Chapter 33 Flashcards
1
Q
Value-chain analysis assumes that the basic economic purpose of a firm is to create value and it is a useful
framework for analyzing the strengths and weaknesses of the firm.
A
T. Value-chain analysis views the organization as a sequential process of value-creating activities. It
provides greater insights into analyzing the competitive position of a firm than SWOT analysis does by
itself.
2
Q
In value-chain analysis, value is measured by the market value of the total stock outstanding of the
company.
A
F. Value is the amount that buyers are willing to pay for what a firm provides them and is measured by total
revenue, a reflection of the price the product of the firm commands and the quantity it can sell.
3
Q
When is a firm considered profitable?
A) When its total revenue is greater than its total costs.
B) When the value it receives exceeds the total cost of creating its product or service.
C) When its consumer surplus is maximized.
D) When its fixed costs are minimized.
A
B
4
Q
What are primary activities according to Porter?
A) Activities that support the overall strategy of the firm.
B) Activities that directly contribute to the creation, sale, and support of a product or service.
C) Activities that focus on financial management.
D) Activities that involve human resource development.
A
B
5
Q
What does inbound logistics refer to?
A) Managing the delivery of products to customers.
B) Transforming raw materials into finished goods.
C) Managing the receipt, storage, and distribution of inputs.
D) Promoting and selling products to customers.
A
C
6
Q
Which of the following is a support activity in Porter’s framework?
A) Outbound logistics
B) Service
C) Technology development
D) Marketing and sales
A
C
7
Q
What is the main focus of human resource management as a support activity?
A) Managing logistics and distribution.
B) Recruiting, training, and retaining talent.
C) Enhancing product features.
D) Developing marketing strategies.
A
B
8
Q
Which activity is responsible for delivering products or services to customers?
A) Operations
B) Inbound logistics
C) Outbound logistics
D) Service
A
C
9
Q
What role does general administration play in Porter’s framework?
A) It focuses on product design.
B) It manages overall firm operations and strategy.
C) It enhances customer relationships.
D) It oversees supply chain management.
A
B
10
Q
In assessing its primary activities, an airline would examine
A. employee training programs.
B. baggage handling.
C. criteria for lease versus purchase decisions.
D. the effectiveness of its lobbying activities.
A
B
11
Q
Inbound logistics include
A. machining and packaging.
B. repair and parts supply.
C. promotion and packaging.
D. warehousing and inventory control
A
D. Inbound logistics is associated primarily with receiving, storing, and distributing inputs to the product. It
includes material handling, warehousing, inventory control, vehicle scheduling, and returns to suppliers.
12
Q
Advertising is a __________ activity. Supply of replacement parts is a __________ activity.
A. support;
primary
B. primary;
primary
C. primary;
support
D. support;
secondary
A
B
13
Q
Which of the following examples demonstrates how successful organizations manage their primary
activities?
A. Motorola has revised its compensation system to reward employees who learn a variety of skills.
B. Wal-Mart implemented a sophisticated information system that resulted in reduced inventory
carrying costs and shortened customer response times.
C. National Steel improved its efficiency by reducing the number of job classifications.
D. Hewlett Packard has cut lead time from five days to one by employing JIT inventory management.
A
D
14
Q
The value-chain concept assumes that both primary and support activities are capable of producing
value for customers.
A
T
15
Q
Inbound logistics include all activities associated with transforming inputs into the final product form
such as machining, packaging, assembly, equipment, testing, printing, and facility operations.
A
F. Inbound logistics is primarily associated with receiving, storing, and distributing inputs to the product.
Operations include all activities associated with transforming inputs into the final product form, such as
machining, packaging, assembly, testing, printing, and facility operations.
16
Q
Support activities provide support for primary activities, but not each other.
A
F. Support activities (procurement, technology development, human resource management, and general
administration) either add value by themselves or add value through important relationships with both
primary activities and other support activities.
17
Q
Establishing a customer service hotline to handle customer complaints would be considered a primary
activity in value-chain analysis.
A
T. Service is a primary activity which 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.
18
Q
In value-chain analysis, finance and accounting are considered part of the general administration of a
firm
A
T
19
Q
What is an important reason for firms to analyze both internal and external value creation?
A) To maximize profits without considering customer needs.
