brand equity, reputation, intellectual property (patents, designs, copyrights, trademarks, trade secrets)

What are intangible resources?

assets that a company can draw on when crafting and executing a strategy. Resources can be either tangible or intangible or human.

What are resources?

Visible, Physical Attributes labor, capital, land, buildings, plant, equipment, supplies

What are tangible resources?

accounting profitability, shareholder value creation, and economic value creation

What are three traditional frameworks used to measure and assess firm performance?

balanced scorecard and triple bottom line

What are two integrative frameworks that combine quantitative data with qualitative assessments?

a strategy that combines both differentiation and cost-leadership activities; a firm offers a differentiated product or service at a low cost; examples- Trader Joe's and IKEA; uses value innovation to reconcile trade-offs

What is blue ocean strategy?

A former core competency that turned into a liability- result of an environmental change and no longer fits the external environment Turns a resource from an asset to a liability- causes loss of competitive advantage; the firm may even go out of business

What is core rigidity?

seeks to create similar value vs competitors; charges lower prices

What is cost leadership?

seeks to create higher value vs competitors; offers unique features; charges higher prices

What is differentiation?

Model assumption that a firm is a bundle of resources and capabilities differ across firms

What is resource heterogeneity?

Model assumption that a firm has resources that tend to be "sticky" and that do not move easily from firm to firm.

What is resource immobility?

The external analysis is not complete. External analysis only explains performance differences at the industry level.

Why do we need internal analysis?

A) Economic value created

________ is best described as the difference between a buyer's willingness to pay for a product or service and a firm's total cost to produce it. A) Economic value created B) Break-even point C) Consumer surplus D) Cost of capital