Deck 3: Assessing the Internal Environment of the Firm

Question 1

Inbound logistics include

A) machining and packaging.
B) warehousing and inventory control.
C) repair and parts supply.
D) promotion and packaging.

Answer 1

B

Question 2

A marketing department that promises delivery faster than the production department's ability to produce is an example of a lack of understanding of the

A) interrelationships among functional areas and firm strategies HYPERLINK "" .
B) need to maintain the reputation of the company.
C) organizational culture and leadership.
D) synergy of the business units.

Answer 2

A

Question 3

_____ are associated with collecting,storing,and distributing the product or service to buyers.They consist of warehousing,material handling,delivery operation,order processing,and scheduling.

A) Services
B) Inbound logistics
C) Outbound logistics
D) Operations

Answer 3

C

Question 4

_____ are the competencies or skills that a firm employs to transform inputs into outputs.

A) Tangible resources
B) Intangible resources
C) Reputational resources
D) Organizational capabilities

Question 5

Which of the following lists consists of support activities?

A) Human resource management, technology development, customer service, and procurement
B) Human resource management, customer service, marketing and sales, and operations
C) Human resource management, information systems, procurement, and firm infrastructure
D) Customer service, information systems, technology development, and procurement

Question 6

For a resource to provide a firm with the potential for a sustainable competitive advantage,it must have the following four attributes

A) Rare, valuable, mobile, and nonsubstitutable.
B) Rare, inimitable, physically unique, and nonsubstitutable.
C) Rare, valuable, inimitable, and nonsubstitutable.
D) Rare, valuable, physically unique, and causally ambiguous.

Question 7

Advertising is a _____ activity.Supply of replacement parts is a _____ activity.

A) primary; primary
B) support; primary
C) support; secondary
D) primary; support

Question 8

In assessing its primary activities,an airline would examine

A) employee training programs.
B) baggage handling.
C) criteria for lease versus purchase decisions.
D) the effectiveness of its lobbying activities.

Question 9

Assessment of a firm's primary activities should include analysis of all of the following except

A) inbound logistics.
B) operations.
C) human resources
D) marketing and sales.

Question 10

Human resource management consists of activities involved in the recruiting,hiring,training,development,and compensation of all types of personnel.It

A) supports only individual primary activities.
B) supports only individual support activities.
C) supports both individual primary and support activities and the entire value chain.
D) supports mostly support activities but does have some impact on primary activities.

Question 11

Which of the following is a support activity?

A) Inbound logistics
B) Operations
C) Technology development
D) Customer service

Question 12

Which of the following is not an advantage of Just-In-Time inventory systems?

A) Reduced raw material storage costs
B) Minimized idle production facilities and workers
C) Reduced work-in-process inventories
D) Reduced dependence on suppliers

Question 13

The three key types of resources that are central to the resource-based view of the firm are

A) tangible resources, intangible resources, and organizational structure.
B) culture, tangible resources, and intangible resources.
C) tangible resources, intangible resources, and organizational capabilities.
D) tangible resources, intangible resources, and top management.

Question 14

According to value chain analysis,which of the following would be considered part of a firm's infrastructure?

A) Human resource management
B) Information systems
C) Technology development
D) Procurement

Question 15

Gillette combines several technologies (e.g.,metallurgy,physiology,physics)to attain unparalleled success in the wet shaving industry.This is an example of their

A) tangible resources.
B) intangible resources.
C) organizational capabilities.
D) strong primary activities.

Question 16

For firms such as Campbell Soup Company,information systems have been a source of competitive advantage by enabling them to

A) forecast future demand.
B) replenish products in a timely manner.
C) monitor inventories in distribution centers.
D) all of these are correct.

Question 17

The resource-based view (RBV)of the firm combines two perspectives

A) the primary and support activities of the firm.
B) the interrelationships among the primary activities of the firm and corporate management.
C) the internal analysis of the firm as well as the external analysis of the industry and competitive environment.
D) the industry and the competitive environment.

Question 18

Customer service would include

A) product promotion.
B) product distribution.
C) parts supply.
D) procurement of critical supplies.

Question 19

To create an intangible resource that cannot be easily copied,Canadian retailer Holt Renfrew combines

A) real estate and store fixtures.
B) brand name and experienced staff.
C) accumulated reputation for quality.
D) all of these are correct

Question 20

Which of the following would be most difficult to assess?

A) The liquidity position of a firm
B) The legitimacy and reputation of a firm
C) Market share growth
D) The efficiency with which a firm utilizes its assets

Question 21

The following are examples of socially complex organizational phenomena except

A) a firm's culture
B) interpersonal relations among a firm's managers
C) complex physical technology
D) reputation with suppliers and customers

Question 22

Historical comparisons provide information to managers about changes in a firm's competitive position.Historical comparisons are often misleading

A) if the overall strategy of the firm is the same.
B) in periods of recession or economic boom.
C) if the firm shows constant growth.
D) if the firm's stock is publicly traded.

Question 23

Which of these categories of financial ratios is used to measure a company's ability to meet its short-term financial obligations?

A) Leverage ratios
B) Profitability ratios
C) Activity ratios
D) Liquidity ratios

Question 24

A resource is valuable and rare but neither difficult to imitate nor without substitutes.This should enable the firm to attain

A) no competitive advantage.
B) competitive parity.
C) a temporary competitive advantage.
D) a sustainable competitive advantage.

Question 25

An important implication of the "balance scorecard" approach is that

A) managers need to recognize tradeoffs in stakeholder demands and realize that such demands represent a "zero-sum" game in which one stakeholder will gain only at another's loss
B) the key emphasis on customer satisfaction and financial goals are only a means to that end
C) managers should not look at their job as primarily balancing stakeholder demands; increasing satisfaction among multiple stakeholders can be achieved simultaneously
D) gains in financial performance and customer satisfaction must often come at a cost of employee satisfaction

Question 26

The balanced scorecard enables managers to consider their business from all of the following perspectives except

A) customer perspective.
B) internal business perspective.
C) innovation and learning perspective.
D) ethical perspective.

