Question #6
simran2505 wrote:
Could you please explain question 6 here?
Lots of discussion of question #6, but we'll add our two cents in case it's useful.
Quote:
6. The passage suggests that the recent study of retail firms discussed in the second paragraph supports which of the following conclusions regarding a firm's competitive advantage?
To answer this question, let's first go back to the passage to see what it says about the study:
"According to a recent study of retail firms, which confirmed that IT has become pervasive and relatively easy to acquire, IT by itself appeared to have conferred little advantage. In fact, though little evidence of any direct effect was found, the frequent negative correlations between IT and performance suggested that IT had probably weakened some firms' competitive positions. However, firms' human resources, in and of themselves, did explain improved performance, and some firms gained IT-related advantages by merging IT with complementary resources, particularly human resources."
From this we know that:
1) IT by itself didn't result in a competitive advantage, and in fact may have worsened some firms' competitive positions
2) Human resources by themselves DID explain improved performance
3) By combining IT and human resources, some firms gained an advantage
So, which answer choice aligns with this information?
Quote:
A. Human resources alone are more likely to contribute to competitive advantage than is IT alone.
This one looks good! Human resources by themselves DID explain improved performance, while IT alone did not. From this, we can say that human resources alone were more likely to lead to competitive advantage than IT alone.
Keep (A), and let's look at the other options.
Quote:
B. Human resources combined with IT are more likely than human resources alone to have a negative effect on competitive advantage.
We know that some firms gained a competitive advantage by combining IT and HR. We also know that HR alone provided an advantage.
The passage says good things about both of these options, but doesn't provide a clear comparison between the two -- we don't know how often either option led to
negative effects on competitive advantage.
Because of this, we can rule out (B).
Quote:
C. Human resources combined with IT often have a negative effect on competitive advantage.
Nope! We know that some firms
gained a competitive advantage by combining IT and HR. The study doesn't suggest in any way that this combination led to a
negative effect on competitive advantage.
Eliminate (C).
Quote:
D. IT by itself is much more likely to have a positive effect than a negative effect on competitive advantage.
The study actually suggests the opposite of (C) -- IT alone "conferred little advantage," and actually sometimes WORSENED a firm's competitive advantage.
(D) is out.
Quote:
E. The positive effect of IT on competitive advantage increases with time.
Hmm, the study doesn't mention any changes of competitive advantage
with time. Instead, the study just says that IT can have a positive effect when combined with other complementary resources, such as HR.
(E) is out, and (A) is the answer to question #6.
I hope that helps!