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67.
Switching costs for an end user are likely to be much higher because of the Internet.
68.
Because of the Internet and digital technologies, it is very difficult for suppliers to create
purchasing techniques that lower switching costs.
69.
Reintermediation is responsible for an overall reduction in business opportunities.
70.
The Internet heightens the threat of substitutes because it creates new ways to accomplish the
same task.
71.
Five-forces analysis implicitly assumes a zero-sum game, a perspective that can be short-
sighted.
72.
Michael Porter's five-forces Analysis is a dynamic tool for analyzing industry attractiveness.
73.
Complement products typically have no impact on the value of products and services of the
firm.
74.
The Nintendo success story in the early 1990s was a result of its ability to manage its
relationship with its complementors, such as the licensee rights given to outside firms to
develop games using the Nintendo game console.
75.
Apple used complementors to gain market share in the digital music business.
76.
Establishing long-term mutually beneficial relationships with suppliers improves the company
ability to implement just-in-time (JIT) inventory systems, which let it manage inventories better
and respond quickly to market demands.
77.
In conducting a good industry analysis that will yield an improved understanding of the root
causes of profitability, rigorous quantification of the five forces is not necessary.
78.
Competition tends to be more intense among firms within a strategic group than between
strategic groups.
79.
The same environmental trend or event may have a very different impact on different strategic
groups within the same industry.
80.
The use of the strategic group concept is generally not helpful in charting the future directions
of the strategies of a firm.
81.
Strategic groupings help a firm identify barriers to mobility that protect a group from attacks by
other groups.
82.
Another value of strategic grouping is that it helps a firm identify groups whose competitive
position may be marginal or tenuous.
83.
Strategic groupings are of no assistance in charting the future direction of company strategy.
84.
Strategic groups are helpful in thinking through the implications of each industry trend for the
strategic group as a whole.
85.
A sharp increase in interest rates, for example, tends to have more impact on providers of
higher-priced goods (e.g., Porsches) than on providers of lower-priced goods (e.g., Chevrolet
Cobalt), whose customer base is much more price-sensitive.
86.
If all strategic groups are moving in a similar direction, this could indicate a high degree of
future volatility and intensity of competition.
87.
The strategic groups concept is valuable for determining mobility barriers across groups,
identifying groups with marginal competitive positions, charting the future directions of firm
strategies, and assessing the implications of industry trends for the strategic group as a
whole.
88.
The concept of strategic groups is also important to the external environment of a firm.
89.
The strategic groups concept is valuable for identifying groups with marginal competitive
positions.
Multiple Choice Questions
90.
Two of the key inputs to developing forecasts discussed in the text are
91.
Salemi Industries launched Cell Zone unsuccessfully in 2005 because it did not understand
the market demand for its new product. This is an example of
92.
Environmental analysis requires continual questioning of all of these assumptions except
93.
Firms that were successful in the past can fail today because
94.
Examples of how to improve perceptual acuity include:
95.
Perceptual acuity requires all of the following except
96.
Two non-competing global firms meet quarterly to discuss multiple perspectives on world
trends. This is an example of how to improve
97.
Which of the following is not an input to develop forecasts?
98.
Boards of directors use outsiders to critique their strategy. This is necessary to improve
mostly
99.
When the management frame of reference gets out of touch with the realities of the actual
business situation, what can happen to the firm?
100.
Corporate retreats do not
101.
Why must successful managers recognize opportunities and threats in their company external
environment?
102.
_____________ tracks the evolution of environmental trends, sequences of events, or
streams of activities.
103.
Taking advantage of the increasing penetration of personal computers in American homes, the
Mayo Clinic transformed itself as a provider of health-related knowledge and expertise. It took
advantage of the ______ trends of the _______ in the prices of PCs and the ____________
presence of PCs in virtually every home in the United States.
104.
Scanning the general environment would identify information on
105.
Which of the following is not an example of corporate competitive analysis?
106.
Gathering competitive intelligence
107.
Environmental forecasting does not involve plausible projections about the ________ of
environmental change.
108.
Which of the following websites is not an example of one used routinely for corporate
competitive intelligence gathering?
109.
Executives must be careful to avoid spending so much time and effort tracking the actions of
___________ that they ignore ____________.
110.
Banks and airlines are examples of two industries that track competitor offers continually. This
is called the process of gathering
111.
Which of the following would not lead a manager to believe that an ethical concern exists?
112.
In 1977, Kenneth H. Olsen, then president of Digital Equipment Corp., announced that there
was no reason for individuals to have a computer in their home. Long since disproven, this is
an example of
113.
It is important to question the reliability of forecasts because
114.
A danger of forecasting discussed in the text is that
115.
PPG Industries, the Pittsburgh-based manufacturer of paints, coatings, optical products,
specialty materials, chemicals, glass, and fiber glass suffered serious failures in 1986 and
1987 when it attempted to diversify its offers. It used a technique to help it identify possible
future strategies. What was it?
116.
SWOT analysis is a framework for analyzing the internal and external environment of a
company. It consists of strengths, weaknesses, opportunities, and threats. According to a
SWOT analysis, which of the following is not an aspect that the strategy of the firm must
follow?
117.
Scenario planning is a useful technique for firms competing in industries characterized by
__________ and ____________.
