A company’s strategy concerns
Management’s action plan for running the business and conducting operations—its commitment to pursue a particular set of actions in growing the business, staking out a market position, attracting and pleasing customers, competing successfully, conducting operations and achieving targeted objectives
A company’s strategy consists of
The competitive moves and business approaches that managers are employing to grow the business, stake out a market position, attract and please customers, compete successfully, conduct operations and achieve targeted objectives
The competitive moves and business approaches a company’s management is using to grow the business, stake out a market position, attract and please customers, compete successfully, conduct operations and achieve organizational objectives is referred to as its
In crafting a strategy, management is in effect saying
“Among all the many different business approaches and ways of competing we could have chosen, we have decided to employ this particular combination of competitive and operating approaches in moving the company in the intended direction, strengthening its market position and competitiveness and boosting performance.”
A company’s strategy is most accurately defined as
Management’s commitment to pursue a particular set of actions in growing the business, attracting and pleasing customers, competing successfully, conducting operations and improving the company’s financial and market performance
Which of the following is not something a company’s strategy is concerned with?
How quickly and closely to copy the strategies being used by successful rival companies
Which of the following is not a primary focus of a company’s strategy?
How to achieve above-average gains in the company’s stock price and thereby meet or beat shareholder expectations
In crafting a company’s strategy,
Managers need to come up with some distinctive “aha” element to the strategy that draws in customers and produces a competitive edge over rivals
The heart and soul of a company’s strategy-making effort…
Involves coming up with moves and actions that produce a durable competitive edge over rivals
A company’s strategy and its quest for competitive advantage are tightly connected because
Crafting a strategy that yields a competitive advantage over rivals is a company’s most reliable means of achieving above-average profitability and financial performance
A company achieves sustainable competitive advantage when
An attractive number of buyers have a lasting preference for its products or services as compared to the offerings of competitors
A creative, distinctive strategy that sets a company apart from rivals and that gives it a sustainable competitive advantage
Is a company’s most reliable ticket to above-average profitability—indeed, the tight connection between competitive advantage and profitability means that the quest for sustainable competitive advantage always ranks center stage in crafting a strategy
What separates a powerful strategy from a run-of-the-mill or ineffective one is
Management’s ability to forge a series of moves, both in the marketplace and internally, that sets the company apart from rivals, tilts the playing field in the company’s favor and produces sustainable competitive advantage over rivals
Which of the following is a frequently used strategic approach to setting a company apart from rivals and achieving a sustainable competitive advantage?
((All of these))
A. Striving to be the industry’s low-cost provider, thereby aiming for a cost-based competitive advantage
B. Outcompeting rivals on the basis of such differentiating features as higher quality, wider product selection, added performance, better service, more attractive styling, technological superiority or unusually good value for the money
C. Developing expertise and resource strengths that give the company competitive capabilities that rivals can’t easily imitate or trump with capabilities of their own
D. Focusing on a narrow market niche and winning a competitive edge by doing a better job than rivals of serving the special needs and tastes of buyers comprising the niche
Which of the following is not a frequently used strategic approach to setting a company apart from rivals and achieving a sustainable competitive advantage?
Striving to be more profitable than rivals and aiming for a competitive edge based on bigger profit margins
One of the keys to successful strategy-making is
To come up with one or more differentiating strategy elements that act as a magnet to draw customers and yield a lasting competitive edge
Which of the following is not something to look for in identifying a company’s strategy?
Management actions to revise the company’s financial and strategic performance targets
Which of the following is something to look for in identifying a company’s strategy?
((All of These))
A. Actions to gain sales and market share
B. Actions to strengthen marketing standing and competitiveness by merging with or acquiring rival companies
C. Actions to enter new geographic or product markets or exit existing ones
D. Actions and approaches used in managing R&D, production, sales and marketing, finance and other key activities
E. All of above are pertinent in identifying a company’s strategy
A company’s strategy evolves over time as a consequence of
((All of these))
A. The need to keep strategy in step with changing market conditions and changing customer needs and expectations
B. The proactive efforts of company managers to fine-tune and improve one or more pieces of the strategy
C. The need to abandon some strategy features that are no longer working well
D. The need to respond to the newly-initiated actions and competitive moves of rival firms
E. All of these
Which of the following is not one of the basic reasons that a company’s strategy evolves over time?
The need on the part of company managers to make regular adjustments in the company’s strategic vision and also to initiate fresh strategic actions so as to keep employees from becoming bored with having to execute the same strategy month after month
Changing circumstances and ongoing managerial efforts to improve the strategy
Account for why a company’s strategy evolves over time
A company’s strategy is a “work in progress” and evolves over time because of
The ongoing need of company managers to react and respond to changing market and competitive conditions
It is normal for a company’s strategy to end up being
A blend of proactive actions to improve the company’s competitiveness and financial performance and as-needed reactions to unanticipated developments and fresh market conditions
Crafting a strategy involves
Stitching together a proactive/intended strategy and then adapting first one piece and then another as circumstances surrounding the company’s situation change or better options emerge
Which of the following statements about a company’s strategy is true?
A company’s strategy is typically a blend of proactive and reactive strategy elements
A company’s strategy evolves from one version to the next because of
The proactive efforts of company managers to improve this or that aspect of the strategy, a need to respond to changing customer requirements and expectations and a need to react to fresh strategic maneuvers on the part of rival firms
Which one of the following does not account for why a company’s strategy evolves from one version to another?
A desire on the part of company managers to develop new strategy elements on the fly
In the course of crafting a strategy, it is common for management to
A. Decide to abandon certain strategy elements that have grown stale or become obsolete
B. Modify the current strategy when market and competitive conditions take an unexpected turn or some aspects of the company’s strategy hit a stone wall
C. Modify the current strategy in response to the fresh strategic maneuvers of rival firms
D. Take proactive actions to improve this or that piece of the strategy
E. All of these
In choosing among strategy alternatives, company managers
Are well-advised to go beyond merely keeping a company’s strategic actions within the bounds of what is legal and consider whether the various pieces of the company’s strategy are compatible with ethical standards of “right” and “wrong” and duty—what a company should and should not do
A company’s strategy can be considered “ethical”
If it does not entail actions or behaviors that cross the moral line from “can do” to “should not do” (because such actions are unsavory, unconscionable, injurious to others or unnecessarily harmful to the environment) and if it allows management to fulfill its ethical duties to all stakeholders (shareholders, employees, customers, suppliers, the communities in which it operates and society at large)
