WPC 470 ASU Midterm

One of the risks of pursuing a blue ocean strategy is that a firm can find itself

"stuck in the middle."

Asher has been tasked with formulating the business strategy for Calm Cosmetics' new line of lipsticks. Which of the following ideas would Ida be likely to include in her proposal?

Promote the lipsticks as the longest-lasting on the market.

In 2008, BlackBerry's market cap peaked at $75 billion. By 2017 this valuation had fallen more than 90 percent, to $3.9 billion. BlackBerry fell victim to two important PESTEL factors in its external environment: sociocultural and technological. How did technology contribute to BlackBerry's decline?

BlackBerry failed to change its device into one that could perform multiple tasks effectively.

What is level 3 of the Level-5 Leadership Pyramid?

Competent managers can effectively oversee people and resources, helping to achieve predetermined goals.

What is level 2 of the Level-5 Leadership Pyramid?

Contributing team members are good at working with others and are notably proficient at helping their groups reach objectives

What is co-opetition?

Cooperation by competitors to achieve a strategic objective

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.

Correct—competitive parity is achieved by generating average returns, relative to competition in a given industry

What is level 4 of the Level-5 Leadership Pyramid?

Effective leaders can steer their companies toward well-defined, compelling goals. They also keep their organizations functioning at high levels of performance

Sasha is the CEO of Enterprise Technologies, a consumer electronics manufacturer. Last year, Enterprise's return on invested capital (ROIC) was 11.6 percent, while Enterprise's closest competitor, Federation Tech, had an ROIC of 17 percent. Which of the following factors might Sasha use to convince investors to invest in Enterprise rather than Federation Tech?

Enterprise's intangible intensity was 6 percent, while Federation Tech's was 3 percent

What is level 5 of the Level-5 Leadership Pyramid?

Executives have the unique capability to develop a company's greatness through what Collins identifies as "a paradoxical combination of personal humility plus professional will."

Several senior managers recently left Fred's Autos Inc. and went to work at Better Autos Inc., a rival company. What does this imply?

Fred's Autos Inc. faced resource leakage

Bestie Toys faces stiff competition from FunGadgets Inc., a rival firm with which Bestie Toys has achieved differentiation parity. Both firms have invested in state-of-the art production facilities and have similar learning curves of 85 percent. Assuming neither firm can reduce the cost of its input factors, how can Bestie Toys achieve a competitive advantage as a cost-leader?

Have a cumulative output that is greater than FunGadgets Inc.'s

What is level 1 of the Level-5 Leadership Pyramid?

Highly capable individuals are regular workers who are talented, knowledgeable, and skilled. They are effective in the workplace.

You are the manager in charge of setting the strategy for a new fast-casual restaurant. Which of the following questions would be appropriate for you to ask during the analysis phase of the AFI strategy framework?

How have consumer preferences in the fast-casual restaurant industry changed in the last five years?

How does causal ambiguity act as an isolating mechanism for organizations?

It makes it difficult for the competitors to understand why a company has been so successful.

Which of the following is a primary feature of the five forces model?

It views competition within an industry broadly to include forces such as buyers, suppliers, and the threat of substitutes.

Brandon is part of a sales team. He effectively coordinates his tasks with others in the team and willingly contributes to their efforts in achieving the team's objectives. Thus, Brandon is in ________ of the Level-5 leadership pyramid.

Level 2

Companies in the same _____ are direct competitors

Strategic group

In order to achieve a competitive advantage, the Heavenly Hotels, a chain of luxury beach resorts, wants to increase its market share. Which of the following strategies is most likely to do so?

Take advantage of economies of scale and scope by opening a chain of lower-priced economy hotels that leverage the Heavenly Hotels brand image.

Which of the following is an advantage of a triple-bottom-line approach?

The approach takes an integrative and holistic view in assessing a company's performance

What do managers consider during the analysis phase of the AFI strategy framework?

The internal and external environment as well as the role of strategic leaders and how the firm can assess and achieve a competitive advantage

Which of the following provides an example of how a firm's valuable resource can be imitated?

