SmartBook Ch. 5 MAN 4720

Which of the following are ways an overall cost leadership strategy can improve a company's position vis-a-vis Porter's forces?

- Low-cost leaders can earn returns even when intense rivalry erodes profits .- Powerful buyers can only drive down prices to the level of the next most efficient producer. - Low-cost leaders are in a better position to absorb supplier price increases due to their margins.

Revenues grow during the growth stage due to which of the following?

- The number of repeat customers is increasing.- New consumers are purchasing the product.

Which actions should be taken when implementing a retrenchment strategy?

Analyze the cost-effectiveness of internal processes. Analyze the profitability of market segments. Take action to cut unprofitable market segments.

______ is when firms are in a turnaround situation and aggressively cut administrative expenses and inventories and speed up receivable collections.

Asset and cost surgery

______ is to offer a product in a different category to create the perception that the product is altogether different.

Breakaway positioning

Which of the following are characteristics of products that are in the decline stage?

Changes in customer tastes or technology decrease product demand. Competitors often cut their prices. Declining products often take a large share of time and financial resources relative to their worth.

______ involves obtaining as much profit as possible and requires that costs be reduced quickly.

Harvesting

The ______ stage is the third stage of the product life cycle.

Maturity

Firms that compete using a focus strategy are said to focus on ______.

a narrow target market

One reason a company would use a maintaining strategy for a declining stage product would be Blank______.

because the potential exists to continue to earn revenues and profits.

Companies that are not able to create a competitive advantage through both cost leadership and differentiation strategies Blank______.

become stuck in the middle

Companies that cannot identify any type of competitive advantage are classified as Blank______.

being stuck in the middle

The primary benefit of using a combination strategy is that Blank______.

competitors often have difficulty duplicating or imitating them

Maintaining, harvesting, consolidating, and exiting are the four basic strategies available in the Blank______ phase.

decline

The Blank______ stage is the fourth stage of the industry life cycle and is characterized by falling sales and profits.

decline

Which of the following are characteristics of the growth stage?

developing brand recognition increasing sales revenues financing complementary value-chain activities growing competition

Which of the following are two challenges of the introduction stage of the industry life cycle?

developing the product and finding a way to get users to try it generating enough exposure so the product emerges as the "standard" by which all rivals' products are evaluated

Combination strategies likely provide value through Blank______.

differentiated attributes and lower prices

Which of the following are characteristics of the industry life cycle's maturity stage?

direct and price competition strategic emphasis on efficient operations and company exiting industry slowing demand growth and saturated markets

Which of the following are characteristics of the decline stage of the industry life cycle?

falling sales and profits increasing price competition industry consolidation

True or false: A firm experiences competitive parity with competing firms when they capture so much of its market share that it is left with no profits.

false

In order to most effectively sequence the growth of a platform business, what two factors should managers take into account?

geographic area and product markets

Which of the following can erode a company's competitive advantage?

globalized trade technological advancements competitors' actions

Revenues increase during the ___________ stage of the industry life cycle as new customers try the product and an ever-increasing number of satisfied customers make repeat purchases.

growth

The Blank______ stage is the second stage of the industry life cycle.

growth

Which of the following are strategies that are available in the decline phase?

harvesting maintaining consolidating exiting

The Blank______ stage is the first stage of the industry life cycle.

introduction

Name the stages of the industry life cycle in the correct order, with the first stage at the top.

introduction growth maturity decline

Which statement is true about the duration of competitive advantages in modern business?

it is declining

______ refers to keeping a product going without significantly reducing marketing support, technological development, or other investments, in the hope that competitors will eventually exit the market.

maintaining

An industry's ______ is the total profits at all points along its value chain

profit pool

Which of the following are examples of piecemeal productivity improvements?

reengineering business processes increasing capacity utilization improving employee productivity benchmarking specific activities against industry leaders

A _________strategy works to stop declines in performance and improve profits by eliminating unprofitable market segments and investments.

retrenchment

Companies that use a Blank______ positioning strategy offer products with fewer product attributes and lower prices, in contrast to the industry tendency to continuously augment products as part of the product life cycle.

reverse

The breadth of the target market refers to ______.

the range between industrywide and narrow market segments

Which of the following is a firm able to do when it successfully enters a new category with a breakaway product?

It is able to redefine its competition.

Which of the following are issues for platform businesses?

Maximize the connection between supplier and customer. Create a base of customers and suppliers. Build an accessible customer interface.

Which of the following are goals of reverse positioning?

Move a product from maturity backward into a growth position. Allow a product to assume a new competitive position in its category.

______ is a generic strategy based on appeal to the industrywide market using a competitive advantage based on Blank______.

Overall cost leadership; low cost

Which of the following statements regarding combination strategies are correct?

The goal is to provide unique customer value in an efficient manner. Customers benefit from both differentiated attributes and lower prices.

One reason for a company to use a harvesting strategy for a declining product is to Blank______.

earn as much profit as possible by quickly reducing costs in the value chain's primary and support activities

An overall cost leadership strategy is a strategy based on managing relationships______.

throughout the firm's entire value chain

Research has found that companies that Blank______.

use multiple forms of competitive advantage (e.g., cost leadership and differentiation) outperform those that do not