Session 1

Question 1

How do you analyse a macro-environment of the firm ?

Answer 1

PESTEL Analysis focuses on principal components of strategic significance in the macro-environment

Question 2

What does PESTEL analysis mean ?

Answer 2

Politic
Economic
Sociologic
Technologic
Environmental
Legal

Question 3

Give an example of sociologic issue

Answer 3

Comparison of population trees of Germany, China, Vietnam and India (Sociology problem)

If you need young population choose Vietnam or India.

Question 4

Give an example of 4 Porter’s forces analysis

Answer 4

Airlanes - 4 Porter’s Forces

If people are sensitive about price because you think the products are the same.

Question 5

What is the average cost ?

Answer 5

Average Cost = Total Cost / Quantity

Buying a plane

Question 6

What is the marginal cost ?

Answer 6

Marginal Cost = Addition of total cost / Addition of the last one
The box is already , the presence of the technician, the cost is to have one more customer, so its a marginal cost.

Question 7

What are the supplier power for airlane company ?

Answer 7

Supplier power :
Dominated by Boeing and Airbus
High cost of labor (40%), fuel (15%) and aircrafts

Question 8

What are core competencies ?

Answer 8

4 different type of core competencies :

1) Unique strengths
2) Embedded deep within a firm
3) Allows the firm to differentiate from rivals
4) Expressed through structures, processes and routines (Ex: Wallmart - economy of scale - )

Question 9

What are the 4 characteristics of a sustainable competitive advantage ?

Answer 9

4 characteristics of a competitive advantage are :

1) Valuable
2) Rare
3) Costly to imitate
4) Organized to capture the value of the resource.

Question 10

What is an isolating mechanism ?

Answer 10

• Barriers to imitation.
• Helps sustain a competitive advantage

Ex: Airplanes - Short-haul; point-to-point med-sized cities and airports which provide 15 gate turns, very low ticket prices, etc.

Question 11

What is a Core Rigidity ?

Answer 11

A core rigidity = a former core competency turned into a liability (dette / boulet)

Ex: DELL - Late comer - you can customize your computer - 1995 to 1998 they were competitive but after 2006 Dell drop because it was not useful to buy directly by the internet a personalized computer.