MGT

Question 1

concerned with developing a
corporation’s mission, objectives,
strategies, and policies.

Answer 1

STRATEGY FORMULATION

Question 2

process of finding a strategic fit
between external opportunities and
internal strengths while working
around external threats and internal
weaknesses.

Answer 2

SITUATION ANALYSIS

Question 3

should not only result in the identification of a corporation’s dis- tinctive competencies but also in the identification of opportunities that the firm
is not currently able to take advantage of due to a lack of appropriate resources.

Answer 3

SWOT analysis

Question 4

has proven to be the most enduring analytical technique used in strategic man-
agement.

Answer 4

SWOT analysis

Question 5

summarizes an
organization’s strategic factors by combining the external factors from the EFAS Table with the internal factors from the IFAS Table.

Answer 5

SFAS (Strategic Factors Analysis Summary) Matrix

Question 6

a listing of the firm’s external and internal strategic factors
in one table.

Answer 6

SFAS Matrix

Question 7

extremely favorable niche

Answer 7

propitious niche

Question 8

a unique market opportunity that is available only for a particular time.

Answer 8

Strategic windows

Question 9

company is where it meets customers’ needs in a way that rivals can’t, given the context in which it competes.

Answer 9

Strategic Sweet Spot

Question 9

illustrate how external opportunities and threats facing a particular corporation can be matched with that company’s internal strengths and weaknesses to result in four sets of possible strategic alternatives.

Answer 9

TOWS Matrix

Question 10

list the external opportunities available in the company’s
or business unit’s current and future environment from the EFAS Table

Answer 10

Opportunites

Question 10

list the external threats facing the company or unit now and in
the future from the EFAS Table

Answer 10

threats

Question 10

specific areas of current and future strength for the
company

Answer 10

strength

Question 11

specific areas of current and future Weaknesses for the
company

Answer 11

weaknesses

Question 12

are generated by thinking of ways in which a company or business unit
could use its strengths to take advantage of opportunities.

Answer 12

SO Strategies

Question 13

attempt to take advantage of opportunities by overcoming weaknesses.

Answer 13

WO Strategies

Question 13

consider a company’s or unit’s strengths as a way to avoid threats.

Answer 13

ST Strategies

Question 14

are basically defensive and primarily act to minimize weaknesses and
avoid threats.

Answer 14

WT Strategies

Question 14

focuses on improving the competitive position of a company’s or business
unit’s products or services within the specific industry or market segment that the company or
business unit serves.

Answer 14

Business strategy

Question 15

ability of a company to provide unique and superior value to the buyer in terms of product quality, special features, or after-sale service.

Answer 15

Differentiation strategy

Question 15

can be competitive (battling against all com-
petitors for advantage) and/or cooperative (working with one or more companies to gain ad-
vantage against other competitors).

Answer 15

Business strategy

Question 15

a lower-cost competitive strategy that aims at the broad mass market

Answer 15

Cost Leadership

Question 15

aimed at the broad mass market and involves the creation of a product or service that is perceived throughout its industry as unique.

Answer 15

Differentiation

Question 15

ability of a company or a business unit to design, produce, and
market a comparable product more efficiently than its competitors.

Answer 15

Lower cost strategy

Question 16

This strategy is valued by those who believe that a company or a unit that focuses its efforts is better able to serve the special needs of a narrow strategic target more effectively than can its competition.

Answer 16

Differentiation Focus

Question 17

a low-cost competitive strategy that focuses on a particular buyer group or geographic market and attempts to serve only this niche, to the exclusion of others.

Answer 17

Cost Focus

Question 18

risk of the company not being able to maintain its cost advantages due to inflation of prices in the market, or due to the market being more efficient through new technology, which makes it cheaper for everyone to create the products without any economies of scale.

Answer 18

Risk of Cost Leadership

Question 18

the company might not be able to convince enough customers to pay up for the differentiated product. In other words, they might not see enough value that would make them choose the company’s products and pay a premium for them, instead of going for the cost leader.

Answer 18

Risk of Differentiation

Question 19

narrowing the gap between the advantage provided by the focused company and other companies that serve the broader marker, or having new players entering the markets and out-focusing the company by serving an even more targeted and narrower segment within its segment.

Answer 19

Risk of Focus

Question 19

Primary operating characteristics,

Answer 19

Performance

Question 20

supplement the basic functions.

