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Chapter 08 - Business Strategy
Chapter 08
Business Strategy
Multiple Choice Questions
1. (p. 231) The two most prominent sources of competitive advantage for a business are:
2. (p. 231) Businesses that create competitive advantages from one or both of cost and
differentiation usually experience ______ profitability within their industry.
3. (p. 231) Which of the following are often referred to as generic strategies?
4. (p. 232) Which of these refers to business strategies that seek to establish long-term
competitive advantages by emphasizing and perfecting value chain activities that can be
achieved at costs substantially below what competitors are able to match on a sustained
basis?
5. (p. 232) Business success built on cost leadership requires the business to be able to provide
its product or service at a cost _____ what its competitors can achieve.
6. (p. 234) Which of the following is NOT a skill or a resource that fosters cost leadership?
7. (p. 234) Organizational requirements to support and sustain cost leadership are:
8. (p. 234) ______ type of innovations support a cost leadership strategy.
9. (p. 234) Common resource, skills and organizational requirements to support an "overall cost
leadership" generic strategy include all but:
10. (p. 234) Truly low-cost advantages ______ price competition.
11. (p. 234) Low-cost advantages should ______ the attractiveness of substitute products.
12. (p. 235) Which one of the following is NOT a key risk associated with a cost leadership
oriented business strategy?
13. (p. 235) Cost differences often ____ over time.
14. (p. 236) __________ requires that the business have substantial advantages that allow it to
provide buyers with something uniquely valuable to them.
15. (p. 237) Rivalry is ____ when a business successfully differentiates itself.
16. (p. 237) Which of the following is NOT a skill or a resource that fosters differentiation?
17. (p. 237) Skills and resources that foster differentiation are:
18. (p. 237) Skills and resources that foster differentiation are:
19. (p. 237) Common resources, skills and organizational requirements to support a
"differentiation" generic strategy include all but:
20. (p. 237) Organizational requirements to support and sustain differentiation activities include
which of these?
21. (p. 238) A key risk associated with a differentiation strategy is:
22. (p. 239) Business strategies built around functional capabilities and activities that allow the
company to meet customer needs more rapidly than its main competitors are referred to as
__________ strategies.
23. (p. 239) Speed-based strategies are a form of
24. (p. 240) All of the following are skills or resources that foster rapid response (speed)
EXCEPT:
25. (p. 240) Organizational requirements to support and sustain rapid response activities include
which of these?
26. (p. 240) Speed-based competitive advantage can be created around all of these activities
EXCEPT:
27. (p. 240) The use of preapproved online suppliers into production is a feature of which
strategy?
28. (p. 241) The extent to which a business concentrates on a narrowly defined market, it is
called a(n) __________ strategy.
29. (p. 241) When a firm competes in a geographically defined specific area, it is using a(n)
_______ strategy.
30. (p. 243) An industry that has growing sales across all the companies in the industry based on
growing demand for the relatively new products, technologies and/or services made available
by the firms participating in this industry is called a(n) _______ industry.
31. (p. 243) Business strategies in emerging industries must be concerned with which of the
following characteristics?
32. (p. 243) From the standpoint of strategy formulation, the essential characteristics of an
emerging industry is that
33. (p. 243) The absence of rules in emerging industries presents both a _____ and a(n) _____
34. (p. 244) Which of these is NOT a stage of industry evolution?
35. (p. 244) Production operations' capabilities to improve product and reduce costs and ability
36. (p. 244) Which of these represent marketing capabilities at the growth stage of industry
evolution?
37. (p. 244) Which of these represent marketing capabilities at the decline state of industry
evolution?
38. (p. 244) Ability to expand capacity effectively, limit number of designs and develop
standards represents the introduction stage of industry evolution for which function?
39. (p. 244) Resources to support high net cash overflow and initial losses and ability to use
leverage effectively represent finance area's capability at which stage of industry evolution?
40. (p. 244) Ability to reuse or liquidate unneeded equipment; advantage in cost facilities;
control system accuracy; and streamlined management control represent decline stage of
industry evolution for which functional area?
41. (p. 244) Existence of an ability to add skilled personnel motivated and loyal workforce
represent personnel capabilities at which stage of the industry evolution?
42. (p. 244) Which of these personnel capabilities match the maturity stage of the industry
evolution?
43. (p. 244) Skill in quality and new feature development; ability to start developing successor
product represent engineering and R&D capabilities at which stage of the industry evolution?
44. (p. 244) Ability to reduce costs, develop variants and differentiate products represent the
maturity stage of industry evolution capabilities which functional area?
45. (p. 244) Which key functional area is critical at the introduction stage of industry evolution
and which strategy should be focused on?
46. (p. 244) Which key functional area and which strategy focus are critical at the growth stage
of industry evolution?
47. (p. 244) Which key functional area and which strategy focus are critical at the maturity stage
of industry evolution?
48. (p. 244) Which key functional area and which strategy focus are critical at the decline stage
of the industry evolution?
49. (p. 244) For success in emerging industry setting, business strategies require which of these
features?
