TEST 1 CHAPTER 3 PART 4

Question 1

Dominant Attribute: Goal achievement, environment exchange, competitiveness

Leadership Style: Production and achievement-oriented, decisive

Bonding: Goal orientation, production, competition

Strategic emphasis: Toward competitive advantage and market superiority

Answer 1

Market (Compete) culture

Question 2

A written or spoken agreement, especially one concerning employment, sales, or tenancy, that is intended to be enforceable by law.

Answer 2

Contracts

Question 3

The process of adding members to an elite group at the discretion of members of the body, usually to manage opposition and so maintain the stability of the group.

Answer 3

Cooptation

Question 4

An organization of diverse interest groups that join their human and material resources to produce a specific change that they are unable to deliver as independent individuals or separate organizations.

Answer 4

Coalition

Question 5

What are Porter’s 5 five forces?

Answer 5

Threat of new entries 
Supplier power
Buyer power
Threat of substitute products 
Rivalry among existing firms

Question 6

An assessment of how easy it is for suppliers to drive up prices. This is driven by the: number of suppliers of each essential input; uniqueness of their product or service; relative size and strength of the supplier; and cost of switching from one supplier to another.

Answer 6

Supplier power

Question 7

An assessment of how easy it is for buyers to drive prices down. This is driven by the: number of buyers in the market; importance of each individual buyer to the organisation; and cost to the buyer of switching from one supplier to another. If a business has just a few powerful buyers, they are often able to dictate terms.

Answer 7

Buyer power

Question 8

The main driver is the number and capability of competitors in the market. Many competitors, offering undifferentiated products and services, will reduce market attractiveness.

Answer 8

Competitive rivalry

Question 9

Where close substitute products exist in a market, it increases the likelihood of customers switching to alternatives in response to price increases. This reduces both the power of suppliers and the attractiveness of the market.

Answer 9

Threat of substitution

Question 10

Profitable markets attract new entrants, which erodes profitability. Unless incumbents have strong and durable barriers to entry, for example, patents, economies of scale, capital requirements or government policies, then profitability will decline to a competitive rate

Answer 10

Threat of new entry