To compete with Build Your Own's model of the Eiffel Tower, Best Replica came out with a model of the Leaning Tower of Pisa.

Casual Ambiguity describes:

a situation in which the cause and effect of a phenomenon are not readily apparent

The Founder of Teach for America, Wendy Kopp, established a mission by building on her vision, which is "One day, all children in this nation will have the opportunity to attain an excellent education." Considering this, how did Klopp implement the mission of Teach for America?

by enlisting talented young professionals as teachers

Samsung and Google cooperate as complementors to compete against Apple's strong position in the mobile device industry, while at the same time Samsung and Google are increasingly becoming competitive with one another. This scenario best illustrates the process of

co-opetition

Susan is trying to determine if her company has a competitive advantage. She must be able to accomplish two critical tasks before she can substantiate this claim. First, she must assess the performance of her company accurately; second, she must

compare and benchmark her firm's performance to other competitors in her same industry

Jack and Jill both love hot coffee. Jack likes to keep his coffee hot during the day while Jill doesn't mind drinking room temperature coffee. Jack is willing to spend more money on a thermos than Jill is willing to spend. This example illustrates the following major limitation of employing the Economic Value Creation framework because

determining the value of a good/service through the perspective of a consumers is not a simple task because consumers have different spending habits

Under the ________ framework, producer surplus is important in the quest for competitive advantage because this is the profit that a firm captures when producing and selling a good or service.

economic value creation

A resource is valuable if:

helps a firm increase the perceived value of its product or service in the eyes of consumers, either by adding attractive features or by lowering price because the resource helps the firm lower its costs

In the context of the SWOT matrix, which of the following best exemplifies a firm's internal strength?

increase in a firm's customer loyalty

Trader Joe's differentiates itself from competitors by offering top-quality foods obtained through sustainable agriculture. This business strategy implies that Trader Joe's focuses on

increasing the perceived value created for customers, which allows it to charge a premium price

Three large firms dominate the telecommunication industry of CallsRUs: TeleFone Inc., Cell Comm Corp., and Talk Now Inc. Instead of cutting prices competitively, these firms have resorted to non-price competition through branding and product differentiation. Which of the following industry competitive structures are these companies most likely in?

oligopoly

When young start-up entrepreneurs make claims like, "We will be the Uber of X, where X is any other category than ride hailing" or "We will be the Airbnb of Y, where Y is any other category than hospitality services" they are best illustrating which of the following cognitive biases?

representativeness bias

If a company wants to gain a competitive advantage in a highly competitive industry, it should ideally:

stake out a unique position within the industry

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 positioning

Amelia has recently started a restaurant in a commercial area that already has many other established restaurants and popular fast-food chains. Amelia owns the building in which her restaurant is located, rather than leasing premises as her competitors do. This factor allows her to offer her products at a more competitive price. Amelia has also invested a huge amount in designing the restaurant's interior and in equipping the kitchen with the appliances that are most widely used in her industry. In this scenario, which of the following is the most valuable resource for Amelia's business?

the building owned by Amelia, which reduces cost of operations

Which of the following is not one of the three pillars of managment?

the unification of major goals and objectives

When is economic value creation created?

when a customer is willing to pay more for a good or service than it costs the firm to produce it

TransNational Inc. is a large conglomerate that operates in 17 different countries. The corporate executives at the headquarters have decided that the company's objective for the next two years will be to increase its customer equity, or the value of potential future revenues generated by all its customers in a lifetime. Based on this guideline received from the top management team, the product leader of the home audio division has decided to adopt a cost-leadership strategy in all of his 17 units. Thus, the decision made by the product leader best illustrates a ________ strategy.

Business

Breeze Car Rental follows a cost-leadership strategy. Which of the following firms will most likely be its direct competitor?

Quicker Rental Cars, which follows a low-cost strategy

Golden Soles has been successful at differentiating itself from competitors by claiming a premium price for its athletic footwear based on superior design and high-quality materials. In this scenario, which of the following is the key value driver?

product features