BS_Chapter 1

A winning strategy must pass which three tests?

B) the fit test, the competitive advantage test, and the performance test

A company's realized strategy evolves from one version to the next due to

B) 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.

The customer value proposition lays out the company's approach to

D) satisfying customer wants and needs at a price that customers will consider a good value.

The difference between a company's strategy and a company's business model is that

D) 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.

Strategy formulation is

D) typically a blend of proactive and reactive strategy elements.

A company's strategy stands a better chance of succeeding when

C) it is predicated on competitive moves aimed at appealing to buyers in ways that set the company apart from rivals.

If you were advising Rebel Toad Brewing, a local brewpub, about how to set itself apart from rivals and achieve a sustainable competitive advantage, you would most likely not recommend that Rebel Toad Brewing

C) mimic the successful strategies of rivals.

FaberRoad, a respected courier brand, is fast losing its market share to competitors who do overnight deliveries of packages or offer lower prices. The company's research department has found that many customers care more about knowing exactly when a package will arrive than getting it the next day. Which strategy would best address the current state of FaberRoad and help it regain its market?

B) developing radio tags that could be attached to packages to allow for real-time tracking by customers' PCs and mobile phones

A regional electric scooter manufacturer sells its scooter at a lower price than other manufacturers of two-wheeler scooters. What will make the product most attractive for customers?

B) high value

A company's business model

B) is management's blueprint for how it will generate revenues sufficient to cover costs and yield an attractive profit.

A "repeatedly evolving strategy" best applies to a

B) mobile phone company, established in a saturated market, that plans its research and development activities to allow for quarterly releases of new products that match or overtake features of rivals' mobile phones.

In evaluating proposed or existing strategies managers should

B) 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.

A company's strategy is NOT concerned with management's choices about how to

B) stake out the same market position as successful rival companies.

A company's strategy is a "work in progress" and evolves over time because of the

D) ongoing need of company managers to react and respond to changing market and competitive conditions.

If you were asked to develop a low-cost provider strategy for a startup passenger air carrier business, what would you most likely not recommend?

B) offer low prices on long-distance flights and maintain long service times for aircraft between flights

________ is the set of actions that its managers take to outperform the company's competitors and achieve superior profitability.

A) A strategy

The consumer goods companies listed below all pursue the same business model with the exception of

A) Acer laptops.

Ben Weprin is founder and CEO of Graduate Hotel, a growing chain of boutique hotels situated near college campuses and designed to cater to the nostalgia and local boosterism that are part of the culture of university towns. (Room keys are imprinted with the names of famous alumni, and public spaces are decorated with historical photos of campus life, vintage art and other collegiate artifacts.) Mr. Weprin and his company are trying to create a brand that will find year-round business by catering to more than just alumni coming back for once-a-year football weekends or 10-year anniversaries of their graduating classes. What is the major question that Mr. Weprin and his team need to ask about his company's strategy?

A) What must managers do, and do well, to make a company a winner in the marketplace?

Every strategy needs

A) a distinctive element that attracts customers and produces a competitive edge.

It is incorrect to say that a company's strategy evolves due to

A) a need to promote stability and retain the status quo.

Changing circumstances and ongoing managerial efforts to improve the strategy

A) account for why a company's strategy evolves o

Expectations on key quality features, performance, and/or service attributes while beating their price expectations is a ________ strategy.

A) best-cost provider

A company's strategy consists of the action plan management takes to

A) stake out a unique market position and achieve superior profitability.

Consider the following three companies and their strategies. • Company A is an established database management company that acquires a well-reputed but small publishing house to enter the booming publishing industry. • Company B, a sports management house, declared bankruptcy during a recent recession but now has created a television network that airs regional sports events. • Company C, a package delivery business, is a startup based on delivery efficiency models created by a few students, and delivers almost all kinds of packages. The use of strategies by these three companies accurately can be analyzed by saying that

B) All three companies employ deliberate strategies.

A luxury bathtub manufacturer offered scented bubble bath foams and massage coupons as a gimmick when its bathtubs did not sell. The bubble foam became famous among some women and led to a line of exclusive bath products for women. The manufacturer established shops in various regional locations and hired celebrities to market its products to enhance sales. Now its products are sold through retail outlets and online sites throughout the world. Which of the following is accurate?

B) Creating a subbrand that offered exclusive bath products for women was an emergent strategy.

Based upon its advertising slogan, the pizza restaurant that likely offers the best value proposition to its customers is

B) Fast n'Fresh Pizza: "Get fresh, hot pizza, delivered under 20 minutes—or it's free."

