UCSC ECON 136 MIDTERM MC
15. Tangible resources include: A. human assets and intellectual capital, which can include the talent of the work force and the creativity and innovativeness of certain personnel. B. reputational assets, which can include the company's reputation for quality, service, and reliability as well as their reputation for fair dealings with suppliers. C. relationships with alliances that provide access to technologies, specialized know-how, or geographic markets. D. technological assets such as patents, copyrights, and trade secrets. E. None of these.
D
20. The four tests of a resource's competitive power are often referred to as: A. the SCIR test, which asks if a resource is sustainable, competitive, internalized, and reproducible. B. the competitive advantage sustainable method test. C. the reliability resources simulation. D. the VRIN test, which asks if a resource is valuable, rare, inimitable, and non-substitutable. E. the organizational capability metric analysis.
D
21. The spotlight in analyzing a company's resources, internal circumstances, and competitiveness includes such questions/concerns as: A. whether the company's present strategy is better than the strategies of its closest rivals based on such performance measures as earnings per share, ROE, dividend payout ratio, and average annual increase in the common stock price. B. whether the company's key success factors are more dominant than the key success factors of close rivals. C. whether the company has the industry's most efficient and effective value chain. D. what are the company's resource strengths and weaknesses and its external opportunities and threats. E. what new acquisitions the company would be well advised to make in order to strengthen its financial performance and overall balance sheet position.
D
3. Which of the following is not an analytical tool for revealing a company's competitiveness and for helping to match the strategy to the company's own particular circumstances? A. Resource and capability analysis B. SWOT analysis C. Value chain analysis D. Bench-pressing analysis E. Competitive strength analysis
D
41. What two factors inhibit the ability of rivals to imitate a firm's most valuable resources and capabilities? A. Social ambiguity and causal uncertainty B. Social simplicity and causal complexity C. Collective complexity and causal ambiguity D. Social complexity and causal ambiguity E. Social simplicity and causal uncertainty
D
102. The value chains of company distribution channel partners are relevant because: A. their costs and margins are part of the price the ultimate consumer pays. B. the activities they perform affect sales volumes and customer satisfaction. C. they have a competitive interest in promoting higher sales volumes and customer satisfaction. D. they perform primary and support activities that are related to the entire value chain system. E. All of these apply.
E
13. The main reason that listing or categorizing company resources matters is: A. to ensure all resources are categorized correctly. B. that the important resources are reported against strategically subjective activities. C. that the resources are prioritized in terms of value propositions. D. that the strategically placed resources are manageable. E. that all the different types of resources are included.
E
31. A company's resources can include: A. a skill, specialized expertise, or competitively important capability. B. valuable human assets and intellectual capital. C. an achievement or attribute that puts the company in a position of market advantage. D. competitively valuable alliances or cooperative ventures. E. All of these.
E
40. The competitive power of a company resource strength or competitive capability hinges on: A. how hard it is for competitors to copy. B. whether it is rare and something rivals lack. C. whether it is really competitively valuable and has the potential to contribute to a competitive advantage. D. how easily it can be trumped by the substitute resources/capabilities of rivals. E. All of these.
E
46. For a company to have competitively potent resources and capabilities, they must: A. be in sync with changes in the company's own strategy. B. be in sync with its efforts to achieve a resource-based competitive advantage. C. fully support company efforts to attract customers. D. combat competitors' newly launched offensives to win bigger sales and market shares. E. All of these.
E
47. Which of the following is NOT an example of a company's dynamic capability? A. A capacity to improve existing resources and capabilities B. Upgrades to R&D resources to drive product innovation C. A capacity to add new resources and capabilities to the competitive asset portfolio D. An ability to replace degraded resources with acquired capabilities E. An ability to keep antiquated resources by disregarding innovative capabilities
E
54. When a company is good at performing a particular internal activity, it is said to have: A. a competitive advantage over rivals. B. a competitive capability. C. a distinctive competence. D. a core competence. E. a company competence.
E
6. The business strategy is made up of key "functional" strategies except: A. R&D, technology, and product design strategies. B. Production and information technology and supply chain management strategies. C. Human resource and finance strategies. D. Sales, marketing, and distribution strategies. E. Alliance and partnerships as well as merger and acquisition growth strategies.
E
61. A distinctive competence: A. is a competitively important activity that a company performs better than its rivals. B. gives a company a competitively valuable capability that is unmatched by rivals. C. is a basis for sustainable competitive advantage. D. qualifies as a superior internal strength. E. All of these.
E
64. A company resource weakness or competitive deficiency: A. represents a problem that needs to be turned into a strength because weaknesses prevent a firm from being a winner in the marketplace. B. causes the company to fall into a lower strategic group than it otherwise could compete in. C. prevents a company from having a distinctive competence. D. usually stems from having a missing link or links in the industry value chain. E. are shortcomings that constitute competitive liabilities.
