quiz answers The principal offensive strategy options include all of the following EXCEPT: A. using a cost advantage to attack competitors on the basis of lower price or better product value. B. using hit-and-run or guerrilla tactics to grab sales and m

An automotive manufacturer sells a limited number of high-end, custom-built cars, using technologically advanced power systems. What strategy is the manufacturer using to gain competitive advantage?

A focused differentiation strategy

Which of the following is NOT one of the pitfalls of pursuing a differentiation strategy

Emphasizing efforts to strongly differentiate the company's product from those of rivals

Which of the following is not one of the benefits of outsourcing value chain activities presently performed in-house

Enables a company to gain better access to end users and better market visibility

Which of the following rivals make the best targets for an offensive attack?

Firms with weaknesses in areas where the challenger is strong

Which of the following is NOT one of the ways that a company can achieve a cost advantage by revamping its value chain?

Increasing extra services to increase staffing requirements

Which of the following is not a strategic disadvantage of vertical integration?

It reduces the opportunity for achieving greater product differentiation

The principal offensive strategy options include all of the following EXCEPT: A. using a cost advantage to attack competitors on the basis of lower price or better product value. B. using hit-and-run or guerrilla tactics to grab sales and market share from complacent or distracted rivals. C. launching a preemptive strike to secure an advantageous position D. pursuing continuous product innovation to draw sales and market share away from less innovative rivals.

None of the above (that is, all of the above are options for offensive strategies)

Which of the following is NOT one of the pitfalls of a low-cost provider strategy

None of the above (that is, all of the above are pitfalls) A. Overly aggressive price-cutting B. Relying on an approach to reduce costs that can be easily copied C. Becoming too fixated on cost reduction D. Having the basis for the firm's cost advantage undermined by cost-saving technological breakthroughs that can be readily adopted by rival firms

All firms are subject to offensive challenges from rivals. Which of the following is NOT among the intent of the best defensive move? A Lower the risk of being attacked B. Weaken the impact of any attack that occurs C. Pressure challengers to aim their efforts at other rivals D. Help protect a competitive advantage

None of the above (that is, all of the above are the intents of the best defensive move)

Which of the following is NOT an action that a company should take to perform value chain activities more cost-effectively?

None of the above (that is, all of the above are true) A. Striving to capture all available economies of scale and taking advantage of experience and learning-curve effects B. Trying to operate facilities at full capacity C. Adopting labor-saving operating methods D. Improving supply chain efficiency

Which of the following is not a potential advantage of backward vertical integration?

Reduced business risk due to low capital requirements

Which of the following is not true regarding strategic alliances

Strategic alliances are useful in extending the scope of operations via international expansion and diversification strategies.

Which of the following is NOT true regarding how to interpret financial ratios?

Current ratio: Lower is better.

Which of the following is NOT pertinent in identifying a company's present strategy?

The company's vision, mission, and core values

What does the scope of the firm refer to?

The range of activities the firm performs internally, the breadth of its product offerings, and the extent of its geographic market

Which of the following is NOT a typical strategic objective or benefit that drives mergers and acquisitions?

To facilitate a company's shift from a broad differentiation strategy to a focused differentiation strategy

The four tests of a resource's competitive power are often referred to as the:

VRIN analysis.

The best reason for investing company resources in vertical integration (either forward or backward) is to:

add materially to a company's technological capabilities, strengthen the company's competitive position, and/or boost its profitability

While listing or categorizing company resources, what matters is that:

all the different types of resources are included in the inventory.

Successful broad differentiation allows a firm to:

command a premium price for its product, and/or increase unit sales, and/or gain buyer loyalty to its brand

A company's value-creating activities can offer a competitive advantage in one of two ways:

contribute to greater efficiency and lower costs and provide a basis for differentiation.

The strategic impetus (motivations) for forward vertical integration is to:

gain better access to end users and better market visibility

The big risk of employing an outsourcing strategy is:

hollowing out a firm's own resources and capabilities that contribute fundamentally to the firm's competitiveness.

The range of product and service segments that the firm serves within its market is known as the firm's

horizontal scope.

A blue-ocean strategy:

involves inventing a new industry or new market segment and allows a company to create and capture altogether new demand.

Which of the following is NOT an example of a threat to a company's future profitability and well-being?

lack of a well-known brand name with which to attract new customers and help retain existing customers

Whether a broad differentiation strategy ends up enhancing a company's profitability depends mainly on whether:

most buyers accept the customer value proposition as unique and the product can produce sufficient unit sales to cover the costs of achieving the differentiation.

The risks of a focused strategy based on either low-cost or differentiation include the:

potential for the preferences and needs of niche members to shift over time toward product attributes desired by buyers in the mainstream portion of the market.

A competitive strategy predicated on low-cost leadership tends to work best when:

price competition among rivals is especially vigorous and the offerings of rival firms are essentially identical, standardized, commodity-like products.

A powerful tool for sizing up the company's competitive assets and determining whether they can provide the foundation necessary for competitive success in the marketplace is termed:

resource and capability analysis.

The culture of a company can be a cost-efficient value chain activity because it can:

spur worker pride in productivity and continuous improvement.

When firms are involved in a mix of in-house and outsourced activity in any given stage of the vertical chain, its called:

tapered intergration

An analytic tool useful in determining whether a company's costs and customer value proposition are competitive is termed

value chain analysis.

The extent to which a firm's internal activities encompass one, some, many, or all of the activities that make up an industry's entire value chain system is known as:

vertical scope.

The competitive power of a company resource strength or competitive capability hinges on all of the following EXCEPT:

whether it has the potential for lowering the firm's unit costs.

The best indicator of how well a company's strategy is working is whether:

All of the above A. the company is achieving its stated financial and strategic objectives B. its financial performance is better than the industry average C. the company is gaining customers and increasing its market share

In which of the following cases is a late-mover advantage likely to arise?

All of the above. A. When the costs of pioneering are much higher than being a follower and only negligible learning/experience benefits accrue to the pioneer B. When the marketplace is skeptical about the benefits of a new technology being pioneered by a first-mover C. When technological change is rapid and fast-following rivals find it easy to leapfrog the pioneer with next-generation products of their own

Being first to initiate a particular strategic move can have a high payoff in all of the following when

All of the above. A. pioneering helps build up a firm's image and reputation and creates strong brand loyalty. B. buyers remain strongly loyal to pioneering firms because of high switching costs. C. there is a steep learning curve and when learning can be kept proprietary.