Question 1

Which of the following is NOT a factor affecting sustainability of a competitive advantage?
A) The availability of substitutes for a firm's core competence.
B) The rate at which obsolescence of the core competence occurs because of environmental changes.
C) The imitability of a core competence.
D) The length of time the core competence has existed.

Accepted Answer

The length of time the core competence has existed is not a factor affecting sustainability of a competitive advantage. Rather, it is the other factors listed (availability of substitutes, rate of obsolescence, and imitability) that impact the sustainability of a competitive advantage.

Question 2

The proper matching of what a firm can do with what it might do
A) balances the internal characteristics of the firm with the characteristics of the external environment.
B) overcomes the rigidity and inertia resulting from a history of success.
C) yields insights the firm requires to select its strategy.
D) develops core competencies based on human knowledge.

Accepted Answer

The answer of The proper matching of what a firm...

Question 3

The three conditions that characterize difficult managerial decisions concerning resources, capabilities, and core competencies are
A) complexity, rarity, and human intellectual capital.
B) uncertainty, complexity, and intraorganizational conflicts.
C) imitability, complexity, and interorganizational conflicts.
D) imitability, comparability, and human intellectual capital.

Accepted Answer

The three conditions that characterize difficult managerial decisions concerning resources, capabilities, and core competencies are uncertainty, complexity, and intraorganizational conflicts. Uncertainty arises from the lack of information or predictability of outcomes, complexity arises from the interconnectedness of different factors influencing the decision, and intraorganizational conflicts arise from competing interests and diverse perspectives within the organization. The other answer choices either do not accurately capture the three conditions or include additional factors that are not relevant.

Question 4

____ is measured by a product's performance characteristics and its attributes for which customers are willing to pay.
A) Competitive advantage
B) Profit potential
C) Contribution
D) Value

Accepted Answer

Value is the measure of a product's performance characteristics and attributes for which customers are willing to pay. This is an important concept in business as companies strive to create value for their customers in order to gain a competitive advantage and increase profit potential.

Question 5

Internal analysis enables a firm to determine what the firm
A) can do.
B) should do.
C) will do.
D) might do.

Accepted Answer

Internal analysis helps a firm identify its resources, capabilities, strengths, and weaknesses. This information enables a firm to determine what it can do in terms of leveraging its strengths and addressing its weaknesses. Internal analysis does not necessarily provide guidance on what a firm should do, will do, or might do.

Question 6

A decision that results in failure
A) is a career-ending event because it is so unusual.
B) often results from lack of accountability.
C) fosters organizational inertia.
D) allows for learning.

Accepted Answer

A decision that results in failure allows for learning opportunities. It is important for individuals and organizations to reflect on their failures, identify the reasons for the failure, and use this information to inform future decision-making processes. Only by learning from failures can individuals and organizations improve and grow.

Question 7

According to the Chapter 3 Opening Case, all of the following are core competencies of Subway EXCEPT
A) Providing continuous training for its franchisees and those working within those units.
B) Offering healthy and nutritious products to consumers.
C) The challenging economic environment in which even affluent consumers are choosing to dine at quick-service restaurants such as Subway.
D) Use of nontraditional locations such as appliance stores, automobile showrooms, and zoos.

Accepted Answer

The opening case of Chapter 3 discusses the core competencies of Subway, which includes providing continuous training, offering healthy and nutritious products, and utilizing nontraditional locations. However, the case does not mention the challenging economic environment as a core competency of Subway.

Question 8

It is increasingly difficult for a firm to develop and sustain a competitive advantage because of the effects of globalization and
A) the rapid development of the Internet's capabilities.
B) extensive use of outsourcing within the borders of the U.S.
C) the declining number of inventions and patents developed by U.S. citizens.
D) the simultaneous erosion of the U.S. work ethic and the U.S. education system.

Accepted Answer

The rapid development of the Internet's capabilities has led to increased competition as firms can now easily reach global markets and compete with firms from around the world. This has made it increasingly difficult for firms to develop and sustain a competitive advantage.

Question 9

As discussed in the Chapter 3 Strategic Focus, CEOs of companies such as Viacom, the Oprah Winfrey Network, the Gap, and Cisco frequently had to make decisions about __________________ and the success of those decisions affected the tenure of those CEOs.
A) how to please customers
B) how to best rivals
C) use of the firm's resources
D) their method of compensation

Accepted Answer

The CEOs had to make decisions about the use of the firm's resources, which ultimately affected the success of the company and the CEO's tenure. This is highlighted in the chapter as a key strategic focus for CEOs. While pleasing customers and competing with rivals are important factors in decision making, they are not the specific focus mentioned in this context. The CEO's method of compensation may be relevant, but it is not emphasized in the given context.

Question 10

By emphasizing core competencies when formulating strategies, companies learn to compete primarily on the basis of
A) intangible resources.
B) their primary activities.
C) firm-specific differences.
D) efficiency of production.

Accepted Answer

By emphasizing core competencies, companies focus on those areas in which they have firm-specific differences, which enables them to compete on a unique basis rather than solely on factors such as efficiency of production or primary activities. This can lead to a sustainable competitive advantage.

Question 11

A person who has made a successful decision when no obviously correct model or rule is available or when relevant data are unreliable or incomplete has exercised
A) foresight.
B) judgment.
C) effective strategic thinking.
D) decisiveness.

Accepted Answer

Making a successful decision when there is no obviously correct model or rule and unreliable or incomplete data requires the ability to exercise judgment. Judgment involves carefully evaluating the available information and using one's expertise, experience, and intuition to make a well-informed decision. Foresight, effective strategic thinking, and decisiveness can all be important in decision-making, but without good judgment, these qualities may not lead to successful outcomes.