Question 27

How should managers assess changes in their firm's competitive position in their industries during a period of unusual economic growth?

A) Compare the firm's financial ratios with ratios of firms in other strategic groups in the industry.
B) Compare the firm's financial ratios over the most recent one-year period.
C) Compare the financial ratios of all firms in the country's industry-some of whom serve very diverse market segments and have specialized accordingly.
D) Compare the financial ratios of firms in the company's strategic group.

Question 28

Value chain analysis assumes that a firm's basic economic purpose is to create value and it is a useful framework for analyzing a firm's strengths and weaknesses.

Question 29

A variety of firm resources include interpersonal relations among managers in the firm,its culture,and its reputation with its suppliers and customers.Such competitive advantages are based upon

A) social complexity.
B) path dependency.
C) physical uniqueness.
D) tangible resources.

Question 30

A competitive advantage based on inimitability can be sustained for at least some time if it has the following characteristics

A) Physical uniqueness, path dependency, causal ambiguity, and social complexity.
B) Psychographic uniqueness, path dependency, causal ambiguity, and substitutability.
C) Rarity, path dependency, causal ambiguity, and social substitutability.
D) Geographic uniqueness, cause dependency, social ambiguity, and path complexity.

Question 31

Campbell's Soup uses continuous replenishment for the Loblaw stores it supplies in Canada.

Question 32

A meaningful ratio analysis

A) must go beyond the calculation and interpretation of financial ratios.
B) is based primarily on leverage ratios.
C) involves only liquidity ratios.
D) involves profitability ratios at a single point in time.

Question 33

A crash R&D program by one firm cannot replicate a successful technology developed by another firm when research findings cumulate.This is an example of

A) social complexity.
B) path dependency.
C) physical uniqueness.
D) causal ambiguity.

Question 34

The "balanced scorecard" developed by Kaplan and Norton helps to integrate

A) financial analysis and a firm's reputation.
B) intangible resources and operational measures.
C) financial analysis and stakeholder perspectives.
D) short-term perspectives and strategic positioning.

Question 35

In value chain analysis,value is measured by market value of the total stock outstanding of the company.

Question 36

Primary activities contribute to the physical creation of a product or service,its sale and transfer to the buyer,and its service after the sale.

Question 37

Performing a value chain analysis provides a complete assessment of the firm's strengths and weaknesses.

Question 38

The "balanced scorecard" provides top managers with a _____ view of the business.

A) detailed and complex
B) fast but comprehensive
C) simple and routine
D) long-term financial

Question 39

The value chain concept assumes that both primary and support activities are capable of producing value for customers.

Question 40

The best measure of a company's ability to meet imminent financial obligations is known as the

A) current ratio.
B) total asset turnover.
C) debt ratio.
D) profit margin.

Question 41

A firm's intangible resources refer to its capacity to deploy tangible resources over time and leverage those resources effectively.

Question 42

What are the key advantages of value chain analysis over SWOT analysis?

Question 43

Path dependency has no impact on the inimitability of resources.

Question 44

Historical comparisons are most appropriate during periods of recession or economic boom.

Question 45

Leverage ratios provide measures of a firm's capacity to meet its long-term financial obligations.

Question 46

Establishing a customer service hotline to handle customer complaints would be considered a primary activity in value chain analysis.

Question 47

An increase in profits indicates an improvement in cash flow.

Question 48

Products and services that are difficult to imitate help firms sustain their profitability.

Question 49

A primary benefit of the "balanced scorecard" is that it complements financial indicators with operational measures of customer satisfaction,internal processes,and the organization's innovation and improvement activities.

Question 50

Financial analysis provides an accurate way to assess the relative strengths of firms and can be used as a complete guide to study companies.

Question 51

For a resource to provide a firm with potential sustainable advantages it must satisfy only two criteria: rareness and difficulty in substitution.

Question 52

An important implication of the balanced scorecard is that managers need not look at their job as primarily balancing stakeholder demands.

Question 53

Tangible resources are assets that are relatively easy to identify such as financial and physical assets.

Question 54

Capabilities that are causally ambiguous are difficult to imitate.

Question 55

What are some of the key strengths and limitations of SWOT analysis?

Question 56

When using industry norms as a standard of comparison,managers must be sure that the firms used in the comparisons are representative of all sizes and strategies within the industry.

Question 57

Technology development is a much broader concept than research and development.

Question 58

The balanced scorecard enables managers to evaluate their business from only two perspectives: customer and financial.

Question 59

Managers should focus their attention on interrelationships among value chain activities within the firm-not on relationships among activities within the firm and other organizations (such as suppliers and customers).

Question 60

In value chain analysis,general management is considered part of a firm's infrastructure.

Question 61

What are the benefits and limitations of making historical comparisons in analyzing a firm's performance?

Question 62

What are some ways in which a firm's general administration can help create (or enhance)competitive advantages?

Question 63

What are some of the most important implications of using the "balanced scorecard" approach?

Question 64

What are the four perspectives that the "balanced scorecard" enables managers to evaluate their business?

Question 65

The resource-based view (RBV)combines both the internal analysis of the firm and the external analysis of the environment.Discuss and provide examples.

Question 66

How can a firm develop (or enhance)its advantages in the marketplace by having strong,positive interrelationships among its value chain activities and those of its suppliers and customers? Provide an example.

Question 67

Explain the four attributes that a resource must have to provide a firm with a sustainable competitive advantage.