Learn Smart 4

Question 1

Which of the following issues might be included on a managerial “worry list”

Answer 1

• how to deal with rivals reducing prices
• how to respond to foreign competitors
• whether to acquire a rival company

Question 2

An activity that a company performs poorly in a comparison to its competitors is an example of a competitive deficiency, or _______

Answer 2

weakness

Question 3

T/F
a value chain system is defined as a company’s own value chain combined with those of its suppliers but not those of its wholesale distributors,who deal with finished products.

Answer 3

False

Question 4

A Capability that does not provide a sustainable competitive advantage

Answer 4

can provide a temporary advantage for entering a new market

Question 5

To evaluate a firms _______ it is necessary to identify the firms capabilities and resources and then determine their quality.

Answer 5

competitive

Question 6

the ability of a company to perform competently in carrying out a particular internal activity, such as product innovation or development, it is called a

Answer 6

Capability

Question 7

A company’s tangible resources, typically defines as resources that can be easily quantified, include which of the following?

Answer 7

• organizational resources
• financial resources
• technological resources

Question 8

patents and copyright are types of resources that are part of a company’s

Answer 8

Technological resources

Question 9

Which statements about a company’s capabilities are true?

Answer 9

• One method of identifying capabilities starts with a survey of the functions performed within the company’s resources
• one method of identifying capabilities starts with a survey of the functions performed within the company

Question 10

Closely integrated competitive assets that are tied to one or more cross-functional capabilities are called ______

Answer 10

resource

Question 11

A company’s ongoing ability to adapt and renew its competitive assets, capabilities and resources is referred to as a ___ capability

Answer 11

dynamic

Question 12

When a company is able to maintain its competitive edge despite competitors efforts to overcome it, the company is said to have achieved

Answer 12

a sustainable competitive advantage

Question 13

a competitive asset owned or controlled by a company is referred to as a(n)

Answer 13

resource

Question 14

in addition to human resources, which of the following are intangible assets of a company?

Answer 14

• Reputation
• Image
• its brands

Question 15

As a Type of company resource, relationships include which of the following?

Answer 15

• dealer networks
• partnerships
• joint ventures

Question 16

Most of firms organizational capabilities can be characterized as being either of which two of the following

Answer 16

• being based on knowledge

- existing in a firms processes and systems

Question 17

Capabilities that utilize various resources and result from collaboration across multiple departments, such as R&D, marketing, sales and manufacturing, are known as ______ capabilities

Answer 17

Cross-functional

Question 18

Which of the following factors contribute to the erosion of a company’s competitive advantage over time?

Answer 18

• customer preferences
• changes in technology
• distribution channels

Question 19

A two step process for evaluating a company’s competitive assets and its ability to compete successfully in the marketplace is known as _____ and ____ analysis

Answer 19

resource, capability

Question 20

When company A’s rivals have much higher competitive strength, company A is said to have a net competitive ______

Answer 20

disadvantage

Question 21

the two main categories of activities in a company’s value chain are ____ activities and support acclivities

Answer 21

primary

Question 22

There are times, such as the financial crisis of 2008-2009, when adverse market conditions can create______ that plunges a company into crisis and put its future in jeopardy

Answer 22

a sudden death threat

Question 23

Which of the following accurately reflect the relationship between a company activities and its resources and capabilities?

Answer 23

• Continuous investment of resources in value chain activities leads to the creation of a competence
• Prioritizing a competitive capability transforms it into a core competence
• Value -creating activities contribute to the formation and development of capabilities

Question 24

In order for managers to guide a company’s

strategy successfully, they must first identify its

Answer 24

Market opportunities

Question 25

Resources and capabilities are difficult for competitors to replicate when they

Answer 25

- are unique - required large-scale operations - take time to build up

Question 26

Something a firm does well or a quality it has that increases it competitiveness in the marketplace is a

Answer 26

strength

Question 27

The process of comparing the performance of numerous value chain activities across multiple types of companies to assess the cost and effectiveness of these activities is called

Answer 27

benchmarking

Question 28

The clothing retailer Patagonia remains a competitive with a customer value proposition that focuses on which of the following ?

Answer 28

- corporate environmental responsibility | - high quality

Question 29

How can managers improve a firms customer value proposition and enhance differentiation?

Answer 29

- Adopt best practices - Introduce new technologies - relocate high-cost activities

Question 30

A(n) ________ competence is a key activity that a company executes better than its rivals

Answer 30

distinctive

Question 31

When company resources and capabilities reflects a high level of social complexity?