B) To ensure that their internal processes align with the value expectations of suppliers, customers, and partners.
C) To focus only on product development and ignore market trends.
D) To simplify their operations by reducing external partnerships.
A
B
20
Q
Which of the following is an example of value addition?
A) Reducing employee training programs
B) Enhancing collaboration with suppliers
C) Cutting costs across all departments
D) Minimizing communication with customers
A
B
21
Q
Which of the following is not an advantage of Just-In-Time inventory systems?
A. reduced raw material storage costs
B. minimized idle production facilities and workers
C. reduced work-in-process inventories
D. reduced dependence on suppliers
A
D. With JIT inventory systems, parts deliveries arrive at the assembly plants only hours before they are
needed. This requires greater reliance on superior performance of suppliers.
22
Q
XYZ Corp. is focusing on the objective of low-cost, high quality, on-time production by minimizing idle
productive facilities and workers. The XYZ Corp. is taking advantage of a __________ system.
A. Last In, First Out (LIFO)
B. Highly mechanized
C. First In, First Out (FIFO)
D. Just-In-Time (JIT)
A
D. Just-in-time (JIT) inventory systems were designed to achieve efficient inbound logistics, which is one of
the five primary activities in value-chain analysis. With JIT inventory systems, parts deliveries arrive at
the assembly plants only hours before they are needed, which reduces idle production capacity.
23
Q
Inbound logistics include
A. machining and packaging.
B. repair and parts supply.
C. promotion and packaging.
D. warehousing and inventory control
A
D
24
Q
Which of the following strategies is NOT mentioned as a method for managing inbound logistics effectively?
A) Implementing a Just-in-Time (JIT) inventory system
B) Locating assembly plants near suppliers
C) Developing long-term supplier contracts
D) Creating an efficient layout for raw materials
A
C
25
What do operations primarily encompass in an organization?
A) Marketing and sales activities
B) Transforming inputs into final products
C) Customer service interactions
D) Financial planning and analysis
B
26
Which of the following is NOT an example of an operation task?
A) Machining
B) Packaging
C) Market research
D) Testing
C
27
___________ is/are associated with collecting, storing, and distributing the product or service to buyers.
They consist of warehousing, material handling, delivery operation, order processing, and scheduling.
A. Services
B. Inbound logistics
C. Outbound logistics
D. Operations
C
28
How can implementing environmentally friendly manufacturing practices benefit an organization?
A) By increasing raw material costs
B) By creating a competitive advantage
C) By reducing product quality
D) By limiting production capacity
B
29
Campbell Soup uses an electronic network to facilitate its continuous-replenishment program with its
most progressive retailers. This is known as an operations primary activity in the value chain.
F. Outbound logistics is associated with collecting, storing, and distributing the product or service to
buyers. These activities include finished goods, warehousing, material handling, delivery vehicle
operation, order processing, and scheduling. Campbell Soup uses an electronic network to facilitate its
continuous-replenishment program with its most progressive retailers.
30
Frito-Lay uses crowdsourcing to make its Super Bowl ads. This is an example of a primary activity in
the value chain
T. Marketing and sales activities are associated with purchases of products and services by end users and
the inducements used to get them to make purchases. They include advertising, promotion, sales force,
quoting, channel selection, channel relations, and pricing. Frito-Lay uses crowdsourcing to create
competition for ads. The best ones air during the Super Bowl.
31
Establishing a customer service hotline to handle customer complaints would be considered a primary
activity in value-chain analysis.
T
32
At Sephora.com, a customer service representative taking a phone call from a repeat customer has
instant access to what shade of lipstick she likes best. This is an example of a procurement support
activity in the value chain.
F
33
Customer service includes
A. product promotion.
B. procurement of critical supplies.
C. product distribution.
D. parts supply.
D. Service 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.
34
What does service activity include in relation to product value?
A) Marketing strategies and advertising campaigns
B) Installation, repair, training, parts supply, and product adjustment
C) Manufacturing and production processes
D) Financial forecasting and budgeting
B
35
Which of the following lists consists of support activities?
A. human resource management, technology development, customer service, and procurement
B. human resource management, customer service, marketing and sales, and operations
C. customer service, information systems, technology development, and procurement
D. human resource management, technology development, procurement, and general administration
D
36
Which of the following is a support activity?
