Deck 5: Internal Scanning and Organizational Analysis

Question 1

Since competitors were not able to understand how Gillette's Mach 3 razor was produced, it was considered transparent.

Answer 1

False

Question 2

A company's center of gravity is usually the point at which the company started.

Answer 2

True

Question 3

Durability is the rate at which a firm's underlying resources and capabilities (core competencies)can be duplicated by others.

Answer 3

False

Question 4

Tacit knowledge is knowledge that can be easily communicated or articulated and as result can be easily imitated.

Question 5

Resources are the organization's assets and are the basic building blocks of the organization.

Question 6

Core competencies may mature and become core deficiencies.

Question 7

The resources of an organization include tangible assets, human assets, and intangible assets.

Question 8

New product development would be a core competency if it goes beyond one division.

Question 9

General Electric is well known for its distinctive competency in management development.

Question 10

According to Porter, a manufacturing firm's support activities usually begin with inbound logistics, go through an operations process in which a product is manufactured, and continue on to outbound logistics and finally to service.

Question 11

Capabilities refer to a corporation's ability to exploit its resources.

Question 12

A functional structure is appropriate for a medium sized firm with several product lines in one industry.

Question 13

An example of a cluster in the US is found in the Silicon Valley.

Question 14

eBay and Amazon.com have successfully used the efficiency model by acting as an intermediary to connect multiple sellers to multiple buyers.

Question 15

Two characteristics that determine the sustainability of a firm's distinctive competency are durability and transparency.

Question 16

A value chain is a linked set of value-creating activities.

Question 17

A company's center of gravity is the part of the value chain that is most important to the company and the point where its greatest expertise and core competencies lie.

Question 18

When a company uses the same marketing channel for two separate products, this is an example of an economy of scope.

Question 19

Transferability is the ability of competitors to use duplicated resources and capabilities to imitate the other firm's success.

Question 20

A core competency can be easily imitated to the extent that it is transparent, transferable, and replicable.

Question 21

A company's capability in product R & D can be measured by consistent reductions in unit manufacturing costs and by the number of product defects.

Question 22

It is generally accepted that product R & D normally dominates the early stages of a product's life cycle, whereas process R & D becomes especially important in the later stages.

Question 23

A good rule of thumb for R & D spending is that a corporation should spend at a "normal" rate for that particular industry unless its strategic plan calls for unusual expenditures.

Question 24

Using concurrent engineering, Chrysler Corporation was able to reduce its product development cycle from 60 to 36 months.

Question 25

The marketing mix refers to the particular combination of key variables under the corporation's control that can be used to affect demand and to gain competitive advantage.

Question 26

Cultural integration is the degree to which members of a unit accept the norms, values, or other culture content associated with the unit.

Question 27

When employees across the organization hold the same cultural values and norms, this demonstrates a high level of cultural integration.

Question 28

Historically, competitive leadership in a market changes hands as one technology nears the end of its S-curve.

Question 29

To increase flexibility, avoid layoffs, and reduce labor costs, corporations are using more contingent workers.

Question 30

The corporate culture generally reflects the values of the founder(s)and the mission of the firm.

Question 31

Those critical strengths and weaknesses that are likely to determine if a firm will be able to take advantage of opportunities while avoiding threats are called

A)SWOT.
B)competitive forces.
C)internal strategic factors.
D)quality accounting.
E)factor analysis.

Question 32

Research reveals a positive relationship between corporate reputation and financial performance.

Question 33

A divisional structure has no functional or product categories and is appropriate for a small, entrepreneur-dominated company with one or two product lines that operates in a reasonably small, easily identifiable market niche.

Question 34

A current trend in corporate information systems is the increasing use of the Internet for marketing, intranets for internal communication, and extranets for logistics and distribution.

Question 35

The product life cycle enables a marketing manager to examine the marketing mix of a particular product or group of products in terms of its position in its life cycle.

Question 36

An example of an intermittent manufacturing system is an auto body repair shop.

Question 37

Flexible manufacturing permits the low-volume output of custom-tailored products at relatively low unit costs through economies of scope.

Question 38

The EFAS Table is one way to organize the internal factors into generally accepted categories of strengths and weaknesses as well as to analyze how well a particular company's management is responding to these specific factors in light of the perceived importance of these factors to the company.

Question 39

Research indicates that greater financial leverage has a positive impact on performance for firms in dynamic environments.

Question 40

Intermittent manufacturing systems reap benefits from economies of scale.

Question 41

Knowledge that is not easily communicated because it is deeply rooted in employee experience or in a corporation's culture is called

A)tacit knowledge.
B)explicit knowledge.
C)imitable knowledge.
D)transferable knowledge.
E)durable knowledge.

Question 42

The business model used by IBM to make money not selling IBM products, but by selling its expertise to improve their customers operations is the

A)profit pyramid model.
B)advertising model.
C)customer solutions model.
D)efficiency model.
E)entrepreneurial model.

Question 43

The ability of competitors to use duplicated resources and capabilities to imitate the other firm's success is called

A)imitability.
B)durability.
C)transferability.
D)transparency.
E)replicability.

