Question 1

The four tests of a resource's competitive power are often referred to as the

Accepted Answer

The VRIN test is commonly used to determine a resource's competitive power. It assesses if a resource is valuable, rare, inimitable, and non-substitutable, which are key factors in creating a sustained competitive advantage. Option A is not a commonly used test, while options B and E do not accurately describe the four tests. Option C is not a commonly used term in the context of strategic management.

Question 2

A resource of a firm is considered to be

Accepted Answer

The answer of A resource of a firm is considered...

Question 3

A company that has competitive assets that are central to its company strategy and superior to those of rival firms creates a

Accepted Answer

When a company has competitive assets that are central to its company strategy and superior to those of rival firms, it creates a competitive advantage over other companies. This means that the company is able to outperform its competitors in terms of profitability or market share because it has something that its competitors do not. This could be a unique product or service, a proprietary technology or process, a strong brand, or a talented workforce. The company can leverage this advantage to attract customers, retain them over the long-term, and ultimately gain a strategic foothold in the market.

Question 4

How are a company's organizational capabilities developed and enabled?

Accepted Answer

Organizational capabilities are developed and enabled through the deployment of a company's resources or some combination of its resources. This can include investments in technology, training and development programs, strategic partnerships, and other initiatives that align with the company's mission, vision, and goals. Strengthening traditions or shifting decision-making may be important factors in shaping the company's culture, but they do not necessarily lead to the development of organizational capabilities. Similarly, searching outside the company for best practices is important, but it is not the only factor that contributes to the development of organizational capabilities.

Question 5

A competitively valuable resource or capability is a company's

Accepted Answer

A competitively valuable resource or capability is a fundamental aspect of a company's business model that provides a competitive advantage over its rivals. It enables the company to differentiate itself from competitors and create value for its customers. Option B talks about an equally valuable substitute resource, which contradicts the idea of a resource being competitively valuable. Option C talks about superior substitutes but does not relate to the concept of competitively valuable resources. Option D mentions worker productivity and product quality, which can be a result of a competitively valuable resource but not a resource in itself. Option E discusses a unique piecework incentive system, which can be a resource but may not necessarily be competitively valuable.

Question 6

Resource and capability analysis is achieved by

Accepted Answer

Resource and capability analysis involves assessing a firm's competitive assets such as financial resources, human resources, and intellectual property, and comparing them to those of rival firms. This helps the firm to identify its strengths and weaknesses and opportunities for competitive advantage. Option B, C, D, and E do not accurately describe resource and capability analysis.

Question 7

When a company has become proficient in modifying, upgrading, or deepening the company's resources and capabilities in response to its changing environment and market opportunities, it is called

Accepted Answer

A dynamic capability refers to a company's ability to modify and improve its resources and capabilities in response to changes in the market environment and opportunities. This allows the company to stay ahead of the competition and adapt to shifting consumer preferences and technological advancements. A core competence is a company's unique strengths and capabilities that give it a competitive advantage in the market, but it may not necessarily involve the ability to adapt and change. A distinct competence is not a commonly used term in strategic management. Strategic assessment and benchmarking exercises are tools used in analyzing a company's strengths, weaknesses, opportunities, and threats, but they do not necessarily reflect a company's ability to adapt and evolve.

Question 8

The best quantitative evidence of whether a company's present strategy is working well is

Accepted Answer

The best quantitative evidence of whether a company's present strategy is working well is whether the company is achieving its financial and strategic objectives and whether it is an above-average industry performer. This indicates that the strategy is producing good results and is effective. Other options are not completely relevant or adequate to measure the success of a company's strategy.

Question 9

A linked and closely integrated set of competitive assets centered around one or more cross-functional capabilities is termed

Accepted Answer

The term "resource bundle" refers to a set of resources and capabilities that are closely integrated and linked to each other, forming a cohesive and competitive advantage for the organization. This term is often used in the context of the resource-based view of the firm, which emphasizes the importance of firm-specific resources and capabilities in creating sustained competitive advantage. Option A ("organizational assets") is a more generic term that could refer to any asset owned by the organization, while option C ("resource capability") and option E ("integrated asset advantage") are not commonly used terms in the literature. Option D ("functional method compilation") is not a recognized term in management theory.