Managerial considerations in determining how to compete successfully do not normally include

B) How can a company modify its entire product line to emphasize its internal service attributes?

A company achieves sustainable competitive advantage when

B) a sufficiently large number of buyers have a lasting preference for its products or services as compared to the offerings of competitors.

What separates a powerful strategy from a run-of-the-mill or ineffective one?

D) 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

A pharmaceutical giant acquires a manufacturer of rare specialty drugs to improve its falling share prices and invests all its wealth into the deal. Due to a deficit, it agrees to do a joint venture for the acquisition and involves a major automobile giant to fund the deal. After a rocky start, the companies now have a strong market position and generate good profits. How would you characterize this company's strategy?

C) It is a winning strategy.

Adapting to new conditions like new innovations by competitors, fast-changing technological developments, and constantly evaluating what is working result in

C) an emergent strategy.

Crafting a deliberate strategy involves developing strategy elements that

C) consist of a blend of proactive new planned initiatives plus ongoing strategy elements continued from prior periods.

A creative, distinctive strategy that delivers a sustainable competitive advantage is important because

C) 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.

A winning strategy is one that

C) fits the company's internal and external situation, builds sustainable competitive advantage, and improves company performance.

The most significant signs of a well-managed company are

C) good strategy-making combined with good strategy execution.

BloomsJay Resorts Inc. has multiple tropical resorts in various locations. In a crowded market that caters to all kinds of consumers, this resort caters mainly to gays with a guaranteed hassle-free holiday experience at a premium price. What strategy is BloomsJay using to gain competitive advantage?

D) a focused differentiation strategy

Strategy, at its essence, is about

D) developing lasting success that can support growth and secure the company's future over the long term.

A winning strategy is one that

D) 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

D) gain sales and market share with lower prices despite increased costs.

Identify the company with a low-cost provider strategy.

D) A baby products retailer sells unassembled baby furniture produced in China.

Why is it important to craft a business model?

D) 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

Consider the following five companies and their situations. • Company A is an established online fantasy sports gaming company that has been accused of game-rigging, bribes and kickbacks. • Company B, a ride share company, has delayed its planned initial public offering due to reports of having an inhospitable workplace characterized by sexual harassment and discrimination. • Company C, a pharmaceutical manufacturer, charges higher prices for life-saving drugs in some countries than it charges in others. • Company D, a manufacturer and marketer of high-end consumer electronics, has a strict Code of Conduct that requires its suppliers to comply with several standards regarding safe working conditions, fair treatment of workers, and environmentally safe manufacturing. • Company E, a pizza delivery business, is a being boycotted by customers and losing sponsored tie-ins with professional sports due to racist comments by its founder and CEO. Which of the above companies is distinguished by an ethical strategy as opposed to an unethical or flawed strategy?

D) Company D

To test the merits of a firm's strategy and distinguish it as a winning strategy, which major question needs to be addressed?

D) Is the strategy helping the company achieve a sustainable competitive advantage, and is it resulting in better company performance?

It is normal for a company's strategy to end up being

D) a blend of proactive actions to improve the company's competitiveness and financial performance, and adaptive reactions to unanticipated developments and fresh market conditions.

Amy's Drive-Thru, a fast food facility, offers healthy, sustainably grown veggie and vegan fast food at higher prices than its competitors in the market and has a drive-through and indoor seated casual dining operation. What strategy is Amy's Drive-Thru using to gain competitive advantage?

D) a differentiation strategy

Good strategy combined with good strategy execution

D) is the clearest indicator of good management.

An evolving strategy for a ride-share business like Uber or Lyft is not likely to be triggered by

E) their need to respond to short-term swings in the stock market that impact timing of an initial public offering (IPO).

To distinguish a winning strategy from a mediocre or losing strategy, a strategic manager should ask which question?

E) How well does the strategy fit the company's situation?

Winning a sustainable competitive edge over competitors does not hinge on which of the following?

E) building products and distributing them at low prices to a broad customer base irrespective of manufacturing cost

Due to impending labor strife over planned layoffs in its Silicon Valley headquarters, a social networking company has decided to outsource its programming operations to an emerging market, India, to obtain cheaper labor. Since then, this social networking company has encountered criticism that has diminished its current market position and staff productivity. You have been retained by this company to develop an appropriate reactive (emergent) strategy that would begin by

E) cancelling the job cuts till the market situation and entry operations stabilize.

The heart and soul of a company's strategy-making effort is determining how to

E) come up with moves and actions that produce a durable competitive edge over rivals.