Question 12

Value consists of
A) A product's proprietary characteristics and by its attributes for which customers are willing to pay.
B) A product's performance characteristics and by its attributes for which customers are willing to pay.
C) A product's proprietary characteristics and by its attributes for which customers consider paying for.
D) A product's performance characteristics and by its attributes for which customers consider paying for.

Accepted Answer

Value is determined by a product's performance characteristics and attributes for which customers are willing to pay. Proprietary characteristics may contribute to value, but they are not the sole determinant. Customers must be willing to pay for the attributes and characteristics for them to add value to the product.

Question 13

The key to achieving competitiveness, earning above-average returns, and remaining ahead of competitors in the long run is to manage current core competencies
A) in a way that uniquely bundles and leverages the firm's existing resources.
B) while simultaneously developing new ones.
C) and imitate the core competencies of successful competitors.
D) in order to preserve and enhance them against the firm's competitors.

Accepted Answer

Simply preserving current core competencies won't ensure long-term success. Developing new competencies while managing current ones is necessary for a company to remain competitive and earn above-average returns.

Question 14

____ is/are the source of a firm's ____, which is/are the source of the firm's ____.
A) Resources, capabilities, core competencies
B) Capabilities, resources, core competencies
C) Capabilities, resources, above average returns
D) Core competencies, resources, competitive advantage

Accepted Answer

The answer of ____ is/are the source of a firm's...

Question 15

Today, a substantially slimmed-down Polaroid is introducing a number of new products including GL20 Camera Glasses which have a built-in camera and LCDs. This wave of new product development is explained by
A) the funds provided by a patent infringement lawsuit won by Poloroid.
B) weaker competitors in its industry.
C) the learning that occured from making earlier mistakes.
D) an easing of regulations governing Intellectual Propery Protection.

Accepted Answer

The introduction of new products after a period of restructuring and downsizing suggests that the company has learned from its earlier mistakes and is now in a better position to develop and market new products. The other options do not have any direct relevance to the company's product development strategy.

Question 16

____ of organizational decisions fail.
A) Few
B) About one-quarter
C) About half
D) Most

Accepted Answer

Research suggests that about half of organizational decisions fail due to various reasons such as flawed decision-making processes, insufficient data analysis, lack of communication and collaboration, among others.

Question 17

One reason executive judgment can be a particularly important source of competitive advantage is that judgment
A) allows a firm to build a strong reputation.
B) gains the loyalty of shareholders.
C) increases human intellectual capacity.
D) allows for superior bundling of resources.

Accepted Answer

Executive judgment can be an important source of competitive advantage because it allows a firm to build a strong reputation. A company with a reputation for consistently making sound judgments and decisions is more likely to attract investors, customers, and talented employees, which can give it an edge over its competitors. Additionally, a strong reputation may also allow a company to charge higher prices for its products or services, further strengthening its competitive position in the market.

Question 18

Which of the following is not a component of internal analysis leading to competitive advantage?
A) Tangible and intangible resources.
B) Analysis of supplier power.
C) Capabilities.
D) Core competencies.

Accepted Answer

Analysis of supplier power is related to external analysis, specifically Porter's Five Forces. The rest of the choices are components of internal analysis leading to competitive advantage.

Question 19

Which of the following is NOT required for a firm to achieve strategic competitiveness and earn above-average returns from its core competencies?
A) Core competencies must be acquired.
B) Core competencies must be bundled.
C) Core competencies must be internationalized.
D) Core competencies must be leveraged.

Accepted Answer

The answer of Which of the following is NOT required...

Question 20

The overall lesson from the Chapter 3 Strategic Focus about decision-making at several companies was the importance of _________
A) CEO compensation.
B) the effect of unattractive industries on firm performance.
C) making decisions about use of the firm's resources under conditions of uncertainty.
D) competing against innovative rivals.

Accepted Answer

The chapter highlights the importance of making decisions under uncertain conditions and the strategies different companies use to mitigate risks and increase opportunities. CEO compensation, industry attractiveness, and competition with innovative rivals were also discussed but were not the main lesson.

Quiz 3: The Internal Organization: Resources, Capabilities, Core Competencies, and Competitive Advantages

Which of the following is NOT a factor affecting sustainability of a competitive advantage?

The proper matching of what a firm can do with what it might do

The three conditions that characterize difficult managerial decisions concerning resources, capabilities, and core competencies are

____ is measured by a product's performance characteristics and its attributes for which customers are willing to pay.

Internal analysis enables a firm to determine what the firm

A decision that results in failure

According to the Chapter 3 Opening Case, all of the following are core competencies of Subway EXCEPT

It is increasingly difficult for a firm to develop and sustain a competitive advantage because of the effects of globalization and

As discussed in the Chapter 3 Strategic Focus, CEOs of companies such as Viacom, the Oprah Winfrey Network, the Gap, and Cisco frequently had to make decisions about __________________ and the success of those decisions affected the tenure of those CEOs.

By emphasizing core competencies when formulating strategies, companies learn to compete primarily on the basis of

A person who has made a successful decision when no obviously correct model or rule is available or when relevant data are unreliable or incomplete has exercised

Value consists of

The key to achieving competitiveness, earning above-average returns, and remaining ahead of competitors in the long run is to manage current core competencies

is/are the source of a firm's , which is/are the source of the firm's .

Today, a substantially slimmed-down Polaroid is introducing a number of new products including GL20 Camera Glasses which have a built-in camera and LCDs. This wave of new product development is explained by

____ of organizational decisions fail.

One reason executive judgment can be a particularly important source of competitive advantage is that judgment

Which of the following is not a component of internal analysis leading to competitive advantage?

Which of the following is NOT required for a firm to achieve strategic competitiveness and earn above-average returns from its core competencies?

The overall lesson from the Chapter 3 Strategic Focus about decision-making at several companies was the importance of _________