E
65. A company's resource weaknesses can relate to: A. inferior or unproven skills, expertise, or intellectual capital in competitively important parts of the business. B. something that it lacks or does poorly in comparison to rivals. C. deficiencies in competitively important physical, organizational, or intangible assets. D. missing or competitively inferior capabilities in key areas. E. All of these.
E
79. The payoff of doing a thorough SWOT analysis is: A. identifying whether the company's value chain is cost-effective vis-à-vis the value chains of rivals. B. helping strategy-makers benchmark the company's resource strengths against industry key success factors. C. enabling a company to assess its overall competitive position relative to its key rivals. D. revealing whether a company's market share, measures of profitability, and sales compare favorably or unfavorably vis-à-vis key competitors. E. assisting strategy-makers in crafting a strategy that is well-matched to the company's resources and capabilities, its market opportunities, and the external threats to its future well-being.
E
89. A company is less competitively vulnerable when: A. the company has well-known profit levels. B. the company's stock price is the highest. C. the company's management is recognized as being strategic thinkers. D. the company can offer a greater amount of customer value profitability relative to close rivals. E. the company has less financial risk than rivals.
E
85. The steps of SWOT analysis are: A. identifying the company's resource strengths and weaknesses and its opportunities and threats, drawing conclusions about the company's overall situation, and translating the conclusions into strategic actions to improve the company's strategy. B. pinpointing the company's competitive assets, pinpointing its competitive deficiencies, and determining whether it enjoys a competitive advantage. C. determining whether the company has more competitive assets than competitive liabilities, determining whether the company has good market opportunities, and evaluating the seriousness of the threats to the company's future profitability. D. matching the company's strategy to its resource strengths, correcting the company's important resource weaknesses, and identifying the company's best market opportunities. E. benchmarking the company's strengths and weaknesses against those of key rivals, identifying its market opportunities and the external threats it faces, and determining the company's potential for establishing a competitive advantage over rivals.
B
88. One of the most telling signs of whether a company's market position is strong or precarious is: A. whether its product is strongly or weakly differentiated from rivals. B. whether its prices and costs are competitive with those of key rivals. C. whether it has a lower stock price than key rivals. D. the opinions of buyers regarding which seller has the best product quality and customer service. E. whether it is in a bigger or smaller strategic group than its closest rivals.
B
91. A company's value chain identifies: A. the steps it goes through to convert its net income into value for shareholders. B. the primary activities and related support activities it performs in creating customer value. C. the series of steps it takes to get a product from the raw materials stage into the hands of end users. D. the activities it performs in transforming its competencies into distinctive competencies. E. the competencies and competitive capabilities that underpin its efforts to create value for customers and shareholders.
B
94. The primary purpose of value chain analysis is to: A. segregate the company's operations into different types of functions. B. facilitate a comparison activity-by-activity of how effectively and efficiently a company delivers value to its customers, relative to its competitors. C. eliminate unproductive and obsolete functionality in the firm's operating strategy. D. compare cost structure efficiency with the operating effectiveness of rivals to determine the strategy content of rival firms. E. All of these.
B
96. The value chains of rival companies: A. tend to be essentially the same—any differences are typically minor. B. can differ substantially, reflecting differences in the evolution of each company's own particular business, differences in strategy, and differences in the approaches being used to execute strategy. C. are fairly similar or fairly different, depending on how many activities are performed internally and how many are outsourced. D. can be either fairly similar or fairly different, depending on the extent to which each company's primary and support activities are comprised of fixed-cost activities and variable cost activities. E. are fairly similar except when rival companies have quite different product designs.
B
14. Tangible resources do not include: A. physical resources. B. financial resources. C. human assets. D. technological assets. E. organizational assets.
C
22. Which of the following is NOT pertinent in identifying a company's present strategy? A. The key functional strategies (R&D, supply chain management, production, sales and marketing, HR, and finance) a company is employing B. Management's planned, proactive moves to outcompete rivals (via better product design, improved quality or service, wider product lines, and so on) C. The company's mission, strategic objectives, and financial objectives D. Moves to respond and react to changing conditions in the macro-environment and in industry and competitive conditions E. The strategic role of its collaborative partnerships and strategic alliances with others
C
23. One important indicator of how well a company's present strategy is working is whether: A. it has more core competencies than close rivals. B. its strategy is built around at least two of the industry's key success factors. C. the company is achieving its financial and strategic objectives and whether it is an above-average industry performer. D. it is customarily a first-mover in introducing new or improved products (a good sign) or a late -mover (a bad sign). E. it is subject to weaker competitive forces and pressures than close rivals (a good sign) or stronger competitive forces and pressures (a bad sign).
