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BUAD 453 Exam 1 Questions And Verified Detailed Answers
What is an appropriate problem statement/strategic challenge for the Charles Chocolates case? - ANSWER The Charles Chocolates Board of Directors has charged Steve Parkland to double or triple the size of the company within 10 years. The strategy must fit the company's culture and gain support of the board, management and employees.
There are three levels of strategy that affect different levels in an organization - corporate, business and managerial/functional level strategy. Which level of strategy is most relevant when making decisions about how a business-unit within the firm will be competitive? - ANSWER Business-level Strategy
Which of the following business-level strategies is most appropriate for Charles Chocolates? - ANSWER Differentiation
Charles Chocolates has four key competitors within the premium chocolate market; Godiva, Delice, Lindt, and Cardon's. According to the information contained within the "Competitors" section on Page 2 of the case, which one of the these companies would most likely tend towards a cost leadership business-level strategy? ANSWER Cardon's
Which strategic management analytical framework would be most appropriate to use when analyzing major factors that affect profit potential of the premium chocolate industry? - ANSWER Porter's Five Forces
There are many substitutes for premium chocolate, particularly as a gift. Which of the following is NOT a substitute? - ANSWER Premium chocolate from other companies
Which of the following facts of the case would weaken the threat of new entrant pressure-that is, the threat of new competitors-in a Porter's Five Forces analysis? ANSWER There is strong brand loyalty to existing competitors.
Which of the following facts from the Charles Chocolates case is an example of a sociocultural factor in a STEEP analysis? - ANSWER Demand for chocolate has increased because it has antioxidants and consumers are more health conscious.
Which of the following is NOT a key resource or capability of Charles Chocolates? - ANSWER Strong human resources management
Which of the following is NOT one of the options Charles Chocolates is considering to double or triple the size in ten years? - ANSWER Status quo
Fifty percent of Charles Chocolates revenue is derived from its retail stores. What is the LEAST percentage of total sales for one of its other business lines - ANSWER Online
Charles Chocolates ROA is increasing year over year and well above the industry average. Which of the following is an appropriate interpretation of this data? - ANSWER The company is doing a good job with utilizing its assets to generate profit.
Is the brand image of Charles Chocolates a basis of competitive advantage? ANSWER Yes, it is valuable, rare, costly to imitate, and organized to capture value-at least in the Portland, ME area.
Why are Charles Chocolates' production facilities NOT a source of competitive advantage? Select the best answer. - ANSWER There are not effective management systems in place to maximize efficiency. Therefore, the facilities are not organized to capture value.
Charles Chocolates manufactures a quality chocolate. Which of the following is a piece of evidence that its high-quality chocolate is "valuable" (in the VRIO model)? Choose the best answer. ANSWER It received the prestigious Superior Taste Award from the Institute for Taste in Belgium.
Although Charles Chocolates is a strong brand image, one might question the brand image particularly as it relates to growth. - ANSWER The brand image is very traditional and it is not clear whether or not younger buyers would appreciate it.
Question If Charles Chocolates decides to invest heavily in expansion within Portland and throughout New England while continuing to uphold the board's strategic challenge, which of the following is most important for Steve Parkland and the management team? - ANSWER Create a culture-rich work environment and customer experience
Steve Parkland and the board of Charles Chocolates have retained you to evaluate several options to double or triple the size of the firm over the next ten years. Which of the following modes of market entry is NOT one of the options under consideration by Charles Chocolates? - ANSWER Establish a greenfield facility in Portland, Maine in partnership with an apparel retailer
If Charles Chocolates wanted to vertically integrate its supply chain, which of the following would accomplish that?- ANSWER Buy a cocoa farm
Which of the following strategic decisions by Charles Chocolates would be an example of vertical integration? -ANSWER An online digital storefront to sell product online
Now imagine that Charles Chocolates wants to contract with ethical sources of cocoa bean growers. If Steve Parkland reminds the sourcing manager that this type of bean is an important competitive advantage to Charles Chocolates and there is increasing difficulty writing these contracts because transactions happen frequently and there is high demand for these beans from competitors. Given this description and referencing figure 17.1 in Strategy in 3D, what should the sourcing manager recommend. - ANSWER Vertically Integrate
At the Monday "all-hands" meeting, Steve Parkland announced that the board approved hiring a VP of Product Development reporting to Parkland, who joins in 3Q that year. Referencing the organizational chart on page 8 of the case, how will this strategic decision benefit the company? - ANSWER Rebalance the organizational chart
If product is in the decline phase of the lifecycle, which of the following is NOT a strategic option the managers would want to follow? - ANSWER increase investment to maximize profit
Blue Apron's biggest problem as related to the product life cycle and the S-curve was ___. - ANSWER it was in the growth phase, Blue Apron decided to focus on supply chain and not customer acquisition
Which of the following companies is least likely to be included in the same strategic group as Blue Apron if the axes for a two-variable strategic map of the subscription-based meal-kit industry are defined as low price versus high price (x-axis) and small company versus large company (y-axis)? ANSWER Amazon
This problem requires comparing Blue Apron's ROA ratio in 2017 and 2016 to determine why this ratio is falling. For this
2017 - 0.
