Question 1

In order to discover a "blue ocean" of uncontested market space,a firm must use technological innovation to create a new product market

Accepted Answer

A) True 
 B)False

Question 2

Achieving productivity gains from process innovation usually requires that new production processes are matched by other management changes-including changes in human resource management.

Accepted Answer

A) True 
 B)False

Question 3

Uncertain imitability is one type of isolating mechanisms.

Accepted Answer

A) True 
 B)False

Question 4

To understand customer' willingness to pay for differentiation,it is important to know what motivates customers,and the criteria they apply when choosing among competing products.

Accepted Answer

A) True 
 B)False

Question 5

Tangible differentiation comprises observable product features such as shape,color,size,and style; it does not include performance dimensions such of the product - for instance its reliability and durability.

Accepted Answer

A) True 
 B)False

Question 6

What is the difference between differentiation and segmentation?

Accepted Answer

A) There is no difference between the two 
B) Differentiation deals with the "how" a firm chooses to compete,while segmentation describes "where" in the entire market a firm chooses to compete 
C) Differentiation is a firm's strategic choice,whereas segmentation is given by its environment 
D) Segmentation is the head of the marketing department's responsibility,whereas the CEO is in charge of differentiation 
A) There is no difference between the two 
B) Differentiation deals with the "how" a firm chooses to compete,while segmentation describes "where" in the entire market a firm chooses to compete 
C) Differentiation is a firm's strategic choice,whereas segmentation is given by its environment 
D) Segmentation is the head of the marketing department's responsibility,whereas the CEO is in charge of differentiation

Question 7

Competitive advantage is invariably revealed by a firm being more profitable than its rivals.

Accepted Answer

A) True 
 B)False

Question 8

Advertising costs as a percentage of sales revenue for soft drink brands with large market shares (such as Coca-Cola and Pepsi-Cola)are lower than for brands with small market shares (Dr.Pepper,Schweppes,Fresca).This is because:

Accepted Answer

A) Advertising campaigns are subject to a large minimum budgets ("indivisibilities") 
B) Big brands can negotiate lower rates with advertising agencies and media owners 
C) Economies of learning-long-established brands such as Coca-Cola and Pepsi have learned how to be more efficient in their advertising campaigns 
D) Economies of global advertising campaigns 
A) Advertising campaigns are subject to a large minimum budgets ("indivisibilities") 
B) Big brands can negotiate lower rates with advertising agencies and media owners 
C) Economies of learning-long-established brands such as Coca-Cola and Pepsi have learned how to be more efficient in their advertising campaigns 
D) Economies of global advertising campaigns

Question 9

An industry's level of concentration is largely determined by the existence of economies of scale.

Accepted Answer

A) True 
 B)False

Question 10

A firm's competitive advantage is not necessarily revealed in higher profitability; it may be reflected in:

Accepted Answer

A) Expanding market share 
B) An aggressive quest for acquisitions 
C) Increasing employee bonuses 
D) Expanding market share and/or increasing employee bonuses ○ 
A) Expanding market share 
B) An aggressive quest for acquisitions 
C) Increasing employee bonuses 
D) Expanding market share and/or increasing employee bonuses ○

Question 11

Causal ambiguity creates uncertain imitability.

Accepted Answer

A) True 
 B)False

Question 12

In the automobile industry,scale economies have resulted in the biggest automobile companies-Toyota,General Motors,Volkswagen,Ford,and Hyundai-also being the most profitable.

Accepted Answer

A) True 
 B)False

Question 13

Cost and differentiation strategies are similar in terms of their potential to confer sustainable competitive advantage.

Accepted Answer

A) True 
 B)False

Question 14

Banks spend more money on their head office buildings than most other large corporations because:

Accepted Answer

A) They tend to be located in financial centers where property prices are high. 
B) They offer "experience goods",hence they need to signal wealth and stability. 
C) Their CEOs are more committed to the display of wealth than other CEOs. 
D) Because their products are essentially commodities,they need to find alternative ways of differentiating. 
A) They tend to be located in financial centers where property prices are high. 
B) They offer "experience goods",hence they need to signal wealth and stability. 
C) Their CEOs are more committed to the display of wealth than other CEOs. 
D) Because their products are essentially commodities,they need to find alternative ways of differentiating.

Question 15

A "business model" describes the overall configuration of a firm's business system.

Accepted Answer

A) True 
 B)False

Question 16

A basic principle of Business Process Reengineering is that dramatic improvements in cost efficiency are better achieved through incremental improvements rather than fundamental redesign.

Accepted Answer

A) True 
 B)False

Question 17

A change in the external environment creates competitive advantage either because some firms by responding more effectively than others to the firm or because the change has differential effects upon competing firms.

Accepted Answer

A) True 
 B)False

Question 18

Achieving a differentiation means making your offering unique in a way that makes it more valuable to customers,irrespective of the costs of creating that differentiation.

Accepted Answer

A) True 
 B)False

Question 19

"Experience goods" are those which:

Accepted Answer

A) Have performance attributes that are difficult to ascertain at the moment of purchase 
B) Only customers with previous experience of using these goods would rationally consider purchasing 
C) Only firms with wide experience in an industry would rationally consider making 
D) Have been produced by the firm furthest down the learning curve 
A) Have performance attributes that are difficult to ascertain at the moment of purchase 
B) Only customers with previous experience of using these goods would rationally consider purchasing 
C) Only firms with wide experience in an industry would rationally consider making 
D) Have been produced by the firm furthest down the learning curve

Question 20

As markets become more turbulent and unpredictable,quick-response capability depends primarily upon:

Accepted Answer

A) Good forecasting 
B) Early identification of emerging changes 
C) Speed of response 
D) Early identification of emerging changes together with speed in responding to them 
A) Good forecasting 
B) Early identification of emerging changes 
C) Speed of response 
D) Early identification of emerging changes together with speed in responding to them

In order to discover a "blue ocean" of uncontested market space,a firm must use technological innovation to create a new product market

Achieving productivity gains from process innovation usually requires that new production processes are matched by other management changes-including changes in human resource management.

Uncertain imitability is one type of isolating mechanisms.

To understand customer' willingness to pay for differentiation,it is important to know what motivates customers,and the criteria they apply when choosing among competing products.

Tangible differentiation comprises observable product features such as shape,color,size,and style; it does not include performance dimensions such of the product - for instance its reliability and durability.

What is the difference between differentiation and segmentation?

Competitive advantage is invariably revealed by a firm being more profitable than its rivals.

Advertising costs as a percentage of sales revenue for soft drink brands with large market shares (such as Coca-Cola and Pepsi-Cola)are lower than for brands with small market shares (Dr.Pepper,Schweppes,Fresca).This is because:

An industry's level of concentration is largely determined by the existence of economies of scale.

A firm's competitive advantage is not necessarily revealed in higher profitability; it may be reflected in:

Causal ambiguity creates uncertain imitability.

In the automobile industry,scale economies have resulted in the biggest automobile companies-Toyota,General Motors,Volkswagen,Ford,and Hyundai-also being the most profitable.

Cost and differentiation strategies are similar in terms of their potential to confer sustainable competitive advantage.

Banks spend more money on their head office buildings than most other large corporations because:

A "business model" describes the overall configuration of a firm's business system.

A basic principle of Business Process Reengineering is that dramatic improvements in cost efficiency are better achieved through incremental improvements rather than fundamental redesign.

A change in the external environment creates competitive advantage either because some firms by responding more effectively than others to the firm or because the change has differential effects upon competing firms.

Achieving a differentiation means making your offering unique in a way that makes it more valuable to customers,irrespective of the costs of creating that differentiation.

"Experience goods" are those which:

As markets become more turbulent and unpredictable,quick-response capability depends primarily upon:

The Concept of Strategy

Goals,values and Performance

Industry Analysis: the Fundamentals

Further Topics in Industry and Competitive Analysis

Analyzing Resources and Capabilities

Organization Structure and Management Systems: the Fundamentals of Strategy Implementation

Industry Evolution and Strategic Change

Technology-Based Industries and the Management of Innovation

Competitive Advantage in Mature Industries

Vertical Integration and the Scope of the Firm

Global Strategy and the Multinational Corporation

Diversification Strategy

Implementing Corporate Strategy: Managing the Multibusiness Firm

External Growth Strategies: Mergers,acquisitions,and Alliances

Current Trends in Strategic Management

Filters

Exam 7: The Sources and Dimensions of Competitive Advantage

In order to discover a "blue ocean" of uncontested market space,a firm must use technological innovation to create a new product market

Achieving productivity gains from process innovation usually requires that new production processes are matched by other management changes-including changes in human resource management.

Uncertain imitability is one type of isolating mechanisms.

To understand customer' willingness to pay for differentiation,it is important to know what motivates customers,and the criteria they apply when choosing among competing products.

Tangible differentiation comprises observable product features such as shape,color,size,and style; it does not include performance dimensions such of the product - for instance its reliability and durability.

What is the difference between differentiation and segmentation?

Competitive advantage is invariably revealed by a firm being more profitable than its rivals.

Advertising costs as a percentage of sales revenue for soft drink brands with large market shares (such as Coca-Cola and Pepsi-Cola)are lower than for brands with small market shares (Dr.Pepper,Schweppes,Fresca).This is because:

An industry's level of concentration is largely determined by the existence of economies of scale.

A firm's competitive advantage is not necessarily revealed in higher profitability; it may be reflected in:

Causal ambiguity creates uncertain imitability.

In the automobile industry,scale economies have resulted in the biggest automobile companies-Toyota,General Motors,Volkswagen,Ford,and Hyundai-also being the most profitable.

Cost and differentiation strategies are similar in terms of their potential to confer sustainable competitive advantage.

Banks spend more money on their head office buildings than most other large corporations because:

A "business model" describes the overall configuration of a firm's business system.

A basic principle of Business Process Reengineering is that dramatic improvements in cost efficiency are better achieved through incremental improvements rather than fundamental redesign.

A change in the external environment creates competitive advantage either because some firms by responding more effectively than others to the firm or because the change has differential effects upon competing firms.

Achieving a differentiation means making your offering unique in a way that makes it more valuable to customers,irrespective of the costs of creating that differentiation.

"Experience goods" are those which:

As markets become more turbulent and unpredictable,quick-response capability depends primarily upon:

The Concept of Strategy

Goals,values and Performance

Industry Analysis: the Fundamentals

Further Topics in Industry and Competitive Analysis

Analyzing Resources and Capabilities

Organization Structure and Management Systems: the Fundamentals of Strategy Implementation

Industry Evolution and Strategic Change

Technology-Based Industries and the Management of Innovation

Competitive Advantage in Mature Industries

Vertical Integration and the Scope of the Firm

Global Strategy and the Multinational Corporation

Diversification Strategy

Implementing Corporate Strategy: Managing the Multibusiness Firm

External Growth Strategies: Mergers,acquisitions,and Alliances

Current Trends in Strategic Management

Filters