C
24. The best quantitative evidence of whether a company's present strategy is working well is: A. whether the company has more competitive assets than it does competitive liabilities. B. whether the company is in the industry's best strategic group. C. the caliber of results the strategy is producing, specifically whether the company is achieving its financial and strategic objectives and whether it is an above-average industry performer. D. whether the company has a shorter value chain than close rivals. E. whether the company is in the Fortune 500.
C
26. A company's resource and capability analysis: A. represent its core competencies. B. are the most important parts of the company's value chain. C. signal whether it has the wherewithal to be a strong competitor in the marketplace. D. give it an excellent ability to insulate itself against the impact of the industry's driving forces. E. combine to give it a distinctive competence.
C
28. Which of the following does NOT represent a company resource? A. A company's brand B. A productive input that is owned by the firm C. Marketing and brand management D. R&D teams E. A productive input that is controlled by the firm
C
29. Which of the following is a clear representation of a company's capability? A. A company's brand B. A productive input that is owned or controlled by the firm C. The capacity of a firm to perform some activity D. An alliance or collaboration with another firm E. All of these.
C
32. The BEST example of a company resource is: A. having higher earnings per share and a higher return on shareholders' equity investment than key rivals. B. being totally self-sufficient such that the company does not have to rely in any way on key suppliers, partnerships with outsiders, or strategic alliances. C. having proven technological expertise and an ability to churn out new and improved products on a regular basis. D. having a larger number of competitive assets than competitive liabilities. E. having more built-in key success factors than rivals.
C
33. Which of the following is NOT a good example of a company's resources? A. More intellectual capital and better e-commerce capabilities than rivals B. Fruitful partnerships or alliances with suppliers that reduce costs and/or enhance product quality and performance C. Having higher earnings per share and a higher stock price than key rivals D. A well-known brand name and enjoying the confidence of customers E. A lower-cost value chain than rivals
C
1. Which of the following is NOT one of the six questions that comprise the task of evaluating a company's resources and competitive position? A. What are the company's most profitable geographic market segments? B. How well is the company's present strategy working? C. Are the company's cost structure and customer value proposition competitive? D. Is the company competitively stronger or weaker than key rivals? E. What strategic issues and problems merit front-burner managerial attention?
A
100. Activity-based costing: A. is an accounting system that assigns a company's expenses to whichever activity in a company's value chain is responsible for creating the cost. B. involves using benchmarking techniques to develop cost estimates for the value chain activities of each major rival. C. is a powerful tool for identifying the different pieces of a company's value chain and classifying them as primary activities and support activities. D. involves determining which value chain activities represent variable costs and which represent fixed costs. E. is a tool for identifying the activities that cause a company's product to be strongly differentiated from the products of rivals.
A
11. The difference between a resource and a capability is: A. a resource is a productive input or competitive asset, while a capability is the capacity of the firm to perform some internal activity competently. B. a resource is a reserve supply or back-up supply function, whereas a capability is the ability to manage the resource function. C. a resource is a mechanism used for carrying out some responsibility, while a capability possesses the qualities needed to do a particular thing. D. a resource is the firm's fixed assets, while a capability defines whether the firm is competent to perform some function. E. All of these.
A
12. A useful way to identify a company's resources is to view them as: A. divided into two main categories, tangible and intangible. B. every productive input or competitive asset except human assets and intellectual capital, which are considered capabilities or competencies. C. physical resources, such as the company's brand, image, and reputation assets. D. an inventory or a collection of the firm's strengths, weaknesses, opportunities, and threats. E. All of these.
A
16. There are two approaches that can make the process of uncovering and identifying a firm's capabilities more systematic. They include: A. resources assessment and the functional approach. B. strengths valuations and weaknesses estimations. C. sustainability resource allocation methods and a resource bundling approach. D. cross-functional analysis and collaborative resource methodology. E. financial statement analysis and management support analysis.
A
17. Organizational capabilities are virtually always: A. knowledge-based, residing in people and in the company's intellectual capital, or in organizational processes and systems, which embody tacit knowledge. B. more complex than resources and are exercised only through key personnel. C. require constant evaluation to ensure cooperative support from management. D. are easier and less challenging to categorize than resources because there are fewer to be concerned about. E. reflective of the industry's driving forces.
A
19. A sustainable competitive advantage is gained: A. when a company has durable competitive assets that are central to its strategy and superior to those of rival firms. B. when a company has sufficient resources to expedite its strategy. C. when a company realizes its inherent weaknesses are transformable to advantages. D. when a company can stand out relative to rivals because of resource utilization. E. All of these.