Question 44

According to Barney's VRIO framework, the exploitation of a resource pertains to the ________ of the resource.

A)value
B)rareness
C)imitability
D)organization
E)durability

Question 45

________ is more valuable because it can provide companies with a sustainable competitive advantage that is harder for competitors to imitate.

A)Tacit knowledge
B)Explicit knowledge
C)Imitable knowledge
D)Transferable knowledge
E)Durable knowledge

Question 46

When a company's core competencies are superior to those of competitors, these are known as

A)resources.
B)distinctive competencies.
C)core competencies.
D)critical success factors.
E)key performance factors.

Question 47

The speed with which other firms can understand the relationship of resources and capabilities supporting a successful firm's strategy is called

A)imitability.
B)reverse engineering.
C)transferability.
D)transparency.
E)durability.

Question 48

The part of an industry's value chain that is most important to a company and the point where its greatest expertise and capabilities lie is called the company's

A)functional crossroads.
B)center of gravity.
C)dynamic equilibrium.
D)R&D intensity.
E)economy of scope.

Question 49

Which of the following is NOT one of the four question areas Barney proposes in his VRIO framework used to evaluate a firm's key resources?

A)durability
B)organization
C)rareness
D)value
E)imitability

Question 50

When a company takes apart a competitor's product in order to find out how it works, this process is known as

A)durability.
B)replicability.
C)reverse engineering.
D)transparency.
E)transferability.

Question 51

A linked set of value-creating activities beginning with basic materials provided by suppliers and ending with distributors getting the final product into the hands of the ultimate consumer is called a(n)

A)value chain.
B)continuum of sustainability.
C)strategic capability.
D)fully integrated activity set.
E)a strategic group.

Question 52

Knowledge that can be easily articulated and communicated is known as

A)tacit knowledge.
B)explicit knowledge.
C)imitable knowledge.
D)transferable knowledge.
E)durable knowledge.

Question 53

The business model used by HP in selling printers and printer cartridges is the

A)profit pyramid model.
B)advertising model.
C)customer solutions model.
D)efficiency model.
E)multi-component system/installed base model.

Question 54

Things that a corporation can do exceedingly well across the corporation are called

A)resources.
B)distinctive competencies.
C)core competencies.
D)critical success factors.
E)key performance factors.

Question 55

The rate at which a firm's underlying resources and capabilities depreciate or become obsolete is called

A)replicability.
B)transparency.
C)imitability.
D)durability.
E)transferability.

Question 56

When a company determines a competency's competitive advantage, Barney refers to this issue as

A)value.
B)rareness.
C)imitability.
D)organization.
E)durability.

Question 57

The rate at which a firm's underlying resources, capabilities, or core competencies can be duplicated by others is called

A)replicability.
B)transparency.
C)imitability.
D)durability.
E)transferability.

Question 58

A corporation's ability to exploit its resources is referred to as its

A)resources.
B)capabilities.
C)core competencies.
D)critical success factors.
E)key performance factors.

Question 59

On the continuum of resource sustainability, where would Sony's Walkman be placed?

A)slow-cycle resources
B)sustainable resources
C)standard-cycle resources
D)fast-cycle resources
E)down-cycle resources

Question 60

Which of the following statements is true concerning clusters?

A)The desire to build or upgrade a core competency is one reason why entrepreneurial and other fast-growing firms often tend to locate close to their competitors.
B)Clusters are geographic concentrations of interconnected companies and industries.
C)An example of a cluster in the U.S. is California's Silicon Valley.
D)According to Porter, clusters provide access to employees, suppliers, specialized information, and complementary products.
E)all of the above

Question 61

Through market research, corporations can target their various products or services so that management can discover what niches to seek or develop, and how to minimize competitive pressure.This is descriptive of

A)marketing position.
B)product life cycle.
C)market segmentation.
D)marketing mix.
E)marketing leverage.

Question 62

A graph showing time plotted against the dollar sales of a product as it moves from introduction through growth and maturity to decline is called the

A)marketing position.
B)product life cycle.
C)market segmentation.
D)marketing mix.
E)marketing leverage.

Question 63

The particular combination of product, place, promotion, and price is called

A)marketing position.
B)product life cycle.
C)market segmentation.
D)marketing mix.
E)marketing leverage.

Question 64

Which of the following is NOT a primary activity of the value chain?

A)raw materials handling
B)installation
C)repair
D)purchasing
E)warehousing

Question 65

Which of the following describes a typical functional structure?

A)Employees tend to be specialists in the business functions important to that industry such as manufacturing, marketing, finance, and human resources.
B)This is most appropriate for large corporations with many product lines in several related industries, with employees acting as specialists attempting to gain synergy among divisional activities.
C)This is most appropriate for small, entrepreneur-dominated companies with one or two product lines that operate in a small niche market, with employees acting as jack-of-all trades.
D)Employees have two or more superiors, a project manager and a functional manager.
E)This is most appropriate for large corporations with many product lines in several unrelated industries, with employees acting as specialists but with no attempt at gaining synergy among the divisions.

