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A company that successfully and methodically applies Six Sigma methods to its value
chain, activity by activity, can:
A. clearly consider what it will take to overtake rivals with the industry's overall best
strategy.
B. make major strides in improving the proficiency with which its strategy is executed
without sacrificing innovation.
C. increase its bargaining power with suppliers and create better seller"supplier
collaborations.
D. assess the extent to which rivals have competitively valuable competencies or
capabilities.
E. construct a business model that entails a value proposition based on quality.
Answer:
In a weighted competitive strength analysis, each strength measure is assigned a weight
based on:
A. its percentage share of total industry revenues.
B. B).its percentage share of total industry losses.
C. its perceived importance in determining a company's competitive success in the
marketplace.
D. its percentage share of total industry profits.
E. what it takes to provide better analytical balance between the companies with high
ratings and the companies with low ratings and thus get the sum of the weights to add
up to 1.0.
Answer:
The BEST example of a company resource is:
A. having higher earnings per share and a higher return on shareholders' equity
investment than key rivals.
B. being totally self-sufficient such that the company does not have to rely in any way
on key suppliers, partnerships with outsiders, or strategic alliances.
C. having proven technological expertise and an ability to churn out new and improved
products on a regular basis.
D. having a larger number of competitive assets than competitive liabilities.
E. having more built-in key success factors than rivals.
Answer:
A company's value-creating activities can offer a competitive advantage in one of two
ways:
A. contribute to greater efficiency and lower costs and provide a basis for
differentiation.
B. contribute expense savings and enhance product exclusivity.
C. reduce cost disadvantages and market price anomalies.
D. contribute customer experience value and conserve operating functionality.
E. contribute to competitive assets and discontinue distinctive competencies.
Answer:
Good strategy combined with good strategy execution:
A. offers a surefire guarantee for avoiding periods of weak financial performance.
B. is the best sign that a company is a true industry leader.
C. is a more important management function than forming a strategic vision combined
with setting objectives.
D. is the clearest indicator of good management.
E. signals that a company has the best business model in a market.
Answer:
Each of the five generic strategies positions the company differently, EXCEPT when it
concerns:
A. its market and competitive environment.
B. establishing a central theme for how the company will endeavor to outcompete
rivals.
C. having resources and capabilities that rivals have trouble duplicating.
D. defining differences in terms of product line and production emphasis.
E. defining differences in terms of marketing emphasis and the means of maintaining
strategy.
Answer:
Which of the following is NOT an action that a company should take to perform value
chain activities more cost-effectively?
A. Striving to capture all available economies of scale and taking advantage of
experience and learning-curve effects
B. Trying to operate facilities at full capacity
C. Adopting labor-saving operating methods
D. Improving supply chain efficiency
E. Over-differentiating so that product features exceed the needs of most buyers
Answer:
In order to coordinate and control the complex set of activities, managers must ensure:
A. the organizational structure enables bureaucratic waste and strives for eliminating
imposed capacity limitations of the strategy.
B. the various parts of the organizational structure are aligned with one another and also
matched to the requirements of the strategy.
C. they have enough employees dedicated to the various functions to attain economies
of scale benefits.
D. they can orchestrate the process with forceful administration and political
maneuvering.
E. they accommodate situational idiosyncrasies to build a competitively capable
organization.
Answer:
The target market of a best-cost provider is:
A. value-conscious buyers.
B. brand-conscious buyers.
C. price-sensitive buyers.
D. middle-income buyers.
E. young adults (in the 18"35 age group).
Answer:
Outsourcing the performance of value chain activities presently performed in-house to
outside vendors and suppliers makes strategic sense EXCEPT when:
A. an activity can be performed better or more cheaply by outside specialists.
B. it allows a company to focus its entire energies on its core business.
C. it restricts a company's ability to assemble diverse kinds of expertise speedily and
efficiently.
D. it reduces the company's risk exposure to changing technology and/or changing
buyer preferences.
E. it allows a company to leverage its key resources.
Answer:
Televisa, a Mexican media company, became the world's most prolific producer of
Spanish-language soap operas owing to its expertise in Spanish culture and linguistics.
Which of the following strategies did Televisa employ to defend against global giants?
A. Develop business models that exploit shortcomings in local distribution networks or
infrastructure.
B. Utilize keen understanding of local customer needs and preferences to create
customized products or services.
C. Take advantage of aspects of the local workforce with which large international
companies may be unfamiliar.
D. Transfer company expertise to cross-border markets and initiate actions to contend
on an international level.
E. Use acquisition and rapid-growth strategies to better defend against
expansion-minded internationals.
Answer:
The marketing emphasis of a company pursuing a focused low-cost provider strategy
usually is to:
A. tout the company's lower prices.
B. tout the lack of frills and extras.
C. out-advertise rivals and make frequent use of discount coupons.
D. communicate the attractive features of a budget-priced product offering that fits
niche members' expectations.