Question 10

Resource and capability analysis is designed to

Accepted Answer

Resource and capability analysis is a tool used to identify which resources and capabilities of a company are competitively valuable, meaning they give the company a sustainable competitive advantage over competitors. This analysis helps the company focus on strengthening and leveraging those resources and capabilities to maintain its competitive edge.

Question 11

The BEST example of a company resource is

Accepted Answer

Having proven technological expertise and an ability to churn out new and improved products on a regular basis is a clear example of a company resource, as it allows the company to create products that are better than those of its competitors and to stay ahead in the market. The other options listed may be important for a company's success, but they are not as clear of an example of a company resource.

Question 12

If a company doesn't possess standalone resource strengths capable of contributing to competitive advantage,

Accepted Answer

Even if a company does not possess standalone resource strengths, it may still have a bundle of resources that can be combined and leveraged to develop a distinctive competence. This can be a source of competitive advantage. Therefore, the company's best strategy would be to identify and develop these resources to create a unique position in the marketplace.

Question 13

Imitation by rivals is most challenging when

Accepted Answer

When capabilities reflect a high level of social complexity and causal ambiguity, it is difficult for rivals to understand and imitate the resources and capabilities. This is because such resources are typically based on trust, culture, and informal relationships that are difficult to observe and learn from. Thus, imitating such resources may require a significant investment of time and effort but may not yield the same results.

Question 14

Which of the following is NOT pertinent in identifying a company's present strategy?

Accepted Answer

The company's past strategy is not pertinent in identifying its present strategy. The other options listed are all relevant in identifying a company's present strategy.

Question 15

A sustainable competitive advantage is gained when a company

Accepted Answer

A sustainable competitive advantage requires having durable competitive assets that are central to a company's strategy and superior to those of its rivals. This means that these assets must be difficult to replicate or replace, and should give the company a unique position in the market that rivals cannot easily match. This advantage should be sustainable over time, and enable the company to maintain its market position and profitability even in the face of increased competition or changes in the market environment.

Question 16

The spotlight in analyzing a company's resources, internal circumstances, and competitiveness includes such questions/concerns as

Accepted Answer

Analyzing a company's resources, internal circumstances, and competitiveness involves identifying the company's resource strengths and weaknesses in relation to the market opportunities and external threats. This analysis helps in developing an understanding of the company's competitiveness and identifying areas for improvement. Options A, B, and E do not directly relate to the process of analyzing a company's resources and internal circumstances. Option C is one aspect of the analysis, but not the only focus.

Question 17

What two factors inhibit the ability of rivals to imitate a firm's most valuable resources and capabilities?

Accepted Answer

Social complexity and causal ambiguity inhibit the ability of rivals to imitate a firm's most valuable resources and capabilities. Social complexity refers to the difficulty of replicating the social systems, relationships, and culture that contribute to a firm's success, while causal ambiguity refers to the difficulty of determining why a firm's resources and capabilities are effective. These factors make it challenging for competitors to replicate a firm's advantages, leading to sustained competitive advantage.

Question 18

Which of the following is NOT a good example of a company's resources?

Accepted Answer

A company's earnings per share and stock price are not resources in themselves, but rather outcomes or results of the company's resources and operations.

Question 19

The competitive power of a company resource strength or competitive capability hinges on all of the following EXCEPT

Accepted Answer

The competitive power of a company resource strength or capability hinges on how hard it is for competitors to copy, whether it is rare and something rivals lack, whether it is really competitively valuable and has the potential to contribute to a competitive advantage, and whether it is nonsubstitutable. The only option that is not part of these criteria is whether it is readily available for rivals to adopt.

Question 20

Which of the following is NOT a reliable measure of how well a company's current strategy is working?

Accepted Answer

While having a larger number of competitive assets than competitive liabilities and having a superior quality product are important factors in determining a company's competitiveness, they are not reliable measures of how well a company's current strategy is working. The other options, such as sales growth, market share, profit margins, customer image, and internal process improvement, are more indicative of a company's strategy effectiveness.

Quiz 4: Evaluating a Companys Resources and Competitive Position