A seldom used strategic approach to setting a company apart from rivals and achieving a sustainable competitive advantage is

E) copying the attributes of a popular product or service.

Troopline Inc., an online laptop retailer, sells laptops of similar range and features as other online laptop retailers. Which of the value propositions would not benefit the company?

E) establishing a comparison feature tab that allows customers to compare offerings from other online retailers

A company's business strategy is not likely to include

E) management's actions to revise the company's financial and strategic performance targets.

An emergent strategy is best exemplified by a(n)

E) microbrewer that invests in building community water wells during a drought.

A salsa manufacturing company that enjoys the lest bargaining power with its suppliers would most likely be

E) offering high-cost specialized salsas that could be consumed only by customers with specific food allergies.

Managers must be prepared to modify their strategy except when

E) rivals announce their monthly profit margins in public.

Under Armor, a multinational sports apparel company plans entry into a new geographical location, Vietnam, considered an emerging market, with its established and best-selling product line: women's running shorts. How should Under Armour not craft a strategy to enhance future profits in Vietnam?

A) create a sales plan that aims to enhance initial sales and market penetration with low prices based on high operational costs

Managers of every company should be willing and ready to modify their strategies because

A) market conditions and circumstances are changing over time or the current strategy is clearly failing.

A pharmaceutical company selling prescription drugs in France for the past 10 years has had moderate sales in a crowded market, as its rivals manufacture and market drugs of similar efficacy and having similar safety precautions, but that have superior market share. This particular pharmaceutical company's greatest challenge is to increase French doctors' prescribing their drugs. What would be the most effective strategy to improve sales performance in the existing market?

A) modifying marketing communication to increase brand familiarity within key physician segments

A deliberate strategy is best exemplified by a(n)

A) popular downtown theater that has been staging plays and showing films decides to begin booking rock and roll acts.

A company achieves a competitive advantage when it

A) provides buyers with superior value compared to rival sellers or offers the same value at a lower cost.

Excellent execution of an excellent strategy is

A) the best test of managerial excellence and the best recipe for making a company a standout performer.

Strategy is about competing differently than rivals; thus, strategy success is about

A) the sources of sustained advantages and superior profitability.

A search engine giant specializes in all types of search items; provides a free translation feature for 80 different languages; stores all passwords for commonly visited sites in encrypted form; allows users to view ads on previously made related searches; provides suggestive search items to assist the user; allows users to view a collection of related web pages users might want to visit; and provides a faster load time and more accurate hits than its rivals. This search engine company uses a profit formula that primarily consists of

B) allowing users to view ads on previously made related searches.

Why are crafting and executing business strategies the foremost tasks of any organization?

B) 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

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

B) best describes what is meant by a company's business model.

Volta Motors, a manufacturer of self-driving delivery trucks, is working on developing its next-generation electric vehicles. It has decided on a strategy of focusing on a narrow buyer segment and outcompeting rivals by offering buyers customized autonomous, self-driving electric vehicles at a lower cost than rivals. What basic strategic approach has Volta Motors decided upon?

B) best-cost provider

For John Sidanta, CEO and founder of Primaplast, a manufacturer of biodegradable plastic drinking straws made from recycled material, crafting and executing a strategy is a top-priority managerial task because it

C) is Primaplast management's prescription for doing business, its roadmap to competitiveadvantage, a game plan for pleasing customers, and its formula for improving performance, especially in light of impending community and some food service outlets' bans on conventional plastic drinking straws.

A creative and distinctive strategy that sets a company apart from rivals and that gives it a sustainable competitive advantage

C) is a company's most reliable ticket to above-average profitability.

In crafting a company's strategy, managers

D) need to come up with a sustainable competitive advantage that draws in customers and produces a competitive edge over rivals.

You have been asked to advise Waltham Furniture, a company that seeks to serve a target middle-class customer demographic obsessed with the quality and price of products. Your proposed value proposition for this company to offer to its customers would be to

D) provide comparable quality furniture at a much lower price than your rivals but leave the final assembly of purchased furniture to customers accompanied by an easy-to-follow assembly guide.

In the course of crafting a strategy, managers typically do not

E) share the strategy publicly to obtain additional customer and shareholder support.

To improve performance, there are many different avenues for out competing rivals such as

E) strengthening competitiveness by pursuing strategic alliances and collaborative partnerships.

Strategic approaches to set a company apart from rivals and achieve a sustainable competitive advantage are not likely to include

E) striving to be the industry's high-price provider.