TEST 1 SACE

Digital technologies are increasing the intensity of competition in the markets for electronic hardware because they are causing: a. Entry barriers to fall b. Chinese companies that were once contract manufacturers for Western and Japanese electronics producers to become direct competitors c. Production costs to fall d. The markets for once-separable products to converge

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The difference between a resource and a capability is: a. A resource is a productive asset; a capability refers to what the firm can do b. A resource tends to be an immobile asset; capabilities are dynamic c. A resource is a weak source of competitive advantage d. A capability is a type of resource

a. A resource is a productive asset; a capability refers to what the firm can do

If competition, market turbulence, and accelerating technological change are increasing the pace at which firms' competitive advantage is eroded, to sustain competitive advantage companies need to: a. Create multiple sources of competitive advantage. b. Build strength in intellectual property. c. Foster innovation. d. Adopt global strategies that arbitrage the resource advantages of multiple countries.

a. Create multiple sources of competitive advantage.

The primary purpose of a company's strategy is to: a. Being better than its rivals b. Achieving success c. Satisfying stakeholders d. Being an excellent corporate citizen

b. Achieving success

For both individuals and businesses, successful strategies are characterized by: a. Unrelenting commitment to ambitious goals b. Clear goals, understanding the competitive environment, resource appraisal & implementation c. Meticulous planning d. The possession of superior abilities and resources which are then deployed to build competitive advantage

b. Clear goals, understanding the competitive environment, resource appraisal & implementation

The principle similarity between business and military strategy is that: a. They share the same objective: to annihilate rivals b. They share common concepts and principles c. The nature of leadership is much the same whether in a military or business context d. They are both concerned with tactical maneuvers that can establish positions of advantage.

b. They share common concepts and principles

During the 1990s, the focus of strategy analysis shifted: a. From corporate planning to strategic management b. To the role of resources and capabilities as a foundation for firm strategy c. To the application of microeconomics to analyze the sources of firm profitability d. From the structure-based approach to the value-added perspective

b. To the role of resources and capabilities as a foundation for firm strategy

When the environment becomes more turbulent, unpredictable, and full of new opportunities: a. strategy appears to not be very useful b. strategy becomes a vital tool to navigate the firm through "stormy seas" c. strategy should be put into the hands of external consultants d. strategy becomes an "impossible exercise"

b. strategy becomes a vital tool to navigate the firm through "stormy seas"

To identify a firm's resources and capabilities it is useful to: a. To first identify the key success factors within the firm's industry then identify the resources and capabilities needed to satisfy these success actors. b. Identify the firm's value chain then identify the main resources and capabilities at each stage of the value chain. c. Both (a) and (b). d. Classify resources into intangible, tangible and human.

c. Both (a) and (b).

Nassim Taleb uses the black swan to refer to an event that is rare, unpredictable, and has a major impact. If black swan events are major sources of change and uncertainty in the world, the key implication that Taleb draws is: a. We need to develop more sophisticated tools of probability analysis b. Scenario-based models offer a better guide to the future than forecasting models that analyze past data c. Individuals and organizations need to develop robustness to unpredictable changes d. We need to recognize that most events follow power-law distributions rather than normal distributions.

c. Individuals and organizations need to develop robustness to unpredictable changes

During turbulent times, real options are increasingly important sources of value. The following are strategic measures can create option value for a firm: a. Commitment to long-term fixed price contracts for key raw materials. b. Increasing levels of debt in order to reduce the firm's weighted-average cost of capital. c. Initiating multiple strategic alliances. d. Investing in projects enhances environmental sustainability

c. Initiating multiple strategic alliances.

Intangible resources tend to be more valuable than tangible ones because: a. They are easier to acquire b. They are cheaper to acquire c. They are more likely to provide sustainable competitive advantage d. All of the above

c. They are more likely to provide sustainable competitive advantage

A well established brand can be a source of sustainable competitive advantage because: a. Consumers will always pay a premium for a recognized brand. b. Brands can be protected by the law relating to trademarks. c. A brand protects a firm from competition from low-cost new entrants. d. It tends to be durable, loses value when transferred between firms, and is costly to replicate.

d. It tends to be durable, loses value when transferred between firms, and is costly to replicate.

As organizations and their environment becomes more complex and less predictable, the type of leadership that fosters effective organizational adaptation is increasingly characterized by: a. Commitment clear performance goals b. Willingness to take tough decisions c. Management of detail d. Management of identity, meaning, and the emotional climate of the organization

d. Management of identity, meaning, and the emotional climate of the organization

Strategic goals should be: a. simple b. consistent c. long-term d. all of the above

d. all of the above