Ch 2 sevi
In which of the following ways can suppliers exert bargaining power? (Check all that apply.)
By squeezing the profitability of firms By reducing the quality of purchased goods and services By threatening to raise prices of raw materials
The six major entry barriers in Porter's five forces model include which of the following?
Capital requirements and switching costs. Economies of scale and product differentiation. Limited access to distribution channels and cost disadvantages independent of scale.
______ helps firms define and understand their industry and identify rivals' strengths and weaknesses.
Competitive intelligence
are products or services that have an impact on the value of a firm's products or services.
Complements
______ involves the development of plausible projections about the direction, scope, speed, and intensity of environmental change. Multiple choice question.
Environmental forecasting
______ tracks the evolution of environmental trends, sequences of events, or streams of activities.
Environmental monitoring
______ involves surveillance of a firm's external environment to predict environmental changes and detect changes already underway.
Environmental scanning
Which of the following describe factors that result in intense rivalry?
High fixed or storage costs. Slow industry growth. Capacity augmented in large increments. High exit barriers. Numerous or equally balanced competitors. Lack of differentiation or switching costs.
is when competitors sense pressure from others in the same industry or act on an opportunity to improve their position.
Rivalry
______ analysis is a framework for analyzing a company's internal and external environments.
SWOT
______ is an in-depth approach to environmental forecasting that involves experts' detailed assessments of social, economic, political, technology trends or other dimensions of the external environment.
Scenario analysis
An advantage that some existing competitors have over new entrants and that does not depend on economies of scale is having favorable access to
Raw materials
Which are the most useful dimensions for classifying an industry into strategic groups?
companies with a high degree of vertical integration companies that sell in the same geographical area companies that use similar distribution strategies
Michael Porter's five forces model is the most commonly used analytical tool for examining which of the following type of environment?
competitive
According to Porter, what are the two critical issues in conducting a good industry analysis?
conducting a rigorous quantification of the five forces choosing the appropriate time frame
Which of the following pairings are examples of products that are complements?
hot dogs and buns binders and paper video game consoles and games
Environmental monitoring enables firms to evaluate
how the dynamic competitive landscape is being changed by environmental trends
Environmental monitoring enables firms to evaluate Blank______
how the dynamic competitive landscape is being changed by environmental trends
Strategic group analysis helps managers do which of the following?
identify groups whose competitive position may be marginal or tenuous think through implications of industry trends for each company within the group identify barriers to mobility that protect a group from attacks by other groups
The bargaining power of buyers depends on the
importance of purchases from that group compared with the industry's overall business
Which of the following are effects of the digital economy?
decreased asset intensity increased globalization of business increased connection between products and the Internet
The Blank______ segment of the general environment consists of changes in a market's characteristics such as age, race, ethnicity, and education.
demographic
Which of the following elements of the general environment is the easiest to understand and quantify?
demographic
Which of the following are included in the six segments of the general environment?
demographic and sociocultural political/legal and technological economic and global
A buying group is considered powerful when it
is responsible for a large volume of a seller's sales
A firm's strategy should be directly tied to
its SWOT analysis
A CEO can improve perceptual acuity by Blank______.
meeting with and listening to others seeking out information
A good industry analysis does which of the following?
seeks to understand the underpinnings of competition in the industry distinguishes short-term fluctuations from structural changes in the industry identifies the root causes of profitability for the industry
The Blank______ segment of the general environment consists of the values, beliefs, and lifestyles of a society.
sociocultural
The effect on the business clothing and restaurant industries caused by an increase of women in the workforce is an example of which segment of the general environment?
sociocultural
Increases in household income due to more women entering the workforce in white collar jobs is likely to affect which two segments the most?
sociocultural and economic
Interest rate increases, currency exchange rates, and the Dow Jones are examples of factors to be considered in which segment of the general environment?
economic
The Blank______ segment of the general environment consists of the characteristics of the economy, including national income and monetary conditions
economic
Which of the following are examples of advantages some existing competitors might have that are independent of size or economies of scale?
favorable government policies proprietary products government subsidies
The Blank______ environment is composed of segments external to an industry that are usually beyond a firm's control, such as demographics and economic factors, that can affect a firm's strategy
general
Competitive intelligence
helps companies avoid surprises by anticipating competitors' moves and response time
SWOT stands for
strengths, weaknesses, opportunities, and threats
Which of the following are part of a firm's competitive environment?
suppliers competitors customers
A one-time cost that customers pay when changing vendors is known as
switching costs
Developments in computer software and hardware, nanotechnology, and R&D in exotic materials are examples of trends in which segment of the general environment?
technological
The ______ segment of the general environment is concerned with innovation and state of knowledge in industrial arts, engineering, applied sciences, and pure science, and their interaction with society.
technological
The extent of the threat of potential entrants into an industry depends on which of the following?
the combined reaction from existing competitors existing barriers to entry
Which sector is most affected by legislation on H-1B visas?
the high-technology sector
The number of middle-class consumers in which region is rapidly rising and thus influencing hiring practices of U.S. multinationals?
