Question

Which of the following statements is true about firms and their resources and capabilities?

1) Firms should identify their internal resources and assess their strengths and weaknesses
2) Firms should identify the set of resources that provide the firm with capabilities that are unique to the firm, relative to its competitors
3) Firms should determine the potential for their unique set of resources and capabilities to outperform rivals in terms of returns
4) Locate and compete in an attractive industry
5) To attain a sustainable competitive advantage and earn above average returns, firms should formulate and implement strategies that enable them to exploit their resources and capabilities to take advantage of opportunities in the external environment better than their competitors

Answer 1

True statements about firms include the need to assess resources and capabilities, identifying unique capabilities, potential to outperform rivals, competing in an attractive industry, and exploiting resources for a sustainable competitive advantage.

Step-by-step explanation:

The following statements about firms and their resources and capabilities are all true:

1. Firms should identify their internal resources and assess their strengths and weaknesses.
2. Firms should identify the set of resources that provide the firm with capabilities that are unique to the firm, relative to its competitors.
3. Firms should determine the potential for their unique set of resources and capabilities to outperform rivals in terms of returns.
4. Locate and compete in an attractive industry.
5. To attain a sustainable competitive advantage and earn above average returns, firms should formulate and implement strategies that enable them to exploit their resources and capabilities to take advantage of opportunities in the external environment better than their competitors.

Each of these points aligns with strategic management principles, highlighting the importance of internal analysis, competitive positioning, industry attractiveness, and strategy formulation for achieving and maintaining a leading position in the marketplace.