Title: Environments and Strategic Management
Course: Question Banks

Q: Companies strive to provide a product or service that is distinct, or ________, in some way from their competitors.
- separated
- branded
- differentiated
A: differentiated

Q: When customers perceive the product differentiation as valuable, they will prefer to purchase the business’s product over a competitor’s products. This is called
- an intangible resource
- a core competency
- a competitive advantage
A: a competitive advantage

Q: A company wishes to convince customers that its product or service provides more value to them than a competitor’s product or service. That is, it offers a
- commodity
- generic product
- value proposition
A: value proposition

Q: The advertisements for the Apple MacBook show an edge-on image of a MacBook with the caption “MacBook: Light. Years ahead.” This refers to the lightweight design and the advanced tech inside. This is Apple’s
- mission statement
- vision
- value proposition
A: value proposition

Q: ________ decides how best to attain a company’s mission and vision through the coordinated efforts to achieve specific goals and objectives.
- Social network management
- Human resource management
- Strategic management
A: Strategic management

Q: Strategic management’s first function is deciding how to compete. The second function is to make sure
- that human resources hires the right people
- that the control systems support the strategy
- that the people in the organization support the strategy
A: that the people in the organization support the strategy

Q: The general environment analysis considers broad societal dimensions influencing the industry or firms within it. The general environment areas include
- political, essential, social, technological, ecological, and legal
- political, economic, social, technical, environmental, and governmental
- political, economic, social, technological, environmental, and legal
A: political, economic, social, technological, environmental, and legal

Q: Domestic U.S. companies conducting a PESTEL analysis consider national growth, employment, inflation, and interest rates. These are aspects of which macro term?
- environmental
- ecological
- economic
A: economic

Q: In order to understand the competitive structure of an industry, analysts use Michael Porter’s Five Forces model. Porter’s model includes all of the following EXCEPT:
- barriers to entry and new entry threats, buyers’ negotiating power
- suppliers’ negotiating power, threat from substitutes, and rivalry
- strategic partnerships, research and development
A: strategic partnerships, research and development

Q: The threat of new entrants in Porter’s Five Forces analysis is often the most important force affecting an industry. In the food truck industry, for example, it is easy for new firms to enter and compete. The food truck industry would benefit if there were ________, such as required and restricted licenses.
- substitute products
- government regulations
- barriers to entry
A: barriers to entry

Q: A robust competitive analysis will allow you to focus on those companies that will compete for customers
- in your industry
- in your market
- in your target market
A: in your target market

Q: Financial strength can be a competitive advantage. In the Great Recession, General Motors went bankrupt, but Ford had acquired long-term financing beforehand that carried it through the downturn. This insight is part of
- industry analysis
- Porter’s Five Forces
- competitive analysis
A: competitive analysis

Q: The five components of industry environment are
- clients, competitors, suppliers, regulations, and adversaries
- customers, competitors, supplicants, regulations, and advocacy groups
- customers, competitors, suppliers, regulations, and advocacy groups
A: customers, competitors, suppliers, regulations, and advocacy groups

Q: Identifying the target customer and asking about customer demographics (age, income, location, gender, politics, etc.) is part of
- supply chain analysis
- competitor analysis
- customer analysis
A: customer analysis

Q: SWOT analysis stands for:
- strategies, weaknesses, obligations, threats
- strengths, wealth, opportunities, tactics
- strengths, weaknesses, opportunities, threats
A: strengths, weaknesses, opportunities, threats

Q: Bharti Airtel is the largest cellular provider in India, with more than 300 million customers as of 2014. It also supplies broadband and telephone services, as well as many other telecommunications services to both domestic and corporate customers. Bharti Airtel and Vodafone have an on/off relationship. Vodafone owned a 5.6% stake in the Airtel business, until it sold it back to Airtel and invested in Airtel’s rival, Hutchison Essar. Knowledge and technology previously available to Airtel moved into the hands of one of its competitors. In a SWOT analysis, this point represents ________.
- an opportunity
- a strength
- a threat
A: a threat

Q: Bharti Airtel is the largest cellular provider in India, with more than 300 million customers as of 2014. It also supplies broadband and telephone services, as well as many other telecommunications services to both domestic and corporate customers. Until a few years ago Airtel did not own its own towers, which was a particular strength of some of its competitors, such as Hutchison Essar. Towers are important if your company wishes to provide wide coverage nationally. In a SWOT analysis, this point would be ________.
- an opportunity
- a threat
- a weakness
A: a weakness

