Question 1

The learning generated by making and correcting mistakes is generally unimportant to efforts to create new capabilities and core competencies.

Accepted Answer

Learning from mistakes is essential to creating new capabilities and core competencies. Without identifying and correcting mistakes, an organization cannot improve and develop new skills necessary to stay competitive in the marketplace.

Question 2

Creating customer value is the source of the firm's potential to earn above-average returns.

Accepted Answer

Creating customer value is the core of the value proposition of a firm, which enables the firm to differentiate itself from its competitors, build strong customer relationships, and earn above-average returns. Therefore, the statement is true.

Question 3

People are a critical resource for helping organizations learn how to continuously innovate.

Accepted Answer

People bring their knowledge, skills, experiences, and creativity to the organization, which is essential for driving and sustaining innovation. Organizations that invest in their people through training, development, and creating a culture of learning are more likely to successfully innovate over time.

Question 4

Resources are the source of capabilities, some of which lead to the development of core competencies; in turn, some core competencies may lead to competitive advantage.

Accepted Answer

This statement is true as resources are the foundation for developing capabilities, and some of these capabilities may become core competencies that can give a firm a competitive advantage.

Question 5

Firms should seek to continually develop new core competencies because all core competencies have limited life spans.

Accepted Answer

Core competencies are unique capabilities that give a company a competitive advantage. However, these competencies may become outdated, inferior or even irrelevant over time due to changes in technology, customer needs, or market conditions. Therefore, firms should continually develop new core competencies to stay ahead of the competition and remain relevant in the marketplace.

Question 6

The Chapter 3 Strategic Focus illustrates the challenge facing strategic managers in making decisions about the appropriate use of their companies' resources and capabilities. While a number of firms have successfully used resources and capabilities to earn above average returns, others have not been so successful.

Accepted Answer

The statement accurately describes the content discussed in Chapter 3.

Question 7

In today's global economy, traditional factors such as labor costs, access to financial resources and raw materials, and protected or regulated markets are less likely to become core competencies and possibily competitive advantages.

Accepted Answer

With the increase in globalization and technological advancements, traditional factors are becoming less relevant as companies focus on innovation, speed to market, and customer experience as their core competencies and sources of competitive advantage.

Question 8

The sustainability of a competitive advantage depends upon the rate of obsolescence of the core competence, the availability of substitutes for the core competence, and the imitability of the core competence.

Accepted Answer

This statement is true. The sustainability of a competitive advantage depends on various factors, including the rate of obsolescence of the core competence, the availability of substitutes for the core competence, and the imitability of the core competence. If the core competence becomes obsolete quickly, or if there are alternative options available that can replace it, or if it can be easily replicated by competitors, then the competitive advantage may not be sustainable over time.

Question 9

Value is measured by the variable and fixed costs associated with the production and marketing of a particular product compared with the revenue and profits the product generates.

Accepted Answer

The answer of Value is measured by the variable and...

Question 10

Analyzing the internal environment enables a firm to determine what it might do by identifying what opportunities and threats exist.

Accepted Answer

The answer of Analyzing the internal environment enables a firm...

Question 11

A global mind-set is free of the assumptions of a single country, culture, or context.

Accepted Answer

A global mind-set encompasses a broad perspective and open-mindedness that transcends national or cultural boundaries. It recognizes and respects diverse beliefs, practices, and customs, and seeks to understand and learn from them. It is essential for success in today's interconnected and fast-changing world.

Question 12

Walmart uses core competencies such as information technology and distribution channels to create value for its customers through its "everyday low price."

Accepted Answer

Walmart's use of information technology and distribution channels allows them to efficiently manage their inventory and supply chain, ultimately leading to lower costs and the ability to offer "everyday low prices" to its customers. These core competencies are a key factor in Walmart's competitive advantage.

Question 13

Value is created when firms innovately bundle and leverage their resources to form capabilities and core competencies.

Accepted Answer

Value is created when firms are able to combine their resources in a unique and innovative way to create capabilities and core competencies that give them a competitive advantage in the market. This allows them to differentiate their products or services and create value for their customers.

Question 14

The challenge and difficulty of making effective decisions are implied by preliminary evidence suggesting that one-half of organizational decisions fail.

Accepted Answer

The statement implies that making effective decisions is challenging and difficult, and that half of organizational decisions fail. Therefore, the answer is true.

Question 15

The Chapter 3 Opening Case demonstrates that although conditions in the economic environment influenced Subway's success, the manner in which Subway used its resources and capabilities also influenced that success.

Accepted Answer

The opening case clearly shows that Subway's success was influenced by both the economic environment as well as the manner in which it utilized its resources and capabilities.

Question 16

Given enough time, any firm's competitive advantage can be imitated by its competitors.

Accepted Answer

This is known as the law of imitation or law of diffusion of innovation, which suggests that any competitive advantage a firm has will eventually be imitated by its competitors given enough time. Therefore, firms need to constantly innovate and improve to maintain their competitive advantage.

Question 17

Firms achieve strategic competitiveness and earn above average returns by acquiring, bundling, and leveraging their resources for the purpose of taking advantage of opportunities in the external environment in ways that create value for customers.

Accepted Answer

This statement accurately describes how firms can achieve strategic competitiveness and earn above average returns. They must acquire, bundle, and leverage their resources to take advantage of external opportunities and create value for customers.

Question 18

Understanding how to leverage the firm's unique bundle of resources and capabilities is a key outcome decision makers seek when analyzing the internal organization.

Accepted Answer

Leveraging the firm's unique resources and capabilities is a key outcome decision makers seek when analyzing the internal organization. It helps the firm gain a competitive advantage and create value for its stakeholders.

Question 19

Analyzing the internal environment enables a firm to determine what it can do by identifying resources, capabilities, and core competencies in the internal organization.

Accepted Answer

Analyzing the internal environment allows a firm to assess its resources, capabilities, and core competencies, which are all critical factors in determining what the organization can do.

Question 20

The need to meet quarterly earnings numbers disciplines managers to accurately examine the firm's internal organization.

Accepted Answer

The answer of The need to meet quarterly earnings numbers...

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