A company’s strategy can be considered “unethical” or shady
A. If any of its actions constitute “unfair competition.”
B. If the company engages in actions or behaviors that are contrary to the general public interest
C. If the company’s actions/behaviors are harmful to its stakeholders—customers, employees, shareholders, suppliers and the communities in which the company operates
D. If it entails actions or behaviors that cross the moral line from “can do” to “should not do” (because such actions are “unsavory” or unconscionable or unnecessarily harmful to the environment)
E. All of the above call the company’s actions/behaviors into question from an ethical standpoint
A company whose strategy has shady or unethical elements
Puts the reputation of the company and its top executives at risk and may even jeopardize the company’s long-term well-being and survival, especially if it is required to pay out considerable sums of money to settle punitive lawsuits and compensate customers, employees, shareholders, suppliers, rival companies and any others for the injuries they have suffered
In endeavoring to craft an ethical strategy, company managers
Have to go beyond what strategic actions and behaviors are legal and address whether all the various elements of the company’s strategy can pass the test of moral scrutiny
A company’s business model
Is management’s storyline for how it will generate revenues ample to cover costs and produce a profit—absent the ability to deliver good profitability, the strategy is not viable and the survival of the business is in doubt
A company’s business model
Zeros in on how and why the business will generate revenues sufficient to cover costs and produce attractive profits and return on investment
Management’s story line for how and why the company’s business approaches will generate revenues sufficient to cover costs and produce attractive profits and returns on investment
Best describes what is meant by a company’s business model
A company’s business model
Sets forth the key components of the enterprise’s business approach, indicates how revenues will be generated and makes a case for why the strategy can deliver value to customers in a profitable manner
The difference between a company’s strategy and a company’s business model is that
Strategy relates broadly to a company’s competitive moves and business approaches (which may or may not lead to profitability) while its business model relates to whether the revenues and costs flowing from the strategy demonstrate that the business is viable from the standpoint of being able to earn satisfactory profits and returns on investment
A winning strategy is one that
Fits the company’s internal and external situation, builds sustainable competitive advantage and improves company performance.
Which one of the following questions can be used to test the merits of one strategy over another and distinguish a winning strategy from a mediocre or losing strategy?
How well does the strategy fit the company’s situation?
Which of the following questions ought to be used to test the merits of one strategy over another and distinguish a winning strategy from a mediocre or losing strategy?
Is the strategy helping the company achieve a sustainable competitive advantage and is it resulting in better company performance?
Crafting and executing strategy are top-priority managerial tasks because
There is a compelling need for managers to proactively shape how the company’s business will be conducted and because a strategy-focused enterprise is more likely to be a stronger bottom-line performer than a company whose management views strategy as secondary and puts its priorities elsewhere
Crafting and executing strategy are top-priority managerial tasks because
Good strategy coupled with good strategy execution greatly raises the chances that a company will be a standout performer in the marketplace
Good strategy combined with good strategy execution
Are the most trustworthy signs of good management
The most trustworthy signs of a well-managed company are
Good strategy-making combined with good strategy execution
Excellent execution of an excellent strategy is
The best test of managerial excellence and the best recipe for making a company a standout performer
Which one of the following is not one of the five basic tasks of the strategy-making, strategy-executing process?
Developing a profitable business model
Which of the following is an integral part of the managerial process of crafting and executing strategy?
Setting objectives and using them as yardsticks for measuring the company’s performance and progress
Which of the following are integral parts of the managerial process of crafting and executing strategy?
Developing a strategic vision, setting objectives, and crafting a strategy
The strategy-making, strategy-executing process
Embraces the tasks of developing a strategic vision, setting objectives, crafting a strategy, implementing and executing the strategy and then monitoring developments and initiating corrective adjustments in light of experience, changing conditions, new ideas and new opportunities
A company’s strategic vision concerns
A company’s directional path and future product-market-customer-technology focus
A company’s strategic vision
Delineates management’s aspirations for the business, providing a panoramic view of “where we are going” and a convincing rationale for why this makes good business sense
Developing a strategic vision for a company entails
Prescribing a strategic direction for the company to pursue and a rationale for why this strategic path makes good business sense
The managerial task of developing a strategic vision for a company
Involves deciding upon what strategic course a company should pursue in preparing for the future and why this directional path makes good business sense
Which one of the following is not an accurate attribute of an organization’s strategic vision?
Outlining how the company intends to implement and execute its business model
Management’s strategic vision for an organization
Charts a strategic course for the organization (“where we are going”) and provides a rationale for why this directional path makes good sense
What a company’s top executives are saying about where the company is headed and about what the company’s future product-customer-market-technology will be
Constitutes their strategic vision for the company
One of the important benefits of a well-conceived and well-stated strategic vision is to
Clearly communicate management’s aspirations for the company to stakeholders and help steer the energies of company personnel in a common direction
The defining characteristic of a well-conceived strategic vision is
What it says about the company’s future strategic course—”the direction we are headed and what our future product-market-customer-technology focus will be.”
Which one of the following questions is not pertinent to company managers in thinking strategically about their company’s directional path and developing a strategic vision?
What business approaches and operating practices should we consider in trying to implement and execute our business model?
Which one of the following questions is not something that company managers should consider in choosing to pursue one strategic course or directional path versus another?
Do we have a better business model than key rivals?
Which of the following are characteristics of an effectively-worded strategic vision statement?
Graphic, directional and focused
Which one of the following is not a characteristic of an effectively-worded strategic vision statement?
Consensus-driven (commits the company to a “mainstream” directional path that most all stakeholders will enthusiastically support)
Which of the following is not a common shortcoming of company vision statements?
Too narrow—doesn’t leave enough room for future growth
Which of the following are common shortcomings of company vision statements?
Too broad, vague or incomplete, bland/uninspiring, not distinctive and too reliant on superlatives
A company’s mission statement typically addresses which of the following questions?
“Who are we and what do we do?”
The difference between the concept of a company mission statement and the concept of a strategic vision is that
A mission statement typically concerns a company’s present business scope (“who we are and what we do”) whereas the principal concern of a strategic vision is with the company’s long term direction and future product-market-customer-technology focus
The difference between a company’s mission statement and the concept of a strategic vision is that
A mission statement typically concerns a company’s present business scope and purpose whereas a strategic vision sets forth “where we are going and why.”
Top management efforts to communicate the strategic vision to company personnel
Should be done in language that inspires and motivates company personnel to unite behind executive efforts to get the company moving in the intended direction
The task of effectively communicating the strategic vision is made easier by
Capturing the essence of the vision in a catchy slogan or brief phrase and then using it repeatedly as a reminder of “where we are going and why.”