Answer 31

- internal company culture - trust-based relations with customers - interpersonal relationships between managers

Question 32

a competitive strength assessment utilizes which of the following test of analyses?

Answer 32

- SWOT analysis - value chain analysis - benchmarking

Question 33

To improve a company's cost competitiveness, mage

Answer 33

- outsource activities - implement best practices throughout the company - use new technologies to redesign products

Question 34

A true capability of a company that is performed consistently well and at an acceptable level of cost is called a(n) ______

Answer 34

competence

Question 35

Threats to a company's profitability and competitive well being can arise from which of the following external factors

Answer 35

- the emergence of lower cost or improved technologies - burdensome new regulation - unfavorable demographic shifts

Question 36

The total amount a company spends on the primary and support activities that make up its value chain defines its

Answer 36

internal cost structure

Question 37

to be considered legitimate, a best practice must be unusually effective in which of the following ways?

Answer 37

- in improving performance - in lowering costs - in enhancing safety

Question 38

A companys strategy should always be based on

Answer 38

the companys internal strengths

Question 39

Which of the following are aspects of customer value proposition that have allowed Patagonia to remain competitive with other outerwear companies with cheaper prices?

Answer 39

- wide selection - environmental commitment - quality of merchandise

Question 40

What techniques can a company use to identify its cost or value disadvantages when compared to key competitors

Answer 40

- value chain analysis | - benchmarking

Question 41

Although it is an important way for a company to evaluate its business practices relative to other firms, the greatest barrier to benchmarkig is ____ the necessary information

Answer 41

gaining access to

Question 42

A company's sales revenues minus the cost of goods sold, divided by the sales revenues, is called the company's___ margin

Answer 42

gross profit

Question 43

The value of performing a detailed competitive strength assessment is that it allows a company to

Answer 43

- Plan offensive and defensive strategies - address vulnerabilities - pinpoint competitors relative weaknesses.

Question 44

How can a company use the information it has gleaned from bechmarking and value chain analysis?

Answer 44

- Enhance competitiveness - improve profitability - eliminate its own cost or value disadvantages

Question 45

Debt to equity long term debt to capital, and total debt to assets are all examples of____ ratios

Answer 45

leverage

Question 46

the value chains of a company's distribution-channel partners are significant because they directly affect which of the following ?

Answer 46

- sales volumes - retail prices - customer satisfaction

Question 47

A company is better able to fend of competition when it provides ____ than its rivals

Answer 47

higher customer value

Question 48

What qualities help create differentiation based on quality, which improves a company's competitive advantage?

Answer 48

- status - innovation - design - image

Question 49

How can a company reduce cost disadvantages associated with supplier-related value chain activities?

Answer 49

- identify ways the company and suppose can both reduce costs - switch to less expensive materials - negotiate lower prices from suppliers

Question 50

how can a company enhance differentiation at the forward end of the value chain system?

Answer 50

- Set standards and train channel partners to implement them - participate in cooperative advertising - offer incentives to downstream partners to enhance customer value

Question 51

Aggressive price cutting to win customers away from a rival can be risky for which of the following reasons?

Answer 51

- Rivals with stronger relative cost positions might be able to better survive a price war - other competitors might interpret such a move as an attack

Question 52

the operating income of a company divided by its interest expenses is called the ___ ratio

Answer 52

times-interest-earned

Question 53

How can a company use its supplier relationships to bolster its customers value proposition?

Answer 53

- Choose suppliers that have higher standards - offer suppliers quality-based incentives - integrate suppliers into the design process

Question 54

Which of the following are example of what can be learned form using value chain analysis

Answer 54

- The differences in how competitors perform specific activities - a company's capacity for differentiation - the competitive differences between rivals

Question 55

how can a company improve cost competitiveness on the distribution side of its value chain?

Answer 55

- Encourage forward channel allies to reduce their costs and markups - change to a more cost-effective distribution strategy - collaborate with distributors to find win-win cost reduction strategies

Question 56

Companies that have successfully managed their value chains to produce cost based market advantages include

Answer 56

- Nucor steel - carrefour - ryanair

Question 57

What analytic tools are helpful in evaluating the competitiveness of a company's cost and customer value proposition?

Answer 57

- benchmarking | - value chain analysis

Question 58

which three of the following types of market opportunities are the most relevant for a company to pursue?

Answer 58

- Market opportunities that offer the best chances for profitability - market opportunities that offer the best chances for growth - market opportunities that match up with the company's competitive assets

Question 59

detailed examination of a company's value chain, including its customers value proposition and business model, allows for evaluation of which of the following ?

Answer 59

- Cost structure and pricing - capabilities that enhance differentiation - profit margin