Evaluating a Company's Resources, Capabilities, and Competitiveness

Evaluating a Company's Resources, Capabilities, and Competitiveness 

1 Which one of the following is not helpful in identifying the components of a single-business company's strategy?

A) Initiatives to build competitive advantage

B) Efforts to expand or narrow geographic coverage

C) The company's resource strengths and weaknesses

D) The company's key functional strategies

E) Efforts to build competitively valuable partnerships and strategic alliances with other enterprises within its industry

2 SWOT analysis

A) provides the basis for crafting a strategy that capitalizes on the company's strengths, overcomes its weaknesses, aims squarely at capturing the company's best opportunities, and defends against competitive and environmental threats

B) provides a quick overview of where on the scale from "alarmingly weak" to "exceptionally strong" the attractiveness of the company's overall business situation ranks.

C) helps provide a basis for matching the company's strategy to its internal resource capabilities and its external opportunities and threats.

D)helps identify a company's core competencies and competitive capabilities and the seriousness of its resource weaknesses and competitive deficiencies.

E) All of these.

3 A core competence

A) is a more durable company resource than a "distinctive competence."

B) usually resides in a company's technology and physical assets (state-of-the-art plants and equipment, attractive real estate locations, modern distribution facilities, and so on) whereas a company competence usually resides in a company's human assets.

C) may evolve into a distinctive competence, giving the company superiority over rivals in performing an important value chain activity

D) is usually tied closely to the caliber of a company's manufacturing capability and/or its proprietary technology and know-how.

E) is better suited to helping a company defend against external threats than in pursuing external market opportunities.

4 Which of the following analytical tools are particularly useful for determining whether a company's prices and costs are competitive?

A) SWOT analysis, strategy assessment, activity-based costing analysis, and key success factor analysis.

B) Best practices analysis, and value chain analysis.

C) Value chain analysis and benchmarking.

D) Competitive position assessment, competitive strength assessment, strategic group mapping, SWOT analysis, and value chain analysis.

E) SWOT analysis, best practices analysis, activity-based costing analysis, and competitive strength assessment.

5 A company's value chain consists of

A) the activities a company performs in converting its resource weaknesses into resource strengths.

B) the collection of activities it performs in the course of designing, producing, marketing, delivering, and supporting its product or service and delivering value to customers.

C) those activities a company performs that represent "best practices"—only best practice activities are capable of delivering value to customers and thus qualify to be part of a company's value chain.

D) the activities that a company performs in developing a distinctive competence.

E) the activities that represent a company's competencies, core competencies, distinctive competencies, and competitive capabilities—it is these activities that underpin a company's efforts to create value for customers and shareholders.

6 Benchmarking

A) is inherently unethical if it involves companies that are direct competitors because it involves gathering competitively sensitive information about the operations and costs of rivals.

B) is not a valid tool for measuring the cost-effectiveness of an activity unless it is restricted to companies in the same industry.

C) is a potent tool for improving a company's own internal activities that is based on learning how other companies perform them and borrowing "best practices".

D) loses much of its managerial usefulness if it is done with the aid of third-party organizations who insist on protecting the confidentiality of individual company data; moreover, benchmarking is not used very often by companies because of "borderline" ethical considerations and because most of the time the information and data used in doing benchmarking studies has turned out to be unreliable and untrustworthy.

E) entails calculating the costs of performing each of the primary and related support activities in a company's value chain.

7 A company's cost competitiveness is largely a function of

A) whether it does a good enough job of benchmarking its value chain activities against the value chains of competitors so that it knows exactly how low to drive its costs to be cost-competitive.

B) how efficiently it manages its overall value chain activities relative to how efficiently competitors manage theirs.

C) whether it does a better job of building its resource strengths more cost effectively than rivals.

D)whether it possesses more core competencies and competitive capabilities than rivals.

E) how closely its internally-performed activities are linked to the activities performed by suppliers and to the activities performed by forward channel allies.

8 For a company to translate performance of value chain activities into competitive advantage, it

A) must be more cost efficient in how it performs value chain activities or better able to manage activities that add customer value.

B) has to develop more core competencies than rivals by focusing primarily on R&D and market research.

C) must be more adept than rivals in using benchmarking and activity-based costing.

D) has to position itself in the strategic group where profit margins are highest.

E) must adopt more best practices than rival firms.

9 The measure of internal cash flow estimates the cash a company's business is generating _____________________________.

A) after payment of operating expenses, and interest

B) before payment of operating expenses, interest, and taxes

C) after payment of operating expenses, interest, taxes, dividends, and desirable reinvestments in the business

D) before payment of interest and taxes.

E) after payment of operating expenses, interest, and taxes

10 Which one of the following is not something that can be learned from doing a competitive strength assessment?

A) How does the company rank relative to competitors on each of the important factors that determine market success

B) Whether a company utilizes best practices in performing its value chain activities

C) Which of the rated companies is competitively strongest and what size competitive advantage it enjoys

D) Whether a company has a net competitive advantage or is a net competitive disadvantage relative to key rivals (with the size of the advantage/disadvantage being indicated by the differences among the companies' competitive strength scores)

E) Which rival company is competitively weakest and the areas where it is most vulnerable to competitive attack—when a company has important competitive strengths in areas where one or more rivals are weak, it makes sense to consider offensive moves to exploit rivals' competitive weaknesses