Effectively communicating the strategic vision down the line to lower-level managers and employees has the value of
Not only explaining where management is trying to take the company and what changes lie on the road ahead but, more importantly, also inspiring company personnel to unite behind managerial efforts to get the company moving in the intended direction
Perhaps the most important benefit of a vivid, engaging and convincing strategic vision is
Gaining wholehearted organizational support for the vision and uniting company personnel behind managerial efforts to get the company moving in the intended direction
Breaking down resistance to a new strategic vision typically requires that top management
Frequently reiterate the basis for the new direction at company gatherings, address employee concerns and fears head-on, try to lift the spirits of employees and provide updates and progress reports as events unfold (particularly information that confirms the wisdom of the new direction)
When there’s an order of magnitude change in a company’s environment that dramatically alters its prospects and mandates radical revision of its strategic course, the company is said to have encountered
A strategic inflection point
The payoffs of a clear vision statement do not include
Greater ability to avoid strategic inflection points
A company’s values concern
The beliefs, traits and behavioral norms that company personnel are expected to display in conducting the company’s business and pursuing its strategic vision and strategy
A company’s values relate to such things as
Fair treatment, integrity, ethical behavior, innovativeness, teamwork, top-notch quality, superior customer service, social responsibility and community citizenship
Company managers connect values to the chosen strategic vision by
Making it clear that company personnel are expected to live up to the values in conducting the company’s business and pursuing its strategic vision
Which one of the following statements concerning a company’s values is inaccurate?
There is seldom a very wide gap between a company’s stated values and the reality of how it conducts its business
The managerial purpose of setting objectives includes
A. Converting the strategic vision into specific performance targets—results and outcomes the organization wants to achieve
B. Using the objectives as yardsticks for tracking the company’s progress and performance
C. Challenging and helping stretch the organization to perform at its full potential and deliver the best possible results
D. Pushing company personnel to be more inventive, to exhibit more urgency in improving the company’s financial performance and business position and to be more intentional and focused in their actions
E. All of these
A set of “stretch” financial and strategic objectives
Is an effective tool for avoiding ho-hum results
Which one of the following is not an advantage of setting “stretch” objectives?
Helping clarify the company’s strategic vision and strategic intent
A company needs financial objectives
Because adequate profitability and financial strength is critical to effective pursuit of its strategic vision, as well as to its long-term health and ultimate survival—weak earnings and a weak balance sheet alarm shareholders and creditors and put executives’ jobs at risk
Which of the following is the best example of a well-stated financial objective?
Increase earnings per share by 15% annually
Which of the following is the best example of a well-stated strategic objective?
Overtake key competitors on product quality within three years
Relate to strengthening a company’s overall business and competitive position
A balanced scorecard for measuring company performance
Entails creating a set of objectives that is “balanced” in the sense of including both financial and strategic objectives
A “balanced scorecard” that includes both strategic and financial performance targets is a conceptually strong approach for judging a company’s overall performance because
Financial performance measures are lagging indicators that reflect the results of past decisions and organizational activities whereas strategic performance measures are leading indicators of a company’s future financial performance
Perhaps the most reliable way for a company to improve its financial performance over time is to
Recognize that the achievement of strategic objectives fosters better long-term financial performance and that a balanced scorecard approach to objective-setting has much to recommend
A company that pursues and achieves strategic objectives
Is frequently in better position to improve its future financial performance (because of the increased competitiveness and strength in the marketplace that flows from the achievement of strategic objectives)
A company exhibits strategic intent when
It relentlessly pursues an ambitious strategic objective, concentrating the full force of its resources and competitive actions on achieving that objective
Strategic intent refers to a situation where a company
Relentlessly pursues an ambitious strategic objective, concentrating the full force of its resources and competitive actions on achieving that objective
A company with strategic intent
Usually has an exceptionally bold and grandiose long-term objective—like becoming the dominant global market leader—and an unshakable commitment to concentrating its full resources and strategy on achieving that objective even if it takes 10 years or longer
Need to be broken down into performance targets for each of its separate businesses, product lines, functional departments and individual work units
A company needs performance targets or objectives
For its operations as a whole and also for each of its separate businesses, product lines, functional departments and individual work units
The task of stitching together a strategy
Entails addressing a series of hows: how to grow the business, how to please customers, how to outcompete customers, how to outcompete rivals, how to respond to changing market conditions, how to manage each functional piece of the business and develop needed competencies and capabilities and how to achieve strategic and financial objectives
Masterful strategies come from
Doing things differently from competitors where it counts—out-innovating them, being more efficient, adapting faster—rather than running with the herd
More of a collaborative group effort that involves, to some degree, all managers and sometimes key employees, as opposed to being the function and responsibility of a few high-level executives
Managerial jobs with strategy-making responsibility
Extend throughout the managerial ranks and exist in every part of a company?business units, operating divisions, functional departments, manufacturing plants and sales districts
Which of the following accurately describes the task of crafting a company’s strategy?
The more that a company’s operations cut across different products, industries and geographical areas, the more that headquarters executives have little option but to delegate considerable strategy-making authority to down-the-line managers in charge of particular subsidiaries, divisions, product lines, geographic sales offices, distribution centers and plants
Which of the following is not an accurate description of the task of crafting a company’s strategy?
The task of crafting strategy is best done by a company’s chief strategic planning officer, who should report directly to the company’s CEO and board of directors
A company’s overall strategy
Is really a collection of strategic initiatives and actions devised by managers and key employees up and down the whole organizational hierarchy
In a diversified company, the strategy-making hierarchy consists of
Corporate strategy, business strategies, functional strategies and operating strategies
In a single-business company, the strategy-making hierarchy consists of
Business strategy, functional strategies and operating strategies
Corporate strategy for a diversified or multi-business enterprise
Is orchestrated by the CEO and other senior corporate executives and centers around the kinds of initiatives the company uses to establish business positions in different industries and efforts to boost the combined performance of the set of businesses the company has diversified into
Business strategy concerns
The actions and approaches crafted by management to produce successful performance in one specific line of business
Business strategy, as distinct from corporate strategy, is chiefly concerned with
Forging actions and approaches to compete successfully in a particular line of business
Concern the actions, approaches and practices to be employed in managing particular functions or business processes or key activities within a business
The primary role of a functional strategy is to
Support the overall business strategy and competitive approach
Operating strategies concern
The relatively narrow strategic initiatives and approaches for managing key operating units within a business (plants, distribution centers, geographic units) and for performing strategically significant operating tasks (maintenance, shipping, inventory control, purchasing, advertising) in ways that support functional strategies and the overall business strategy
Management’s direction-setting, strategy-making effort is not complete until
The pieces of a company’s strategy up and down the strategy pyramid are cohesive and mutually reinforcing, fitting together like a jigsaw puzzle
A company’s strategy is not at full power until
Its many pieces are united and fit together like a jigsaw puzzle
A company’s strategic plan consists of
A vision of where it is headed, a set of performance targets and a strategy to achieve them
Which of the following is not among the principal managerial tasks associated with managing the strategy execution process?