Answer 20

Features

Question 21

Probability that the product will continue functioning without any significant maintenance.

Answer 21

reliability

Question 22

Degree to which a product meets standards.

Answer 22

conformance

Question 22

Number of years of service a consumer can expect from a product before it significantly deteriorates.

Answer 22

durability

Question 22

Product’s ease of repair.

Answer 22

serviceability

Question 23

How a product looks, feels, sounds, tastes, or smells.

Answer 23

aesthetic

Question 24

Product’s overall reputation. Especially important if there are no objective, easily used measures of quality.

Answer 24

perceived quality

Question 25

where many small- and medium-sized local companies compete for relatively small shares of the total market, focus strategies will likely predominate.

Answer 25

fragmented industry,

Question 25

dominated by a few large companies.

Answer 25

consolidated industry

Question 25

refers to a situation where industries face intense and rapidly escalating competition, making it increasingly difficult to sustain a competitive advantage for extended periods.

Answer 25

Hypercompetition,

Question 25

efficient way to quickly consolidate a fragmented industry.

Answer 25

strategic rollup

Question 26

Deals with when a company implements a strategy.

Answer 26

timing tactic

Question 26

The first company to manufacture and sell a new product or service

Answer 26

First mover

Question 27

is a specific operating plan that details how a strategy is to be imple- mented in terms of when and where it is to be put into action.

Answer 27

tactic

Question 28

a company that enters a market after the first movers have established themselves.

Answer 28

Late Mover

Question 29

Where to Compete: A market location tactic deals with where a company implements a strategy.

Answer 29

Market Location Tactics

Question 30

usually takes place in the firm's own current market position as a defense against a possible attack by a rival.

Answer 30

defensive tactic

Question 30

usually takes place in an established competitor's market location.

Answer 30

offensive tactic

Question 30

The attacking firm goes head to head with its competitor.

Answer 30

Frontal assault

Question 31

Rather than going straight for a competitor’s position of strength with a frontal assault, a firm may attack a part of the market where the competitor is weak.

Answer 31

Flanking maneuver

Question 31

Rather than directly attacking the established competitor frontally or on its flanks, a company or business unit may choose to change the rules of the game.

Answer 31

Bypass attack

Question 32

Usually evolving out of a frontal assault or flanking maneuver, attacking company or unit encircles the competitor’s position in terms of products or markets or both.

Answer 32

Encirclement

Question 33

Instead of a continual and extensive resource-expensive attack on a competitor, a firm or business unit may choose to “hit and run.”

Answer 33

Guerrilla warfare

Question 34

aim to lower the probability of attack, divert attacks to less threatening avenues, or lessen the intensity of an attack.

Answer 34

defensive tactics

Question 35

Entry barriers act to block a challenger’s logical avenues of attack.

Answer 35

Raise structural barriers

Question 35

This tactic is any action that increases the perceived threat of retaliation for an attack.

Answer 35

Increase expected retaliation

Question 35

A third type of defensive tactic is to reduce a challenger’s expectations of future profits in the industry.

Answer 35

Lower the inducement for attack

Question 35

to gain competitive advantage within an industry by working with other firms.

Answer 35

cooperative strategies

Question 36

active cooperation of firms within an industry to reduce output and raise prices in order to get around the normal economic law of supply and demand.

Answer 36

Collusion

Question 36

a long-term cooperative arrangement between two or more independent firms or business units that engage in business activities for mutual economic gain

Answer 36

strategic alliance

Question 37

firms cooperate through direct communication and negotiation

Answer 37

ExplicitCollusion

Question 38

a partnership of similar companies in similar industries that pool their resources to gain a benefit that is too expensive to develop alone, such as access to advanced technology.

Answer 38

mutual service consortium

Question 38

there is no direct communication among competing firms

Answer 38

TacitCollusion

Question 39

a strong and close alliance in which one company or unit forms a long-term arrangement with a key supplier or distributor for mutual advantage.

Answer 39

value-chain partnership

Question 39

a “cooperative business activity, formed by two or more separate organizations for strategic purposes, that create an independent business entity and allocates ownership, operational responsibilities, and financial risks and rewards to each member, while preserving their separate identity/autonomy

Answer 39

joint venture

Question 39

an agreement in which the licensing firm grants rights to another firm in another country or market to produce and/or sell a product.

Answer 39

licensing arrangement