chapter 6

_____ is defined as the purchase of a company by another company.

Acquisition

The _____ is a portfolio strategy that managers use to categorize their corporation's businesses by growth rate and relative market share. This strategy helps them to decide how to invest corporate funds.

BCG matrix

_____ is the measure of the intensity of competitive behavior between companies in an industry.

Character of the rivalry

_____ are the central companies in a strategic group.

Core firms

_____ is the rivalry between two companies that offer similar products and services, acknowledge each other as rivals, and act and react to each other's strategic actions.

Direct competition

_____ is a strategy for reducing risk by buying a variety of items so that the failure of one stock or one business does not doom the entire portfolio.

Diversification

_____ strategies typically work in market niches that competitors have overlooked or have difficulty serving.

Focus

Which of the following is an example of a common approach to corporate-level strategy?

Grand strategies

Which of the following is NOT one of the five industry forces that determine an industry's overall attractiveness and potential for long-term profitability?

Organizational synergy

_____ consists of the strategic actions that a company takes to return to a growth strategy.

Recovery

______ are the assets, capabilities, processes, information, and knowledge that an organization uses to improve its effectiveness and efficiency, to create and sustain competitive advantage, and to fulfill a need or solve a problem.

Resources

_____ is a discrepancy between a company's intended strategy and the strategic actions managers take when actually implementing that strategy.

Strategic dissonance

Which of the following is an example of core capabilities of an organization?

The organization's skill in maintaining large inventories effectively.

A(n) _____ strategy is a corporate strategy that addresses the question "How should we compete in this line of business?"

industry-level

Resource similarity and _____ are factors that determine the extent to which firms will be in direct competition with each other.

market commonality

A company that is seeking to grow by taking risks and looking for innovations is best characterized as a(n) _____.

prospector

A _____ resource is a resource that is not controlled or possessed by many competing firms.

rare

The strategy-making process begins with:

the assessment of the need for strategic change.

The purpose of a _____ strategy is to increase profits, revenues, market share, or the number of places (stores, offices, locations) in which the company does business.

growth

An industry-level strategy that is best suited to changes in the organization's external environment is a(n)_____ strategy.

adaptive

Organizations can achieve a _____ by using their resources to provide greater value for customers than competitors can.

competitive advantage

The research on diversification in portfolio management indicates that the best approach is probably _____.

related diversification

In the context of the strategic reference point theory, the _____ strategy aims to protect an existing competitive advantage.

risk-avoiding

A _____ is an assessment of the strengths and weaknesses in an organization's internal environment and the opportunities and threats in its external environment.

situational analysis

Companies often choose a _____ strategy when their external environment doesn't change much or after they have struggled with periods of explosive growth.

stability