Chapter 1
A winning strategy is one that
fits the company's internal and external situation, builds sustainable competitive advantage, and improves company performance.
The pattern of actions and business approaches that would NOT define a company's strategy include actions to
gain sales and market share with lower prices despite increased costs.
Changing circumstances and ongoing managerial efforts to improve the strategy
account for why a company's strategy evolves over time.
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.
__________ is the set of actions that its managers take to outperform the company's competitors and achieve superior profitability.
A strategy
Why are crafting and executing business strategies the foremost tasks of any organization?
Because a good strategy coupled with a good strategy execution are the most telling signs of good management and allow a company to be a standout performer in the marketplace
Why is it important to craft a business model?
Because it 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.
Which of the following is NOT one of the managerial considerations in determining how to compete successfully?
How can a company modify its entire product line to emphasize its internal service attributes?
Which of the following questions can be used to 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 tests the merits of the firm's strategy and distinguishes it as a winning strategy?
Is the strategy helping the company achieve a sustainable competitive advantage and is it resulting in better company performance?
The customer value proposition lays out the company's approach to
Satisfying customer wants and needs at a price customers will consider a good value.
What is the foremost question in running a business enterprise?
What must managers do, and do well, to make a company a winner in the marketplace?
A company achieves sustainable competitive advantage when
a sufficiently large number of buyers have a lasting preference for its products or services as compared to the offerings of competitors.
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 adaptive reactions to unanticipated developments and fresh market conditions.
Which of the following companies would have the LEAST bargaining power with its suppliers?
a company that offers high-cost specialized products that could be used only by customers of a certain age group
Every strategy needs
a distinctive element that attracts customers and produces a competitive edge.
Which one of the following does NOT account for WHY a company's strategy evolves from one version to another?
a need to promote stability and retain the status quo
Management's blueprint 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.
Winning a sustainable competitive edge over competitors does NOT hinge on which of the following?
building products and distributing them at low prices to a broad customer base irrespective of manufacturing cost
The heart and soul of a company's strategy-making effort is determining how to
come up with moves and actions that produce a durable competitive edge over rivals.
Crafting a deliberate strategy involves developing strategy elements that
consist of a blend of proactive new planned initiatives plus ongoing strategy elements continued from prior periods.
Which of the following is a seldom used strategic approach to setting a company apart from rivals and achieving a sustainable competitive advantage?
copying the attributes of a popular product or service
A creative, distinctive strategy that delivers a sustainable competitive advantage is important 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.
Strategy, at its essence, is about
developing lasting success that can support growth and secure the company's future over the long term.
The most significant signs of a well-managed company are
good strategy-making combined with good strategy execution.
A creative and 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.
A company's business model
is management's blueprint for how it will generate revenues sufficient to cover costs and yield an attractive profit.
Good strategy combined with good strategy execution
is the clearest indicator of good management.
Crafting and executing a strategy is a top-priority managerial task because
it is management's prescription for doing business, its roadmap to competitive advantage, a game plan for pleasing customers, and its formula for improving performance.
A company's strategy stands a better chance of succeeding when
it is predicated on competitive moves aimed at appealing to buyers in ways that set the company apart from rivals.
What separates a powerful strategy from a run-of-the-mill or ineffective one?
management's ability to forge a series of actions, both in the marketplace and internally, that sets the company apart from rivals and produces sustainable competitive advantage
Which of the following is not an element of a company's business strategy?
management's actions to revise the company's financial and strategic performance targets
Managers of every company should be willing and ready to modify the strategy because
market conditions and circumstances are changing over time or the current strategy is clearly failing.
In crafting a company's strategy, managers
need to come up with a sustainable competitive advantage that draws in customers and produces a competitive edge over rivals.
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.
A company achieves a competitive advantage when it
provides buyers with superior value compared to rival sellers or offers the same value at a lower cost.
Managers must be prepared to modify their strategy in response to all of the following EXCEPT
public pronouncements from rivals about monthly profit margins.
In evaluating proposed or existing strategies managers should
scrutinize the company's existing strategies on a regular basis to ensure they offer a good strategic fit, create a competitive advantage, and result in above-average performance.
In the course of crafting a strategy, which of the following is NOT a common management function?
sharing the strategy with the public to gain additional customer and shareholder support
Which of the following is NOT a frequently used strategic approach to set a company apart from rivals and achieve a sustainable competitive advantage?
simply trying to mimic the successful strategies of rivals
A company's strategy consists of the action plan management takes to
stake out a unique market position and achieve superior profitability.
A company's strategy is NOT concerned with management's choices about how to
stake out the same market position as successful rival companies.
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 while its business model relates to whether the revenues flowing from the strategy are sufficient to cover costs and realize a profit
To improve performance, there are many different avenues for outcompeting rivals such as
strengthening competitiveness by pursuing strategic alliances and collaborative partnerships.
Which of the following is NOT a frequently used strategic approach to set a company apart from rivals and achieve a sustainable competitive advantage?
striving to be the industry's high-price provider
A winning strategy must pass which three tests?
the Fit Test, the Competitive Advantage Test, and the Performance Test
Excellent execution of an excellent strategy is
the best test of managerial excellence and the best recipe for making a company a standout performer.
A company's realized strategy evolves from one version to the next due to
the proactive efforts of company managers to improve the current 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.
Strategy is about competing differently than rivals, thus strategy success is about
the sources of sustained advantages and superior profitability.