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Exam 3: The Internal Organization: Resources, Capabilities, Core Competencies, and Competitive Advantages

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Question 21

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Value chain analysis is a tool used to

A) analyze a firm's external environment for value-creating opportunities.
B) analyze a firm's value chain activities and support functions in isolation from its competitors' value chain.
C) understand the parts of the firm's operation that create value and those that do not.
D) identify the firm's core competencies in each of the primary activities of the firm.

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Question 22

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Capabilities may be costly to imitate if they have a unique and valuable organizational culture, and are causally ambiguous and socially complex.

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Question 23

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A person who has made a successful decision when no obviously correct model or rule is available or when relevant data are unreliable or incomplete has exercised

McDonald's culture with an emphasis on cleanliness, consistency, service, and the training that reinforces the value of these characteristics illustrates which of the following criteria for sustainable competitive advantage?

Firms should never outsource a primary activity because of the danger of the activity being imitated by rivals.

Which of the following is not a component of internal analysis leading to competitive advantage?

Walmart uses core competencies such as information technology and distribution channels to create value for its customers through its "everyday low price."

A local restaurant, Farm Fresh Ingredients, has become highly successful through its menu based solely on organically-raised chicken, beef, and organic seasonal produce. It has opened new locations in other cities, and these new locations are becoming highly profitable. Farm Fresh can expect that, at best, its competitive advantage will be

From a customer's point of view, for an organization's capability to be a core competence it must be

Judgment is the capacity for making a successful decision when

Resources are the source of capabilities, some of which lead to the development of core competencies; in turn, some core competencies may lead to competitive advantage.

Capabilities that other firms cannot develop easily are classified as

Tangible resources include

When firms lay off employees they are

Value chain activities include all of the following EXCEPT

Describe the four specific criteria that managers can use to decide which of their firm's capabilities have the potential to create a sustainable competitive advantage.

Only capabilities that are valuable, common, costly to imitate, and substitutable can be strategic capabilities.

One criteria for a resource or capability to be a source of competitive advantage is that it allows the firm to perform a value-creating activity that competitors cannot perform.

The Chapter 3 Strategic Focus illustrates the challenge facing strategic managers in making decisions about the appropriate use of their companies' resources and capabilities. While a number of firms have successfully used resources and capabilities to earn above average returns, others have not been so successful.

The key to achieving competitiveness, earning above-average returns, and remaining ahead of competitors in the long run is to manage current core competencies