A
30. Which of the following most accurately reflect a company's resource strengths? A. Its human, physical and/or organization assets; its skills and competitive capabilities; and its achievements or attributes that enhance the company's ability to compete effectively B. The sizes of its unit sales, revenues, and market share vis-à-vis those of key rivals C. The sizes of its profit margins and return on investment vis-à-vis those of key rivals D. Whether it has more primary activities in its value chain than close rivals and a better overall value chain than these rivals E. Whether it has more core competencies than close rivals
A
36. Resource and capability analysis is achieved by: A. probing the caliber of a firm's competitive assets relative to those of rival firms. B. achieving price stability. C. analyzing only internal strengths and weaknesses through a matrix comparison model. D. cost-benefit analysis of the company's core product sales. E. performing resource-specific activities within the organization to allocate available capital.
A
38. Whether a resource or capability can support a competitive advantage is determined by which two components of the four tests of competitive power analysis? A. Whether the resource or capability is competitively valuable and/or is something that rivals lack B. Whether the resource or capability is rare and/or is hard to copy C. Whether the resource or capability can be trumped and/or is hard to copy D. Whether the resource or capability is competitively valuable and/or there are good substitutes available for the resource E. Whether the resource or capability is hard to copy and/or can be trumped by different types of resources and capabilities
A
4. The best indicator of how well a company's strategy is working is whether the company: A. is achieving its stated financial objectives, its financial performance equates to the industry average, and market share gains reflect short-term preferences for capacity maximization. B. is attentive to its poor execution in functional areas, business goals are stretch, and the value proposition has a product focus. C. is geared to initiatives designed to build market share and to promote corporate responsibility. D. is achieving its stated financial and strategic objectives, its financial performance is better than the industry average, and it is gaining customers and increasing market share. E. All of these.
A
42. A competitively valuable resource or capability is a company's: A. enabling foundation of its business model. B. equally valuable substitute resource providing a competitive advantage. C. assessment of the availability of superior substitutes. D. unsurpassed worker productivity and product quality. E. unique piecework incentive system, providing a competitive advantage.
A
43. For a particular company resource/capability to have real competitive power and perhaps qualify as a basis for competitive advantage, it should: A. be hard to copy, be rare and something rivals lack, be competitively valuable, and not be easily trumped by substitute resource strengths possessed by rivals. B. be something that a company does internally rather than in collaborative arrangements with outsiders. C. be patentable. D. be an industry key success factor and occupy a prime position in the company's value chain. E. have the potential for lowering the firm's unit costs.
A
48. A dynamic capability: A. is the ongoing capacity to modify existing resources and capabilities to create new ones. B. is the improvement evaluation process for eliminating waste in the firm. C. is the functional and operating resources management process. D. is the ongoing capability to understand and establish rival commitment to resource alignment. E. All of these.
A
49. Identifying and assessing a company's resource strengths and weaknesses and its external opportunities and threats is called: A. a SWOT analysis. B. a competitive asset/liability analysis. C. a competitive positioning analysis. D. a strategic resource assessment. E. a company resource mapping.
A
52. When an activity becomes something a company has learned to perform proficiently and capably, it is said to have: A. a competence. B. a competitive advantage over rivals. C. a key value chain proficiency. D. a distinctive capability. E. a resource advantage.
A
58. A core competence: A. is a more competitively valuable strength than a competence because of the key role the activities play in the company's strategy. B. typically has competitive value, the amount of which is reflected in the physical and tangible assets on a company's balance sheet. C. usually is grounded in the technological expertise of a particular department or work group. D. is more difficult for rivals to copy than a distinctive competence. E. refers to a company's lowest-cost and most efficiently executed value-chain activity.
A
66. Sizing up a company's complement of resource strengths and weaknesses: A. is akin to constructing a "strategic balance sheet" where strengths represent competitive assets and weaknesses represent competitive liabilities. B. is called benchmarking. C. is called competitive strength assessment. D. is focused squarely on ascertaining whether the company has more/less resource strengths than weaknesses. E. is called company resource mapping.
A
68. The market opportunities most relevant to a particular company are those that: A. offer the best prospects for growth and profitability. B. provide a strong defense against threats to the company's profitability. C. embrace the most potential for product innovation. D. provide avenues for taking market share away from close rivals. E. hold the most potential to reduce costs.
A
71. Which of the following is NOT an example of an external threat to a company's future profitability? A. The lack of a distinctive competence B. New legislation that entails burdensome and costly government regulations C. Slowdowns in market growth D. More intense competitive pressures E. The introduction of restrictive trade policies in countries where the company does business
A
77. A company's internal strengths should always serve as the basis of strategy because: A. placing heavy reliance on the company's best competitive assets is the soundest route to attracting customers and competing successfully against rivals. B. they represent what the company considers relevant despite the prevailing opportunities. C. they can overpower the impact of important external threats. D. they form the foundation of the firm's position in the marketplace. E. All of these.