Surveying employees on how they think costs can be reduced and how employee morale and job satisfaction can be improved
Management is obligated to monitor new external developments, evaluate the company’s progress and make corrective adjustments in order to
Decide whether to continue or change the company’s strategic vision, objectives, strategy and/or strategy execution methods
The primary roles/obligations of a company’s board of directors in the strategy-making, strategy-executing process include
Overseeing the company’s direction, strategy and business approaches and evaluating the caliber of senior executives’ strategy-making and strategy-executing skills
The obligations of an investor-owned company’s board of directors in the strategy-making, strategy-executing process include
Overseeing the company’s financial accounting and financial reporting practices and evaluating the caliber of senior executives’ strategy-making/strategy-executing skills
Which one of the following is not among the chief duties/responsibilities of a company’s board of directors insofar as the strategy-making, strategy-executing process is concerned?
Hiring and firing senior-level executives and working with the company’s chief strategic planning officer to improve the company’s strategy when performance comes up short of expectations
Which of the following is particularly pertinent in evaluating whether an industry presents a sufficiently attractive business opportunity?
The industry’s growth potential, whether competition appears destined to become stronger or weaker and whether the industry’s overall profit prospects are above average, average or below average
Evaluating whether an industry presents a sufficiently attractive business opportunity usually does not involve a consideration of which of the following factors?
Whether the industry’s product is strongly or weakly differentiated
A company’s “macroenvironment” refers to
All the relevant forces and factors outside a company’s boundaries?general economic conditions, population demographics, societal values and lifestyles, technological factors, governmental legislation and regulation and closer to home, the industry and competitive arena in which it operates
Which one of the following is not part of a company’s macroenvironment?
The company’s resource strengths, resource weaknesses and competitive capabilities
Which of the following is not a major question to ask in thinking strategically about industry and competitive conditions in a given industry?
How many companies in the industry have good track records for revenue growth and profitability?
Thinking strategically about industry and competitive conditions in a given industry involves evaluating such considerations as
A. The forces driving change in the industry
B. The dominant economic features of the industry in which the company operates
C. The kinds of competitive forces industry members are facing and the strength of each competitive force
D. The key factors influencing future competitive success in the industry
Which of the following is not a factor to consider in identifying an industry’s dominant economic features?
How strong driving forces and competitive forces are
Which of the following is not a relevant consideration in identifying an industry’s dominant economic features?
How many strategic groups the industry has and which ones are most profitable and least profitable
The state of competition in an industry is a function of
A. The competitive pressures associated with the market maneuvering and jockeying for buyer patronage that goes on among rival firms in the industry
B. Competitive pressures coming from the attempts of companies in other industries attempting to win buyers over to their substitute products
C. Competitive pressures associated with the threat of new entrants into the marketplace
D. Competitive pressures associated with the bargaining power of suppliers and customers
The nature and strength of the competitive forces that prevail in an industry are generally a joint product of
A. The pressures induced by the market maneuvering and jockeying for buyer patronage that goes on among rival sellers in the industry
B. The threat that firms outside the industry will decide to enter the market
C. The attempts of companies in other industries to win buyers over to their own substitute products
D. Competitive pressures stemming from the bargaining power of both suppliers and buyers
Which of the following is not one of the five typical sources of competitive pressures?
The power and influence of industry driving forces
The most powerful of the five competitive forces is usually
The competitive pressures associated with the market maneuvering and jockeying for buyer patronage that goes on among rival sellers in the industry
Typically, the weakest of the five competitive forces in an industry is/are
None of the above is typically weakest
Competitive jockeying and market maneuvering among industry rivals
Is ever-changing as fresh offensive and defensive moves are initiated and as rivals emphasize first one mix of competitive weapons and tactics and then another
Using the five-forces model of competition to determine what competition is like in a given industry involves
Building the picture of competition in three steps: (1) identifying the specific competitive pressures associated with each of the five competitive forces; (2) evaluating how strong the pressures comprising each competitive force are; and (3) determining whether the collective impact of all five competitive forces is conducive to earning attractive profits
What makes the marketplace a competitive battlefield is
The constant jockeying of industry members to strengthen their standing with buyers and win a competitive edge over rivals
Factors that cause the rivalry among competing sellers to be weak include
Rapid growth in buyer demand and high buyer switching costs
Which one of the following does not cause the rivalry among competing sellers to be weak?
Low barriers to entry
Factors that tend to result in weak rivalry among competing sellers include
Rapid growth in buyer demand, high buyer costs to switch brands and so many industry rivals that any one company’s actions have little impact on rivals’ businesses
The rivalry among competing sellers tends to be less intense when
Industry rivals are not particularly aggressive or active in making fresh moves to improve their market standing and business performance
Rivalry among competing sellers is generally more intense when
Rivals are active in making fresh moves to lower prices, introduce new products, increase promotional efforts and advertising and otherwise gain sales and market share
Rivalry among competing sellers grows in intensity when
Buyer demand is growing slowly and the industry is composed of 6 to 10 competitors that are fairly equal in size and competitive capability
The competitive force of rival firms’ jockeying for better market positions, higher sales and market shares and competitive advantage
Tends to intensify when strong companies outside the industry acquire weak firms in the industry and launch aggressive, well-funded moves to transform the acquired companies into strong market contenders
Which of the following is not among the factors that affect whether competitive rivalry among participating firms is strong, moderate or weak?
Whether industry driving forces are strong or weak
In analyzing the strength of competition among rival firms, an important consideration is
The diversity of competitors in terms of visions, strategic intents, objectives, strategies, resources and countries of origin
The intensity of rivalry among competing sellers does not depend on whether
The industry has more than two strong driving forces and whether the industry has more than 2 strategic groups
Rivalry among competing sellers tends to be more intense when
Several competitors are under pressure to improve their market share or profitability and launch fresh strategic initiatives to attract more buyers and bolster their business position
In which one of the following instances is rivalry among competing sellers not more intense?
When there are so many industry rivals that the impact of any one company’s actions is spread thinly across all industry members
Potential entrants are more likely to be deterred from actually entering an industry when
Incumbent firms have previously been aggressive in defending their market positions against entry
Competitive pressures associated with the threat of entry are greater when
A. Incumbent firms are unable or unwilling to strongly contest the entry of newcomers
B. Newcomers can expect to earn attractive profits and a number of outsiders have the expertise and resources to hurdle whatever entry barriers exist
C. Entry barriers are relatively low and buyer demand for the product is growing fairly rapidly
D. Existing industry members are looking to expand their market reach by entering product segments or geographic areas where they currently do not have a presence
E. All of these conditions heighten the competitive pressures associated with fresh entry into the industry
Which one of the following does not intensify the competitive pressures associated with the threat of entry?