A. inbound logistics
B. customer service
C. technology development
D. operations
C
37
What does procurement refer to in the context of a firm's value chain?
A) The process of selling finished products to customers
B) The process of purchasing inputs such as raw materials, supplies, and assets
C) The management of customer relationships
D) The development of marketing strategies
B
38
Technip has developed intelligent pipes that can monitor and regulate the temperature throughout an oil
pipeline. This is an example of a procurement support activity in the value chain
F. Technology development
39
Technology development is a much broader concept than research and development.
T. Technology development related to product features supports the entire value chain, while other technology development is tied to specific primary or support activities.
40
Human resource management consists of activities involved in the recruiting, hiring, training,
development, and compensation of all types of personnel. It supports
A. only individual primary activities.
B. mostly support activities but does have some impact on primary activities.
C. only individual support activities.
D. both individual primary and support activities and the entire value chain.
D
41
According to value-chain analysis, which of the following would be considered part of the general
administration in a firm?
A. information systems
B. technology development
C. human resource management
D. procurement
A
42
What does general administration encompass?
A) Only finance and accounting
B) Only legal and government affairs
C) A range of activities including management, planning, finance, and information systems
D) Only quality management
C. support the entire value chain
43
In a retail service industry, which of the following is not a primary value-chain activity?
A. purchasing goods
B. human resource management
C. partnering with vendors
D. operating stores
B
44
What is the focus of Level 1 interrelationships in the value chain?
A) Relationships with customers
B) Interrelationships among activities within the firm
C) Collaborations with suppliers
D) External market conditions
B
45
A marketing department that promises delivery faster than the ability of the production department to
produce is an example of a lack of understanding of the
A. interrelationships among functional areas and firm strategies organizational culture and leadership.
B. organizational culture and leadership.
C. need to maintain the reputation of the company.
D. synergy of the business units
A
46
Level 2 interrelationships in the value chain primarily involve:
A) Internal department collaborations
B) Relationships between the firm and external stakeholders
C) Employee training programs
D) Financial reporting
B
47
What is the primary focus of integrating customers into the value chain?
A) Reducing costs
B) Enhancing competition
C) Strengthening the relationship between the organization and its customers
D) Streamlining operations
C
48
What is a key benefit of directly incorporating customers into the value creation process?
A) Decreased production time
B) Increased customer satisfaction and loyalty
C) Reduced marketing expenses
D) Simplified logistics
B
49
In the prosumer concept, who collaborates with firms?
A) Competitors
B) Suppliers
C) Customers (prosumers)
D) Investors
C
50
Which of the following is a potential outcome of involving prosumers in product design?
A) Higher manufacturing costs
B) Increased employee turnover
C) Insights leading to cost-saving initiatives
D) Reduced customer engagement
C
51
In terms of value chain analysis, a telephone operating company would find that negotiating and
maintaining ongoing relations with regulatory bodies are important activities for achieving
A. returns on investment.
B. customer awareness.
C. competitive advantage.
D. better employees.
Although general administration is sometimes viewed only as overhead, it can be a powerful source of
competitive advantage. In a telephone operating company, for example, negotiating and maintaining
ongoing relations with regulatory bodies can be among the most important activities for competitive
advantage.
C
52
General administration is sometimes viewed as only _______ but can be a powerful source of
competitive advantage.
A. income
B. value
C. overhead
D. unimportant
C
53
German truck and trailer manufacturer, Schmitz Cargobull, mainly serves customers that are operators of
truck or trailer fleets. What sets the company apart is its expertise in telematics (the integrated
application of telecommunications data) to monitor the current state of any Schmitz Cargobull-produced
trailer. This is an example of using ________ to enhance customer value and increase _______ position.
A. sales; competitive
B. operations; marketing
C. information technology; competitive
D. human resources; marketing
C
54
In an interview with Lise Saari, former director of global workforce research at IBM, she notes that HR
must be a true partner of the business, with a deep and up-to-date understanding of business realities and
objectives, and must ensure HR initiatives fully support them at all points of the value chain. This is an
example of
A. relationships among activities within the firm and with other stakeholders.
B. relationships between firms.
C. interrelationships among activities within the firm.
D. interrelationships among firms.
c
55
Regarding the value-chain concept, the most important interrelationship is between the organization and
its
A. board of directors.
B. employees.
C. management.
D. customers.
D
56
In contrast to __________ interactions, which allow the firm to gain insights on the needs of a particular
customer, ___________ offers the opportunity to leverage the wisdom of a larger crowd.