A
82. The primary lesson stemming from a SWOT analysis is that a company's strategy should: A. leverage resource strengths, capitalize on market opportunities, overcome important weaknesses, and defend against external threats. B. be aimed at opportunities that offer the best potential for improved profitability. C. seek aggressively to defend against those threats to the company's immediate profitability. D. be designed to place heavy demands on areas where the company has proven competencies to meet the threats head-on. E. concentrate on making the SWOT's four lists relevant for strategic discussion and planning.
A
87. The higher a company's costs are above those of close rivals, the more: A. competitively vulnerable the company becomes. B. a net profit margin analysis becomes vital. C. its value proposition remains attractive. D. important cost-tracking becomes. E. All of these.
A
9. A powerful tool for sizing up the company's competitive assets and determining whether they can provide the foundation necessary for competitive success in the marketplace is termed: A. Resource and capability analysis B. SWOT C. Competitive analysis D. Financial and asset management analysis E. Value chain analysis
A
93. With its focus on value-creating activities, the value chain: A. is an ideal tool for examining how a company delivers on its customer value proposition. B. preserves cost structure advantages. C. provides identification of customer differentiation shortfalls. D. is a recognized method for classifying the relevant support activities that are relevant to operations tasks. E. is crucial in understanding cost disadvantages and economies of scale and scope shortfalls.
A
34. If a company doesn't possess standalone resource strengths capable of contributing to competitive advantage: A. all potential for competitive advantage is lost. B. it is unlikely to survive in the marketplace and should exit the industry. C. it may have a bundle of resources that can be leveraged to develop a distinctive competence. D. it is virtually blocked from using offensive strategies and must rely on defensive strategies. E. its best strategic option is to revamp its value chain in hopes of creating stronger competitive capabilities.
C
37. A company that has competitive assets that are central to its company strategy and superior to those of rival firms creates a: A. long-term derivative strategy. B. cash flow feasibility analysis. C. competitive advantage over other companies. D. resource deployment strategic plan. E. cost underestimation and benefit overestimation.
C
45. A company requires a dynamically evolving portfolio of resources and capabilities to: A. assist the strategic planning team in overall direction. B. sustain complex manufacturing systems as a strategic recall. C. sustain its competitiveness and help drive improvements in its performance. D. sustain benefits of high market share as an interest in growth strategies. E. transform knowledge into a management style supporting competition in a globally diverse world.
C
5. One important indicator of how well a company's present strategy is working is whether: A. it has more core competencies than close rivals. B. its strategy is built around at least two of the industry's key success factors. C. the company is achieving its financial and strategic objectives and whether it is an above-average industry performer. D. it is customarily a first-mover in introducing new or improved products (a good sign) or a late-mover (a bad sign). E. it is subject to weaker competitive forces and pressures than close rivals (a good sign) or stronger competitive forces and pressures (a bad sign).
C
53. When a company has a proficiency in performing a strategically and competitively important value chain activity better than its rivals, it is said to have: A. a company competence. B. a core competence. C. a distinctive competence D. a key value chain proficiency. E. a competitive advantage over rivals.
C
56. The difference between a core competence and a distinctive competence is that: A. a distinctive competence refers to a company's strongest resource or competitive capability, while a core competence refers to a company's lowest-cost and most efficiently executed value-chain activity. B. a core competence usually resides in a company's base of intellectual capital, whereas a distinctive competence stems from the superiority of a company's physical and tangible assets. C. a core competence is a competitively and strategically relevant activity that a firm performs well compared to its other activities, whereas a distinctive competence is a competitively relevant activity a firm performs well compared to other rival firms. D. a core competence represents a resource strength, whereas a distinctive competence is achieved by having more resource strengths than rival companies. E. a core competence usually resides in a company's technology and physical assets, whereas a distinctive competence usually resides in a company's know-how, expertise, and intellectual capital.
C
59. When a company performs a particular competitively important activity truly well in comparison to its rivals, it is said to have: A. a company competence. B. a strategic resource. C. a distinctive competence. D. a core competence. E. a key success factor.
C
67. The external market opportunities which are MOST relevant to a company are the ones that: A. can increase market share. B. are reinforced by the overall business strategy and where the business model is appropriate. C. match up well with the firm's competitive assets, offer the best prospects for growth and profitability, and present the most potential for competitive advantage. D. qualify to correct its internal weaknesses and resource deficiencies. E. are relevant for defending against the external threats to its well-being.
C
10. A productive input or competitive asset that is owned or controlled by a company is termed a: A. resource, which is the source of everything enjoyed by the firm. B. resource, and there are different types of resources at the firm's disposal that vary not only in kind but in quality as well. C. resource, which is common to the firm's strategy of facilitating and replicating what they do best. D. resource, and it can be tangible or intangible or both and provide substantial benefits to the firm's asset growth. E. All of these.
