MGT 498: Strategic Management

The concept of a(n) Blank______ attempts to combine both learning effects and process improvements.

experience curve

Select all that apply In terms of business strategy, blue oceans represent which of the following?

increased demand untapped market space

Select all that apply Which of the following are input factors?

labor information technology services raw materials capital

Which type of strategy is being used if a company offers a product at a lower cost than its competitors?

cost-leadership strategy

The Ritz-Carlton provides a personalized customer experience based on sophisticated analysis of data gathered about each guest. This focus on Blank______ allows the hotel to increase its perceived value.

customer service

Which of the following are business strategies JetBlue pursued in order to gain a competitive advantage?

differentiation and cost-leadership

A firm that increases its output of a given product and experiences a simultaneous decrease in per unit costs is taking advantage of Blank______.

economies of scale

Business-level strategy addresses which overarching question?

How should we compete?

A tablet manufacturer that includes a free stylus with every purchase is using Blank______ to enhance users' experiences and increase the perceived value of its tablets.

complements

A struggling retailer seeking to implement a blue ocean strategy is likely to experience difficulty with Blank______.

cutting costs and increasing value at the same time

Economies of scale are Blank______.

decreases in cost per unit as output increases

A Blank______ strategy aims to create higher value for customers by offering products with unique features but a similar level of costs to those of competing products.

differentiation

A(n) Blank______ strategy attempts to increase the perceived value of a product while controlling costs.

differentiation

An auto manufacturer that has access to cheaper labor and raw materials than its rivals will have a competitive advantage regarding lower cost of Blank______ factors.

input

Why does the learning curve go down when productivity is considered?

As workers repeatedly engage in an activity, they become more efficient, driving down costs.

What is one of the benefits of pursuing a differentiation strategy when it comes to the power of suppliers?

Differentiation provides protection against an increase in input prices.

True or false: Formulating a business strategy is a relatively easy task because only a few strategic options are available.

False

Which capability is required to create superior product features?

R&D

What is the relationship between fixed costs and economies of scale?

The amount of fixed costs allocated to each unit of output decreases as output increases.

In terms of productivity, which of the following is true of learning curves?

They go down.

Select all that apply Which of the following competitive forces can result in the erosion of margins for both differentiation and cost-leadership business strategies?

Threat of entry Power of suppliers Power of buyers

What must strategic leaders keep in mind if they are going to achieve successful strategic positioning?

To achieve strategic positioning, firms must make important trade-offs.

True or false: A company that achieves differentiation parity at a lower cost has implemented a successful cost-leadership strategy.

True

In addition to having the lowest cost, a low-cost leader is likely to have Blank______.

a large market share

If two firms produce very similar products at the same rate of output, and firm A is able to achieve lower per-unit costs than firm B by taking advantage of a new manufacturing technology, firm A is benefiting from Blank______.

an experience-curve effect based on process innovation

Why do many firms fail to successfully implement a blue ocean strategy?

because they end up being "stuck in the middle," unable to increase value and lower costs at the same time

A Blank______ outlines the steps a manager will take to achieve competitive advantage in a single product market.

business-level strategy

Unique features and attributes that differentiate a product from competitors' offerings allow the firm to Blank______.

charge premium pricing

Bundling of products and services that are consumed in tandem to create value is an example of Blank______.

complements

Select all that apply What are the three most important value drivers that managers can use to create a competitive advantage?

complements customer service product features

Select all that apply Which two of the following variables can managers primarily manipulate in order to answer the question, "How should we compete?"

cost value

The goal of a Blank______ strategy is to achieve expenses below those of competitors while maintaining similar value. A firm with this strategy could or could not achieve differentiation parity.

cost leadership

A Blank______ strategy requires achieving the lowest costs in the industry while maintaining a level of value that is acceptable to customers.

cost-leadership

Select all that apply Which of the following are examples of ways that a large retailing firm can increase the perceived value of its offerings by focusing on customer service?

offering a "no questions asked" return policy maintaining a domestic call center that is open 24 hours per day

Two important features that managers can adjust in an effort to improve the firm's strategic position are Blank______.

product features and customer service

The most significant challenge JetBlue faced in implementing its business strategy was Blank______.

reconciling the trade-offs between cutting costs and providing superior service

Products in the affordable "business-casual" clothing market have largely become commoditized, and most retailers have begun to compete mainly on price rather than product features. In this environment, it is impossible for one retailer to gain market share without another losing it. This is an example of a Blank______ ocean.

red

A manufacturer of electronic components can use its manufacturing machines to produce many different components such as semiconductors, sensors, and capacitors. In this case, the firm benefits from an economy of _______, reducing overall production costs by finding multiple uses for its components and facilities.

scope

Economies of Blank______ are the savings that come from producing two or more different outputs at a lower cost than producing each output individually.

scope

Economies of scale present an opportunity to increase profits because as the number of units within the relevant range increases, fixed costs Blank______.

stay the same

Select all that apply A producer of consumer headphones that successfully differentiates its products with a patented noise-canceling technology and celebrity endorsements will enjoy which of the following benefits?

the ability to charge a premium price less intense competition from imitators

The perceived value that a company creates for consumers less the company's costs to create the value equals Blank______.

the economic value created

A firm that manages to avoid competition entirely by offering a product or service that creates an uncontested market space is engaging in Blank______.

value innovation

Implementing a blue ocean strategy requires making competition irrelevant and creating a new market space, otherwise known as Blank______.

value innovation