One mechanism through which managers can achieve channel alignment under the
threat of alignment is careful selection of honest and trustworthy partner firms,
Business market managers should limit the evaluation of relationships to quantitative,
activity-based costing data and transaction price data especially in partnering when
qualitative measures do not contribute good information.
Business channel management is the process of putting products that create the greatest
value of the targeted market segments.
In a new task buying situation, the customer firm has had experience securing the
product or service, but managers need to reevaluate alternatives
The substantive facets of market sensing include defining the market, monitoring
competition, assessing customer value, and gaining customer feedback.
Managing customers is the process of differentiating transactional and collaborative
customers, delivering offerings that fulfill the respective requirements and preferences
of a portfolio of customers in a superior way, and getting a fair return in exchange.
Reduction of trade barriers and tariffs makes the playing field for foreign suppliers to
compete with domestic suppliers in their home-country markets far more difficult.
Organizing skills reflect how adroit a manager is in connecting relationships and
managing group dynamics, whereas interacting skills refer to one-on-one interaction
adeptness.
The Diffusion-Adoption Model proposes five stages: awareness, interest, evaluation,
trial, and adoption. This model is an example of a response hierarchy model
To better reflect channel partner gives & gets, some progressive suppliers have
migrated toward a functional allowance. Here, the supplier pays a reseller a set percent
off the reseller buy price for performing specific tasks.
A skimming pricing strategy, is used when the firm intends to make its overall profits
through selling fewer units at a higher profit per unit.
Procurement managers classify products and services that fail to meet company
requirements as underspecified and those that provide far more features than necessary
as overspecified.
At the strategic level of value management, all executives learn to “manage by value.”
At the tactical level, all personnel focus on the “management of value.”
Managers in business markets know that there is no benefit from adapting the concepts
and practices of their counterparts in consumer markets to the business-to-business
setting.
Wheelwright and Clark provide a model which emphasizes cross-functional integration
and provides the primary activities of engineering, marketing, and manufacturing for
each development phase.
A volume discount is a pricing tactic that is an invoice reduction used to encourage
prospective customers to try an offering that is new to them. The offering’s actual price
is listed on the invoice, then reduced by the incentive to change, with the notation
“initial use discount.”
The three core business processes essential to customer value creation are product
development management, supply chain management, and customer relationship
management.
A supplier firm and reseller firm, practicing mutual self-interests, partner because their
respective managements understand that by sharing complementary resources and
capabilities, they are more likely to achieve their respective self-interests than if they
act alone.
Sequential engineering is where firms work on the process for making a product while
they are still in the process of designing it.
The process of generating leads from databases entails first developing a profile of key
descriptors of targeted firms or managers, and then using a variety of statistical
programs to search databases for names that match the profile.
As a consultant, the salesperson asks a series of focused SPIN questions during calls.
Through these questions, the rep helps the customer manager uncover _______
requirements, which are vaguely defined areas of discontent, dissatisfaction, and
discomfort with current operations,
a. implied
b. explicit
c. situation
d. problem
_______ is a process in which a customer firm and supplier firm form strong and
extensive social, economic, service, and technical ties over time.
a. Transactional relationships
b. Managing customer relationships
c. Partnering
d. Customer selection
Ken, a buyer for Miller Construction, is willing to sacrifice fewer product variations,
fewer delivery locations and less technical support from his supplier in exchange for
reduced prices. This is an example of:
a. multisourcing
b. target pricing
c. procurement orientation
d. defeaturing or cooperative pricing
Specification, problem-solving, and trouble-shooting are technical services of a(n)
_______.
a. brand
b. minimally augmented product
c. core product
d. augmented product
A(n) ________ is the continuing process of aligning the mutual self interests and
complementary resources of partner firms in stable marketplaces, responding adaptively
to incremental marketplace changes, and transforming channels in the face of disruptive
forces.
a. reseller partnership
b. sustaining reseller partnerships
c. alignment
d. mutual self-interest
The _______ captures two critical performance dimensions for resellers: how quickly
they are turning inventory and how much gross profit they make on these sales.
a. partner relationship management system
b. performance and activity reports
c. expense-to-revenue ratios
d. turns x earns
The process of designing a set of marketing and distribution arrangements that create
superior customer value for targeted market segments and customers, and executing
those arrangements directly through supplier firm sales forces and logistics systems or
indirectly through resellers and third-party service providers.
a. marketing channel
b. business channel management
c. fulfillment management
d. value-added management
‘Services can”t be touched but rather are experienced’ describes the _______
characteristic of services.
a. intangibility
b. inseparability of production and consumption
c. perishability
d. heterogeneity
The value assessment method, _____, enables a supplier firm to fill critical gaps in its
knowledge of the customer firm’s usage system as it relates to the supplier’s market
offering. Note that a critical assumption of this method is that the customer has an
accurate perception of the effects of the studied changes upon its usage system.
