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Quices de strategy and managment

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Janeth Cadena
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40 views

Quiz Week 3 Feedback

Quices de strategy and managment

Uploaded by

Janeth Cadena
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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1.

A company's broad macroenvironment refers to


A) the industry and competitive arena in which the company operates.
B) general economic conditions plus the factors driving change in the markets being served.
C) all the strategically significant forces and factors outside a company's boundaries—general
economic conditions, population demographics, societal values and lifestyles, technological
factors, and governmental legislation and regulation.
D) the competitive market environment that exists between a company and its competitors.
E) the dominant economic features of a company's industry.
Answer: C. Strictly speaking, the macroenvironment excludes a company's competitively valuable resources and
capabilities and instead encompasses all of the relevant factors—political factors, economic conditions in the firm's
general environment, sociocultural forces, technological factors, environmental forces, and legal/regulatory
factors—making up the broad environmental context in which a company operates. See Figure 3.1, The Components
of a Company's External Environment.
Topic: Understanding a Firm's External Environment
Learning Objective: Identify factors in a company's broad macro-environment that may have strategic significance.

2. Competitive pressures stemming from buyers' bargaining power tend to be weaker when
A) the number of buyers is small, such that each customer's business tends to be particularly
important to a seller.
B) buyer demand is growing slowly or maybe even declining.
C) the costs incurred by buyers in switching to competing brands or to substitute products are
relatively high.
D) buyers are well informed about sellers' products, prices, and costs.
E) the buyer group consists of a few large buyers and the seller group consists of numerous small
firms.
Answer: C. See Figure 3.3. High buyer-switching costs tends to weaken the bargaining power of buyers; all of the
other responses tend to increase buyers' bargaining power.
Topic: Five Forces Model of Industry Attractiveness
Learning Objective: Recognize the factors that cause competition in an industry to be fierce, moderate or weak.

3. The bargaining leverage of suppliers is greater when


A) only a small number of suppliers exist and when it is difficult for industry members to switch
to attractive substitutes.
B) industry members incur low costs in switching their purchases from one supplier to another.
C) industry members purchase in large quantities and thus are important customers of the
suppliers.
D) it makes good economic sense for industry members to vertically integrate backward.
E) the supplier industry is composed of a large number of relatively small suppliers.
Answer: A. See Figure 3.5. When the number of suppliers of inputs is limited, suppliers tend to have stronger
bargaining power and can charge industry members higher prices (passing costs on to them) and limit opportunities
to find better deals via switching.
Topic: Five Forces Model of Industry Attractiveness
Learning Objective: Recognize the factors that cause competition in an industry to be fierce, moderate or weak.

4. Factors that cause the rivalry among competing sellers to be weak include
A) low buyer-switching costs and rival sellers that are relatively equal in size and capability.
B) rapid growth in buyer demand and high buyer-switching costs.
C) a recent acquisition of a weak rival by an industry outsider with the intent of turning the
acquisition into a major contender.
D) low barriers to entry and weakly differentiated products among rival sellers.
E) slow growth in buyer demand and strongly differentiated products.
Answer: B. Rivalry decreases when buyer demand accelerates, buyers' switching costs are high, and buyers do not
have a proliferation of choices. In this case, sellers may find themselves with capacity shortages and/or inventory
stockouts. Excess demand conditions create a "sellers' market," decreasing competitive pressure on industry rivals,
as shown in Figure 3.7.
Topic: Five Forces Model of Industry Attractiveness
Learning Objective: Recognize the factors that cause competition in an industry to be fierce, moderate or weak.

5. A competitive environment in which 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
A) is competitively unattractive from the standpoint of earning good profits.
B) offers little ability to build a sustainable competitive advantage.
C) is highly conducive to achieving strong product differentiation and high brand loyalty.
D) offers moderate to good prospects for achieving low costs and building a sustainable
competitive advantage.
E) requires that industry members have a strongly differentiated product offering in order to be
profitable.
Answer: A. As a rule, a strong collective impact of the five competitive forces makes an industry more unattractive
and lowers the combined profitability of industry participants.
Topic: Five Forces Model of Industry Attractiveness
Learning Objective: Recognize the factors that cause competition in an industry to be fierce, moderate or weak.

6. Steps involved in driving forces analysis include


A) developing a comprehensive list of all the potential causes of changing industry conditions.
B) predicting which new driving forces will emerge next.
C) making it difficult to achieve a competitive advantage via anything other than being the
industry's low-cost leader.
D) identifying the driving forces, assessing whether their impact will make the industry more or
less attractive, and determining what strategy changes are needed to prepare for the impact of the
driving forces.
E) discerning which among the five competitive forces is most potent and which is least potent.
Answer: D. Driving forces analysis consists of three steps: (1) identifying what the driving forces are; (2) assessing
whether the drivers of change are, individually or collectively, acting to make the industry more or less attractive;
and (3) determining what strategy changes are needed to prepare for the impact of the driving forces.
Topic: Analyzing Industry Competition
Learning Objective: Recognize the factors that cause competition in an industry to be fierce, moderate or weak.

7. A strategic group
A) consists of those industry members that are growing at about the same rate and have similar
product line breadth.
B) includes all rival firms having comparable profitability.
C) is a cluster of industry rivals that have similar competitive approaches and market positions.
D) consists of those firms whose market shares are about the same size.
E) is made up of those firms having comparable profit margins.
Answer: C. A strategic group is a cluster of industry rivals that have similar competitive approaches and market
positions.
Topic: Analyzing Industry Competition
Learning Objective: Map the market positions of key groups of industry rivals.
8. 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
A) identifies who the industry's current market share leaders are.
B) helps a company to anticipate what moves rivals are likely to make next and to craft its own
strategic moves.
C) helps identify which rival is in which strategic group.
D) enables company managers to determine which rival has the worst strategy and how to avoid
making the same strategy mistakes.
E) enables more accurate predictions about how long it will take a particular rival to copy most
of what the strategy leader is doing.
Answer: B. Studying competitors' past behavior and preferences provides a valuable assist in anticipating what
moves rivals are likely to make next and outmaneuvering them in the marketplace.
Topic: Competitive Behavior
Learning Objective: Map the market positions of key groups of industry rivals.

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