Q1. In social network analysis, groups can become too insular and fail to share what they have learned with people outside the group. This is a result of __________
a. bridging relationships
b. intellect
c. closure
d. diverse knowledge
Q2. Social capital is a source of strength to many firms. Firms leverage their social capital in an effort to create competitive advantages. The social capital of a firm is based on ___________
a. the individual abilities of employees
b. the allocation of the financial resources of the firm
c. the relationships among the employees of the firm
d. the knowledge of an individual
Q3. Creativity and problem solving ability are considered to be part of ____________
a. physical capital
b. human capital
c. social capital
d. emotional capital
Q4. In bridging relationships in social networks, one member is central to the communication flows in a group
a. TRUE
b. FALSE
Q5. Companies have found that referrals from their own employees are generally an effective approach to recruiting top talent
a. True
b. False
Q6. Generally, employees are most likely to stay with an organization if _____________
a. the employer provides high salaries to technology professionals
b. the firm is in a high tech industry
c. the organization mission and values align with the employees mission and values
d. the mission and values of the organization change often
Q7. The use of information technology (e.g., e-mail) has increased in recent years in many organizations. This has helped to ____________
a. make more effective use of time in every situation
b. communicate information efficiently
c. restrict social network growth
d. create smaller social networks
Q8. Many successful firms use internal labor markets. The most important reason for doing this is _____
a. they want to encourage job rotation
b. they want to keep highly mobile employees motivated and challenged
c. if employees remain in the same department for too long, they would become indispensable
d. an employee who moves too much can be identified as unreliable and then eliminated
Q9. The value net is a game-theoretic approach that _____________
a. extends the value chain analysis
b. is a way to analyze all the players in a game and analyze how their interactions affect the ability of a firm to generate and appropriate value
c. helps us to understand the evolution of the five forces over time
d. uses network analysis to understand the relationships among different companies
Q10. Which of the following would be considered part of a firm's general environment?
a. decreased entry barriers
b. higher unemployment rates
c. increased bargaining power of the firm's suppliers
d. increased competitive intensity
Q11. SWOT analysis is a framework for analyzing the internal and external environment of a company. It consists of strengths, weaknesses, opportunities, and threat. According to a SWOT analysis, which of the following is not an aspect that the strategy of the firm must follow?
a. build on its weaknesses
b. remedy the weaknesses or work around them
c. take advantage of the opportunities presented by the environment
d. protect the firm from the threats
Q12. Although changes in the general environment may often adversely or favorably impact a firm, they seldom alter an entire industry
a. True
b. False
Q13. Threat of substitute products comes from ____________
a. other companies in the same industry
b. foreign companies which can use cheap labor in their countries
c. firms in other industries that produce products or services that satisfy the same customer need
d. new companies in the same industry
Q14. The threat of new entrants is high when there are _______
a. low economies of scale
b. high capital requirements
c. high switching costs
d. high differentiation among competitors products and services
Q15. The aging of the population, changes in ethnic composition, and effects of the baby boom are ____
a. macroeconomic changes
b. demographic changes
c. global changes
d. sociocultural changes
Q16. In general, the threat of substitutes is heightened because the Internet ____________
a. introduces new ways to accomplish the same task
b. lowers switching costs
c. lowers barriers to entry
d. increases output per unit of cost
Q17. The bargaining power of suppliers increases as ____________
a. more suppliers enter the market
b. importance of buyers to supplier group increases
c. switching costs for buyers decrease
d. threat of forward integration by suppliers increases
Q18. In a retail service industry, which of the following is not a primary value-chain activity?
a. purchasing goods
b. operating stores
c. partnering with vendors
d. human resource management
Q19. In value-chain analysis, the activities of an organization are divided into two major categories of value activities: primary and support. Which of the following is a primary activity?
a. purchasing key inputs
b. repairing the product for the consumer
c. recruiting and training employees
d. monitoring the cost of producing the product through a cost accounting system
Q20. 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 dependence on suppliers
d. reduced work-in-process inventories
Q21. The resource-based view (RBV) of the firm combines 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
Q22. The balanced scorecard, developed by Kaplan and Norton, helps to integrate ______.
a. financial analysis and the reputation of a firm
b. intangible resources and operational measures
c. financial analysis and stakeholder perspectives
d. short-term perspectives and strategic positioning
Q23. The best measure of a company's ability to meet imminent financial obligations is known as the
a. debt ratio
b. current ratio
c. total asset turnover
d. profit margin
Q24. According to value-chain analysis, which of the following would be considered part of the general administration in a firm?
a. human resource management
b. technology development
c. information systems
d. procurement
Q25. 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. organizational culture and leadership
b. interrelationships among functional areas and firm strategies
c. need to maintain the reputation of the company
d. synergy of the business units
Q26. High product differentiation is generally accompanied by __________.
a. higher market share
b. higher profit margins and lower costs
c. decreased emphasis on competition based on price
d. significant economies of scale
Q27. Atlas Door created competitive advantage by reducing the time to receive and process and order and through installing a just in time logistics operation. Which of the following is not a reason for their favorable position relative to the five forces of industry competition?
a. It exerted power over its customers.
b. It created high entry barriers for new entrants.
c. The integration of many value-chain activities in the firm provided causal ambiguity and path dependency.
d. The product was easily imitable.