A. consumer; sourcing
B. prosumer; outsourcing
C. prosumer; crowdsourcing
D. marketing; crowdsourcing
C
57
In using crowdsourcing as a means to integrate the customer into the value chain, there are some perils
to consider. Which of the following is not related to crowdsourcing perils?
A. Giving customers the opportunity to tarnish the company brand.
B. Asking for consumer input when demand is highly uncertain.
C. Repeatedly getting feedback from the same customer.
D. Asking for consumer input when demand is certain.
D
58
Accounting is a sort of transformation process that converts daily records of individual transactions into
monthly financial reports. The __________ are the inputs, accounting is the operation that adds value,
and ___________ are the outputs.
A. transaction records; financial statements
B. financial statements; transaction records
C. employee records; transaction records
D. health records; transaction statements
A
59
A travel agent adds value by creating an itinerary that includes transportation, accommodations, and
activities that are customized to your budget and travel dates. In terms of the value chain analysis, this is
an example of a ____________ organization.
A. retail
B. servic
e
C. manufacturing
D. travel
B. A travel agent adds value by creating an itinerary that includes transportation, accommodations, and
activities that are customized to your budget and travel dates. These are the operations, or transformation
processes, of a service organization.
60
For an engineering services firm, ________________ provides inputs, the transformation process is the
engineering itself, and innovative designs and practical solutions are the outputs.
A. experimentation
B. customer support
C. research and development
D. human resource management
C
61
The resource-based view (RBV) of the firm combines the following two perspectives:
A. the primary and support activities of the
firm.
B. the interrelationships among the primary activities of the firm and corporate management.
C. the internal analysis of the firm and the external analysis of the industry and competitive
environment.
D. the industry and the competitive environment.
C
62
What must be considered when assessing a firm's competitive advantage? A) Only the firm's internal resources
B) The broader competitive environment
C) The firm's marketing strategy
D) Customer feedback
B
63
For a competitive advantage to be sustainable, resources must be: A) Cheap and easy to obtain
B) Valuable, rare, and difficult to duplicate
C) Common and widely available
D) Used by all competitors
B
64
If a firm's resources do not meet the criteria for sustainability, what will the firm achieve? A) Competitive advantage
B) Competitive parity
C) Market leadership
D) Innovation
B
65
What is a key requirement for resources to contribute to a sustainable competitive advantage? A) They must be readily available in the market
B) They must be easy to replicate
C) They must be costly to duplicate for competitors
D) They must be inexpensive to acquire
C
66
Which of the following statements is true regarding competitive advantage? A) It can be determined solely by a firm's internal resources.
B) It cannot be assessed without considering the competitive context.
C) It is guaranteed if a firm has unique resources.
D) It is always permanent and unchanging.
B
67
Can unique or impressive strengths guarantee competitive advantages? A) Yes, always.
B) No, they don’t guarantee competitive advantages.
C) Only if they are well marketed.
D) Yes, but only in certain industries.
B.
68
What is the focus of the Resource-Based View (RBV)? A) Identifying a firm's weaknesses
B) Determining if advantages are created and sustained over time
C) Analyzing market trends
D) Comparing financial performance with competitors
B
69
In the context of competitive advantage, what is more important than having strengths or capabilities? A) Having a large customer base
B) The ability to create and sustain those advantages over time
C) Reducing operational costs
D) Expanding product lines
B
70
What does the Resource-Based View (RBV) framework reveal? A) How to minimize operational costs
B) How core competencies can be used to explore new products and markets
C) The importance of customer satisfaction
D) The need for aggressive marketing strategies
B
71
The three key types of resources that are central to the resource-based view of the firm are
A. tangible resources, intangible resources, and organizational structure.
B. culture, tangible resources, intangible resources.
C. tangible resources, intangible resources, and organizational capabilities.
D. tangible resources, intangible resources, and top management.
C
72
What determines whether a firm can attain a sustainable competitive advantage? A) The number of employees
B) The quality of its products
C) Its resources and capabilities
D) Its market location
C
73
In the resource-based view of the firm, examples of tangible resources include
A. financial resources, human resources, and firm competencies.
B. financial resources, physical resources, and technological resources, organizational resources.
C. financial resources, physical resources, and the capacity to combine intangible resources.
D. outstanding customer service, innovativeness of products, and reputation.
Examples of tangible resources are financial resources, physical resources, organizational resources, and
technological resources.