B
18. A linked and closely integrated set of competitive assets centered around one or more cross-functional capabilities and closely integrated competitive assets is termed: A. organizational assets. B. a resource bundle. C. a resource capability. D. functional method compilation. E. integrated asset advantage.
B
2. Which of the following is NOT a component of evaluating a company's resources and competitive position? A. Evaluating how well the present strategy is working B. Scanning the environment to determine a company's best and most profitable customers C. Assessing whether the company's cost structure and customer value proposition are competitive D. Evaluating whether the company is competitively stronger or weaker than key rivals E. Evaluating if the company is able to seize market opportunities and overcome external threats to its future well-being
B
75. In order to gain value from the SWOT analysis, it is important that the company address the two most important parts of a SWOT analysis, which are: A. identifying the resource strengths and resource weaknesses. B. understanding the relationship between the strengths, weaknesses, opportunities, and threats and establishing criteria for remedying the company's shortfalls. C. drawing conclusions from the SWOT listings about the company's overall situation and translating these conclusions into strategic actions. D. clarifying the firm's current position and ensuring the SWOT listings are complete. E. establishing a game plan to capitalize on the company's strengths and leverage the weaknesses in light of the available opportunities.
C
90. Two analytical tools useful in determining whether a company's prices and costs are competitive are: A. SWOT analysis and key success factor analysis. B. SWOT analysis and benchmarking. C. value chain analysis and benchmarking. D. competitive position assessment and competitive strength assessment. E. driving forces analysis and SWOT analysis.
C
92. A company's value chain consists of two broad categories of activities: A. consists of the primary activities that it performs in seeking to deliver value to shareholders in the form of higher dividends and a higher stock price. B. depicts the internally performed activities associated with creating and enhancing the company's competitive assets. C. consists of two broad categories of activities: the primary activities that create customer value and the requisite support activities that facilitate and enhance the performance of the primary activities. D. concerns the basic process the company goes through in performing R&D and developing new products. E. consists of the series of steps a company goes through to develop a new product, get it produced and distributed into the marketplace, and then start collecting revenues and earning a profit.
C
95. Identifying the primary activities and support activities that comprise a company's value chain: A. indicates whether a company's resource strengths will ultimately translate into greater value for shareholders. B. reveals whether a company's resource strengths are well-matched to the industry's key success factors. C. is the first step in understanding a company's internal cost structure since each activity in the value chain gives rise to costs. D. is called benchmarking. E. is called resource value analysis.
C
97. The three main areas in the value chain where significant differences in the costs of competing firms can occur include: A. age of plants and equipment, number of employees, and advertising costs. B. operating-level activities, functional area activities, and line of business activities. C. the nature and makeup of their own internal operations, the activities performed by suppliers, and the activities performed by wholesale distribution and retailing allies. D. human resource activities (particularly labor costs), vertical integration activities, and strategic partnership activities. E. variable cost activities, fixed cost activities, and administrative activities.
C
99. Activity-based cost accounting aims at: A. making cross-company comparisons of the costs of each value chain activity. B. dividing all company expenses into two categories: activities whose costs are variable and activities whose costs are fixed. C. determining the costs of each activity comprising a company's value chain by establishing expense categories for specific value chain activities and assigning costs to the activity responsible for creating the cost. D. determining the costs of each strategic action a company initiates. E. None of these.
C
25. Which one of the following is NOT a reliable measure of how well a company's current strategy is working? A. Whether the company's sales are growing faster, slower, or about the same pace as the industry as a whole, thus resulting in a rising, falling, or stable market share B. Whether it has a larger number of competitive assets than competitive liabilities and whether it has a superior quality product C. The firm's image and reputation with its customers D. Whether its profit margins are rising or falling and how large its margins are relative to those of its rivals E. How well the firm stacks up against rivals on technology, product innovation, customer service, product quality, price, speed in getting newly developed products to market, and other relevant factors on which buyers base their choice of which brand to purchase
B
27. How are a company's organizational capabilities developed and enabled? A. By strengthening the traditions that company executives are committed to maintaining B. Through deployment of a company's resources or some combination of its resources C. By talking openly about the problems of the present company and determining how new behaviors will improve performance D. By shifting from decentralized to centralized decision-making E. By urging company personnel to search outside the company for work practices and operating approaches that may be an improvement over what the company is presently doing
B
35. Resource and capability analysis is designed to: A. ascertain the internal market place of non-distinct divisions of the company. B. ascertain which of a company's resources and capabilities are competitively valuable. C. stimulate demand for a product. D. ascertain to what extent a competitor can sustain a competitive advantage. E. stimulate economic growth for companies within the industry.
