MBA 705 - Exam #1 Questions with Correct Answers
Social Forces - ✔✔-Societal values
-Trends
-Traditions
-Religious practices
-Concern for the environment
Social Forces Case #1 Eating Habits - ✔✔-Consumers "super size" at record rates
while demanding healthier foods.
-Many fast food restaurants have been "supersizing" their meal combinations by
adding extra fries and larger drinks, while at the same time expanding alternatives
for items such as grilled chicken sandwiches and salads
Social Forces Case #2 Automobiles - ✔✔Contrary to demand patterns in other
parts of the world, demand for large vehicles remains strong in the U.S. amidst
cries for greater fuel economy.
Social Forces: Global Concerns - ✔✔-Firms operating in multiple countries must
address multiple sets of social forces.
-Social forces are influenced by national culture, the generally accepted values,
traditions, and patterns of behavior in a society. Firms should recognize these
cultural differences.
,-Some firms struggle because their managers consciously refer to their own
cultural values as a standard of judgment, a phenomenon known as the self-
reference criterion.
Technological Forces - ✔✔-Scientific improvements & innovations
-The Internet is arguably the most pervasive technological force affecting most
industries.
The World is Flat (Thomas Friedman, 2005) - ✔✔During the dot-com bubble of
the late 1990s, telecommunications firms laid fiber optic cables across the oceans
to connect the U.S. with China and India.
Since the dot-com bust, these cables have provided high quality, low cost contact
with developing nations, "leveling the playing field."
"Any activity that can be digitized and moved around will get moved around."
Strategy and The Internet - ✔✔-Has the Internet created new business models or
just altered the old ones?
-Although the Internet plays a substantial role, critics challenge the notion that
"new business models" are needed to compete in the "new economy." Michael
Porter and others argue that the market forces that governed the traditional
economy have not disappeared in the Internet economy.
,Disaggregation & Reaggregation - ✔✔-Large firms exist because they can perform
most tasks—raw material procurement, production, human resource
management, sales, and so forth—more efficiently than they would otherwise be
performed if they were "outsourced" to the open market.
-Today, many progressive firms have "disaggregated" by no longer perform all of
their functional activities, but instead "reaggregate" by searching for partners
who can perform some of the activities more efficiently.
Strategic Dimensions of the Internet - ✔✔-The Internet has influenced strategic
management in very specific ways.
-Contrary to early expectations, the Internet has not always generated greater
profits for businesses. Consumers have benefitted immensely.
-Five Strategic Dimension of the Internet are addressed in the following slides.
Dimension #1: Movement toward information symmetry- - ✔✔Typical markets
are characterized by information asymmetry, whereby sellers control key
information that is not available to buyers. The Internet promotes information
symmetry, whereby buyers and sellers share information.
Dimension #2: Internet as distribution channel - ✔✔The Internet acts as a
distribution channel for non-tangible goods and services. Consumers can
purchase items such as airline tickets, insurance, stocks, and computer software
online without the necessity of physical delivery.
, Dimension #3: Speed - ✔✔The Internet offers numerous opportunities to improve
the speed of the actual transaction, as well as the process that leads up to and
follows it.
Dimension #4: Interactivity - ✔✔Consumers discuss their experiences with
products and services on bulletin boards or in chat rooms. Firms can readily
exchange information with trade associations that represent their industries.
Dimension #5: Potential for cost reductions and cost shifting - ✔✔The Internet
provides many businesses with opportunities to minimize their costs—both fixed
and variable—and thereby enhance flexibility.
Forms of Electronic Commerce - ✔✔B2B, B2C, B2G.
C2B, C2C
Forms of Electronic Commerce - ✔✔Many traditional firms are integrating e-
commerce into their existing business models
These firms are attempting to build synergy between traditional and virtual
storefronts.
Commoditization & Mass Customization - ✔✔-Commoditization—Firms are
having a more difficult time distinguishing their products and services from those
of their rivals.