B
74
Tangible resources are assets that are relatively easy to identify such as financial and physical assets.
T
75
Financial resources such as cash and cash equivalents are intangible resources
F
76
Effective strategic planning processes are intangible resources.
F. Organizational resources ( tangible resource )
77
What do physical resources refer to in a company? A) Company culture and values
B) The company’s plant, equipment, and machinery
C) Financial statements and reports
D) Customer relationships
B
78
Which type of resource includes strategic planning processes and employee development systems? A) Financial Resources
B) Physical Resources
C) Organizational Resources
D) Technological Resources
C
79
What is an example of how FedEx utilizes its organizational resources? A) By offering competitive salaries
B) By taking computer-based job competency tests for employees
C) By purchasing new delivery trucks
D) By acquiring trade secrets
B
80
What do technological resources encompass? A) Employee satisfaction surveys
B) Financial investments and loans
C) Trade secrets, patents, and proprietary technologies
D) Marketing strategies
C
81
Which of the following is NOT a type of tangible resource? A) Physical Resources
B) Financial Resources
C) Technological Resources
D) Brand reputation
D. This is an intangible resource
82
Intangible resources of a firm refer to its capacity to deploy tangible resources over time and leverage
those resources effectively.
F
83
What are intangible resources? A) Physical assets that can be easily measured
B) Resources that are hard to quantify or imitate
C) Only financial resources like cash and investments
D) Any resource that is not used in production
B
84
Why are intangible resources considered difficult for competitors to imitate? A) They are always costly to acquire.
B) They are often embedded in unique routines and practices.
C) They can be easily replicated by competitors.
D) They do not contribute to a company's value.
B
85
What is an example of an intangible resource mentioned in the text? A) Machinery
B) Financial investments
C) Effective work teams
D) Real estate holdings
C
86
How can social media impact a company's intangible resources? A) It has no effect on public perception.
B) It can enhance a company’s physical assets.
C) It can easily affect reputation and public perception.
D) It guarantees positive customer reviews.
C
87
Company reputation with customers, suppliers and other stakeholders is an intangible resource
t
88
Harley-Davidson sells accessories, clothing, toys and motorcycles. They have a brand image in common
which is a tangible resource.
F. intngaible
89
Comcast gets a bad review on Yelp. This is an example of harm to a tangible resource.
F. intangible
90
FedEx employees take computer-based job competency tests every 6 to 12 months in order to identify
areas of individual weakness and provide input to a computer database of employee skills. This is an
example of a tangible resource.
T
91
Trade secrets are intangible resources.
T
92
Modern plant and facilities as well as favorable manufacturing locations are tangible resources.
t
93
Patents, copyrights, and trademarks are intangible resources.
F
94
_____________ are typically embedded in unique routines and practices that have evolved and
accumulated over time such as effective work teams
A. Tangible resources
B. Intangible resources
C. Reputational resources
D. Organizational capabilities
b
95
The culture of a firm also may be a resource that provides competitive advantage. Which of these
companies might be a good example of this intangible resource?
A. Google
B. Kmar
t
C. Costco
D. Walmart
a
96
Intangible resources are typically embedded in ________ routines and practices that have evolved and
accumulated over time.
A. rare
B. standard
C. unique
D. obvious
c
97
Which of the following is not a tangible resource?
A. technical and scientific skills
B. trade secrets, patents, copyrights
C. state-of-the art machinery
D. company borrowing capacity
A
98
In order to be considered strategic resources that contribute competitive advantage, they must have
several characteristics. Which of the following is not one of these?
A. rare
B. valuable
C. inexpensive to imitate
D. costly to substitute
C
99
__________ are the competencies or skills that a firm employs to transform inputs into outputs.
A. Tangible resources
B. Reputational resources
C. Organizational capabilities
D. Intangible resources
c
100
How do organizational capabilities relate to resources? A) They are the same as tangible resources.
B) They refer to the capacity to deploy both tangible and intangible resources.
C) They are only focused on financial resources.