When industry members are struggling to earn good profits
Which one of the following increases the competitive pressures associated with the threat of entry?
When newcomers can expect to earn attractive profits
The competitive threat that outsiders will enter a market is weaker when
Financially strong industry members send strong signals that they will launch strategic initiatives to combat the entry of newcomers.
Competitive pressures stemming from the threat of entry are weaker when
The industry outlook is risky or uncertain
Which of the following is generally not considered as a barrier to entry?
Rapid market growth
The best test of whether potential entry is a strong or weak competitive force is
To ask if the industry’s growth and profit prospects are strongly attractive to potential entry candidates
The competitive pressures from substitute products tend to be stronger when
Buyers are relatively comfortable with using substitutes and the costs to buyers of switching over to the substitutes are low
In which of the following instances are industry members not subject to stronger competitive pressures from substitute products?
Buyers are dubious about using substitutes
Industry rivals tend to experience weak competitive pressures from substitute products when
Buyers incur high costs in switching to substitutes and substitutes are higher priced relative to the performance they deliver
Just how strong the competitive pressures are from substitute products depends on
Whether attractively priced substitutes are readily available and the ease with which buyers can switch to substitutes
Which of the following is not a good example of a substitute product that triggers stronger competitive pressures?
Coca-Cola as a substitute for Pepsi
Whether supplier-seller relationships in an industry represent a strong or weak source of competitive pressure is a function of
Whether suppliers can exercise sufficient bargaining power to influence the terms and conditions of supply in their favor and the extent of seller-supplier collaboration in the industry
The bargaining leverage of suppliers is greater when
There are no good substitutes for the items being furnished by the suppliers and the number of suppliers is relatively small
In which one of the following instances are the competitive pressures that industry members experience in their dealings with suppliers not weakened?
When the items purchased from suppliers are in short supply
Supplier bargaining power is weaker when
Good substitute inputs exist or new ones emerge
Which one of the following is not a factor that affects the strength of supplier bargaining power?
Whether industry members are struggling to make good profits because of slow-growing market demand
Which one of the following is not a factor in causing supplier bargaining power to be relatively strong?
The input being supplied is a commodity
The strength of competitive pressures that suppliers can exert on industry members is mainly a function of
Whether needed inputs are in short supply or whether ample supplies are readily available from several different suppliers
When one or more industry members have unusually effective and mutually advantageous partnerships with their suppliers,
There is a strong likelihood such partnerships will put increased competitive pressure on those industry members who lack productive collaborative relationships with their suppliers
Which one of the following is not a reason why industry members are often motivated to enter into collaborative partnerships with key suppliers?
To reduce the costs of switching suppliers
In which of the following circumstances are competitive pressures associated with the bargaining power of buyers not relatively strong?
When buyer demand is growing rapidly
Whether buyer bargaining power poses a strong or weak source of competitive pressure on industry members depends in part on
Whether demand-supply conditions represent a buyer’s market or a seller’s market
Whether buyer-seller relationships in an industry represent a strong or weak source of competitive pressure is a function of
The extent to which buyers can exercise enough bargaining power to influence the terms and conditions of sale in their favor and whether the extent of collaboration between certain sellers and certain buyers in the industry places rivals lacking such collaborative arrangements at a competitive disadvantage
Collaborative relationships between particular sellers and buyers in an industry can represent a source of strong competitive pressure when
One or more rival sellers form mutually advantageous partnerships with important or prestigious buyers such that rivals lacking such partnerships are placed at a competitive disadvantage
Competitive pressures stemming from buyer bargaining power tend to be weaker when
The costs incurred by buyers in switching to competing brands or to substitute products are relatively high
Which of the following conditions acts to weaken buyer bargaining power?
When buyers are unlikely to integrate backward into the business of sellers
Which of the following is not a factor that causes buyer bargaining power to be stronger?
The industry is composed of a few large sellers and the customer group consists of numerous buyers that purchase in fairly small quantities
Buyers are in position to exert strong bargaining power in dealing with sellers when
The number of buyers is small or when a customer is particularly important to a seller
Which of the following factors is not a relevant consideration in judging whether buyer bargaining power is relatively strong or relatively weak?
Whether buyer needs and expectations are changing rapidly or slowly
Which of the following factors does not affect whether buyer bargaining power and seller-buyer collaboration are an important source of competitive pressure in an industry?
Whether buyers have a strong preference for products of superior quality or just average quality
Which of the following factors is not a relevant consideration in determining the strength of buyer bargaining power?
Whether the seller is a manufacturer or a wholesaler/distributor
A competitive environment where there is weak to moderate rivalry among sellers, high entry barriers, weak competition from substitute products and little bargaining leverage on the part of both suppliers and customers
Is conducive to industry members earning attractive profits
A competitive environment where there is strong rivalry among sellers, low entry barriers, strong competition from substitute products and considerable bargaining leverage on the part of both suppliers and customers
Is competitively unattractive from the standpoint of earning good profits
As a rule, the stronger the collective impact of competitive pressures associated with the five competitive forces,
The lower the combined profitability of industry members
The “driving forces” in an industry
Are major underlying causes of changing industry and competitive conditions and have the biggest influences in reshaping the industry landscape and altering competitive conditions
Industry conditions change
Because important forces create pressures or incentives for industry participants (competitors, customers, suppliers) to alter their actions
The task of driving forces analysis is to
Identify the driving forces, assess whether their impact will make the industry more or less attractive and determine what strategy changes are needed to prepare for the impacts of the driving forces
Which of the following is not generally a “driving force” capable of producing fundamental changes in industry and competitive conditions?
Ups and downs in the economy and in interest rates
Which of the following are most unlikely to qualify as driving forces?
Mounting competition from substitutes and increasing efforts to collaborate with suppliers via strategic alliances
Increasing globalization of the industry can be a driving force because
It tends to increase rivalry among industry members and often shifts the pattern of competition among an industry’s major players, favoring some and disadvantaging others
Driving forces analysis
Involves identifying the driving forces, assessing whether their impact will make the industry more or less attractive and determining what strategy changes a company may need to make to prepare for the impacts of the driving forces
Driving forces analysis helps managers identify whether
The combined impacts of the driving forces will act to increase/decrease market demand, increase/decrease competition and raise/lower industry profitability in the years ahead
An industry’s driving forces
Generally act in ways which will strengthen or weaken market demand, competition and industry profitability in future years
Which of the following do not qualify as potential driving forces capable of inducing fundamental changes in industry and competitive conditions?
