Ch. 3

Question 1

value chain analysis

Answer 1

views the organization as a sequential process of value-creating activities

Question 2

primary activities

Answer 2

inbound logistics, operations, outbound logistics, marketing and sales, and service - contribute to the physical creation of the product or service, its sale and transfer to the buyer and its service after the sale

Question 3

support activities

Answer 3

procurement, technology development, HR Management, and general administration - either add value by themselves or add value through important relationships with both primary activities and other support activities

Question 4

inbound logistics

Answer 4

primarily associated with receiving, storing, and distributing inputs to the product

• material handing, warehousing, inventory control, vehicle scheduling

Question 5

operations

Answer 5

include all actives associated with transforming inputs into the final product form, such as machining, packaging, assembly, testing, printing, and facility operations

Question 6

outbound logistics

Answer 6

associated with collecting, storing, and distributing the product or service to buyers

• warehousing, material handling, delivery vehicle operation, order processing and scheduling

Question 7

marketing and sales

Answer 7

activities are associated with purchases of products and services by end users and the inducements used to get them to make purchases

• advertising, sales force, quoting, channel selection, pricing

Question 8

service

Answer 8

primary activity includes all actions associated with providing service to enhance or maintain the value of the product, such as installation, repair, training, parts supply, and product adjustment

Question 9

procurement

Answer 9

refers to the function of purchasing inputs used in the firms value chain, not to the purchased inputs themselves

purchased inputs - raw materials, supplies, and other items such as machinery, laboratory equipment, office equipment, and buildings

Question 10

technology development

Answer 10

related to the product and its features supports the entire value chain, while other technology development is associated with particular primary or support activities

Question 11

human resource management

Answer 11

recruiting, hiring, training, development, and compensation

supports both individual primary and support activities and the entire value chain

Question 12

general administration

Answer 12

consists of a number of actives, including general management, planing, finance, accounting

• typically supports the entire value chain and not individual activities

Question 13

resource based view of the firm

Answer 13

combines two perspectives

1- internal analysis of phenomena within a company

2- external analysis of the industry and its competitive environment

aka SWOT

Question 14

tangible resources

Answer 14

assets that are relatively easy to identify

accounts receivable , equipment, patents, copyrights, strategic plan

Question 15

intangible resources

Answer 15

unique routines and practices

experience, ideas, brand name, product quality

Question 16

organizational capabilities

Answer 16

not specific tangible or intangible assets, but rather the competing or skills that. a firm employs to transform inputs into outputs

Question 17

Four attributes for a resource to be a competitive advantage

Answer 17

1- valuable
2- rare
3-difficult to imitate (3 things - physical uniqueness, path dependency, and casual ambiguity)
4-difficult to substitute

Question 18

path dependency

Answer 18

a greater number of resources cannot be imitated

aka scarce

Question 19

casual ambiguity

Answer 19

costly to imitate or competitor wouldn’t know how

Question 20

social complexity

Answer 20

costly to imitate because of social engineering

Question 21

resources and capabilities must be….

Answer 21

rare and valuable as well as difficult to imitate or substitute in order for a firm to attain competitive advantages that are sustainable over time.

Question 22

Four factors help explain the extent to which employees and managers will be able to obtain a proportionately high level of the profits that they generate:

Answer 22

• employee bargaining power: employees are vital to firms unique capability = high wages
• employee replacement cost: employee skills are rare = high bargaining power on high cost to replace them
• employee exit costs: high personal costs when leaving the organization
• manager bargaining power: how well they create resource-based advantages

Question 23

evaluating firms performance: financial ratio analysis

Answer 23

how a firm is performing according to its balance sheet, income statement, and market valuation

-short term/long term solvency/liquidity, asset management , profitability, market value

Question 24

evaluating firms performance: stakeholder view

Answer 24

firms must satisfy a brand range of stakeholders, including employees, customers’ and owners, to ensure their long term viability

Question 25

balanced scorecard

Answer 25

comprehensive view of business

four key perspectives: customer, internal, innovation, and learning and financial