Exam 2: Analyzing the External Environment Ofthe Firm: Creating Competitive Advantages

Explain how the value net analysis adds to the five-forces analysis.Be sure to include examples from at least two industries.

SWOT analysis is a framework for analyzing the internal and external environment of a company.It consists of strengths,weaknesses,opportunities,and threats.According to a SWOT analysis,which of the following is not an aspect that the strategy of the firm must follow?

Because the Internet lowers barriers to entry in most industries,it ________.

A danger of forecasting discussed in the text is that _____________.

Exit barriers do not arise from ________.

The more attractive the price/performance ratio of substitute products,the tighter it constrains the ability of an industry to charge high prices.

Discuss the six segments of the general environment.Provide examples of how they might be related.

PPG Industries,the Pittsburgh-based manufacturer of paints,coatings,optical products,specialty materials,chemicals,glass,and fiber glass suffered serious failures in 1986 and 1987 when it attempted to diversify its offers.It used a technique to help it identify possible future strategies.What was it?

The power of suppliers will be enhanced if they are able to maintain a credible threat of forward integration.

Buyer power tends to be higher if suppliers provide undifferentiated or standard products.

Michael Porter's Five-Forces Analysis is a dynamic tool for analyzing industry attractiveness.

The use of the strategic group concept is generally not helpful in charting the future directions of the strategies of a firm.

New communication technology can impact seemingly unrelated industries such as the airline industry.This would be an example of a ______________.

In general,the threat of substitutes is heightened because the Internet ____________.

What are some of the factors that would cause a supplier group to become powerful? Illustrate.

Which of the following firms would likely pose the least competitive threat?

The threat of new entrants is high when there are _______.

The five-forces model helps to determine both the nature of competition in an industry and the profit potential for the industry. E. Porter describes the competitive environment in terms of five basic competitive forces that affect the ability of a firm to compete in a given market. Together, they determine the profit potential for a particular industry.

Incumbent firms may enjoy increased bargaining power because the Internet ___________.

The aging of the population is a hard trend.