Increases in the economic power and bargaining leverage of customers and suppliers, growing supplier-seller collaboration and growing buyer-seller collaboration
In analyzing driving forces, the strategist’s role is to
Identify the driving forces and evaluate their impact on (1) demand for the industry’s product, (2) the intensity of competition and (3) industry profitability
Which one of the following is not an integral part of driving forces analysis?
Determining whether the driving forces are acting to cause one or more industry rivals to shift to a different strategic group
Which of the following is most likely to qualify as a driving force?
Wildly successful introduction of innovative new products by one or more industry rivals that force other rivals to respond quickly or lose a major share of their customers to the innovating rival(s)
Which one of the following is not a common type of driving force?
Increasing efforts on the part of industry members to collaborate closely with their suppliers
A strategic group
Is a cluster of industry rivals that have similar competitive approaches and market positions
A strategic group consists of those firms in an industry that
Employ similar competitive approaches and occupy similar positions in the market
The concept of strategic groups is relevant to industry and competitive analysis because
Strategic group maps help identify each company’s market position and its closest competitors
In mapping strategic groups
The best variables to use as axes for the map are those that differentiate how rivals have positioned themselves in the marketplace
Which of the following is not an appropriate guideline for developing a strategic group map for a given industry?
The variables chosen as axes for the map should be highly correlated
With the aid of a strategic group map, one can
Often learn to what extent (a) industry driving forces and competitive pressures favor some companies or groups and hurt others and (b) the profit potential of different strategic groups varies because of strengths and weaknesses in each strategic group’s position
Strategic group mapping is a technique for displaying
The different market or competitive positions that rival firms occupy in an industry and identifying each rival’s closest competitors
Which one of the following pairs of variables is least likely to be useful in drawing a strategic group map?
Level of profitability and size of market share
One of the things that can be gleaned from a strategic group map of industry rivals is
Whether profit prospects vary from strategic group to strategic group due to strengths and weaknesses in their respective market positions on the map (perhaps because industry driving forces and competitive pressures are acting to favor some strategic groups and to disadvantage other groups)
The payoff of good scouting reports on rivals is improved ability to
Anticipate what moves rivals are likely to make next, thereby providing a valuable assist in outmaneuvering them in the marketplace
Having good competitive intelligence about rivals’ strategies, latest actions and announcements, resource strengths and weaknesses and moves to improve their situation is important because
It helps a company to anticipate what moves rivals are likely to make next and to craft its own strategic moves with some confidence about what market maneuvers to expect from its rivals
Good competitive intelligence about the strategies and competitive strengths and weaknesses of rival companies helps management determine
A. Which competitor has the best strategy and which competitors have flawed or weak strategies
B. Which rivals are poised to gain market share and which seem destined to lose market share
C. Which rivals are likely to rank among the industry leaders on the road ahead
D. Which rivals are likely to initiate what kinds of fresh strategic moves and why
In seeking to predict the next moves of close or key rivals, it is useful to consider such questions as:
A. Which rivals badly need to increase their unit sales and market share and what new offensive initiatives are they likely to employ?
B. Which rivals are poised to gain market share and which seem destined to lose market share?
C. Which rivals are good candidates to be acquired?
D. Which rivals are likely to enter new geographic markets or expand their product offerings (so as to enter new market segments where they currently do not have a presence)?
The key success factors in an industry
Are those competitive aspects that most affect industry members’ abilities to prosper in the marketplace?the particular strategy elements, product attributes, resources, competencies, competitive capabilities and market achievements that spell the difference between being a strong competitor and a weak competitor
In identifying an industry’s key success factors, strategists should
Consider on what basis customers choose between competing brands, what resources and competitive capabilities firms need to be competitively successful and what shortcomings are almost certain to put a company at a significant competitive disadvantage
An industry’s key success factors
Can be determined from an analysis of an industry’s dominant economic characteristics, what competition is like, the impacts of the driving forces, the comparative market positions of industry members and the likely next moves of industry rivals
Which of the following is not a good example of a marketing-related key success factor?
Product R & D capabilities and expertise in product design
Which of the following is a good example of a manufacturing-related key success factor?
High labor productivity (especially if the production process has high labor content)
Evaluating whether an industry’s environment presents a company with a sufficiently attractive business opportunity involves
Sizing up overall industry and competitive conditions to determine whether the industry’s overall profit prospects are above average, average or below average
Which of the following is not one of the five questions that comprise the task of evaluating a company’s resources and competitive position?
What are the company’s most profitable geographic market segments?
Which of the following is not a component of evaluating a company’s resources and competitive position?
Scanning the environment to determine a company’s best and most profitable customers
The spotlight in analyzing a company’s resources, internal circumstances and competitiveness includes such questions/concerns as
What are the company’s resource strengths and weaknesses and its external opportunities and threats
Which of the following is not pertinent in identifying a company’s present strategy?
The company’s mission, strategic objectives and financial objectives
One important indicator of how well a company’s present strategy is working is whether
The company is achieving its financial and strategic objectives and whether it is an above-average industry performer
The best quantitative evidence of whether a company’s present strategy is working well is
The caliber of results the strategy is producing, specifically whether the company is achieving its financial and strategic objectives and whether it is an above-average industry performer
Which one of the following is not a reliable measure of how well a company’s current strategy is working?
Whether it has a larger number of competitive assets than competitive liabilities and whether it has a superior quality product
Identifying and assessing a company’s resource strengths and weaknesses and its external opportunities and threats is called
SWOT analysis is a powerful tool for
Sizing up a company’s resource capabilities and deficiencies, its market opportunities and the external threats to its future well-being
Provides a good overview of whether a company’s situation is fundamentally healthy or unhealthy
The payoff of doing a thorough SWOT analysis is
Assisting strategy-makers in crafting a strategy that is well-matched to the company’s resources and capabilities, its market opportunities and the external threats to its future well-being
Which one of the following is not part of conducting a SWOT analysis?
Benchmarking the company’s resource strengths and competitive capabilities against industry key success factors
The two most important parts of SWOT analysis are
Drawing conclusions from the SWOT listings about the company’s overall situation and translating these conclusions into strategic actions to better match the company’s strategy to its resource strengths and market opportunities, correct the important weaknesses and defend against external threats
The three steps of SWOT analysis are
Identifying the company’s resource strengths and weaknesses and its opportunities and threats, drawing conclusions about the company’s overall situation and translating the conclusions into strategic action to improve the company’s strategy
A company resource strength can concern
A. A skill, specialized expertise or competitively important capability
B. Valuable human assets and intellectual capital
C. An achievement or attribute that puts the company in a position of market advantage
D. Competitively valuable alliances or cooperative ventures
Which of the following most accurately reflect a company’s resource strengths?