D) They eliminate the need for physical assets.
b
101
What does it mean to leverage organizational capabilities? A) To focus solely on minimizing costs
B) To combine resources to achieve a desired outcome
C) To limit the use of intangible assets
D) To maintain a strict hierarchy within the organization
b
102
Examples of organizational capabilities are outstanding customer service, excellent product development
capabilities, superb innovation processes, and flexibility in manufacturing processes.
t
103
The ability to hire, motivate, and retain human capital is an example of ________ capabilities in the
resource-based view of the firm.
A. tangible
B. organizational
C. management
D. design
b
104
Which of the following is not an example of organizational capabilities?
A. outstanding customer service
B. reputation with customers for quality and reliability
C. innovativeness of products and services
D. ability to hire, motivate, and retain human capital
b. it represents an outcome or result of the organization's capabilities and performance. The other options—outstanding customer service, innovativeness of products and services, and the ability to hire, motivate, and retain human capital—are all examples of specific organizational capabilities that contribute to a company's effectiveness.
105
Apple combines and packages proven technology in new and innovative ways. This is an example of its
use of
A. tangible resources.
B. intangible resources.
C. organizational capabilities.
D. strong primary activities.
c
106
What is the first attribute a resource must have to provide sustainable competitive advantage? A) It must be expensive to acquire.
B) It must be valuable by exploiting opportunities or neutralizing threats.
C) It must be widely available in the market.
D) It must require minimal investment.
b
107
For a resource to contribute to sustainable competitive advantage, it must be: A) Common among competitors.
B) Rare among current and potential competitors.
C) Easy to replicate.
D) Cheap to maintain.
b
108
What does it mean for a resource to be difficult for competitors to imitate? A) It is always expensive to acquire.
B) It cannot be easily duplicated or copied by other firms.
C) It is found only in a specific location.
D) It is not needed in the market.
b
109
What is the fourth attribute that a resource must have for sustainable competitive advantage? A) It must be widely recognized in the industry.
B) It must have no strategically equivalent substitutes.
C) It must be able to generate high profits.
D) It must require minimal oversight.
b. This means that there should be no alternative resources or capabilities that can serve the same strategic function as the resource in question.
110
For a resource to provide a firm with the potential for a sustainable competitive advantage, it must have
four attributes. Which of the following is not one of these attributes?
A. rare
B. valuable
C. easy for competitors to substitute
D. difficult for competitors to imitate
C
111
For a resource to provide a firm with potential sustainable advantages it must satisfy only two criteria:
rareness and difficulty in substitution.
F. must be all 4 attributes
112
What makes a resource valuable for a firm? A) It is widely available to all firms.
B) It enables the firm to enhance efficiency or effectiveness.
C) It requires significant investment to acquire.
D) It is primarily used for marketing purposes.
b
113
According to the SWOT framework, how can firms improve performance? A) By ignoring environmental conditions
B) By exploiting opportunities and neutralizing threats
C) By focusing solely on internal weaknesses
D) By maintaining the status quob
b
114
A resource is valuable and rare but neither difficult to imitate nor without substitutes. This should enable
the firm to attain
A. no competitive advantage.
B. a temporary competitive advantage.
C. competitive parity.
D. a sustainable competitive advantage
b
115
If competitors possess the same valuable resource, what does that imply for a firm? A) The resource is a source of competitive advantage.
B) The resource is not a source of competitive advantage.
C) The firm should invest more in that resource.
D) The resource can lead to increased profits.
b
116
What is the consequence of strategies based on non-rare resources? A) They will always lead to competitive advantage.
B) They may be valuable but will not lead to competitive advantage.
C) They guarantee market dominance.
D) They require fewer investments.
b
117
A competitive advantage based on inimitability can be sustained for at least some time, if it has the
following characteristics:
A. psychographic uniqueness, path dependency, causal ambiguity, and substitutability.
B. physical uniqueness, path dependency, causal ambiguity, and social complexity.
C. rarity, path dependency, causal ambiguity, and social substitutability.
D. geographic uniqueness, cause dependency, social ambiguity, and path complexity.
b
118
What is physical uniqueness in the context of resources? A) Resources that are easily replicated by competitors
B) Resources that are inherently difficult to copy
C) Resources that are only found in a specific market
D) Resources that require minimal investment
b
119
Which of the following is an example of physical uniqueness? A) A widely used marketing strategy
B) Beautiful resort locations
C) Standard operating procedures
D) Common employee skills
b
120
120
What is another example of a resource that demonstrates physical uniqueness? A) Trade secrets
B) Mineral rights
C) Financial resources
D) Employee training programs
b
121
Path dependency has no impact on the inimitability of resources.
