Question 1

From a competitive standpoint, resource similarity means that the strategic actions your company takes could probably be matched by your direct competitors.

Accepted Answer

Resource similarity between companies means that they have similar resources and capabilities, which could allow them to take similar strategic actions. This increases the likelihood of direct competition and the need for differentiation in order to gain a competitive advantage.

Question 2

A sustainable competitive advantage exists for an organization when other companies have tried unsuccessfully to duplicate the advantage and ____.

Accepted Answer

A sustainable competitive advantage is one that other companies have tried and failed to duplicate. However, this does not necessarily mean that they have been prohibited by law or that the organization has exclusive distribution or operates in the international marketplace. The fact that other companies have stopped trying to duplicate the advantage suggests that the advantage is sustainable in the long-term.

Question 3

The first step in the strategy-making process is to ____.

Accepted Answer

The answer of The first step in the strategy-making process...

Question 4

NTL is the largest cable company in the United Kingdom. The company has recently declared bankruptcy and needs to engage in restructuring in order to give it more flexibility and allow it to raise capital. Since it has identified the need for strategic change, what would be the organization's next step in this strategy-making process?

Accepted Answer

The answer of NTL is the largest cable company in...

Question 5

A(n) ____ is a resource that is impossible or extremely costly or difficult for other firms to duplicate.

Accepted Answer

A resource that is imperfectly imitable means that although other firms may be able to try to replicate it, it is either extremely costly or difficult for them to do so. This makes the resource rare in the sense that it is not readily available to competitors. Nonsubstitutable and strategically dissonant both refer to other aspects of a firm's resources, and reliable is not necessarily related to the uniqueness of a resource.

Question 6

The only kinds of adaptive strategies are defending, analyzing, and reacting.

Accepted Answer

There are four kinds of adaptive strategies: defending, analyzing, prospecting, and reacting.

Question 7

Reactors follow the consistent strategy of anticipating and reacting to potential external opportunities and threats prior to their occurrence.

Accepted Answer

Unlike defenders, prospectors, or analyzers, reactors do not follow a consistent strategy. Furthermore, rather than anticipating and preparing for external opportunities and threats, reactors tend to react to changes in their external environment after they occur.

Question 8

According to the text, valuable, rare, imperfectly imitable resources can produce sustainable competitive advantage only if they are ____ resources.

Accepted Answer

For a firm's resources to provide sustainable competitive advantage they must be rare, imperfectly imitable, and nonsubstitutable.

Question 9

The two factors that determine the extent to which firms will be in direct competition with each other are market commonality and resource similarity

Accepted Answer

Market commonality refers to the degree to which two firms compete in the same geographic or product markets, while resource similarity measures the extent to which two firms possess comparable strategic resources and capabilities. These two factors determine the level of competition between firms.

Question 10

_______ are the assets, capabilities, processes, information, and knowledge that an organization uses to improve its effectiveness and efficiency, to create and sustain competitive advantage, and to fulfill a need or solve a problem.

Accepted Answer

This is the definition of resources.

Question 11

Aveda is a manufacturer and marketer of cosmetics, perfumes, hair-care, and skin-care products. To differentiate its products from other similar brands, Aveda focuses on educating its customers on general skin and hair care. Its salespeople are trained to answer questions and help customers find solutions. Aveda has used customer education and employee training to ____.

Accepted Answer

Aveda has used customer education and employee training to create a competitive advantage by differentiating its products from other similar brands. By focusing on educating its customers on general skin and hair care, it has made it easier for customers to make informed decisions and provided a value addition to its products. This approach distinguishes Aveda from its competitors and gives it a unique selling proposition.

Question 12

The greater the market commonality, the less intense the direct competition between two companies.

Accepted Answer

Market commonality is the degree to which two companies have overlapping products, services, or customers in multiple markets. The more markets in which there is product, service, or customer overlap, the more intense the direct competition between the two companies.

Question 13

When making travel plans, many tourists have selected Thomas Cook, a British tour operation, because they perceive that no other tour company can duplicate the customer service and satisfaction that Thomas Cook has provided over its years of operation. Thomas Cook has apparently created a sustainable competitive advantage by using ____ resources.

Accepted Answer

Nonsubstitutable resources are defined as those that produce value or competitive advantage and have no equivalent substitutes or replacements.

Question 14

Top-Flite manufactures Strata golf balls and prices these balls at about three times what ordinary golf balls cost. The Strata ball sells exceptionally well because customers perceive its patented three-layer construction to improve handling and increase distance. The patent on these golf balls gives Top-Flite a(n) ____.

Accepted Answer

The Strata product is difficult to imitate, valuable, rare, and without substitutes.

Question 15

Most companies compete directly with all the firms in their industry.

Accepted Answer

Most companies do not compete directly with all the firms in their industry. Instead of competing with the industry, most firms compete directly with just a few companies.

Question 16

Differentiation is the positioning strategy of producing a product or service of acceptable quality at consistently lower production costs than competitors.

Accepted Answer

This is the definition of cost leadership. Differentiation is the positioning strategy of providing a product or service that is sufficiently different from competitors' offerings such that customers are willing to pay a premium price for it.

Question 17

A focus strategy entails using either a cost leadership or a differentiation approach to producing a good or service.

Accepted Answer

A focus strategy involves focusing on a particular segment or niche in the market, and using either a cost leadership or a differentiation approach to produce a good or service that specifically meets the needs and preferences of that segment.

Question 18

A(n) ____ resource is a resource that is not controlled or possessed by many competing firms.

Accepted Answer

The answer of A(n) ____ resource is a resource that...

Question 19

Which of the following must be met if a firm's resources are to be used to achieve a sustainable competitive advantage?

Accepted Answer

Resources that are difficult to imitate are critical to sustaining a competitive advantage.

Question 20

Deutsche Bank is the largest bank in the world. Would this give it a sustainable competitive advantage?

Accepted Answer

Competitive advantage is defined as providing greater value for customers than competitors can. There is no evidence of a direct correlation between a company's size and the value it provides to its customers.

Quiz 6: Organizational Strategy