Asia
What is the effect of the digital economy on customer expectations?
Customers have become more knowledgeable and changeable.
Which of the following are examples of what companies do to gain customers?
Decrease product/service prices. Increase warranties. Increase customer service.
High exit barriers include which of the following
High fixed or storage costs that create strong pressures for firms to increase capacity. They sometimes are due to having specialized assets or strategic interrelationships. High exit barriers can be economic, strategic or emotional factors. Government and social pressures due to concern for job loss.
Which of the following are reasons managers should use Porter's five forces model?
It can help them develop their supply chains through developing strong relationships with both suppliers and customers. It can help them decide whether to enter, remain, or exit an industry. It can help them assess how to improve the firm's competitive position within the industry
The SWOT framework is popular with managers for several reasons, including which of the following?
It forces managers to consider both the internal and external factors simultaneously.
Which of the following statements about an industry's composition are correct?
It includes companies that sell to similar customers.
Which of the following statements about scenario analysis are true?
It is an in-depth approach to forecasting. It incorporates the ways in which societal trends may affect an issue. It draws on a range of disciplines.
The general idea of conducting a SWOT analysis is that the firm's strategy must do which of the following?
It should take advantage of opportunities presented by the environment.
Spotting key trends requires a combination of which of the following?
Keeping an eye on what's happening. Understanding one's customers. Knowing one's business.
Companies enter foreign market to access which of the following?
Larger potential markets
Which of the following are caveats of using industry analysis?
Managers should not always avoid low-profit industries. Porter's model assumes a zero-sum game, meaning there is a winner and loser. The five-forces model is essentially a static analysis.
Which of the following is an example of a CEO with perceptual acuity?
Marga starts a ride-sharing business in a city with few parking garages.
groups are clusters of firms that share similar strategies.
Strategic
Which of the following statements are correct regarding strategic groups?
Strategic groups are clusters of firms that share similar strategies. No two firms are exactly the same. No two firms are totally different.
______ products and services limit the potential returns of an industry by placing a ceiling on the prices that firms in that industry can profitably charge.
Substitute
may exert bargaining power by threatening to raise prices of the materials needed by a firm or reduce the quality of goods and services. Multiple choice question.
Suppliers
Which of the following play a role in increasing the bargaining power of the buyer?
The buyers pose a credible threat of backward integration. The buyers make large purchases relative to the industry's sales. The products being purchased from the industry are standard or undifferentiated.
Which of the following statements about the competitive environment are correct?
The competitive environment consists of factors such as competitors, customers, and suppliers. The competitive environment often influences the nature of the competition in an industry. It is also referred to as the task environment.
Which of the following are among Porter's five forces?
The intensity of rivalry among competitors in an industry The threat of new entrants The threat of substitute products and services The bargaining power of suppliers
Supplier groups are powerful under which of the following conditions?
The supplier group poses a credible threat of forward integration. The industry is not an important customer of the supplier group. One or more suppliers have built-in switching costs for buyers.
Which of the following is an example of when the bargaining power of suppliers may be low?
The suppliers provide an input that has many substitutes
Which of the following is an example of when the bargaining power of suppliers may be low?
The suppliers provide an input that has many substitutes.
Which of the following are key arguments against H-1B visas?
They drive down wages for American workers. They take jobs away from Americans.
A key to successful strategic management is gathering industry information and understanding the competitive dynamics of the industry's companies.
True
Trends in one segment of the general environment can have an effect on other segments.
True
Which of the following threaten an industry by forcing down prices, bargaining for higher quality or more services, and playing competitors against each other?
buyers
The process of examining large data sets to uncover hidden patterns, market trends, and customer preferences is known as
data analytics
The Blank______ segment of the general environment consists of how a society creates and exercises power, including rules, laws, and taxation policies. Multiple choice question.
political/legal
The Sarbanes-Oxley Act of 2002 greatly increased the accountability of auditors, executives, and corporate lawyers. This law is an example of which segment of the general environment?
political/legal
The purpose of environmental forecasting is to
predict change
One important factor of the global economy, and one that has influenced more firms to expand overseas, is
the rise of the middle class in emerging nations
Managers should understand how they can create win-win relationships with their suppliers and customers so that they can overcome
the zero-sum game issue
The Blank______ is the possibility that the profits of established firms in the industry may be eroded by new competitors. Multiple choice question.
threat of new entrants
The ______ is the possibility that the profits of established firms in the industry may be eroded by new competitors. Multiple choice question.
threat of new entrants
Firms use "Big Data" to accomplish which of the following goals?
to better customize their offerings to customers
Examples of key elements of the global segment of the general environment include which of the following?
trade agreements between nations currency exchange rates
Which of the following would be substitutes for a soft drink?
water orange juice sports drinks