Strategic Management Ch4

The makeup of goods and services in the Gross Domestic Products of developed countries has changed over the last decade. More than 50% of the value of GDP of developed countries is based on

A. clothing and apparel

B. capital accumulation

C. knowledge

D. financial management

Knowledge
As the competitive environment changes, strategic management must focus on different aspects of the organization. Recently, strategic management has moved from focusing on tangible resources to

A. fixed capital

B. working capital

C. intangible resources

D. investment capital

Intangible resources
Changes in our economy have forced firms to be more concerned with protecting their
A. knowledge workers

B. social capital

C. intellectual capital

D. all of these

all of these
In the knowledge economy, if a large portion of a firm’s value is in intellectual and human assets, the difference between the company’s market value and book value should ______ a company with mostly physical and financial assets.
A. be equal to

B. be larger than

C. be smaller than

D. not be correlated with

be larger than
According to the text, intellectual capital is the difference between the market value and the book value of a firm. Intellectual capital can be increased by
A. increasing retention of below average workers

B. decreasing labor costs

C. attracting and retaining knowledgeable workers

D. increasing the turnover of employees

attracting and retaining knowledgeable workers
Which of the following firms would you expect to have the highest ration of market value to book value?
A. Apple

B. Google

C. Southwest Airlines

D. Nucor (steel)

apple
Human capital includes
A. the relationships between people

B. an individual’s capabilities, knowledge, and skills

C. the output from assembly line employees

D. an improved product

an individual’s capabilities, knowledge, and skills
_______ includes creativity and problem solving ability.
A. physical capital

B. human capital

C. social capital

D. emotional capital

human capital
_______ can be defined as the “network of relationships that individuals have throughout the organization.”
A. human capital

B. intellectual capital

C. social capital

D. tacit knowledge

social capital
Tactic knowledge
A. is the same as explicit knowledge

B. can be accessed only with the consent of the employees

C. is found mostly at the lower levels of the organization

D. can be codified but not reproduced

can be accessed only with the consent of the employees
New knowledge involves the continual interaction between _______ and _____ knowledge
A. intellectual; pragmatic

B. tacit; explicit

C. theoretical; practical

D. detailed; tacit

tacit; explicit
Recently, a knowledge worker’s loyalty to his or her employing firm has _______ compared to his or her loyalty to his or her profession and colleagues.
A. increased

B. remained the same

C. decreased

D. no correlation when

decreased
The text discusses three areas a firm must be concerned with in order to keep their best and brightest employees from leaving. These include all of the following except
A. hiring/selecting

B. developing

C. sorting/absorbing

D. retaining

sorting/absorbing
Managing a knowledge intensive workforce is very challenging. The best way for a firm to manage their workforce is to
A. retain knowledge workers

B. balance efforts in the attraction, selection, and retention of top talent

C. attract the brightest employees

D. ensure that it pays higher salaries than its rivals

balance efforts in the attraction, selection, and retention of top talent
Firms must compete for top talent. When attracting and selecting employees, firms must strive to select the best fit for both the employee and the firm. In an effort to reduce wasted time and effort in interviewing too many candidates while assuring a good candidate pool, a firm should
A. run employment ads in the newspaper

B. only let lower level employees interview job candidates

C. use a pre-interview quiz

D. refrain from hiring by referrals from present employees

use a pre-interview quiz
Many companies use referrals by current employees as a source for new hiring and even monetarily reward them for the following reasons:
A. it is less expensive than the fees paid to headhunters

B. current employees normally are careful in recommending someone due to their personal credibility

C. it is a good test of employee loyalty

D. current employees are careful in their recommendations and it is far less expensive than the fees paid to headhunters

current employees are careful in their recommendations and it is far less expensive than the fees paid to headhunters
ABC, Incorporated desires to have the most qualified people in every position throughout its organization. This is an example of a concern for
A. decreasing labor intensive training

B. developing social networks

C. developing human capital

D. leveraging organizational structure

developing human capital
Developing human capital is essential to maintaining a competitive advantage in today’s knowledge economy. Efforts and initiatives to develop human capital should be directed
A. at top managers

B. at human resource departments

C. throughout the firm at all levels

D. at the employees themselves

throughout the firm at all levels
Maintaining a competitive workforce is very challenging in today’s economy. The role of evaluating human capital, in recent years, has

A. remained the same

B. decreased

C. become less important

D. increased

increased
In a 360 degree evaluation and feedback system, ______ rate a person’s skill and performance.
A. superiors

B. family

C. direct reports

D. colleagues

direct repots
attracting and retaining human capital is a challenge for many firms today.Firms experiencing high turnover should
A. focus on increased recruiting

B. decrease money spent on human capital

C. adopt effective retention strategies

D. make their work environment less stimulating

adopt effective rention strategies
In order to take advantage of investment in human capital, a firm should
A. rotate workers through functions in the company as quickly as possible

B. refrain from training individual employees

C. establish practices that will enhance employee retention

D. keep employees in the same position forever

establish practices that will enhance employee retention
The least effective way to retain human capital is
A. encourage employee identification with organizational mission and goals

B. provide employees with a challenging and stimulating work environment

C. require employees to sign agreements that prevent them from working for competitors in the future

D. provide employees with financial and nonfinancial rewards and incentives

require employees to sign agreements that prevent them from working for competitors in the future
Generally, employees are most likely to stay with an organization if
A. the employer provides high salaries to technology professionals