E. communicate the product's ability to serve the customer's every need.
Answer:
The major avenues for achieving a cost advantage over rivals include:
A. performing value chain activities more cost-effectively than rivals or revamping the
firm's overall value chain to eliminate or bypass some cost-producing activities.
B. having a management team that is highly skilled in cutting costs.
C. being a first-mover in adopting the latest state-of-the-art technologies, especially
those relating to low-cost manufacture.
D. outsourcing high-cost activities to cost-efficient vendors.
E. paying lower wages and salaries than rivals.
Answer:
A strategy of vertical integration can have substantial drawbacks, including:
A. whether horizontal integration can limit the performance of strategy-critical
activities in ways that increase cost, build expertise, protect proprietary know-how, or
increase differentiation.
B. raising the firm's capital investment in the industry and increasing business risk, as
well as providing less flexibility in accommodating shifting buyer preferences by
locking the firm into relying on its own in-house activities.
C. the environmental costs of coordinating operations across vertical chain activities.
D. loss of technological know-how.
E. the difficulties faced in entering outside vertical and horizontal markets.
Answer:
The big difference between business process reengineering and continuous
improvement programs like TQM or Six Sigma is that:
A. reengineering is a tool for installing process organization, whereas TQM/Six Sigma
concern defect-free production methods and delivering world-class customer service.
B. reengineering helps create core competencies, whereas TQM/Six Sigma are tools for
making a core competence stronger and more efficient.
C. reengineering is a tool for achieving one-time quantum improvement, whereas TQM
and Six Sigma programs aim at ongoing incremental improvements.
D. business process reengineering requires benchmarking, whereas TQM and Six
Sigma do not.
E. reengineering represents an effort to totally revamp a firm's value chain, whereas
TQM looks at incrementally improving the performance of two or three targeted value
chain activities and Six Sigma is primarily for reducing manufacturing defects.
Answer:
Adapting to new conditions like new innovations by competitors, fast-changing
technological developments, and constantly evaluating what is working result in:
A. an assured profitability strategy.
B. a broad market entry strategy.
C. an emergent strategy.
D. unlimited revenue generation.
E. a proactive strategy.
Answer:
The advantages of manufacturing goods in a particular country and exporting them to
foreign markets:
A. are largely unaffected by fluctuating exchange rates.
B. are greatest when local distributors and dealers in that country can be convinced not
to carry products that are made outside the country's borders.
C. can be wiped out when that country's currency grows weaker relative to the
currencies of the countries where the output is being sold.
D. are weakened when that country's currency grows stronger relative to the currencies
of the countries where the output is being sold.
E. are multiplied by the potential for local government officials to raise tariffs on the
imports of foreign-made goods into their country.
Answer:
How is a functional structure or unitary structure organized?
A. With a central executive handling all major decisions
B. To lighten the load of senior executives so they can concentrate on value chain action
agendas
C. Specifically to manage unrelated diversification opportunities
D. Into functional departments, with departmental managers who report to the CEO and
small corporate staff
E. With top-heavy management, and senior executives forming a central office of the
chairman
Answer:
Using the five forces model of competition to determine the character and strength of
the competitive forces within a given industry involves:
A. building the picture of competition in three steps: (1) identify the different parties
involved, along with specific factors that bring about competitive pressures; (2)
evaluate how strong the pressures stemming from each of the five forces are (strong,
moderate or weak); and (3) determining whether the collective impact of the five
competitive forces is conducive to earning attractive profits in the industry.
B. building the picture of competition in two steps: (1) determining which rival has the
biggest competitive advantage and (2) assessing whether the competitive advantages
possessed by various industry members allow most industry members to earn
above-average profits.
C. evaluating whether competition is being intensified or weakened by the industry's
driving forces and key success factors.
D. assessing whether the collective impact of all five forces is weak enough to allow
industry members to go on the offensive or use a defensive strategy to insulate against
fierce competitive pressures.
E. gauging the overall strength of competition based on how many industry rivals are
operating with a competitive advantage and how many are operating at a competitive
disadvantage.
Answer:
Whether a broad differentiation strategy ends up enhancing a company's profitability
depends mainly on whether:
A. many buyers view the product's differentiating features as having value.
B. most buyers have similar needs and use the product in the same ways.
C. most buyers accept the customer value proposition as unique and the product can
produce sufficient unit sales to cover the costs of achieving the differentiation.
D. buyer switching costs are low and customer loyalty to any one brand is low.
E. buyers are prone to shop the market for sellers offering the best price.
Answer:
In doing SWOT analysis and trying to identify a company's market opportunities, which
of the following is NOT an example of a potential market opportunity that a company
may have?
A. Serving additional customer groups or market segments
B. Growing buyer preferences for substitutes for the industry's product
C. Acquiring rival firms or companies with attractive technological expertise or
capabilities
D. Expanding into new geographic markets
E. Openings to win market share away from rivals
Answer:
A company's strategy needs to be ethical because:
A. of the dangers that top management will get embarrassed if the company's unethical
behavior is publicly exposed.