2016- 0.
A. Declining efficiency and accuracy at preparing customer orders
b. All of these statements are potential causes
c. Blue Apron's ability to generate profit from its assets has fallen
d. Poor utilization of assets to generate sales
e. High marketing expenses - ANSWER B
Of the following, which resource/capability is most likely to provide a sustained competitive advantage when using the VRIO framework for Blue Apron? ANSWER Relationships with farmers
A competitor analysis of the meal-kit subscription industry paints a light on the competitive landscape that faces the Blue Apron. Which of Blue Apron's competitors below most likely does have a dual-advantage strategic position-i.e., in the middle of the business-level strategy continuum-not purely cost leadership and not purely differentiation? ANSWER Hello Fresh
Refer to the Spotify case in Strategy in 3D. At the time of case 2008 Spotify founders determine that the music streaming industry is in the _____ phase of the industry life cycle. In contrast, at the time of the case 2018 Blue Apron is most likely in the _____ phase of the industry life cycle. - ANSWER Spotify: introduction ; Blue Apron: growth
preference to buy from Chef'd
Which of the following options is NOT one Brad Dickerson is considering to solve Blue Apron's dilemma of a falling share price? - ANSWER Acquisition
The University of Tennessee recently announced that a team of undergraduate students presented, at a business conference, the fact that a device they developed can cut warehouse fulfillment time for any industry by an average of 10% is an example of a __________factor of a ______ analysis. - ANSWER technological; STEEP
The trade association for the subscription-based meal kit delivery industry publishes a monthly newsletter. The following contains data from a recent poll of the association that shows 20% of frequent meal-kit purchasers plan to go back to at least three days per week working in a company office from 100% remote work. To which macroenvironmental force does the report refer? ANSWER Sociocultural
If Blue Apron is reporting increases in most of its _____ ratios, this may indicate __________. - ANSWER leverage; it is taking on additional debt to finance operational improvements
Blue Apron _______ operated most of its key activities including human resource management, _______, and warehouse management. - ANSWER poorly; supply chain
Low switching costs among competitors increase the power of the "threat of new entrants" force. - ANSWER True
Choose the best answer that correctly fills in the blanks: The _______ negotiating power of suppliers to the subscription-based meal kit delivery industry, the greater influence they have in increasing the supplier's prices and extracting profits which______ the profitability potential within the meal-kit industry.
stronger; increases
weaker; decreases
weaker; increases
stronger; decreases - ANSWER Stronger, decreases
Using the Porter's Five Forces framework, which of the following descriptions is an accurate assessment of the rivalry among existing competitors in the subscription-based meal kit delivery industry? - ANSWER High intensity of rivalry: Easy for buyers to switch between competitors, low barriers for competitors to enter the industry, many substitutes to the meal-kit industry
Which of the following strategic management framework is most appropriate to use when assessing major factors affecting profit potential of the subscription-based meal kit delivery industry? ANSWER Porter's Five Forces
Explain and describe what is occurring and is likely to occur in the macroenvironment in which an business operates. It is a systematic method of considering the trends, forces, and changes outside the boundaries of the firm that may affect the firms operations and markets. - ANSWER STEEP
Provides a basis by which to evaluate and understand an industry along with its broad set of participants that includes suppliers, customers, and competitors. It provides a means whereby managers and practitioners may assess the major factors impacting an industry's profit potential and possibly highlight ways whereby a firm may increase its profit potential relative to the other industry participants. - ANSWER Porter's
Provides managers and practitioners with a comprehensive view of the competitive environment facing a company. It is supposed to add a companion analysis of the relative strengths and weaknesses of both current as well as future competitors. - ANSWER Competitor Analysis
Systematically discover resources and capabilities that can potentially be a key source of sustainable competitive advantage. - ANSWER VRIO
It not only indicates the relative economic health of an organization compared to its selected peer group, but it is also a very useful tool to evaluate the efficiency of various managerial decisions and link unfavorable outcomes to their causes. - ANSWER Financial Performance Analysis
What are some of the disadvantages with using joint ventures? (Select all that apply)
A. Cannot access partner's technology or resources.
B. Large investment
C. May be difficult to manage and make decisions over time
D. Inability to leverage local partner's relationships and knowledge - ANSWER B & C
Which strategic management analytical framework is most appropriate to use when assessing major factors that affect profit potential of the premium chocolate industry? - ANSWER Porter's
Which of the following pieces of information about an industry would lessen the threat of new entrants-that is new competitors-of a Porter's Five Forces analysis? - ANSWER There is strong brand loyalty for existing competitors.
