Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

Bus 478 > Chapter 3 > Flashcards

Chapter 3 Flashcards

1
Q

What is competitive advantage

A

When a company’s profitability is greater than the average profitability of all companies in the industry

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What does it mean when the company has a sustained competitive advantage

A

When the company is able to maintain an above average profitability years

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What is the primary objective of strategy

A

Achieve a sustained competitive advantage which will result to a superior profitability and profit growth

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What are distinctive competencies

A

Firm specific strengths which allow a company to differentiate its products from rivals and achieve a lower costs to the rivals

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What are the two complementary sources of distinctive competencies

A
  1. Resources
  2. Capabilities
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What are resources

A

Assets of the company

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What is process knowledge

A

Knowledge of internal rules, routines and procedures of an organization that managers can leverage to achieve organizational objectives

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What is social complex

A

Something that is characterized by or is the outcome of the interaction of multiple individuals

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

What is tacit

A

A characteristic of knowledge or skills that cannot be documented or codified

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

What is organizational architecture

A

Combination of the organizational structure of a company, its control systems, its incentive systems and its organizational culture and human capital strategy

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What is intellectual property

A

Knowledge, research, and information that is owned by an individual or organization

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What are the two types of resources

A
  1. Tangible
  2. Intangible
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What does it mean to have tangible resources

A

Physical entities

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

What does it mean to have intangible resources

A

Non physical entities that are created by employees

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What are examples of intangible assets

A

Companys reputation, knowledge, experience, intellectual properties

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What is the VRIO Framework

A

Allows managers to think about the quality of resources

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

What are the acronyms of VRIO

A
  1. Value → Resources valuable to exploit opportunities and counter threat
  2. Rarity → resources valuable to exploit opportunities and counter threats
  3. Inimitability → Are the resources easy or hard to copy
  4. Organization → Is the company organized and managed where it enables to exploit its resources and capture the value they produce
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

What are capabilities

A

Resource coordinating skills and productive use that reside with the company’s rules, routines and procedures

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

What are companies capabilities

A

Product of its organizational structure, process, control systems and hiring strategies

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

What are distinctive competiencies

A

Shape strategies that the company pursues which lead to a competitive advantage and superior profitability

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

What are three things that the company’s profitability depend on

A
  1. Value
  2. Price
  3. Costs
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

What is a company’s value

A

Value place on the products (utility)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

What is the price

A

What is being charged for the product

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

What are costs

A

Price of creating products

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
What is value creation
Value customers place on a product reflect the utility being derived from it, it is based off of price and function of the product
26
What are the basic factors of production
Resources such as land, labour, management, plants and equipment
27
What are advanced factors of production
Resources such as process knowledge, organizational architecture and intellectual property that contribute to a company's competitive advantage
28
Why is a company's barriers to imitation high?
Prices knowledge is often tacit, hides from view within the firm and socially complex and implementing new rules from outside to within is bhard to do
29
What is causal ambiguity
The way that one thing will lead to an outcome that is not understand
30
What is the value chain consist of
1. Production 2. Marketing 3. Product Development 4. Service 5. Information Systems 6. Material Management 7. Human Resources
31
What are primary activities
Include the design, creation and delivery of the product, the products marketing and support
32
What are the primary activities that are broken down into four functions
1. Research and development 2. Production 3. Marketing and sales 4. Customer Service
33
What are support activities
Value chain that provides inputs that allow primary activities to take place
34
What are the four functions of the support activities
1. Materials Management 2. Human Resources 3. Information Systems 4. Company Infrastructure
35
What are the four factors that help a company build and sustain a competitive advantage
1. Superior Innovation 2. Superior Quality 3. Superior Customer Responsiveness 4. Superior Efficiency
36
What does innovation mean
Act of creating new products or processes
37
What are the two types of innovation
1. Product innovation 2. Process innovation
38
What is product innovation
Developing products that are new to the world and have superior attributes to existing products which enable customers to perceive the product as having more value and increasing companies price option
39
What is process innovation
Developing a new process of producing products and delivering them to customers which allow a company to create more value by lowering production costs
40
What is quality
Product that can be thought of as a bundle of attributes
41
What are attributes
Physical product including its form, features, performance, durability, reliability, style and design
42
What does it mean when the product is to have superior quality
Customers perceive that its attributes provide them with higher utility than sold by rivals
43
What are the two attributes that customers measure product against
1. Related to quality as excellence 2. Relates quality as reliability
44
How do companies achieve responsiveness to customers
Achieving superior quality and innovation
45
What is customer response time
Critical aspect of responsiveness and its the time it takes for a good to be delivered or a services to be performed
46
How do you measure efficiency
Outputs/Inputs
47
How do you measure efficiency
Employee productivity
48
How to analyze financial performance
Looking at their profitability sows the return that a company is generating on its investments
49
What is Return on Invested Capital
Best measurement because it focuses on the true operating performance of the company
50
What is net profit
What is left over after the government takes its share in taxes
51
What is invested capital
Amount that is invested in the operations of a company: Property, Plant, Equipment, Inventories and other assets
52
What are the two main sources of invested capital
Interest bearing debt and shareholders equity
53
What are the three factors to consider regarding the durability of a competitive advantage
1. Barriers to Imitation 2. The capability of competitors 3. The general dynamism of the industry environment
54
What are barriers to imitation
1. When a company with competitive advantage will earn higher than average profits 2. Profits = make the company valuable, distinctive and create superior value
55
What is absorptive capacity
The ability of a company to identify, value, assimilate and use new knowledge
56
What is a dynamic industry environment have
1. A high rate of product innovation 2. Shorter product life cycles
57
Why do companies fail
When they lose their competitive advantage and profitability falls
58
What happens to a failing company
When the profitability is substantially lower than the average profitability of its competitors: it has lost the ability to attract and generate resources and its profit margins and invested capital
59
What are 3 reasons why companies fail
1. Inertia 2. Prior strategic commitments 3. Icarus paradox
60
What is inertia
Company is finding it difficult to adapt to a new environmental condition
61
What are organizational capabilities
The way a company makes decision and manages it processes which are difficult to change
62
What happens to the company's prior strategic commitment when it fails?
May cause a loss of competitive advantage because its resources are not suited for the new industry
63
What is the icarus paradox
When companies become so dazzled by their early success and believe more of the same type of effort as a to future success
64
What are primary activities
Design, creation and delivery of the product
65
What is research and development
Design of products and production processes
66
What is production
Production refers to the creation of a good or service
67
What is marketing and sales
Brand position and advertising of the market companies product
68
What is customer service
Role of the service function of an enterprise to provide after sales service and support
69
What is support activities
Provides inputs that allow the primary activities to take place
70
What are materials management
Controls the transmission of physical materials through the value chain from procurement through production and into distribution
71
What are Human Resources
Helps ensure that the company has a right combination of skilled people to perform its value creation activities effectively
72
What are information systems
Digital systems for managing inventory, tracking sales, pricing products, selling products, dealing with customer service inquiries
73
What are company infrastructure
Includes organizational structure, control systems, incentive systems and organizational culture
74
What is benchmarking
Requires a company to measure how well its performing against other enterprises using strategically relevant data
75
What is capital productivity
Sales produced by a dollar of capital invested in the business

Bus 478 (12 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions