MGMT 425 STUDY GUIDE 2026 EXAM QUESTIONS AND
ANSWERS RATED A+
✔✔Managerial actions to develop core competencies and competitive capabilities
internally generally take one or two forms. What are they? - ✔✔A. either strengthening
the company's base of skills, knowledge, and experience or coordinating and integrating
the efforts of various work groups and departments
✔✔Which of the following is NOT accurate as concerns a company's competencies and
capabilities? - ✔✔E. When a company succeeds in hiring talented employees and
training them properly, competencies and capabilities tend to develop quickly, and once
put in place, can last for a decade or more
✔✔Sometimes a company can short-circuit the task of building an organizational
capability in-house by: - ✔✔C. either acquiring a company that has already developed
the capability or else acquiring the desired capability through collaborative efforts with
outsiders having the requisite skills, know-how, and expertise
✔✔What is the advantage of acquiring capabilities through merger and acquisition? -
✔✔A. Speed, since developing new capabilities internally can take many years of effort
✔✔When are capabilities-motivated acquisitions essential? - ✔✔A. When industry
conditions, like technology advances, and central to growth and rivalry is intense
✔✔In which one of the following instances is the training and retraining of employees
likely to make the LEAST important contribution to good strategy execution? - ✔✔E.
When the strategy execution effort is based on tried-and-true operating practices that
vary little from year to year.
✔✔The strategic importance of deliberately trying to develop organizational
competences and capabilities is - ✔✔B. Improved strategy execution and a potential for
competitive advantage
✔✔Accessing capabilities through an external source can be accomplished through: -
✔✔E. all of these [outsourcing, joint ventures, strategic alliances, learning-based
collaborative partnerships]
✔✔When it is difficult or impossible to out-strategize rivals (beat them with a superior
strategy), the other main avenue to competitive advantage is to: - ✔✔C. out execute
them (beat them by performing certain value chain activities in superior fashion)
✔✔Superior strategy execution capabilities are the only source of sustainable
competitive advantage: - ✔✔A: All of these [when strategies are easy to copy, because
, capabilities are socially complex, because there is no substitute, when the only way to
achieve success is to ensure the firm out-executes its competitors]
✔✔What is the rule for organizing the work effort to support good strategy execution? -
✔✔A. a firm's organizational structure should be matched to its unique strategy
✔✔Organizing a company's work effort to promote successful strategy execution
involves: - ✔✔B. deciding which value chain activities to perform in-house and which to
outsource, and making internally performed strategy-critical value chain activities the
main building blocks in the organization structure
✔✔Which one of the following is NOT part of organizing the work effort in ways that
promote successful strategy execution? - ✔✔D. Determining which functions and
organizational units require superior intellectual capital.
✔✔To organize the work effort around the needs of good strategy execution,
management needs to: - ✔✔E. all of these [make strategy-critical activities the main
building blocks, determine whether some value chain activities can be outsourced more
efficiently, decide how much authority to centralize at the top, provide for coordination
across the various organizational units]
✔✔Outsourcing value chain activities has such strategy executing advantages as: -
✔✔A. less internal bureaucracy, speedier decision making, quicker responses to
changing market conditions, and heightened focus on performing a select few value
chain activities (which can improve the performance of those activities)
✔✔When a company uses outsourcing to zero in on even better performance of those
truly strategy-critical activities where its expertise is most needed, then it may also be
able to: - ✔✔B. decrease internal bureaucracies, flatten its organizational structure,
shorten the time it takes to respond to changing market conditions, and capitalize on its
partnerships with outsiders to enhance its arsenal of capabilities and thus contribute to
better strategy execution
✔✔Which one of the following is NOT a reason why companies might use outsourcing
to improve performance of strategy-critical activities? - ✔✔B. promoting quick
establishment of a total quality culture
✔✔Outsourcing value chain activities to strategic partners can yield such advantages
as: - ✔✔lower costs, less internal bureaucracy, speedier decision making, more
flexibility, and higher strategic focus
✔✔Outsourcing critics contend that shifting responsibility for performing value chain
activities to outside specialists: - ✔✔B. can hollow out a company's knowledge base
ANSWERS RATED A+
✔✔Managerial actions to develop core competencies and competitive capabilities
internally generally take one or two forms. What are they? - ✔✔A. either strengthening
the company's base of skills, knowledge, and experience or coordinating and integrating
the efforts of various work groups and departments
✔✔Which of the following is NOT accurate as concerns a company's competencies and
capabilities? - ✔✔E. When a company succeeds in hiring talented employees and
training them properly, competencies and capabilities tend to develop quickly, and once
put in place, can last for a decade or more
✔✔Sometimes a company can short-circuit the task of building an organizational
capability in-house by: - ✔✔C. either acquiring a company that has already developed
the capability or else acquiring the desired capability through collaborative efforts with
outsiders having the requisite skills, know-how, and expertise
✔✔What is the advantage of acquiring capabilities through merger and acquisition? -
✔✔A. Speed, since developing new capabilities internally can take many years of effort
✔✔When are capabilities-motivated acquisitions essential? - ✔✔A. When industry
conditions, like technology advances, and central to growth and rivalry is intense
✔✔In which one of the following instances is the training and retraining of employees
likely to make the LEAST important contribution to good strategy execution? - ✔✔E.
When the strategy execution effort is based on tried-and-true operating practices that
vary little from year to year.
✔✔The strategic importance of deliberately trying to develop organizational
competences and capabilities is - ✔✔B. Improved strategy execution and a potential for
competitive advantage
✔✔Accessing capabilities through an external source can be accomplished through: -
✔✔E. all of these [outsourcing, joint ventures, strategic alliances, learning-based
collaborative partnerships]
✔✔When it is difficult or impossible to out-strategize rivals (beat them with a superior
strategy), the other main avenue to competitive advantage is to: - ✔✔C. out execute
them (beat them by performing certain value chain activities in superior fashion)
✔✔Superior strategy execution capabilities are the only source of sustainable
competitive advantage: - ✔✔A: All of these [when strategies are easy to copy, because
, capabilities are socially complex, because there is no substitute, when the only way to
achieve success is to ensure the firm out-executes its competitors]
✔✔What is the rule for organizing the work effort to support good strategy execution? -
✔✔A. a firm's organizational structure should be matched to its unique strategy
✔✔Organizing a company's work effort to promote successful strategy execution
involves: - ✔✔B. deciding which value chain activities to perform in-house and which to
outsource, and making internally performed strategy-critical value chain activities the
main building blocks in the organization structure
✔✔Which one of the following is NOT part of organizing the work effort in ways that
promote successful strategy execution? - ✔✔D. Determining which functions and
organizational units require superior intellectual capital.
✔✔To organize the work effort around the needs of good strategy execution,
management needs to: - ✔✔E. all of these [make strategy-critical activities the main
building blocks, determine whether some value chain activities can be outsourced more
efficiently, decide how much authority to centralize at the top, provide for coordination
across the various organizational units]
✔✔Outsourcing value chain activities has such strategy executing advantages as: -
✔✔A. less internal bureaucracy, speedier decision making, quicker responses to
changing market conditions, and heightened focus on performing a select few value
chain activities (which can improve the performance of those activities)
✔✔When a company uses outsourcing to zero in on even better performance of those
truly strategy-critical activities where its expertise is most needed, then it may also be
able to: - ✔✔B. decrease internal bureaucracies, flatten its organizational structure,
shorten the time it takes to respond to changing market conditions, and capitalize on its
partnerships with outsiders to enhance its arsenal of capabilities and thus contribute to
better strategy execution
✔✔Which one of the following is NOT a reason why companies might use outsourcing
to improve performance of strategy-critical activities? - ✔✔B. promoting quick
establishment of a total quality culture
✔✔Outsourcing value chain activities to strategic partners can yield such advantages
as: - ✔✔lower costs, less internal bureaucracy, speedier decision making, more
flexibility, and higher strategic focus
✔✔Outsourcing critics contend that shifting responsibility for performing value chain
activities to outside specialists: - ✔✔B. can hollow out a company's knowledge base