B
39. Which two tests of a resource's competitive power determine whether a company's competitive advantage can be sustained in the face of active competition? A. Whether the resource or capability is competitively valuable and/or is something that rivals lack B. Whether the resource or capability is rare and/or is hard to copy C. Whether the resource or capability is easy to copy D. Whether the resource or capability is competitively valuable and/or there are good substitutes available for the resource E. Whether the resource or capability is hard to copy and/or can be trumped by different types of resources and capabilities
B
44. The competitive power of a company's resource strength is NOT measured by which one of the following tests? A. Is the resource rare and something rivals lack? B. Is the resource strength something that a company does internally rather than in collaborative arrangements with outsiders? C. Is the resource strength easily trumped by the substitute resources/capabilities of rivals? D. Is the resource strength hard to copy? E. Is the resource strength competitively valuable, having the potential to contribute to a competitive advantage?
B
50. SWOT analysis is a simple but powerful tool for: A. gauging whether a company has a cost-competitive value chain. B. sizing up a company's resources and capabilities, strengths and deficiencies, its market opportunities, and the external threats to its future well-being. C. evaluating whether a company is in the most appropriate strategic group. D. determining a company's competitive strength vis-à-vis close rivals. E. identifying the market segments in which a company is strongly positioned and weakly positioned.
B
51. A company's strengths are important because: A. they pave the way for establishing a low-cost advantage over rivals. B. they represent the quality of its competitive assets that enhance its competitiveness in the marketplace. C. they provide extra muscle in helping lengthen the company's value chain. D. they give it competitive protection against the industry's driving forces. E. they provide extra organizational muscle in turning a core competence into a key success factor.
B
62. Which one of the following is inaccurate as concerns a distinctive competence? A. A distinctive competence is a competitively important activity that a company performs better than its rivals. B. A distinctive competence is typically less restrictive for rivals to copy than a core competence. C. A distinctive competence can be a basis for sustainable competitive advantage. D. A distinctive competence qualifies as a superior internal strength. E. A distinctive competence enables delivering stand-out value to customers (in the form of lower prices, better product performance, or superior service).
B
63. The competitive power of a company's core competence or distinctive competence depends on: A. whether it helps differentiate a company's product offering from the product offerings of rival firms. B. how hard it is to copy and how easily it can be trumped by substitute resource strengths and competitive capabilities of rivals. C. whether customers are aware of the competence and view the competence positively enough to boost the company's brand-name reputation. D. whether the competence is one of the industry's key success factors. E. whether the competence is technology-based or based on superior marketing know-how.
B
7. Sluggish performance results relative to rivals are a reliable warning sign that the company has either a weak strategy or poor strategy execution or both. The best way to identify a well-conceived, well-executed strategy is to determine whether the company is experiencing: A. a strengthening of its image and reputation among shareholders. B. a desirable growth rate in new customer acquisition and favorable customer retention efforts for establishing a strong customer experience. C. movement in its operating profit margin, satisfactory returns on investable liquid assets, and elimination of credit access restrictions. D. positive trends with the relevant cultural factors related to buyer's choices and product modifications. E. All of these.
B
72. Which of the following is NOT an example of a threat to a company's future profitability and well-being? A. The likely entry of potent new competitors B. The lack of a well-known brand name with which to attract new customers and help retain existing customers C. Shifts in buyer needs and tastes away from the industry's product D. Costly new regulatory requirements E. Growing bargaining power on the part of the company's major customers and major suppliers
B
8. A company's resources and capabilities represent: A. the firm's net working capital and related determinants for measuring operating performance and capabilities. B. the firm's competitive assets, which are considered big determinants of its competitiveness and ability to succeed in the marketplace. C. whether the firm has the industry's most efficient value chain. D. management's source of funding of new strategic initiatives. E. All of these.
B
80. In doing SWOT analysis, which one of the following is NOT an example of a potential resource weakness or competitive deficiency that a company may have? A. Less productive R&D efforts than rivals B. Having a single, unified functional strategy instead of several distinct functional strategies C. Lack of a strong brand image and reputation (as compared to rivals) D. Higher overall unit costs relative to rivals E. Too narrow a product line relative to rivals
B
81. In doing SWOT analysis and trying to identify a company's market opportunities, which of the following is NOT an example of a potential market opportunity that a company may have? A. Serving additional customer groups or market segments B. Growing buyer preferences for substitutes for the industry's product C. Acquiring rival firms or companies with attractive technological expertise or capabilities D. Expanding into new geographic markets E. Openings to win market share away from rivals
B
83. Which one of the following is NOT part of conducting a SWOT analysis? A. Identifying a company's resource strengths and competitive assets B. Benchmarking the company's resource strengths and competitive capabilities against industry key success factors C. Identifying a company's market opportunities D. Drawing conclusions about the company's overall business situation—what is attractive and what is unattractive about the company's circumstances E. Translating the results of the analysis into actions for improving the company's strategy and market position
B
55. The difference between a company competence and a core competence is that: A. a company competence refers to a company's best-executed functional strategy, while a core competence refers to a company's best-executed business strategy. B. a company competence refers to a company's strongest resource, whereas a core competence refers to a company's lowest-cost and most efficiently performed value chain activity. C. a company competence is a competitively relevant activity that a firm performs especially well relative to other internal activities, whereas a core competence is an activity that a company has learned to perform proficiently. D. a company competence represents real proficiency in performing an internal activity, whereas a core competence is a competitively and strategically relevant activity. E. a core competence usually resides in a company's technology and physical assets, whereas a company competence usually resides in a company's human assets and intellectual capital.
