MGT

Which of the following fundamental insights was provided by Porter's five forces framework from the completion of the Alta Velocidad Española (AVE)?

Any of the five forces on its own, if sufficiently strong, can extract industry profitability.

While implementing strategic group mapping for the U.S. domestic airline industry, two strategic groups become apparent: low-cost, point-to-point airlines (Virgin Atlantic, Alaska Airlines, JetBlue, and Southwest Airlines) versus differentiated airlines using a hub-and-spoke system (American, Delta, and United). Which of the following statements is true about these two strategic groups?

Competitive rivalry between Virgin Atlantic and JetBlue is likely to be higher than that between American and Southwest Airlines.

Managers at SunTrustUs Properties are surprised to hear that interest rates are likely to remain low for the next six months. Which of the following is an implication of low interest rates?

Consumer demand will increase.

First Pharma Inc. and GeoVax Inc. are two competing firms in the pharmaceutical industry. While First Pharma Inc.'s vision is "to be a preeminent drug manufacturer in the industry," GeoVax Inc.'s vision is "to make good health a reality for everyone around the world." Which of the following is an implication of these different visions?

GeoVax Inc. will be more flexible than First Pharma Inc. when adapting to changing environments.

Euan manages product design and development at a toy company. The junior managers who report to him tell him that new complementors for the firm's products are available. What should Euan's reaction be?

He needs to find out if his company as well as other companies can provide the complements.

With the emergence of smartphones, users no longer have to carry a separate music player, a video game, a laptop, or a magazine to keep themselves entertained when traveling. A smartphone is loaded with a variety of applications to satisfy all the customer needs that different industries or products individually satisfied earlier. As a result, the smartphone industry has been posing a threat to a lot of other unrelated industries. What is this phenomenon best known as?

Industry Convergence

Gerald has been an employee with GeoFuture Inc. for 15 years. He started with an entry-level job, and today he is a manager of an entire division. Over the years, Gerald has acquired a reputation for doing the right things in the company. Hence, as an efficient leader, he is capable of effectively communicating and motivating his subordinates to work toward the company's vision and mission. According to the Level-5 leadership pyramid, which is the highest level of leadership Gerald has reached so far?

Level 4

Food Shipp Inc. is a food supply company that wants to sell its products directly to consumers through mail order instead of going through supermarkets and other stores. However, supermarket chains want to make this transaction either illegal or more difficult for Food Shipp. To accomplish this, they are using ________to influence the political process.

Lobbying Forces

Strategic commitments are actions that are:

Long-tern oriented

In nearly every case, which of the Five Forces is the most important in determining the relative power structure in an industry?

No single force is dominant in most every case

A firm's ________ relates to its ability to create value for customers (V) while containing the cost to do so (C).

Strategic Position

Fruit of the Sea is a company that sells lobster, shrimp, and scallops to seafood restaurants. Because the company operates in an industry ...

Temporary Competitive Advantage

Who among the following is responsible for making business strategies in a large conglomerate?

The general managers of individual business units

Which of the following is likely to happen due to horizontal mergers between competitors such as Delta and Northwest airlines?

The overall industry profitability will increase.

Which of the following statements about product-oriented visions is true?

They tend to force managers to take a myopic view of the landscape.

How are cumulative learning and experience effects of a company most likely to affect Michael Porter's five forces?

Threat of new entrants will be low.

Siham is a chef who owns three moderately successful restaurants with innovative menus. Based on what you have read, which of these approaches could help her improve her profits?

Use her existing knowledge, equipment, and staff to launch a catering business.

As a part of strategy formulation, corporate strategy concerns questions relating to:

Where to compete

In which of the following situations is a company that exists in the telecommunications industry most likely to face the highest threat of entry?

if the industry has recently become deregulated

Which of the following is not captured when examining a competitive industry structure?

the ability to engage in forward vertical integration

Mindful Baking is a gourmet bakery chain that differentiates itself from a large number of competitors by providing baked goods for people who have various food allergies. It has some pricing power because it provides differentiated products and, therefore, has some entry barriers in place.

Monopolistic Market

Breeze Car Rental follows a cost-leadership strategy. Which of the following firms will most likely be its direct competitor?

Quicker Rental Cars, which follows a low-cost strategy

Lin manages the supply chain for a company that sells designer bags.

Reduce Supply

GoGadget Inc., a manufacturer of multiuse tools, supplies its products to Hardware Harry's, a home improvement retail chain.

Backward Integration

he COVID-19 pandemic, the BP oil spill, and the 9/11 terrorist attacks are examples of black swan events.

Boiling Frog Scenarios

Gina is the founder and CEO of a successful technology firm. In a memo, she informs the company's employees that remote workers will be required ...

Position Power

While Sesmic Inc. operates in a monopolistically competitive industry, Energy 4 All Inc. operates in a monopoly. Keeping this information in mind, which of the following statements is most likely true?

The threat of new entrants will be higher for Sesmic than for Energy 4 All.

To be effective, firms need to:

back up their visions with strategic commitments that are costly and difficult to reverse.

Top-down strategic planning as an approach to the strategic management process will be most effective when the

size of the firm is large

Which of the following summarizes the difference between a firm's vision and mission?

vision states what a firm wants to accomplish; a mission states how a firm plans to accomplish this vision.

A firm's strategic position is likely to be strong when

the gap between the value the firm's product generates and the cost to produce it is large.

Mercurial Foods is the parent company of several chain restaurants offering a variety of cuisines. The top management at Mercurial has decided to enter the frozen foods industry based on its assessment of the profit potential in that industry. Which of the following strategies does this best illustrate?

Corporate Strategy

Progress Apparel's core value statement reads we will ensure our clothing is made with the highest respect toward human rights and environmental protection. Which of the following actions exemplifies how Progress's core values drive its strategic decision making?

Demanding that textile suppliers pay liveable wages and maintain safe production facilities

Matteo is a management consultant. The leaders of Office Outfitters asks him to evaluate their company, and he finds that the difference between ...

Encourage customers to buy complements to their products

All Signal Inc., a telephone service provider, has a large user base mainly because phone calls and messages between all All Signal users are free. When a person switches to an All Signals network, his or her entire network of family and friends is likely to switch to the same network to receive the benefit of free calls and messages. In addition, an existing user who gets a new user to register with All Signal Inc. is given a free wireless connection. This has helped to keep competition away from All Signal. In this scenario, which of the following factors is acting as an entry barrier for All Signal Inc.?

Network effects

Competitive rivalry based solely on ________ is destructive to firms as it transfers most of the value created in the industry to the customers.

Price-Cutting

Jalen Corp., a large conglomerate, wants to liquidate its business in certain industries to improve its overall profitability. Which of the following industries would Jalen Corp. find it most difficult to exit?

the steel industry in which the company has obligations like severance pay toward employees