MAN 4720 CHAPTER 1 QUESTIONS AND
ANSWERS 100% CORRECT
Strategic Competitiveness - ANSWER-achieved when a firm successfully formulates
and implements a value-creating strategy
Strategy - ANSWER-an integrated and coordinated set of commitments and actions
designed to exploit core competencies and gain competitive advantage
The chosen strategy tells us 2 things: - ANSWER-What the firm WILL DO and WILL
NOT do
Give an example of how Alibaba is changing their environment - ANSWER-Alibaba is
coordinating with Apple Pay
Competitive Advantage - ANSWER-when a firm implements a strategy that creates
superior value for customers and competitors are unable to duplicate or find too costly
to try to imitate
T/F: Some Competitive Advantages are permanent - ANSWER-False, no completive
advantage is permanent
A competitive advantage will last for how long? - ANSWER-Until another firm can
acquire the skills to duplicate the benefits
Above-Average Returns - ANSWER-returns in excess of what an investor expects to
earn from other investments with similar amount of risk
Risk - ANSWER-an investor's uncertainty about the economic gains or losses that will
result from a particular investment
In small new firms, returns are often measured in terms of ________ and _____. -
ANSWER-amount and speed of growth
Average Returns - ANSWER-returns equal to those an investor expects to earn from
other investments with a similar amount of risk
How does failure occur? - ANSWER-when investors withdraw their investments from
firms earning less-than-average returns
Strategic Management Process - ANSWER-The full set of commitments, decisions, and
actions required for a firm to achieve strategic competitiveness and earn above-average
returns.
, The first step of the strategic management process is: - ANSWER-to analyze the firms
external environment and internal organizations
The "strategy" portion of the strategic management process is made up of two steps: -
ANSWER-strategy formulation and implementation
What is one of the most significant challenges for firms right now? - ANSWER-learning
how to successfully compete in a globalized world
Industrial Organization model suggests ______ is the primary determinant of a firm's
actions - ANSWER-external environment
Resource-based model suggests that ________ is the primary determinant of a firm's
actions - ANSWER-the firm's unique resources and capabilities
List the 2 models that firms use to gather info and implement strategies - ANSWER-
Industrial Organization and Resource-Based
From the 1960's through the 1980s, what was the primary determinant of strategies? -
ANSWER-External Environment
The 5 forces - ANSWER-1. Suppliers
2. Buyers
3. rivalry among firms already in the industry
4. Substitutes
5. Potential Entrants to the Industry
What does the 5 forces model do? - ANSWER-identifies the attractiveness of an
industry
Steps in I/O model (5) - ANSWER-1. External Environment
2. An attractive industry
3. Strategy Formulation
4. Assets and Skills
5. Strategy Implementation
I/O model suggests - ANSWER-above-average returns happen when a firm can study
external environment to find an attractive market and implement a good strategy
Resource-based Model suggests that______. - ANSWER-a firm's uniqueness is what
earns them above-average returns
Resources are ______. - ANSWER-inputs into a firm's production process
ANSWERS 100% CORRECT
Strategic Competitiveness - ANSWER-achieved when a firm successfully formulates
and implements a value-creating strategy
Strategy - ANSWER-an integrated and coordinated set of commitments and actions
designed to exploit core competencies and gain competitive advantage
The chosen strategy tells us 2 things: - ANSWER-What the firm WILL DO and WILL
NOT do
Give an example of how Alibaba is changing their environment - ANSWER-Alibaba is
coordinating with Apple Pay
Competitive Advantage - ANSWER-when a firm implements a strategy that creates
superior value for customers and competitors are unable to duplicate or find too costly
to try to imitate
T/F: Some Competitive Advantages are permanent - ANSWER-False, no completive
advantage is permanent
A competitive advantage will last for how long? - ANSWER-Until another firm can
acquire the skills to duplicate the benefits
Above-Average Returns - ANSWER-returns in excess of what an investor expects to
earn from other investments with similar amount of risk
Risk - ANSWER-an investor's uncertainty about the economic gains or losses that will
result from a particular investment
In small new firms, returns are often measured in terms of ________ and _____. -
ANSWER-amount and speed of growth
Average Returns - ANSWER-returns equal to those an investor expects to earn from
other investments with a similar amount of risk
How does failure occur? - ANSWER-when investors withdraw their investments from
firms earning less-than-average returns
Strategic Management Process - ANSWER-The full set of commitments, decisions, and
actions required for a firm to achieve strategic competitiveness and earn above-average
returns.
, The first step of the strategic management process is: - ANSWER-to analyze the firms
external environment and internal organizations
The "strategy" portion of the strategic management process is made up of two steps: -
ANSWER-strategy formulation and implementation
What is one of the most significant challenges for firms right now? - ANSWER-learning
how to successfully compete in a globalized world
Industrial Organization model suggests ______ is the primary determinant of a firm's
actions - ANSWER-external environment
Resource-based model suggests that ________ is the primary determinant of a firm's
actions - ANSWER-the firm's unique resources and capabilities
List the 2 models that firms use to gather info and implement strategies - ANSWER-
Industrial Organization and Resource-Based
From the 1960's through the 1980s, what was the primary determinant of strategies? -
ANSWER-External Environment
The 5 forces - ANSWER-1. Suppliers
2. Buyers
3. rivalry among firms already in the industry
4. Substitutes
5. Potential Entrants to the Industry
What does the 5 forces model do? - ANSWER-identifies the attractiveness of an
industry
Steps in I/O model (5) - ANSWER-1. External Environment
2. An attractive industry
3. Strategy Formulation
4. Assets and Skills
5. Strategy Implementation
I/O model suggests - ANSWER-above-average returns happen when a firm can study
external environment to find an attractive market and implement a good strategy
Resource-based Model suggests that______. - ANSWER-a firm's uniqueness is what
earns them above-average returns
Resources are ______. - ANSWER-inputs into a firm's production process