F. Many resources cannot be imitated because of what economists refer to as path dependency. This means
that resources are unique and therefore scarce because of all that has happened along the path followed
in their development and/or accumulation. Competitors cannot buy these resources quickly and easily;
they must be built up over time in ways that are difficult to accelerate.
122
What does path dependency refer to in the context of resources? A) Resources that are easily replicated by competitors
B) The unique and scarce nature of resources due to their development history
C) Resources that have a fixed market value
D) A process that is irrelevant to resource accumulation
b
123
Why are resources considered unique because of path dependency? A) They are always the most expensive.
B) They result from a specific historical development and accumulation process.
C) They are only valuable in the present market.
D) They can be easily replaced by new innovations.
b
124
A crash R&D program by one firm cannot replicate a successful technology developed by another firm,
when research findings cumulate. This is an example of
A. social complexity.
B. physical uniqueness.
C. path dependency.
D. causal ambiguity
c
125
What does causal ambiguity refer to? A) The clear understanding of resource value
B) The inability of competitors to identify the causes of a valuable resource
C) The ease of replicating successful strategies
D) A straightforward business model
b
126
Capabilities that exhibit causal ambiguity are difficult to imitate.
t.
127
Amazon Prime is credited for helping to increase the Amazon stock price by nearly 300 percent from
2008 to 2010. This competitive advantage is known as
A. causal ambiguity.
B. product rarity.
C. service validity.
D. substitutability.
a
128
What challenge do competitors face when trying to imitate Amazon's strategies? A) They have more resources available.
B) They lack the ability to execute complex strategies.
C) They find it easy to copy the free-shipping strategy.
D) They can easily identify Amazon’s weaknesses.
b
129
The corporate culture at Southwest airlines is an example of causal ambiguity.
t. When Continental and United tried to mimic the successful low-cost strategy of Southwest Airlines, the
planes, routes, and fast gate turnarounds were not the most difficult aspects for them to copy. Those were
all rather easy to observe and, at least in principle, easy to duplicate. However, they could not replicate
Southwest's culture of fun, family, frugality, and focus since no one can clearly specify exactly what that
culture is or how it came to be.
130
All of the following are examples of socially complex organizational phenomena except
A. a firm's culture.
B. complex physical technology.
C. interpersonal relations among a firm's managers.
D. leadership and
trust.
B
131
A variety of firm resources include interpersonal relations among managers in the firm, its culture, and
its reputation with its suppliers and customers. Such competitive advantages are based upon
A. path dependency.
B. social complexity.
C. physical uniqueness.
D. tangible resources.
b
132
People want to partner with you because they have heard you are a credible company built through a
culture of trust. In a sense, being a great company to work for also makes you a great company to work
with. This is an example of causal ambiguity.
f
133
What does strategic equivalence refer to? A) Resources that are identical in all aspects
B) Resources that can be used separately to implement the same strategies
C) Resources that have no market value
D) Resources that are always cheaper than competitors'
b
134
What is an example of imperfect imitation? A) A firm copying another’s marketing strategy exactly
B) A firm developing its own unique management team instead of copying another's
C) A firm using the same production equipment as another firm
D) A firm closing down its operations
b
135
How can very different resources become strategic substitutes? A) They can be produced in the same factory.
B) They serve the same purpose or function in different ways.
C) They always require similar investment amounts.
D) They are found in the same industry.
b
136
Which of the following is an example of strategic substitutability in the book retail industry? A) Online booksellers like Amazon serving as substitutes for brick-and-mortar bookstores
B) A bookstore expanding its physical locations
C) A publisher printing more copies of a book
D) A library lending books for free
a
137
What challenge do pharmaceutical firms face regarding patent protection? A) New drugs using similar processes but serving the same purpose
B) New drugs using different processes, such as genetic therapies, substituting traditional treatments
C) The inability to produce generic versions
D) The high cost of developing new drugs
b