Q28. During the decline stage of the product life cycle, a harvesting strategy means that a firm keeps a product going without significantly reducing marketing support, technological development, or other investments, while hoping that competitors will exit the market.
a. TRUE
b. FALSE
Q29. A market that mainly competes on the basis of price and has stagnant growth is characteristic of what life cycle stage?
a. introduction
b. growth
c. maturity
d. decline
Q30. A differentiation strategy enables a business to address the five competitive forces by ______.
a. having brand-loyal customers become more sensitive to prices
b. lessening competitive rivalry by distinguishing itself
c. increasing economies of scale
d. serving a broader market segment
Q31. Research has consistently shown that firms that achieve both cost leadership and differentiation advantages tend to perform ______________.
a. at about the same level as firms that achieve either cost or differentiation advantages
b. about the same as firms that are stuck-in-the-middle
c. higher than firms that achieve either a cost or a differentiation advantage
d. lower than firms that achieve differentiation advantages but higher than firms that achieve cost advantages
Q32. A firm following a focus strategy must focus on _____________.
a. governmental regulations
b. the rising cost of inputs
c. a market segment or group of segments
d. avoiding entering international markets
Q33. Which of these statements regarding the industry life cycle is correct?
a. Part of the power of the market life cycle is its ability to serve as a short-run forecasting device.
b. Trends suggested by the market life cycle model are generally not reversible or repeatable.
c. It points out the need to maintain a differentiation advantage and a low cost advantage simultaneously.
d. It has important implications for company generic strategies, functional areas, value-creating activities, and overall objectives.
Q34. A firm should consider vertical integration when ___________.
a. the competitive situation is highly volatile
b. customer needs are evolving
c. the suppliers of the firm willingly cooperate with the firm
d. the suppliers of raw materials to the firm are often unable to maintain quality standards
Q35. Corporate-level strategy focuses on _____________.
a. gaining long-term revenue
b. gaining short-term profits
c. decreasing business locations
d. managing investment bankers and their interests
Q36. According to the text, corporate restructuring includes
a. capital restructuring, asset restructuring, and technology restructuring
b. global diversification, capital restructuring, and asset restructuring
c. management restructuring, financial restructuring, and procurement restructuring
d. capital restructuring, asset restructuring, and management restructuring
Q37. In the BCG Matrix, a business that has a low market share in an industry characterized by high market growth is termed a ____________.
a. Star
b. Cash Cow
c. Question Mark
d. Dog
Q38. The risks of vertical integration include all of the following EXCEPT:
a. costs and expenses associated with increased overhead and capital expenditures.
b. problems associated with unbalanced capacities along the value chain.
c. lack of control over valuable assets.
d. additional administrative costs associated with managing a more complex set of activities.
Q39. Although acquiring related businesses can enhance the bargaining power of a corporation, there is a risk of retaliation by competitors that can result in a diminishing of the desired bargaining power.
a. True
b. False
Q40. Research shows that the vast majority of acquisitions results in value creation rather than value destruction.
a. True
b. False
Q41. Diversification initiatives include all of the following except ___________________.
a. mergers and acquisitions
b. strategic alliances
c. joint ventures
d. shareholder development
Q42. According to the text, the triple bottom line approach to corporate accounting includes three components:
a. financial, environmental, and customer
b. financial, organizational, and customer
c. financial, environmental, and social
d. financial, organizational, and psychological
Q43. There are several perspectives of competition. One perspective is zero-sum thinking. Zero-sum thinking means that:
a. all parts of the organization gain at no loss
b. in order for someone to gain others must experience no gain or benefit
c. one can only gain at the expense of someone else
d. everyone in the organization shares gains and losses equally
Q44. Many organizations have a large number of functional areas with very diverse and sometimes competing interests. Such organizations will be most effective if:
a. each functional area focuses on achieving their own goals
b. functional areas work together to attain overall goals
c. goals are defined at the bottom and implemented at the top
d. management and employees have separate goals
Q45. The three participants in corporate governance are:
a. the shareholders, board of directors, and employees
b. the shareholders, labor unions, and employees
c. the shareholders, board of directors, and management
d. the shareholders, banks and lending institutions, and management
Q46. Members of boards of directors are:
a. appointed by the Securities and Exchange Commission
b. elected by the shareholders as their representatives
c. elected by the public
d. only allowed to serve one term of four years
Q47. The text argues that a strategic perspective in an organization should be emphasized:
a. at the top of the organization
b. at the middle of the organization
c. throughout the organization
d. from the bottom up
Q48. In contrast to the vision of an organization, its mission should:
a. be shorter in length
b. encompass both the purpose of the company as well as the basis of competition
c. encompass all the major rules and regulations of the corporate work force
d. be less detailed.
Q49. Leadership is a necessary (but not sufficient) condition for organizational success. Leaders should emerge at which level(s) of an organization?
a. only at the top
b. in the middle
c. throughout the organization
d. only during times of change
Q50. Procter and Gamble developed a laundry detergent compaction technique that appeals to consumers, retailers, shipping and wholesalers, and environmentalists. This is an example of stakeholder symbiosis.
a. True
b. False