Its human, physical and/or organization assets; its skills and competitive capabilities; achievements or attributes that enhance the company’s ability to compete effectively; and whether it is engaged in competitively valuable alliances or cooperative ventures
A company’s resource strengths are important because
They represent its competitive assets and are big determinants of its competitiveness and ability to succeed in the marketplace
A company’s resource strengths
Signal whether it has the wherewithal to be a strong competitor in the marketplace or whether its capabilities and competitive strengths are modest, thus relegating it to a trailing position in the industry
The best example of a company strength is
Having proven technological expertise and ability to churn out new and improved products on a regular basis
Which of the following is not a good example of a company strength?
Having higher earnings per share and a higher stock price than key rivals
When a company has real proficiency in performing a competitively important value chain activity, it is said to have
A core competence
When a company is good at performing a particular internal activity, it is said to have
A company competence
The difference between a company competence and a core competence is that
A company competence represents real proficiency in performing an internal activity whereas a core competence is a competitively relevant activity which a firm performs better than other internal activities
The difference between a core competence and a distinctive competence is that
A core competence is a competitively relevant activity which a firm performs especially well in comparison to the other activities it performs, whereas a distinctive competence is a competitively relevant activity which a firm performs especially well in comparison to other firms with which it competes
A core competence
A. Adds to a company’s arsenal of competitive capabilities and competitive assets and is a genuine resource strength
B. Is typically knowledge-based, residing in a company’s intellectual capital and not in its tangible physical assets on the balance sheet
C. Is often grounded in cross-department combinations of knowledge and expertise
D. Is a competitively relevant activity which a firm performs especially well in comparison to the other activities it performs
A core competence
Gives a company competitive capability and is a genuine company strength and resource
When a company performs a particular competitively important activity truly well in comparison to its competitors, it is said to have
A distinctive competence
Which of the following does not represent a potential core competence?
Having a wider product line than rivals
A distinctive competence
A. Is a competitively important activity that a company performs better than its competitors
B. Gives a company competitively valuable capability that is unmatched by rivals
C. Is a basis for sustainable competitive advantage
D. Can underpin and add real punch to a company’s strategy
Which one of the following is inaccurate as concerns a distinctive competence?
A distinctive competence is typically less difficult for rivals to copy than a core competence
The competitive power of a company’s core competence or distinctive competence depends on
How hard it is to copy and how easily it can be trumped by the different resource strengths and competitive capabilities of rivals
The competitive power of a company resource strength or competitive capability hinges on
A. How hard it is for competitors to copy
B. Whether it is durable and has staying power (in the sense of not losing its value quickly because of new developments)
C. Whether it is really competitively superior to the essentially equivalent type of resource/capability of rivals
D. How easily it can be trumped by the different resources/capabilities of rivals
For a particular company resource/capability to have real competitive power and perhaps qualify as a basis for competitive advantage, it should
Be hard for competitors to copy, be durable and long-lasting and not be easily trumped by the different resources/capabilities of rivals
The competitive power of a company resource strength is not measured by which one of the following tests?
Is the resource strength something that a company does internally rather than in collaborative arrangements with outsiders?
If a company doesn’t possess a distinctive competence,
It can still marshal competitive power in the marketplace via a collection of adequate-to-good resource strengths
A company resource weakness or competitive deficiency
Is something a company lacks or does poorly (in comparison to rivals) or a condition that puts it at a disadvantage in the marketplace
A company’s resource weaknesses can relate to
A. Inferior or unproven skills, expertise or intellectual capital in competitively important parts of the business
B. Something that it lacks or does poorly (in comparison to rivals)
C. Deficiencies in competitively important physical, organizational or intangible assets
D. Missing or competitively inferior capabilities in key areas
In doing SWOT analysis, which one of the following is not an example of a potential resource weakness or competitive deficiency that a company may have?
Having a single, unified functional strategy instead of several distinct functional strategies
Sizing up a company’s overall resource strengths and weaknesses
Essentially involves constructing a “strategic balance sheet” where the company’s resource strengths represent competitive assets and its resource weaknesses represent competitive liabilities
The external market opportunities which are most relevant to a company are the ones that
Match up well with the firm’s financial resources and competitive capabilities, offer the best growth and profitability and present the most potential for competitive advantage
The market opportunities most relevant to a particular company are those that
Offer the best growth and profitability
In doing SWOT analysis and trying to identify a company’s market opportunities, which of the following is not an example of a potential market opportunity that a company may have?
Growing buyer preferences for substitutes for the industry’s product
Which of the following best describes the market opportunities that tend to be most relevant to a particular company?
Those market opportunities that match up well with the firm’s financial resources and competitive capabilities, offer the best growth and profitability and present the most potential for competitive advantage
Which of the following is not an example of an external threat to a company’s future profitability?
The lack of a distinctive competence
Which of the following is not an example of an external threat to a company’s future profitability?
The lack of a well-known brand name with which to attract new customers and help retain existing customers
One of the lessons of SWOT analysis is that a company’s strategy should
A. Be grounded in its resource strengths and capabilities
B. Be aimed at those market opportunities that offer the best potential for both profitable growth and competitive advantage
C. Seek to defend against threats to the company’s future profitability
D. Generally not place heavy demands on areas where company resources are weak or unproven
Which one of the following is not something that can be gleaned from identifying a company’s resource strengths, resource weaknesses, market opportunities and external threats?
How to turn a core competence into a distinctive competence
One of the most telling signs of whether a company’s market position is strong or precarious is
Whether its prices and costs are competitive with those of key rivals
Two analytical tools useful in determining whether a company’s prices and costs are competitive are
Value chain analysis and benchmarking
A company’s value chain identifies
The primary activities it performs in creating value for its customers and the related support activities
A company’s value chain
Consists of two broad categories of activities: the primary activities that create customer value and the requisite support activities that facilitate and enhance the performance of the primary activities
) Identifying the primary and secondary activities that comprise a company’s value chain
Is a first step in understanding a company’s cost structure (since each activity in the value chain gives rise to costs); assigning costs to each of the primary and secondary activities is called activity-based cost accounting
Activity-based cost accounting is used to
Determine the costs of each primary and support activity comprising a company’s value chain and thereby reveal the nature and make-up of a company’s internal cost structure
The value chains of rival companies
Can differ substantially, reflecting differences in the evolution of each company’s own particular business, differences in internal operations, differences in strategy and differences in the approaches being used to execute strategy
The three main areas in the value chain where significant differences in the costs of competing firms can occur include
The nature and make-up of their own internal operations, the activities performed by suppliers and the activities performed by wholesale distribution and retailing allies
Which one of the following provides the most accurate picture of whether a company is cost competitive with its rivals?