Q: In the resource view of strategy, VRIO stands for:
- valuable, reproducing, inimitable, and organized
- validating, rare, inert, and organic
- valuable, rare, inimitable, and organized
A: valuable, rare, inimitable, and organized

Q: The O in VRIO refers to ________ , meaning a company’s capacity to use its resources with purposeful integration to achieve a particular result.
- organized according to Weber’s bureaucratic principles
- organized according to Fayol’s scalar chain principle
- organized to capture value
A: organized to capture value

Q: Amazon has hired a strategic consultant to consider a partnership with Porsche. Amazon would sell Porsche’s cars. As part of a VRIO analysis, the consultant would realize that
- Amazon’s brand name is a valuable resource in getting Porsche customers’ attention.
- Amazon Web Services Cloud is an inimitable resource for capturing customer demographics and hence targeting customers.
- Amazon is not organized to realize the value of partnering with Porsche because Porsche must sell through local dealers.
A: Amazon is not organized to realize the value of partnering with Porsche because Porsche must sell through local dealers.

Q: The second step of the strategy process, Strategy Formulation, includes
- implementing the strategy
- setting up performance measurements to determine if key milestones are being met
- prioritizing the tactics most important to achieving the objectives
A: prioritizing the tactics most important to achieving the objectives

Q: American Spoon is a small company in Petoskey, Michigan that uses fruit from local farmers to handcraft gourmet fruit preserves and condiments in small batches since 1982. The company has expanded slowly and now has six stores in towns along Lake Michigan and a catalogue. It has grown and maintained its customers by continuing to make its products in small batches to ensure freshness and flavor, and to make seasonal and unique product offers possible. In the Strategic Evaluation and Control stage of the strategy process, American Spoon should
- check the freshness of its competitors’ preserves
- ask customers what other brands of preserves they buy
- set up routine checks of the freshness of its inventory
A: set up routine checks of the freshness of its inventory

Q: Michael Porter defined classified competitive strategies based on a grid of price strategy and target markets. What is Walmart’s strategy in this grid?
- focused low cost
- overall differentiation
- overall low cost
A: overall low cost

Q: Michael Porter defined classified competitive strategies based on a grid of price strategy and target markets. Microsoft’s Windows Operating System competes with Apple’s MAC OS X and Linux. Linux is free. What is Microsoft’s strategy in this grid?
- overall low-cost
- focused low cost
- overall differentiation
A: overall differentiation

Q: Walmart has the highest in-store revenues for any U.S. retailer but it is a distant second to Amazon’s online sales. Walmart believes it needs a better ________.
- supply chain
- low-price strategy
- e-commerce strategy
A: e-commerce strategy

Q: Macy’s online store differs from the in-store experience. The online store offers free delivery on larger purchases, free returns, extensive information about the products, and reviews from other customers. Why might Macy’s do business this way?
- Customers want to have access to all the same things online as they do in the store.
- They want managers to be able to easily switch between in-store and digital sales.
- Many of the strategies needed to succeed in e-commerce are very different from competing in a non-digital environment.
A: Many of the strategies needed to succeed in e-commerce are very different from competing in a non-digital environment.

Q: In the summer of 1998, Dr. Rumelt, a professor and consultant, got an opportunity to talk with Steve Jobs about strategy. Rumelt argued that everything we know about the PC business says that Apple cannot really push beyond a small niche position. The network effects are just too strong to upset the PC standard. He then asked for Jobs’ strategy. Jobs said, “I am going to wait for the next big thing.” Nearly twenty years later, Apple is the most valuable publicly traded company in the world. This story shows that in the context of strategy, the tech market is ________.
- stable
- volatile
- dynamic
A: dynamic

Q: In 1956, Dr. Hubbert accurately predicted U.S. oil production for the next 50 years. U.S. oil production started to decline in1970, causing volatile markets and, for strategists, ________. The development of fracking around 2010 restored the U.S. as a major oil producer.
- the Oil Crisis of 1973
- a rapid switch to solar power
- resource scarcity
A: resource scarcity