WPC 480 Exam UPDATED Questions and
CORRECT Answers
Strategic Management - CORRECT ANSWER - An integrative management field that
combines analysis, formulation, and implementation in the quest for competitive advantage.
Strategy - CORRECT ANSWER - The set of goal-directed actions a firm takes to gain and
sustain superior performance relative to competitors.
Competitive advantage - CORRECT ANSWER - Superior performance relative to other
competitors in the same industry or the industry average
Sustainable competitive advantage - CORRECT ANSWER - Outpreforming compeittors
or the industry average over a prolonged period of time.
Competitive disadvantage - CORRECT ANSWER - Underperformance relative to other
competitors in the same industry or the industry average
Competitive parity - CORRECT ANSWER - Performance of two or more firms at the
same level
Industry effects - CORRECT ANSWER - Firm performance attributed to the structure of
the industry in which the firm competes
Firm effects - CORRECT ANSWER - Firm performance attributed to the actions mangers
take.
What are strategies NOT - CORRECT ANSWER - Grandoise statements
Failure to face a competitive challenge
Operational effectiness, comp. benchmarking, or other tactical tools
,Environment breakdown - CORRECT ANSWER - 25% other effects (business cycle
effects, unexplained variance)
20% industry effects
55% firm effects
Black swan events - CORRECT ANSWER - Incidents that describe highly improbably but
high-impact events
Ex. (Fall of Berlin Wall, 9/11, Fukushima nuclear disaster in Japan, Arab Spring)
Stakeholders - CORRECT ANSWER - Organizations, groups, and individuals that can
affect or are affect by a firm's actions
Stakeholder strategy - CORRECT ANSWER - An integrative approach to managing a
diverse set of stakeholders effectively in order to gain and sustain competitve advantage
External Stakeholders - CORRECT ANSWER - Customers, suppliers, alliance partners,
creditors, unions, communities, governments, media
Internal Stakeholders - CORRECT ANSWER - Employees, stockholders, board members
Stakeholder impact analysis - CORRECT ANSWER - A decision tool with which mangers
can recognize, prioritize, and address the needs of different stakeholders, enabling the firm to
achieve competitve advantage while acting as a good corporate citizen.
Step 1: Who are our stakeholders?
Step 2: What are our stakeholders' interests?
Step 3: What opportunities and threats do our stakeholders present?
Step 4: What economic, legal, ethical and philantropic responsbilities do we have to our
stakeholders?
, Step 5: What should we do to effectively address the stakeholder concerns?
Corporate social responsibility (CSR) - CORRECT ANSWER - A framework that helps
firms recognize and address the econmic, legal, social, and philantroopic expections that society
has of the business enterpirse at a given point in time.
CSR Pyramid - CORRECT ANSWER - Philanthropic (top)- Corporate citizienship
Ethical- Do what is right, just, and fair
Legal- Laws and regulations, define min. acceptable standard
Econmic (bottom) - Gain & sustain comp. adv.
AFI - CORRECT ANSWER - Analyze
Formulate
Implement
(How firms craft and execute a strategy that enhances their chances of achieving superior
preformance)
AFI Strategy framework - CORRECT ANSWER - A model that links three interdependent
strategic management tasks- anaylze, formulate, and implement- that , together, help mangers
plan and implement a strategy that can improve performance and result in competitive advantage
Getting started > External and Internal Analysis > Formulation: Business strategy > Formulation:
Corporte Strategy > Implementation
Goal: Gaining and sustaining comp. adv.
Ch 2 - CORRECT ANSWER -
Strategic management - CORRECT ANSWER - Method put in place by strategic leaders
to formulate and implement a strategy, which can lay the foundation for a sustainable
competitive advantage
CORRECT Answers
Strategic Management - CORRECT ANSWER - An integrative management field that
combines analysis, formulation, and implementation in the quest for competitive advantage.
Strategy - CORRECT ANSWER - The set of goal-directed actions a firm takes to gain and
sustain superior performance relative to competitors.
Competitive advantage - CORRECT ANSWER - Superior performance relative to other
competitors in the same industry or the industry average
Sustainable competitive advantage - CORRECT ANSWER - Outpreforming compeittors
or the industry average over a prolonged period of time.
Competitive disadvantage - CORRECT ANSWER - Underperformance relative to other
competitors in the same industry or the industry average
Competitive parity - CORRECT ANSWER - Performance of two or more firms at the
same level
Industry effects - CORRECT ANSWER - Firm performance attributed to the structure of
the industry in which the firm competes
Firm effects - CORRECT ANSWER - Firm performance attributed to the actions mangers
take.
What are strategies NOT - CORRECT ANSWER - Grandoise statements
Failure to face a competitive challenge
Operational effectiness, comp. benchmarking, or other tactical tools
,Environment breakdown - CORRECT ANSWER - 25% other effects (business cycle
effects, unexplained variance)
20% industry effects
55% firm effects
Black swan events - CORRECT ANSWER - Incidents that describe highly improbably but
high-impact events
Ex. (Fall of Berlin Wall, 9/11, Fukushima nuclear disaster in Japan, Arab Spring)
Stakeholders - CORRECT ANSWER - Organizations, groups, and individuals that can
affect or are affect by a firm's actions
Stakeholder strategy - CORRECT ANSWER - An integrative approach to managing a
diverse set of stakeholders effectively in order to gain and sustain competitve advantage
External Stakeholders - CORRECT ANSWER - Customers, suppliers, alliance partners,
creditors, unions, communities, governments, media
Internal Stakeholders - CORRECT ANSWER - Employees, stockholders, board members
Stakeholder impact analysis - CORRECT ANSWER - A decision tool with which mangers
can recognize, prioritize, and address the needs of different stakeholders, enabling the firm to
achieve competitve advantage while acting as a good corporate citizen.
Step 1: Who are our stakeholders?
Step 2: What are our stakeholders' interests?
Step 3: What opportunities and threats do our stakeholders present?
Step 4: What economic, legal, ethical and philantropic responsbilities do we have to our
stakeholders?
, Step 5: What should we do to effectively address the stakeholder concerns?
Corporate social responsibility (CSR) - CORRECT ANSWER - A framework that helps
firms recognize and address the econmic, legal, social, and philantroopic expections that society
has of the business enterpirse at a given point in time.
CSR Pyramid - CORRECT ANSWER - Philanthropic (top)- Corporate citizienship
Ethical- Do what is right, just, and fair
Legal- Laws and regulations, define min. acceptable standard
Econmic (bottom) - Gain & sustain comp. adv.
AFI - CORRECT ANSWER - Analyze
Formulate
Implement
(How firms craft and execute a strategy that enhances their chances of achieving superior
preformance)
AFI Strategy framework - CORRECT ANSWER - A model that links three interdependent
strategic management tasks- anaylze, formulate, and implement- that , together, help mangers
plan and implement a strategy that can improve performance and result in competitive advantage
Getting started > External and Internal Analysis > Formulation: Business strategy > Formulation:
Corporte Strategy > Implementation
Goal: Gaining and sustaining comp. adv.
Ch 2 - CORRECT ANSWER -
Strategic management - CORRECT ANSWER - Method put in place by strategic leaders
to formulate and implement a strategy, which can lay the foundation for a sustainable
competitive advantage
