Deck 6: Competitive Strategy: The Analysis of Strategic Capability

Question 1

A strategic industry factor (Amit and Shoemaker) is known ex ante

Answer 1

False

Question 2

According the the Resource Based View, what accounts for superior profits in an industry and how does this view differ from the Market Based View?

Answer 2

The resource based view argues that superior performance derives from the way in which a firm's resources are configured and managed - it uses the language of 'core competencies'. The market based view argues that competitive advantage derives from positioning within the industry - it is also known as the 'positioning' school and is associated strongly with the work of Porter.

Question 3

How does 'causal ambiguity' protect competitive advantage?

Answer 3

Causal ambiguity is where the lines of cause and effect which add up to superior performance are difficult to prove. It is therefore difficult for a rival to copy the superior firm. The problem with this is that the superior firm might not know for sure why it is superior either.

Question 4

What is meant by the term 'strategic intent'?

Question 5

Describe typical characteristics of 'strategic industry factors' (Amit and Shoemaker, 1993).

Question 6

Prahalad and Hamel argue that core competences should be seen as sources of leverage within each strategic business unit.

Question 7

In practice, competitive advantage is about creating value for the firm and for customers. Four main elements of value are positioning, customer persuasion, capabiltiy and

A) learning
B) efficiency
C) knowledge
D) effectiveness

Question 8

One of the reasons that US firms lost out to East Asian firms is that

A) The Asian firms pursued their objectives with 'strategic intent'
B) The US firms pursued their objectives with 'strategic intent'
C) The Asian firms used the positioning approach to pursue their objectives
D) The Asian firms were not conglomerates

Question 9

Adapting and expanding resources to fulfill the aims of strategic intent is known as

A) competitive fit
B) strategic fit
C) strategic stretch
D) competitive stretch

Question 10

In the heavy construction vehicles industry, Komatsu outperformed Caterpillar in the 1990s by changing the basis of competitive advantage from quality to cost. Komatsu used strategic ___________

Question 11

Which of the following factors does Peteraf (1993) consider to be the basic foundations for determining the value of a core competence?

A) Imitability
B) Company reputation
C) Intangible assets
D) Appropriability

Question 12

'Path dependency' determines the extent that an asset can be imitated. What is the meaning of 'path dependency' in this context?

A) The physical uniqueness of an asset
B) The extent to which an asset can be patented or copyrighted
C) The cumulative learning and experience that is built up over time
D) The inability to ascertain the important elements of a complex asset

Question 13

The output of an academic researcher at a university is normally considered to be a strategic asset.

Question 14

Amit and Shoemaker (1993) devised a theory to explain how competitive advantage can achieved. They suggest that core competencies (strategic assets) should be seen in the context of

A) economic rents
B) disruptive technologies
C) hyper-competitive markets
D) strategic industry factors

Question 15

The asset triangle (McGee) is made up of make-or-buy assets, strategic assets and

A) core assets
B) complementary assets
C) imperfect assets
D) distinctive assets

Question 16

Make-or-buy assets include those that are important strategically.

Question 17

The 'core competence' concept can be applied at corporate level and business level.

Question 18

___________ assets are those which do not have a physical presence.

Question 19

Which view of strategy argues that competitive advantage derives from 'core competences'?

A) The competitive positioning view
B) The resource-based view
C) The value-chain view
D) The management learning view

Question 20

The resource-based view sees the firm as a 'black box'.

Question 21

A fundamental argument of the resource-based view is that two firms with the same generic resources are likely to develop similar capabilities

Question 22

Firm's that start off with a similar set of resources are likely to diverge over time because

A) Managers do not have perfect knowledge
B) Managers have perfect knowledge
C) Managers are rational
D) Managers are irrational

Question 23

Which of the following are capabilities?

A) Production capacity
B) Specialized knowledge
C) Trade relationships
D) Distribution coverage

Question 24

Sony's _______ _____________ is miniaturization which means they have competitive advantage in producing small gadgets.

Question 25

The strategic assets of a firm cannot be considered in isolation to KSFs. What do we mean by KSFs?

A) Killer Success Factors
B) Key Success Factors
C) Key Strategic Functions
D) Knowledge Strength Functions

Question 26

A core competence cannot be a physical asset

Question 27

In practice there are four main influences on competitive strategy and these can be in conflict with each other. The influences are company strengths and weaknesses, industry opportunities and threats, broader societal expectations and

A) paradigm changes
B) shareholder expectations
C) government blockers and enablers
D) the personal values of the key implementers

Question 28

Planning horizons for developing competitive strategy are normally three product life-cycles ahead.

Question 29

In the l980s the external environment was seen as the determinant of competitive advantage.