Strategy and Industry Effects on Profitability

Question 1

Where does the strength of the positive relationship between a hybrid strategy and profitability depend on?

Answer 1

the number of generic dimensions and the inclusion of the low cost as a key component

Question 2

Definition strategy choice

Answer 2

the product of and the response to a sophisticated understanding of industry structure.

Question 3

Why are hybrid strategies considered feasible?

Answer 3

because they do not require the range of assets that are deemed necessary for pursuing pure forms of differentiation and cost leadership, combining them is not too difficult, and investments in technology could positively affect both efficiency and quality.

Question 4

What is an effective way to gain profitable volume and market growth?

Answer 4

A low cost position coupled with acceptable quality

Question 5

What is a stuck in the middle strategy?

Answer 5

a strategy with no distinctive emphasis on all generic strategy dimensions

Question 6

What are the results of pure strategies?

Answer 6

Pure strategies are producing results similar to no strategies or, in the case of pure differentiation, are found to be even worse

Question 7

What does NOT positively affect profitability?

Answer 7

industry concentration and growth

Question 8

What does positively affect profitability?

Answer 8

Industry entry barriers

Question 9

Which variables explain twice as much of the profit variance? Strategy or industry?

Answer 9

Strategy variables

Question 10

What can be concluded about the profitability of the strategy?

Answer 10

The more generic strategy dimensions included, the more profitable the strategy is, provided that one of its strategies is low cost.