Chapter 4: competitive advantage

Question 1

characteristics of competitive advantage

Answer 1

1. sustainable
2. competitive
3. advantageous

Question 2

operational effectiveness

Answer 2

performing the same task as the competitor but better

Question 3

strategic positioning

Answer 3

other tasks than the competitor or the same task in a different way

Question 4

how to achieve operational effectiveness

Answer 4

1. ensure product quality
2. optimising production processes
3. reducing overhead costs
4. improving the customer experience

Question 5

fast follower problem

Answer 5

when using the successes and failures of other companies to market a comparable or superior product at a lower price

Question 6

strategic position A

Answer 6

performing other tasks than competitors

Question 7

strategic position B

Answer 7

same task in a different way

Question 8

straddling

Answer 8

when a company focuses on multiple strategic positions and it is not possible to obtain the optimal benefit of both positions

Question 9

resource based view

Answer 9

defines resources and possessions that are tied to a specific company in a semi-permanent way (brand name and specialised employees)

Question 10

VRIN model

Answer 10

valuable - rare - imperfectly imitable - non-substitutable

Question 11

powerful resources

Answer 11

help companies recognise strengths and weaknesses so that new strategies can be formed

Question 12

imitation resistant value chain

Answer 12

set of activities that create and deliver consumer value that cannot be imitated

Question 13

viral marketing

Answer 13

when customers themselves start talking positively about a company, giving a company free advertising

Question 14

scalability

Answer 14

for low marginal costs, products and services can reach many customers

Question 15

network effects

Answer 15

created when the value of product or service increases with an increasing number of users

Question 16

metcalfe’s law

Answer 16

the value of communication networks is proportional to the square of the number of connected users –> V~n^2

Question 17

affiliates

Answer 17

parties that encourage consumers to make a purchase from a third party and then receive a part of the margin for this

Question 18

patent trolls/ non-practicing entities

Answer 18

companies that apply for a patent with the sole purpose of suing a large company once they use the innovation

Question 19

RFID

Answer 19

small tags a placed on or with products –> have their own energy source and can therefore send and receive signals

Question 20

NFC

Answer 20

tags only send out a signal when they are very close to the reader –> contactless payments

Question 21

long tail

Answer 21

many hard to find items to many consumers

Question 22

long-enough tail

Answer 22

examines whether you have to keep all products that are made, both high and low quality, in stock or whether there must be a certain limit

Question 23

Supreme Court’s First Sale Doctrine

Answer 23

product is protected by copyright if one buys a physical good, with which you can do everything you want, but not copy it

Question 24

bandwith caps

Answer 24

maximum for the quantity that a customer can download

Question 25

net neutrality

Answer 25

Internet Service Providers cannot distinguish between different types of data or users

Question 26

dataset

Answer 26

collection of your data and that of all others to use algorithms to make personalised suggestions

Question 27

collaborative filtering

Answer 27

personalised recommendations are based on the crowd with the assumption other people who like this show also look at this show