Crafting and Executing Strategy 19th Edition

by Thompson Peteraf Gamble Strickland III

ISBN 0078029503 9780078029509
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Chapter 04

Evaluating a Company's Resources, Capabilities, and

Competitiveness

Multiple Choice Questions

4-1
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1. Which of the following is NOT one of the six questions that comprise the task of evaluating a
company's resources and competitive position?

A. What are the company's most profitable geographic market segments?

B. How well is the company's present strategy working?

C. Are the company's cost structure and customer value proposition competitive?

D. Is the company competitively stronger or weaker than key rivals?

E. What strategic issues and problems merit front-burner managerial attention?

2. Which of the following is NOT a component of evaluating a company's resources and

competitive position?

A. Evaluating how well the present strategy is working

B. Scanning the environment to determine a company's best and most profitable customers

C. Assessing whether the company's cost structure and customer value proposition are
competitive

D. Evaluating whether the company is competitively stronger or weaker than key rivals

E. Evaluating if the company is able to seize market opportunities and overcome external
threats to its future well-being

3. Which of the following is not an analytical tool for revealing a company's competitiveness and
for helping to match the strategy to the company's own particular circumstances?

A. Resource and capability analysis

B. SWOT analysis

C. Value chain analysis

D. Bench-pressing analysis

E. Competitive strength analysis

4-2
© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
4. The best indicator of how well a company's strategy is working is whether the company:

A. is achieving its stated financial objectives, its financial performance equates to the
industry average, and market share gains reflect short-term preferences for capacity
maximization.

B. is attentive to its poor execution in functional areas, business goals are stretch, and the
value proposition has a product focus.

C. is geared to initiatives designed to build market share and to promote corporate

responsibility.

D. is achieving its stated financial and strategic objectives, its financial performance is better
than the industry average, and it is gaining customers and increasing market share.

E. All of these.

5. One important indicator of how well a company's present strategy is working is whether:

A. it has more core competencies than close rivals.

B. its strategy is built around at least two of the industry's key success factors.

C. the company is achieving its financial and strategic objectives and whether it is an above-
average industry performer.

D. it is customarily a first-mover in introducing new or improved products (a good sign) or a

late-mover (a bad sign).

E. it is subject to weaker competitive forces and pressures than close rivals (a good sign) or
stronger competitive forces and pressures (a bad sign).

4-3
© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
6. The business strategy is made up of key "functional" strategies except:

A. R&D, technology, and product design strategies.

B. Production and information technology and supply chain management strategies.

C. Human resource and finance strategies.

D. Sales, marketing, and distribution strategies.

E. Alliance and partnerships as well as merger and acquisition growth strategies.

7. Sluggish performance results relative to rivals are a reliable warning sign that the company
has either a weak strategy or poor strategy execution or both. The best way to identify a well-
conceived, well-executed strategy is to determine whether the company is experiencing:

A. a strengthening of its image and reputation among shareholders.

B. a desirable growth rate in new customer acquisition and favorable customer retention
efforts for establishing a strong customer experience.

C. movement in its operating profit margin, satisfactory returns on investable liquid assets,
and elimination of credit access restrictions.

D. positive trends with the relevant cultural factors related to buyer's choices and product
modifications.

E. All of these.

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© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
8. A company's resources and capabilities represent:

A. the firm's net working capital and related determinants for measuring operating
performance and capabilities.

B. the firm's competitive assets, which are considered big determinants of its
competitiveness and ability to succeed in the marketplace.

C. whether the firm has the industry's most efficient value chain.

D. management's source of funding of new strategic initiatives.

E. All of these.

9. A powerful tool for sizing up the company's competitive assets and determining whether they
can provide the foundation necessary for competitive success in the marketplace is termed:

A. Resource and capability analysis

B. SWOT

C. Competitive analysis

D. Financial and asset management analysis

E. Value chain analysis

4-5
© 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
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