D
57. A core competence: A. retracts from a company's arsenal of competitive capabilities and competitive assets and is not a resource strength considered to be genuine. B. is typically results-based, residing in a company's tangible physical assets on the balance sheet. C. is often grounded in a single department's set of knowledge and expertise. D. is an activity that a firm performs proficiently that is also central to its strategy and competitive success. E. All of these.
D
60. Which of the following does NOT represent a potential core competence? A. Skills in manufacturing a high-quality product at a low cost B. Know-how in creating and operating systems for cost-efficient supply chain management C. The capability to fill customer orders accurately and swiftly D. Having a wider product line than rivals E. The capability to speed new or next-generation products to the marketplace
D
69. Which of the following BEST describes the market opportunities that tend to be most relevant to a particular company? A. Those market opportunities that provide avenues for taking market share away from close rivals and enhance a company's image as a leader in product innovation and product quality B. Those market opportunities that offer the company a chance to raise entry barriers C. Those market opportunities that help promote greater diversification of revenues and profits D. Those market opportunities that match up well with the firm's competitive assets, offer the best prospect for growth and profitability, and present the most potential for competitive advantage E. Those market opportunities that help correct a company's biggest weaknesses and competitive deficiencies
D
70. Companies that seize opportunities in the marketplace are usually those that have been: A. actively waiting, staying alert with diligent market reconnaissance and preparing internally to capitalize on potential opportunities. B. the market winners in the past, because they have a proven record and are the best competitively. C. adopting every opportunity for understanding that not all opportunities will be successful and rewarded commensurately. D. first movers willing to accept business risk. E. All of these.
D
73. External threats may pose various degrees of adversity upon the company and can surface from many sources and examples, EXCEPT for: A. the surfacing of cheaper or better technologies. B. the entry of lower-cost foreign competitors and restrictive foreign trade policies. C. new burdensome regulations. D. demographic shifts that can curtail product innovation. E. rising prices on key inputs (such as energy costs).
D
74. SWOT analysis: A. provides a measure of the relative strength of resources in the company's value chain in relation to rivals positioning. B. is a tool for benchmarking whether a firm's strategy is closely matched to industry key success factors. C. reveals whether a company is competitively stronger than its closest rivals. D. provides a good overview and conclusions about the company's overall situation. E. identifies the reasons why a company's strategy is or is not working very well.
D
76. The key questions stemming from the SWOT listings that can reveal relevant substance about the company's overall situation are as follows, except for: A. Are the company's internal strengths and competitive assets sufficiently strong to enable it to compete successfully? B. Does the company have attractive market opportunities that are well suited to its strengths? C. Does the company have threats that are overpowering the firm's competitive assets? D. Are the company's activities and dynamic capabilities adequate for capitalizing on the opportunities? E. All of these.
D
78. How much attention a company should devote to defending against external threats hinges on primarily on: A. whether offensive moves are feasible, cost-effective, and represent the best use of company resources. B. how serious, relevant, and timely the threats are to the company. C. the degree of vulnerability the company has to the threat. D. the compatibility of the pending threats to the company's competitive assets. E. None of these.
D
84. Two important parts of SWOT analysis are: A. pinpointing the company's competitive assets and pinpointing its competitive liabilities. B. identifying the company's resource strengths and identifying the company's best market opportunities. C. identifying the external threats to a company's future profitability and pinpointing how many market opportunities it has. D. drawing conclusions from the SWOT listings about the company's overall situation and translating these into strategic actions to better match the company's strategy to its resource strengths and market opportunities, to correct the important weaknesses, and to defend against external threats. E. making accurate lists of the company's strengths, weaknesses, opportunities, and threats, and then using these lists as a basis for ascertaining how well the company's strategy is working.
D
86. Which one of the following is NOT something that can be gleaned from a company's SWOT? A. How to improve a company's strategy by using company strengths and capabilities as cornerstones for its strategy B. Which market opportunities are best suited to a company's strengths and capabilities C. Which resource weaknesses and deficiencies need to be corrected so as to better enable the pursuit of important market opportunities and to better defend against certain external threats D. How to turn a core competence into a distinctive competence E. Whether any of the company's resource strengths can be used to help lessen the impact of external threats
D