B. it is good business and in the best interest of shareholders.
C. everyone is an ethics watchdog and somebody is sure to blow the whistle on the
company's unethical behavior.
D. of the inevitable risks of getting caught and prosecuted by governmental authorities
if an unethical strategy is used.
E. unethical strategies boost long-termism in corporate culture.
Answer:
Which of the following statements about the match between a company's culture and its
strategy is NOT true?
A. When a company's present work climate promotes attitudes and behaviors that are
well suited to first-rate strategy execution, its culture functions as a valuable ally in the
strategy execution process.
B. A deeply embedded culture tightly matched to the strategy aids the cause of
competent strategy execution by steering company personnel to culturally approved
behaviors and work practices and thus makes it far simpler to root out operating
practices that are a misfit.
C. It is in management's best interest to dedicate considerable effort to embedding a
corporate culture that encourages behaviors and work practices conducive to good
strategy execution.
D. A tight strategy-culture alignment facilitates building core competencies and
distinctive competencies that lead to low operating costs and a cost-based competitive
advantage.
E. When a company's culture is grounded in many of the needed strategy-executing
behaviors, employees feel genuinely better about their jobs and what the company is
trying to accomplish; as a consequence, greater numbers of company personnel exert
their best efforts to execute the strategy and achieve performance targets.
Answer:
The culture of a company can be a cost-efficient value chain activity because it can:
A. allow for safeguarding internalized operating benefits.
B. distinguish a company's capacity integration efforts.
C. spur worker pride in productivity and continuous improvement.
D. foster quality technological enhancements.
E. increase a company's bargaining power with suppliers.
Answer:
A dynamic capability is the:
A. ongoing capacity to modify existing resources and capabilities to create new ones.
B. improvement evaluation process for eliminating waste in the firm.
C. functional and operating resources management process.
D. ongoing capability to understand and establish a commitment to resource alignment.
E. improvement evaluation process for repurposing waste in the firm.
Answer:
Identify and explain the significance of each of the following terms and concepts:
a. global strategy
b. export strategy
c. licensing strategy
d. franchising strategy
Answer:
Strategy is about competing differently than rivals, thus strategy success is about:
A. the sources of sustained advantages and superior profitability.
B. those emergent, unplanned, reactive, and adaptive plans that are more appropriate
than deliberate or intended ones that drive the realized strategy.
C. matching internal resources and capabilities to the industry environment.
D. keeping the firm current with the rapid pace of change in the industry.
E. replacing proactive and reactive measures by modified ongoing strategic elements to
preserve company values.
Answer:
Which of the following is NOT generally a "driving force" capable of producing
fundamental changes in industry and competitive conditions?
A. Changes in the long-term industry growth rate
B. Increasing globalization of the industry
C. Product innovation and technological change
D. Movement in the economy and in interest rates
E. Regulatory influences and government policy changes
Answer:
What is the rule for organizing the work effort to support good strategy execution?
A. Match the firm's organizational structure to its unique strategy.
B. Decide on how much to spend on training managers and employees.
C. Choose an organization structure that is a tight fit with the corporate culture.
D. Ensure the firm hires a capable management team.
E. Learn how the collaborative partner does things.
Answer:
Which of the following is LIKELY to be viewed as a pro-business government policy
from the perspective of companies competing on an international basis?
A. Argentina increases its interest rate on loans to foreign entrants from 15% to 19%.
B. The European Union imposes a 16% tariff on the import of agricultural produce.
C. Australia introduces a permanent employer-sponsored visa program for skilled
manpower.
D. Denmark levies a per metric ton carbon tax on electricity.
E. The Chinese government favors partial local ownership of foreign-owned companies.
Answer:
The most important leadership trait in the strategy execution process is:
A. a strong, confident sense of what to do and how to do it.
B. strong communication skills (both written and verbal) covering motivating intent.
C. strong management skills to ensure a systematic approach to administration.
D. strong organizational skills so as to make actions structured toward results.
E. strong empathy skills when employees run into challenging moments.
Answer:
Telsteer Mobil, a smartphone manufacturer, is working on developing its
next-generation products. It has decided on a strategy of focusing on a narrow buyer
segment and outcompeting rivals by offering buyers customized product features for
specialized needs and tastes. What basic strategic approach has Telsteer decided upon?
A. Focused differentiation
B. Best-cost provider
C. Low-cost provider
D. Broad differentiation
E. Focused low-cost
Answer:
A motivation and incentive system that is aimed at spurring stronger employee
commitment to good strategy execution:
A. should focus on incorporating more positive than negative motivational elements.
B. should be tied first and foremost to whether employees satisfactorily perform their
assigned duties in an ethical and honorable manner.
C. must involve deliberately assigning employees heavy workloads and tight deadlines.
D. D. needs to put top priority on making employees happy and secure in their jobs.
E. must avoid the potential for negative consequences if performance is subpar.
Answer:
