Question 1

Each of the following is likely to help a company's low-cost provider strategy succeed EXCEPT:

Accepted Answer

A)  resources and capabilities to keep costs below those of its competitors. 
B)  cost-effective management of value chain activities better than rivals. 
C)  effective leveraging of cost drivers. 
D)  having the innovative capability to bypass certain value chain activities being performed by rivals. 
E)  capabilities to simultaneously deliver lower cost and higher-quality/differentiated features. 
A)  resources and capabilities to keep costs below those of its competitors. 
B)  cost-effective management of value chain activities better than rivals. 
C)  effective leveraging of cost drivers. 
D)  having the innovative capability to bypass certain value chain activities being performed by rivals. 
E)  capabilities to simultaneously deliver lower cost and higher-quality/differentiated features. E

Question 2

The marketing emphasis of a company pursuing a broad differentiation strategy usually is to:

Accepted Answer

A)  under-price rival brands with comparable features. 
B)  tout differentiating features and charge a premium price that more than covers the extra costs of differentiating features. 
C)  out-advertise rivals and make frequent use of discount coupons. 
D)  emphasize selling directly to end-users and promoting personalized customer service. 
E)  communicate the product's ability to serve the customer's every need. 
A)  under-price rival brands with comparable features. 
B)  tout differentiating features and charge a premium price that more than covers the extra costs of differentiating features. 
C)  out-advertise rivals and make frequent use of discount coupons. 
D)  emphasize selling directly to end-users and promoting personalized customer service. 
E)  communicate the product's ability to serve the customer's every need. B

Question 3

What is the primary target market for a best cost-provider?

Accepted Answer

A)  Value hunting buyers 
B)  Price-conscious buyers 
C)  Best-price driven buyers 
D)  Value-conscious buyers 
E)  Brand-conscious buyer 
A)  Value hunting buyers 
B)  Price-conscious buyers 
C)  Best-price driven buyers 
D)  Value-conscious buyers 
E)  Brand-conscious buyer D

Question 4

A company's biggest vulnerability in employing a best-cost provider strategy is:

Accepted Answer

A)  relying too heavily on outsourcing. 
B)  getting squeezed between the strategies of firms employing low-cost provider strategies and high-end differentiation strategies. 
C)  getting trapped in a price war with low-cost leaders. 
D)  being timid in cutting its prices far enough below high-end differentiators to win away many of their customers. 
E)  not having a sustainable distinctive competence in cost reduction. 
A)  relying too heavily on outsourcing. 
B)  getting squeezed between the strategies of firms employing low-cost provider strategies and high-end differentiation strategies. 
C)  getting trapped in a price war with low-cost leaders. 
D)  being timid in cutting its prices far enough below high-end differentiators to win away many of their customers. 
E)  not having a sustainable distinctive competence in cost reduction.

Question 5

A pitfall to avoid in pursuing a differentiation strategy is:

Accepted Answer

A)  trying to differentiate on the basis of attributes or features that are easily and quickly copied. 
B)  choosing a product offering that supports buyers' indifference to rival brands' offerings. 
C)  charging a premium price for the differentiating features. 
D)  meeting and exceeding the meaningful gaps in quality,performance,service,and other attractive differentiating attributes offered by rivals. 
E)  spending on activities to differentiate the company's product to enhance profitability. 
A)  trying to differentiate on the basis of attributes or features that are easily and quickly copied. 
B)  choosing a product offering that supports buyers' indifference to rival brands' offerings. 
C)  charging a premium price for the differentiating features. 
D)  meeting and exceeding the meaningful gaps in quality,performance,service,and other attractive differentiating attributes offered by rivals. 
E)  spending on activities to differentiate the company's product to enhance profitability.

Question 6

In which of the following market circumstances is a broad differentiation strategy generally NOT well-suited?

Accepted Answer

A)  When buyer needs and preferences are too diverse to be fully satisfied by a standardized product 
B)  When few rivals are pursuing a similar differentiation approach 
C)  When the products of rivals are weakly differentiated 
D)  When there are many ways to differentiate a product or a service and many buyers perceive these differences valuable 
E)  When technological change is fast-paced and competition revolves around rapidly evolving product features 
A)  When buyer needs and preferences are too diverse to be fully satisfied by a standardized product 
B)  When few rivals are pursuing a similar differentiation approach 
C)  When the products of rivals are weakly differentiated 
D)  When there are many ways to differentiate a product or a service and many buyers perceive these differences valuable 
E)  When technological change is fast-paced and competition revolves around rapidly evolving product features

Question 7

To profitably employ a best-cost provider strategy,a company must have the resources and capabilities to:

Accepted Answer

A)  sell a product with the best cost at the best price. 
B)  have the best cost (as compared to rivals)for each activity in the industry's value chain. 
C)  provide buyers with the best attributes at the best cost. 
D)  incorporate attractive or upscale attributes into its product offering at a lower cost than rivals. 
E)  do a better job than rivals of adopting the best operating practices. 
A)  sell a product with the best cost at the best price. 
B)  have the best cost (as compared to rivals)for each activity in the industry's value chain. 
C)  provide buyers with the best attributes at the best cost. 
D)  incorporate attractive or upscale attributes into its product offering at a lower cost than rivals. 
E)  do a better job than rivals of adopting the best operating practices.

Question 8

What are the keys to sustaining a focused low-cost strategy?

Accepted Answer

The keys to sustaining a focused low-cos

Question 9

A focused low-cost strategy can lead to attractive competitive advantage when:

Accepted Answer

A)  buyers are looking for the best value at the best price. 
B)  buyers are looking for a budget-priced product. 
C)  buyers are price sensitive and are attracted to brands with low switching costs. 
D)  a market is emerging and demand in the target market niche is growing rapidly and is served by industry-wide competitors 
E)  a firm can lower costs significantly by limiting its customer base to a well-defined buyer segment. 
A)  buyers are looking for the best value at the best price. 
B)  buyers are looking for a budget-priced product. 
C)  buyers are price sensitive and are attracted to brands with low switching costs. 
D)  a market is emerging and demand in the target market niche is growing rapidly and is served by industry-wide competitors 
E)  a firm can lower costs significantly by limiting its customer base to a well-defined buyer segment.

Question 10

What are value drivers?

Accepted Answer

A)  A set of factors (analogous to cost drivers)that are particularly effective in having a strong differentiation effect 
B)  A firm's hidden success factor for creating over-the-top product features that will command the highest price in the industry 
C)  A technique for easily identifying factors that validate a firm's performance 
D)  A set of factors that verify the unique nature of a firm 
E)  A set of guidelines for identifying the most promising upscale attributes to incorporate into a product 
A)  A set of factors (analogous to cost drivers)that are particularly effective in having a strong differentiation effect 
B)  A firm's hidden success factor for creating over-the-top product features that will command the highest price in the industry 
C)  A technique for easily identifying factors that validate a firm's performance 
D)  A set of factors that verify the unique nature of a firm 
E)  A set of guidelines for identifying the most promising upscale attributes to incorporate into a product

Question 11

A strategy to be the industry's overall low-cost provider tends to be more appealing than a differentiation or best-cost or focus/market niche strategy when:

Accepted Answer

A)  there are many ways to achieve product differentiation that buyers find appealing. 
B)  buyers use the product in a variety of different ways and have high switching costs in changing from one seller's product to another. 
C)  the offerings of rival firms are essentially identical,standardized,commodity-like products. 
D)  entry barriers are high and competition from substitutes is relatively weak. 
E)  the market is composed of many distinct segments with varying buyer needs and expectations. 
A)  there are many ways to achieve product differentiation that buyers find appealing. 
B)  buyers use the product in a variety of different ways and have high switching costs in changing from one seller's product to another. 
C)  the offerings of rival firms are essentially identical,standardized,commodity-like products. 
D)  entry barriers are high and competition from substitutes is relatively weak. 
E)  the market is composed of many distinct segments with varying buyer needs and expectations.

Question 12

A differentiation-based competitive advantage:

Accepted Answer

A)  nearly always is attached to the quality and service aspects of a company's product offering. 
B)  usually is the result of highly effective marketing and advertising to enhance the brand,raise awareness,and build consistent customer experience. 
C)  requires developing at least one distinctive competence that buyers consider valuable. 
D)  hinges on a company's success in developing top-of-the-line product features that will command the highest price premium in the industry. 
E)  often hinges on incorporating features that raise the performance of the product or lower the buyer's overall costs of using the company's product,or enhances buyer satisfaction in intangible or noneconomic ways,or delivers value to customers by differentiating on the basis of competencies and capabilities that rivals can't match. 
A)  nearly always is attached to the quality and service aspects of a company's product offering. 
B)  usually is the result of highly effective marketing and advertising to enhance the brand,raise awareness,and build consistent customer experience. 
C)  requires developing at least one distinctive competence that buyers consider valuable. 
D)  hinges on a company's success in developing top-of-the-line product features that will command the highest price premium in the industry. 
E)  often hinges on incorporating features that raise the performance of the product or lower the buyer's overall costs of using the company's product,or enhances buyer satisfaction in intangible or noneconomic ways,or delivers value to customers by differentiating on the basis of competencies and capabilities that rivals can't match.

Question 13

Best-cost provider strategies are appealing in those market situations where:

Accepted Answer

A)  diverse buyer preferences make product differentiation the norm and where a large number of value-conscious buyers can be induced to purchase mid-range products. 
B)  a company is positioned between competitors who have ultra-low prices and competitors who have top-notch products in terms of both quality and performance. 
C)  buyers are more quality-conscious than price-conscious. 
D)  there are numerous buyer segments,buyer needs are diverse across these segments,only a few of the segments are growing rapidly,and sellers' products are strongly differentiated. 
E)  buyers are more performance-conscious than value-conscious. 
A)  diverse buyer preferences make product differentiation the norm and where a large number of value-conscious buyers can be induced to purchase mid-range products. 
B)  a company is positioned between competitors who have ultra-low prices and competitors who have top-notch products in terms of both quality and performance. 
C)  buyers are more quality-conscious than price-conscious. 
D)  there are numerous buyer segments,buyer needs are diverse across these segments,only a few of the segments are growing rapidly,and sellers' products are strongly differentiated. 
E)  buyers are more performance-conscious than value-conscious.

Question 14

The objective of differentiation is to:

Accepted Answer

A)  offer customers something rivals can't,at least in terms of the level of satisfaction. 
B)  develop strategies that are different from those of rivals. 
C)  establish objectives that are measurable and meaningful when it comes to sales growth. 
D)  offer customers a sustainable competitive advantage. 
E)  offer a diverse range of comparable products with low switching costs. 
A)  offer customers something rivals can't,at least in terms of the level of satisfaction. 
B)  develop strategies that are different from those of rivals. 
C)  establish objectives that are measurable and meaningful when it comes to sales growth. 
D)  offer customers a sustainable competitive advantage. 
E)  offer a diverse range of comparable products with low switching costs.

Question 15

A fast-food restaurant stocks bread,meat,sauces,and other main ingredients,but does not assemble and cook its burgers and sandwiches until a customer places an order.Which cost driver is the restaurant efficiently using to cut costs?

Accepted Answer

A)  Supply chain efficiencies 
B)  Economies of scale 
C)  Incentive systems and culture 
D)  Bargaining power 
E)  Capacity utilization 
A)  Supply chain efficiencies 
B)  Economies of scale 
C)  Incentive systems and culture 
D)  Bargaining power 
E)  Capacity utilization

Question 16

Which of the following is NOT one of the ways that a company can achieve cost-efficient management of its value chain activities?

Accepted Answer

A)  Striving to ensure a corporate diversity policy is introduced with effective controls 
B)  Using the company's strong bargaining power vis-à-vis suppliers or others in the value chain 
C)  Being alert to the cost advantages of outsourcing or vertical integration 
D)  Striving to capture all available economies of scale 
E)  Motivating employees through incentives and company culture 
A)  Striving to ensure a corporate diversity policy is introduced with effective controls 
B)  Using the company's strong bargaining power vis-à-vis suppliers or others in the value chain 
C)  Being alert to the cost advantages of outsourcing or vertical integration 
D)  Striving to capture all available economies of scale 
E)  Motivating employees through incentives and company culture

Question 17

A low-cost leader can translate its low-cost advantage over rivals into superior profit performance by:

Accepted Answer

A)  underpricing rivals and attracting quality-sensitive buyers in great enough numbers. 
B)  maintaining the present price,and using the lower-cost edge to earn a higher profit margin on each unit sold. 
C)  going all out to use its cost advantage to capture a dominant share of the market. 
D)  spending heavily on advertising to promote its cost advantage to build strong customer loyalty. 
E)  out-producing rivals and thus having more available units for sale. 
A)  underpricing rivals and attracting quality-sensitive buyers in great enough numbers. 
B)  maintaining the present price,and using the lower-cost edge to earn a higher profit margin on each unit sold. 
C)  going all out to use its cost advantage to capture a dominant share of the market. 
D)  spending heavily on advertising to promote its cost advantage to build strong customer loyalty. 
E)  out-producing rivals and thus having more available units for sale.

Question 18

For a company's competitive strategy to succeed in delivering favorable performance and the intended competitive edge over rivals,it has to be well-matched to a company's internal situation and underpinned by an appropriate set of resources,know-how,and competitive capabilities.True or false? Explain your answer.

Accepted Answer

The statement is true.To succeed in empl

Question 19

The marketing emphasis of a company pursuing a focused low-cost provider strategy usually is to:

Accepted Answer

A)  tout the company's lower prices. 
B)  tout the lack of frills and extras. 
C)  out-advertise rivals and make frequent use of discount coupons. 
D)  communicate the attractive features of a budget-priced product offering that fits niche members' expectations. 
E)  communicate the product's ability to serve the customer's every need. 
A)  tout the company's lower prices. 
B)  tout the lack of frills and extras. 
C)  out-advertise rivals and make frequent use of discount coupons. 
D)  communicate the attractive features of a budget-priced product offering that fits niche members' expectations. 
E)  communicate the product's ability to serve the customer's every need.

Question 20

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?

Accepted Answer

A)  A low-cost provider strategy 
B)  A broad differentiation strategy 
C)  A focused low-cost strategy 
D)  A focused differentiation strategy 
E)  A best-cost provider strategy 
A)  A low-cost provider strategy 
B)  A broad differentiation strategy 
C)  A focused low-cost strategy 
D)  A focused differentiation strategy 
E)  A best-cost provider strategy

Each of the following is likely to help a company's low-cost provider strategy succeed EXCEPT:

The marketing emphasis of a company pursuing a broad differentiation strategy usually is to:

What is the primary target market for a best cost-provider?

A company's biggest vulnerability in employing a best-cost provider strategy is:

A pitfall to avoid in pursuing a differentiation strategy is:

In which of the following market circumstances is a broad differentiation strategy generally NOT well-suited?

To profitably employ a best-cost provider strategy,a company must have the resources and capabilities to:

What are the keys to sustaining a focused low-cost strategy?

A focused low-cost strategy can lead to attractive competitive advantage when:

What are value drivers?

A strategy to be the industry's overall low-cost provider tends to be more appealing than a differentiation or best-cost or focus/market niche strategy when:

A differentiation-based competitive advantage:

Best-cost provider strategies are appealing in those market situations where:

The objective of differentiation is to:

A fast-food restaurant stocks bread,meat,sauces,and other main ingredients,but does not assemble and cook its burgers and sandwiches until a customer places an order.Which cost driver is the restaurant efficiently using to cut costs?

Which of the following is NOT one of the ways that a company can achieve cost-efficient management of its value chain activities?

A low-cost leader can translate its low-cost advantage over rivals into superior profit performance by:

The marketing emphasis of a company pursuing a focused low-cost provider strategy usually is to:

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?

What Is Strategy and Why Is It Important

Charting a Companys Direction: Its Vision, Mission, Objectives, Andstrategy

Evaluating a Companys External Environment

Evaluating a Companys Resources, Capabilities, and Competitiveness

Strengthening a Companys Competitive Position

Strategies for Competing in International Markets

Corporate Strategy

Ethics, Corporate Social Responsibility, Environmental-Sustainability, and Strategy

Building an Organization Capable of Good Strategy Execution

Managing Internal Operations

Corporate Culture and Leadership

Filters

Exam 5: The Five Generic Competitive Strategies

Each of the following is likely to help a company's low-cost provider strategy succeed EXCEPT:

The marketing emphasis of a company pursuing a broad differentiation strategy usually is to:

What is the primary target market for a best cost-provider?

A company's biggest vulnerability in employing a best-cost provider strategy is:

A pitfall to avoid in pursuing a differentiation strategy is:

In which of the following market circumstances is a broad differentiation strategy generally NOT well-suited?

To profitably employ a best-cost provider strategy,a company must have the resources and capabilities to:

What are the keys to sustaining a focused low-cost strategy?

A focused low-cost strategy can lead to attractive competitive advantage when:

What are value drivers?

A strategy to be the industry's overall low-cost provider tends to be more appealing than a differentiation or best-cost or focus/market niche strategy when:

A differentiation-based competitive advantage:

Best-cost provider strategies are appealing in those market situations where:

The objective of differentiation is to:

A fast-food restaurant stocks bread,meat,sauces,and other main ingredients,but does not assemble and cook its burgers and sandwiches until a customer places an order.Which cost driver is the restaurant efficiently using to cut costs?

Which of the following is NOT one of the ways that a company can achieve cost-efficient management of its value chain activities?

A low-cost leader can translate its low-cost advantage over rivals into superior profit performance by:

The marketing emphasis of a company pursuing a focused low-cost provider strategy usually is to:

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?

What Is Strategy and Why Is It Important

Charting a Companys Direction: Its Vision, Mission, Objectives, Andstrategy

Evaluating a Companys External Environment

Evaluating a Companys Resources, Capabilities, and Competitiveness

Strengthening a Companys Competitive Position

Strategies for Competing in International Markets

Corporate Strategy

Ethics, Corporate Social Responsibility, Environmental-Sustainability, and Strategy

Building an Organization Capable of Good Strategy Execution

Managing Internal Operations

Corporate Culture and Leadership

Filters