Exam 5: Analyzing Resources and Capabilities

One indicator of the growing importance of intangible resources is the widening difference between firms' market capitalization and the balance sheet value of their assets. .

A well-established brand can be a source of sustainable competitive advantage because:

The main strategic lesson to be drawn from the Biblical story of David and Goliath is:

The main problem in using a company's balance sheet to identify its resources and capabilities is that:

In 1990, C.K.Prahalad and Gary Hamel introduced the concept of "core competence." Their argument was that:

A major reason why many companies have the high valuation ratios (ratio of stock market value to balance sheet net asset value) is:

There are two types of economic rent (pure profit):

The more stable is a firm's external environment, the more likely it is that the firm's resources and capabilities, rather than customer needs, will offer a more stable foundation for strategy.

Intangible resources tend to be more valuable than tangible resources because:

Prahalad and Hamel's "core competences" tend to be broad-based organizational capabilities that:

The notion that organizational capabilities form a "hierarchy of integration" in which specialized capabilities are combined to form more general capabilities is only relevant to mature, stable industries.

To exploit its tangible assets more effectively requires that a firm:

According to Prahalad and Hamel, a company's core competences are those capabilities that are fundamental to its strategy and to its performance.

One implication of the resource-based perspective is that:

Strategy needs to take account of both the requirements of the firm's external environment and the firm's own resources and capabilities.Resources and capabilities rather than requirements of the external environment offer a more stable basis for strategy formulation when:

The main implication of the resource-based view of firm is:

"Benchmarking" is:

Firm's with outstanding capabilities are typically those which:

The firm's ability to appropriate the rents generated by its organizational capabilities:

David's victory of over Goliath (as portrayed in The Bible) demonstrates the importance of aligning strategy with one's resources and capabilities.