Question 66

According to the text, which one of the following is NOT descriptive of a corporation's culture?

A)A corporation's culture is a collection of beliefs, expectations, and values learned and shared by corporation's members and transmitted from one generation of employees to another.
B)Corporate cultures are only temporary and can be easily changed.
C)Corporate culture norms are created which define acceptable behavior from top management to operative employee.
D)Myths and rituals often emerge over time to explain why a certain aspect of the culture is important.
E)Cultures have a powerful influence on the behavior of managers and can strongly affect a corporation's ability to shift its strategic direction.

Question 67

An example of the promotion variable of the marketing mix is

A)advertising.
B)discounts
C)location.
D)services.
E)quality.

Question 68

The second step when analyzing the value-added chain is to

A)identify the legal ramifications and responsibilities of their product or service.
B)examine the linkages among the product's or service's value activities.
C)confirm that all variables have been included and taken into consideration.
D)ensure that quality management is adequately addressed.
E)examine the potential synergies among the corporation's product or business units.

Question 69

When the value chains of two separate products or services share activities, such as the same marketing channels, in order to reduce costs, this is an example of

A)economies of scope.
B)economies of scale.
C)economies of integration.
D)economies of learning.
E)outsourcing.

Question 70

Which of the following statements is true concerning a corporate reputation?

A)It is a widely held perception of a company by the general public.
B)A good corporate reputation can be a strategic resource.
C)There is a positive relationship between corporate reputation and financial performance.
D)Reputation tends to be long-lasting and hard for others to duplicate.
E)all of the above

Question 71

Which one of the following best describes a conglomerate structure?

A)Work is divided into subunits on the basis of such functions as manufacturing, marketing, finance, and human resources.
B)This is most appropriate for large corporations with many product lines in several related industries, with employees acting as functional specialists attempting to gain synergy among divisional activities.
C)This is most appropriate for small, entrepreneur-dominated companies with one or two product lines that operate in a small niche market, with employees acting as jack-of-all trades.
D)Employees have two or more superiors, a project manager and a functional manager.
E)This is most appropriate for large corporations with many product lines in several unrelated industries; unrelatedness prevents any attempt at gaining synergy among the divisions.

Question 72

Which of the following is NOT a function of corporate culture?

A)conveys a sense of identity for employees
B)adds to the stability of the organization as a social system
C)helps generate employee commitment to something greater than themselves
D)keeps people guessing about what to do next
E)serves as a frame of reference for employees to use as a guide for appropriate behavior

Question 73

Which of the following best describes a simple structure?

A)Work is divided into subunits on the basis of such functions as manufacturing, marketing, finance, and human resources.
B)This is most appropriate for large corporations with many product lines in several related industries, with employees acting as functional specialists attempting to gain synergy among divisional activities.
C)This is most appropriate for small, entrepreneur-dominated companies with one or two product lines that operate in a small niche market, with employees acting as jack-of-all trades.
D)Employees have two or more superiors, a project manager and a functional manager.
E)This is most appropriate for large corporations with many product lines in several unrelated industries, with employees acting as functional specialists but with no attempt at gaining synergy among the divisions.

Question 74

Which one of the following best describes a divisional structure?

A)Work is divided into subunits on the basis of such functions as manufacturing, marketing, finance, and human resources.
B)This is most appropriate for large corporations with many product lines in several related industries, with employees acting as functional specialists attempting to gain synergy among divisional activities.
C)This is most appropriate for small, entrepreneur-dominated companies with one or two product lines that operate in a small niche market, with employees acting as jack-of-all trades.
D)Employees have two or more superiors, a project manager and a functional manager.
E)This is most appropriate for large corporations with many product lines in several unrelated industries, with employees acting as functional specialists but with no attempt at gaining synergy among the divisions.

Question 75

What is the attribute of corporate culture that is the degree to which members of a unit accept the norms, values, or other culture content associated with the unit?

A)integration
B)strength
C)intensity
D)coordination
E)unity

Question 76

Which of the following is NOT a support activity of the value chain?

A)procurement
B)technology development
C)human resource management
D)marketing and sales
E)strategic planning

Question 77

When examining the corporate value chain of a particular product or service, which one of the following is NOT one of the PRIMARY activities that usually occur?

A)operations
B)inbound and outbound logistics
C)auditing and accounting
D)marketing and sales
E)customer service

Question 78

The breadth of an organization's culture is also known as

A)cultural integration.
B)cultural diversification.
C)cultural intensity.
D)cultural strategy.
E)cultural prerogative.

Question 79

What are the two distinct attributes of corporate culture?

A)differentiation and integration
B)durability and imitability
C)concern for people and concern for task
D)intensity and integration
E)amount of complexity and tolerance of change

Question 80

Which of the following is a function of corporate culture?

A)It encourages a laissez faire set of attitudes.
B)It encourages flexibility and thus constant change.
C)It conveys a sense of identity for employees.
D)It generates creative approaches to new situations.
E)It focuses employee commitment on their own careers.