Deck 5: Competitive Strategy: The Analysis of Strategic Position

Question 1

In the competitive positioning view of strategy, competitive advantage derives from

A) the way that the firm deals with the forces within the industry
B) development of core competencies
C) cost leadership or differentiation
D) distinctive capabilities

Answer 1

the way that the firm deals with the forces within the industry
cost leadership or differentiation

Question 2

Distinguish between a firm's resources and capabilities.

Answer 2

Put simply, resources are something that the firm has, whereas capabilities are something that the firm does. So for example, a firm may have a very large distribution network - this is a resource. Its capability could be for example, the ability of the firm to manage the elements of the distribution
network seamlessly.

Question 3

Outline the different activities in Porter's Value Chain.

Answer 3

The value chain is a generic model which breaks down the activities in an organization which take place to produce the product or service. These are split into primary activities and support activities. Primary activities are those that generate the income from the direct production of the product or service which is split into discrete elements - inbound logistics/operation/outbound logistics/ marketing/after sales. The support activities help the primary activities to work effectively and these are firm infrastructure, HRM, technology development and procurement.

Question 4

How does a value chain analysis assist in achieving competitive advantage?

Question 5

What variables would typically be used to segment industry buyers?

Question 6

What is the purpose of a strategic group analysis?

Question 7

The way in which customers are grouped according to characteristics is called

A) Strategic group analysis
B) Industry analysis
C) Market segmentation
D) Unique selling points

Question 8

When identifying cost drivers of the sales force as part of a value chain analysis, which of the following elements is NOT likely to be included?

A) Product range
B) Product defects
C) Geographical dispersion of customers
D) Learning

Question 9

When doing a cost analysis of the value chain, it is important to identify __________________ because a problem in one area can cause knock-on effects to other parts of the value chain

Question 10

The purpose of doing a value chain analysis is to identify ways of doing activities better or______________ than competitors.

Question 11

The way in which the value chain is configured should enable the organization to appeal to strategic customer segments. These can be defined as

A) A group of customers that can be targeted by a specific combination of product performance and price
B) A group of customers that are willing to pay a high price for a good quality product or service
C) Customer needs that can be created by innovation
D) Those aspects of customer behaviour that are universal

Question 12

The automobile brand Lexus was able to provide a premium product at lower prices than competitiors and thus created a ________

Question 13

The problem with using the same customer segmentation variables as competitors is that competitive advantage can more easily be eroded

Question 14

Strategic segments are conventionally defined around the key variables of customer characteristics and

A) Location characteristics
B) Product characteristics
C) Price characteristics
D) Demographic characteristics

Question 15

When defining strategic segments, industrial buyers are likely to be defined using which of the following bases of segmentation?

A) Size
B) technical sophistication
C) distribution channel
D) demographics

Question 16

A firm which acquires businesses that are related in some way to their existing businesses is trying to benefit from ________

Question 17

A firm achieving competitive advantage today theoretically has a better chance of achieving competitive advantage tomorrow compared to firms with lower profitability.

Question 18

Which of the following is a resource of a firm?

A) Competences
B) Differentiation advantage
C) Capital equipment
D) Cost advantage

Question 19

The basic spine of Porter's Five Forces analysis is represented by the

A) Value chain
B) Strategic groups
C) Supply chain
D) Industry structure

Question 20

Porter's Value Chain model categorized a firm's activities into primary activities and ______________activities

Question 21

Which of the following are primary activities in Porter's Value Chain?

A) Inbound logistics
B) Outbound logistics
C) Distribution
D) Procurement

Question 22

A Value Chain analysis is useful for

A) Identifying sources of competitive advantage
B) Benchmarking with competitors
C) Identifying the effectiveness of linkages between activities
D) Deciding whether to outsource an activity

Question 23

Competitive advantage can be derived from aspects of the organization that are difficult to identify and measure. For example, ___________ knowledge.

Question 24

Firms within an industry can be segmented - these are called ______

Question 25

A strategic group exists if

A) there are mobility barriers between groups of firms within an industry
B) there are a group of firms with similar characteristics
C) there are a number of firms of similar size offering the same kind of product
D) a group of firms are targeting a different strategic segment to other firms in the industry

Question 26

To identify strategic groups any two variables can be used to map firms against

Question 27

Strategic groups can exist in a market under the conditions of perfect competition

Question 28

In industries containing numerous strategic groups of similar sizes competitive rivalry is likely to be__________

Question 29

When selecting the variables for drawing strategic maps, two approaches can be used, these are pragmatic and

A) qualitiative
B) quantitiative
C) behavioural
D) gut instinct

Question 30

Strategic space might exist in a particular strategic map because

A) It would not be feasible to compete in that part of the industry
B) It is perceived to be infeasible to compete in that part of the industry
C) Structural characteristics of the industry have changed since the emergence of strategic groups
D) The strategic map has used inappropriate variables to define the map

Question 31

Strategic group analysis should only consider firms at the level of the business unit.