B. the firm is in a high tech industry

C. the organization mission and values align with the employees mission and values

D. the mission and values of the organization change often

the organization mission and values align with the employees mission and values
Many successful firms use internal labor markets. The most important reason they do this is because

A. they want to encourage job rotation

B. they want to keep highly mobile employees motivated and challenged

C. if employees remain in the same department for too long, they would become indispensable

D. an employee who moves too much can be identified as unreliable and then eliminated

they want to keep highly mobile employees motivated and challenged
All of the following are the benefits of diversity in a firm’s workforce except:
A. creativity argument

B. problem-solving argument

C. similarity in perspectives argument

D. resource acquisition argument

similarity in perspectives arguement
Human capital and social capital are vital for superior firm performance. If a firm has a strong human capital, the firm may exploit this by building social capital. This can be accomplished through
A. requiring workers to work independently of each other

B. decreasing the interaction of departments within the firm

C. structuring the firm with rigid departmental and employee divisions

D. encouraging the sharing of ideas between employees in the firm

encouraging the sharing of ideas between employees in the firm
In effort to capture key employees from competitors, firms may attract the symbolic leader of a group within a competing firm and hope others will follow. This has been termed
A. the Columbus effect

B. knowledge integration

C. the Pied Piper effect

D. strategically competitive hiring

the pied piper effect
What is a major reason for Nokia to lose its competitive edge in the cell phone business?

A. The team consisted of scientists from around the world.

B. The team consisted of only Finnish scientists.

C. All of the work required diverse skill sets.

D. Each scientist worked alone, separate from colleagues.

the team consisted of only finnish scientists
Social capital is a source of strength to many firms. Firms leverage their social capital in an effort to create competitive advantages. A firm’s social capital is based on
A. the individual abilities of employees

B. the allocation of the financial resources of the firm

C. the relationships among the employees of the firm

D. the knowledge of an individual

the relationships among the employees of the firm
Social network analysis is helpful because the configuration of group members’ social ties within and outside the group affects the extent to which members connect to individuals who do all of the following except:
A. convey needed resources

B. have the opportunity to exchange information and support

C. ensure that everyone has the same perspective on strategic and operational issues

D. have the motivation to treat each other in positive ways

ensure that everyone has the same perspective on strategic and operational issues
In social network analysis ______ stress(es) the importance of ties connecting heterogeneous people–helping to ensure a wide range of diversity in information and perspective
A. closure

B. bridging relationships

C. redundancy

D. social supports

bridging relationships
In social network analysis, high levels of ______ often come at a price. For example, groups can become too insular and fail to share what they have learned with people outside the group
A. bridging relationships

B. intellect

C. closure

D. diverse knowledge

closure
Advantages of effective social networks for career success include all of the following except:
A. access to private information

B. access to diverse skill sets

C. greater redundancy in knowledge sources

D. greater power

greater redundancy in knowledge sources
Among the downsides of social capital is/are:
A. High social capital may breed groupthink, that is, a tendency to question shared beliefs.

B. Socialization processes is inexpensive.

C. Individuals may become more willing to collaborate on joint projects.

D. Social capital may both breed groupthink and the socialization processes to create it (orientation, training, etc.) can be expensive.

social capital may both breed groupthink and the socialization process to create it (orientation, training, etc.) can be expensive.
Social capital has many potential benefits. However, according to the text, social capital
A. is always beneficial to a firm

B. usually restricts the productivity of employees

C. may or may not be beneficial to a firm

D. always hurts firm performance

may or may not be beneficial to a firm
Which of the following reasons explains why painter Vincent van Gogh died penniless, while painter Pablo Picasso left a $740 million estate upon this death?

A. Picasso had a wider range of social connections and bridging relationships.

B. Van Gogh had a wider range of social connections.

C. Picasso was a solitary node with few connections.

D. Van Gogh was a hub who embedded himself in a vast network that stretched across various social lines.

picasso had a wider range of social connections and bridging relationships
The use of information technology (e.g., e-mail) has increased in recent years in many organizations. This has helped to
A. make more effective use of time in every situation

B. communicate information efficiently

C. restrict social network growth

D. create smaller social networks

communicate information efficiently
The creation of knowledge assets is typically characterized by
A. high upfront costs and subsequent high variable costs

B. high fixed costs and high variable costs

C. high upfront costs and low variable costs

D. low upfront costs and high variable costs

high upfront costs and low variable costs
Mary Stinson was required to take over a project after the entire team left the company. She was able to reconstruct what the team had accomplished through reading e-mails exchanged by the previous team’s members. This is an example of
A. inefficient use of information management

B. using explicit knowledge

C. using tacit knowledge

D. using replicated knowledge

using explicit knowledge
The management of intellectual property involves all of the following except
A. patents

B. converting explicit knowledge to tacit knowledge

C. contracts with confidentiality and noncompete clauses

D. copyrights and trademark

converting explicit knowledge to tacit knowledge
Dynamic capabilities include all of the following except:

A. learning and innovating

B. becoming more efficient in operational processes

C. the ability of an organization to challenge the conventional industry in its industry and market

D. continuously adopting new ways of serving the evolving needs of the market

becoming more efficient in operational processes
Which of the following is not an example of an IP-related litigation?

A. Apple and HTC sue each other based on patent infringement.

B. Apple sues smartphone makers running Android, Google’s mobile operating system.

C. China is sued by U.S. manufacturers of video games.

D. The United States sues to get access to physical plant assets in China.

the united states sues to get access to physical plant assets in china