The costs of a company’s internally performed activities, costs in the value chains of both the company’s suppliers and forward channel allies and how all these costs compare against the costs that make up the value chain systems employed by rival firms
Determining whether a company’s prices and costs are competitive
A. Requires looking at the costs of a company’s competitively relevant suppliers and forward channel allies (distributors/dealers)
B. Requires considering the costs of a company’s internally performed activities
C. Involves the use of benchmarking the costs in a company’s value chain system (the costs of its suppliers, its internally performed activities, the costs of its distributors/dealers) against the costs of the value chain systems employed by rival firms
D. Typically involves the use of activity-based cost accounting
Activity-based cost accounting aims at
Determining the costs of each activity comprising a company’s value chain by establishing expense categories for specific value chain activities and assigning costs to the activity responsible for creating the cost
Is an accounting system that assigns a company’s expenses to whichever activity in a company’s value chain is responsible for creating the cost
Comparing how different companies perform various value chain activities and then making cross-company comparisons of the costs of these activities
Which of the following is not one of the objectives of benchmarking?
To help construct a company value chain and identify which activities are primary and which are support activities
A much-used and potent managerial tool for determining whether a company performs particular functions or activities in a manner that represents “the best practice” when both cost and effectiveness are taken into account is
The options for remedying an internal cost disadvantage include
A. Investing in productivity-enhancing, cost-saving technological improvements
B. Redesigning the product or some of its components to facilitate speedier and more economical manufacture or assembly
C. Implementing the use of best practices, particularly for high-cost activities
D. Eliminating some cost-producing activities from the value chain, especially low value-added activities
Which of the following is not a good option for trying to remedy high internal costs vis-à-vis rivals firms?
Implementing aggressive strategic resource mapping to permit across-the-board cost reduction
A company’s strategic options for remedying cost disadvantages in internally performed value chain activities do not include
Switching to activity-based costing
The options for remedying a supplier-related cost disadvantage include
Trying to negotiate more favorable prices with suppliers and switching to lower priced substitute inputs
Which of the following is not an option for remedying a supplier-related cost disadvantage?
Persuade forward channel allies to implement best practices
Which of the following is not an option for remedying a cost disadvantage associated with activities performed by forward channel allies (wholesale distributors and retail dealers)?
Insisting on across-the-board cost cuts in all value chain activities—those performed by suppliers, those performed in-house and those performed by distributors-dealers
A company that does a first-rate job of managing its value chain activities relative to competitors
Stands a good chance of achieving competitive advantage by performing its value chain activities either more proficiently or at lower cost
Out-managing rivals in performing value chain activities
Is one of the most dependable ways a company can build a competitive advantage over rivals
For a company to translate its performance of value chain activities into competitive advantage, it must
Develop core competencies and maybe a distinctive competence that rivals don’t have or can’t quite match and that are instrumental in helping it deliver attractive value to customers or else be more cost efficient in how it performs value chain activities such that it has a low-cost advantage
To build a competitive advantage by out-managing rivals in performing value chain activities, a company must
Develop core competencies and maybe a distinctive competence that rivals don’t have or can’t quite match and that are instrumental in helping it deliver attractive value to customers or else be more cost efficient in how it performs value chain activities such that it has a low-cost advantage
The value of doing competitive strength assessment is to
Learn how the company ranks relative to rivals on each of the important factors that determine market success and ascertain whether the company has a net competitive advantage or disadvantage vis-à-vis key rivals
Doing a competitive strength assessment entails
Ranking the company against major rivals on each of the important factors that determine market success and ascertaining whether the company has a net competitive advantage or disadvantage versus major rivals
A weighted competitive strength assessment is generally analytically superior to an unweighted strength assessment because
All of the various measures of competitive strength are not equally important
A weighted competitive strength analysis is conceptually stronger than an unweighted analysis because
The different measures of competitive strength are unlikely to be equally important
In a weighted competitive strength assessment, the sum of the weights should add up to
In a weighted competitive strength analysis, each strength measure is assigned a weight based on
Its perceived importance in determining a company’s competitive success in the marketplace
Calculating competitive strength ratings for a company and its rivals using the industry’s most telling measures of competitive strength or weakness
Is a way of determining which competitor has the biggest overall competitive advantage in the marketplace and which competitor is faced with the biggest overall competitive disadvantage
Quantitative measures of a company’s competitive strength
Provide useful indicators of how a company compares against key rivals, factor by factor and capability by capability—thus indicating whether the company has a net overall competitive advantage or disadvantage against each rival
Which one of the following is an accurate interpretation of the scores that result from doing a competitive strength assessment?
High scores signal a strong competitive position and possession of a competitive advantage over companies with lower scores
Which one of the following is not something that can be learned from doing a competitive strength assessment?
Whether a company should correct its weaknesses by adopting best practices and revamping the makeup of its value chain
Calculating competitive strength ratings for a company and comparing them against strength ratings for its key competitors helps indicate
Which weaknesses and vulnerabilities of competitors that the company might be able to attack successfully
Identifying the strategic issues a company faces and compiling a “worry list” of problems and roadblocks is an important component of company situation analysis because
The “worry list” sets the management agenda for taking actions to improve the company’s performance and business outlook
Identifying the strategy-related issues and problems that company managers need to address and resolve entails
A. Drawing on what was learned from having analyzed the company’s industry and competitive environment
B. Drawing on the evaluations of the company’s own resources, internal circumstances and competitiveness
C. Locking in on what challenges/obstacles/roadblocks the company has to overcome in order to be financially and competitively successful in the years ahead
D. Developing a “worry list” of “how to,” “whether to.,” and “what to do about..”
Identifying the strategic issues and problems that merit front-burner managerial attention
A. Is accomplished in part by using the results of analyzing the company’s external environment to help come up with a “worry list” of “how to,” “whether to.,” and “what to do about..”
B. Helps set management’s agenda for taking actions to improve the company’s performance and business outlook
C. Is done in part by evaluating the company’s own internal situation—its resources and competitive position—to help come up with a “worry list” of “how to,” “whether to.,” and “what to do about..”
D. Is done in part as a basis for drawing conclusions about whether to stick with company’s present strategy or to modify it
Which of the following is not part of the task of identifying the strategic issues and problems that merit front-burner managerial attention?
Assessing what challenges the company has to overcome in order to be financially and competitively successful in the years ahead
Which of the following is not accurate as concerns the task of identifying the strategic issues and problems that merit front-burner managerial attention?
Identifying the strategic issues and problems that the company faces is the first thing that company managers need to do before starting to analyze the company’s internal and external environment