Social Forces - ✔✔-Societal values
-Trends
-Traditions
-Religious practices
-Concern for the environment
Social Forces Case #1 Eating Habits - ✔✔-Consumers "super size" at record rates
while demanding healthier foods.
-Many fast food restaurants have been "supersizing" their meal combinations by
adding extra fries and larger drinks, while at the same time expanding alternatives
for items such as grilled chicken sandwiches and salads
Social Forces Case #2 Automobiles - ✔✔Contrary to demand patterns in other
parts of the world, demand for large vehicles remains strong in the U.S. amidst
cries for greater fuel economy.
Social Forces: Global Concerns - ✔✔-Firms operating in multiple countries must
address multiple sets of social forces.
-Social forces are influenced by national culture, the generally accepted values,
traditions, and patterns of behavior in a society. Firms should recognize these
cultural differences.
,-Some firms struggle because their managers consciously refer to their own
cultural values as a standard of judgment, a phenomenon known as the self-
reference criterion.
Technological Forces - ✔✔-Scientific improvements & innovations
-The Internet is arguably the most pervasive technological force affecting most
industries.
The World is Flat (Thomas Friedman, 2005) - ✔✔During the dot-com bubble of
the late 1990s, telecommunications firms laid fiber optic cables across the oceans
to connect the U.S. with China and India.
Since the dot-com bust, these cables have provided high quality, low cost contact
with developing nations, "leveling the playing field."
"Any activity that can be digitized and moved around will get moved around."
Strategy and The Internet - ✔✔-Has the Internet created new business models or
just altered the old ones?
-Although the Internet plays a substantial role, critics challenge the notion that
"new business models" are needed to compete in the "new economy." Michael
Porter and others argue that the market forces that governed the traditional
economy have not disappeared in the Internet economy.
,Disaggregation & Reaggregation - ✔✔-Large firms exist because they can perform
most tasks—raw material procurement, production, human resource
management, sales, and so forth—more efficiently than they would otherwise be
performed if they were "outsourced" to the open market.
-Today, many progressive firms have "disaggregated" by no longer perform all of
their functional activities, but instead "reaggregate" by searching for partners
who can perform some of the activities more efficiently.
Strategic Dimensions of the Internet - ✔✔-The Internet has influenced strategic
management in very specific ways.
-Contrary to early expectations, the Internet has not always generated greater
profits for businesses. Consumers have benefitted immensely.
-Five Strategic Dimension of the Internet are addressed in the following slides.
Dimension #1: Movement toward information symmetry- - ✔✔Typical markets
are characterized by information asymmetry, whereby sellers control key
information that is not available to buyers. The Internet promotes information
symmetry, whereby buyers and sellers share information.
Dimension #2: Internet as distribution channel - ✔✔The Internet acts as a
distribution channel for non-tangible goods and services. Consumers can
purchase items such as airline tickets, insurance, stocks, and computer software
online without the necessity of physical delivery.
, Dimension #3: Speed - ✔✔The Internet offers numerous opportunities to improve
the speed of the actual transaction, as well as the process that leads up to and
follows it.
Dimension #4: Interactivity - ✔✔Consumers discuss their experiences with
products and services on bulletin boards or in chat rooms. Firms can readily
exchange information with trade associations that represent their industries.
Dimension #5: Potential for cost reductions and cost shifting - ✔✔The Internet
provides many businesses with opportunities to minimize their costs—both fixed
and variable—and thereby enhance flexibility.
Forms of Electronic Commerce - ✔✔B2B, B2C, B2G.
C2B, C2C
Forms of Electronic Commerce - ✔✔Many traditional firms are integrating e-
commerce into their existing business models
These firms are attempting to build synergy between traditional and virtual
storefronts.
Commoditization & Mass Customization - ✔✔-Commoditization—Firms are
having a more difficult time distinguishing their products and services from those
of their rivals.
