MGM 399 EXAM 1 UPDATED ACTUAL QUESTIONS AND
CORRECT ANSWERS
Question:
1. Operational Effectiveness alone is insufficient because...
Answer:
this is a necessary thing if you want to outperform competitors in your market. Efficiency alone is
insufficient.
Question:
2. Trade-offs and 3 reasons for Trade-offs
Answer:
More of one thing necessitates less of another.
-Inconsistencies in image or reputation
-Activities themselves
-Limits internal coordination and control
Question:
3. 3 types of Fit
Answer:
First-order fit: simple consistency between each activity and overall strategy Second-order fit: occurs when
activities are reinforcing Third-order fit: goes beyond activity reinforcement to what is called optimization
of effort
Question:
4. Does Tesla have a good strategy? What is it?
Answer:
Tesla seems to be starting with a promising strategy and is in the process of gaining a competitive
advantage. Performing well and growth but underperforming when compared to established car
companies. Environmental friendly
Question:
5. What is a good strategy?
Answer:
diagnosis of competitive challenge, guiding policy to address, set of coherent actions
Question:
6. What is a vision statement?
Answer:
about what the organization wants to accomplish; aspirations
Question:
7. What are aspects of an effective vision statement?
Answer:
sense of winning and motivates employees at all levels to aim for the same target
, Question:
8. Strategy is not...
Answer:
Grandiose statements, failure to face a competitive challenge, & operational effectiveness
Question:
9. How vision statements help firms gain and sustain competitive advantage? Do they always?
Answer:
This depends on if this is a customer-oriented vision statement or a product-oriented vision statement
Question:
10. What is a product-oriented vision statement?
Answer:
constrains the ability to allow companies to adapt to changing environments
Question:
11. What is a customer-oriented vision statement?
Answer:
allows companies to adapt to changing environments
Question:
12. Provide AFI framework of Tesla
Answer:
Analysis of Tesla: Diagnosis of competitive challenge Formulation of Tesla: Guiding policy to address
competitive challenge Implementation of Tesla: Need economies of scale (increasing production levels)
Question:
13. What is competitive advantage?
Answer:
superior performance relative to other competitors in the same industry or the industry average
Question:
14. What is sustainable competitive advantage?
Answer:
outperforming competitors or the industry average over a prolonged period of time
Question:
15. What are some key features of strategy?
Answer:
to combine a set of activities to stake out a unique strategic position within industry
Question:
16. What are some cost drivers of competitive advantage?
Answer:
Economies of scale, economies of scope, learning curve, low input costs, etc.
CORRECT ANSWERS
Question:
1. Operational Effectiveness alone is insufficient because...
Answer:
this is a necessary thing if you want to outperform competitors in your market. Efficiency alone is
insufficient.
Question:
2. Trade-offs and 3 reasons for Trade-offs
Answer:
More of one thing necessitates less of another.
-Inconsistencies in image or reputation
-Activities themselves
-Limits internal coordination and control
Question:
3. 3 types of Fit
Answer:
First-order fit: simple consistency between each activity and overall strategy Second-order fit: occurs when
activities are reinforcing Third-order fit: goes beyond activity reinforcement to what is called optimization
of effort
Question:
4. Does Tesla have a good strategy? What is it?
Answer:
Tesla seems to be starting with a promising strategy and is in the process of gaining a competitive
advantage. Performing well and growth but underperforming when compared to established car
companies. Environmental friendly
Question:
5. What is a good strategy?
Answer:
diagnosis of competitive challenge, guiding policy to address, set of coherent actions
Question:
6. What is a vision statement?
Answer:
about what the organization wants to accomplish; aspirations
Question:
7. What are aspects of an effective vision statement?
Answer:
sense of winning and motivates employees at all levels to aim for the same target
, Question:
8. Strategy is not...
Answer:
Grandiose statements, failure to face a competitive challenge, & operational effectiveness
Question:
9. How vision statements help firms gain and sustain competitive advantage? Do they always?
Answer:
This depends on if this is a customer-oriented vision statement or a product-oriented vision statement
Question:
10. What is a product-oriented vision statement?
Answer:
constrains the ability to allow companies to adapt to changing environments
Question:
11. What is a customer-oriented vision statement?
Answer:
allows companies to adapt to changing environments
Question:
12. Provide AFI framework of Tesla
Answer:
Analysis of Tesla: Diagnosis of competitive challenge Formulation of Tesla: Guiding policy to address
competitive challenge Implementation of Tesla: Need economies of scale (increasing production levels)
Question:
13. What is competitive advantage?
Answer:
superior performance relative to other competitors in the same industry or the industry average
Question:
14. What is sustainable competitive advantage?
Answer:
outperforming competitors or the industry average over a prolonged period of time
Question:
15. What are some key features of strategy?
Answer:
to combine a set of activities to stake out a unique strategic position within industry
Question:
16. What are some cost drivers of competitive advantage?
Answer:
Economies of scale, economies of scope, learning curve, low input costs, etc.