a. internal engineering assessment
b. field value-in-use assessment
c. indirect survey questions
d. focus group value assessment
Extended purchase price added to the nonperformance costs, all divided by extended
purchase price, equals:
a. total cost of ownership (TCO)
b. early supplier involvement (ESI)
c. supplier performance index (SPI)
d. value in use (VIU)
_______ (is) are firms, institutions, or governments that acquire goods and services
either for their own use, to incorporate into the products or services that they produce,
or for resale along with other products and services to other firms, institutions, or
governments.
a. Business market management
b. Business markets
c. Business marketing
d. Customer value in business markets
A firm that is oriented toward procurement seeks to increase its productivity through all
the following EXCEPT:
a. maximizing power over their suppliers
b. improving quality
c. reducing total cost of ownership
d. cooperating with suppliers
A set of interdependent organizations involved in the process of making a product or
service available for use or consumption is _______.
a. marketing channel
b. business channel management
c. fulfillment management
d. value-added management
_______ are data-driven estimates of what a present or prospective market offering is
worth in monetary terms to targeted customers relative to the next-best alternative
offering for those customers.
a. customer value models
b. competitive intelligence models
c. market segmentation models
d. best practices models
The key objective in managing individual development projects, _______, consists of
all the one-time development costs a specific project incurs development speed.
a. development speed
b. product cost
c. product performance
d. development program expense
________ entails broadening the domain and span of influence of purchasing, pursuing
quality improvements and cost reductions.
a. Supply management orientation
b. Procurement orientation
c. Value orientation
d. Buying orientation
The firm’s _______ defines what knowledge and know-how resources the firm requires,
how it will attain them, and how they will translate into market advantages for the firm.
a. technology strategy
b. market strategy
c. learning strategy
d. project strategy
The worth in monetary terms of the economic, technical, service, and social benefits a
customer firm receives in exchange for the price it pays for a market offering is (a)
_______.
a. business market management
b. business market
c. business marketing
d. customer value in business markets
We _______ because of the predominant role that functionality or performance plays in
business markets.
a. Regard value as the cornerstone
b. Focus on business market processes
c. Manage business channels
d. Stress doing business across borders
_______ is a mechanism to ensure that the collective set of projects will accomplish the
development goals and objectives and build the organizational capabilities needed for
ongoing development success.
a. Aggregate project plan
b. Derivative project
c. Breakthrough project
d. Platform project
A _______ is a business regimen that enhances the ability of a supplier firm, resellers,
and third-party service providers to seamlessly integrate and synchronize their
operations, selling, marketing, and servicing efforts.
a. partner relationship management system
b. performance and activity reports
c. expense-to-revenue ratios
d. turns x earns
_______ is the process of generating knowledge about the market that individuals in the
business use to inform and guide their decision making.
a. Market sensing
b. Market research
c. Information utilization
d. Information acquisition
Offerings that enable customers to tailor the offering to their own requirements and
preferences to a greater degree are considered _______.
a. naked solutions
b. flexible market
c. mass customization
d. options
The _______ allows the customer the ability to choose to purchase a supplier’s offering
intact or piecemeal from several integrated or stand-alone channels on a
transaction-by-transaction basis.
a. efficient, low-cost transactional experience
b. high-touch, consultative experience
c. flexible, multi-access-point experience
d. one-stop shopping experience
________ is mechanisms that partner firms can use to better align their self-interests. In
these arrangements, a supplier assists its customers in becoming more profitable and
exposes itself to potential or actual losses in accomplishing this.
a. Flare out by unbundling
b. Flare out with augmentation
c. Arbitration
d. Risk-sharing, gain-sharing agreement
The ________, stated as a percent reduction from the suggested resale price, ideally
covers the reseller’s costs of performing assigned tasks and provides the reseller with a
reasonable profit.
a. allowance
b. payment discount
c. quantity or volume discount
d. trade or functional discount
A consortium led by the French Association of Value Analysis and the Association of
German Engineers explored, developed and articulated the value management approach
for the European Union. The consortium first urges firms to:
a. focus on business processes
b. adopt a supply management orientation approach
c. adopt a customer-value philosophy and set of action guidelines
d. incorporate a procurement orientation into all aspects of buying
With a _______ format, a firm posts detailed information about the company and its
market offerings. In more advanced systems, customer firms have access to pricing
information, use an “electronic shopping cart” to select items for purchase, configure
more complex offerings, and are able to order products or services 24 hours a day, 7
days a week (24 _ 7).
a. community
b. catalog
c. electronic auction
d. exchange
A business creates _______ when the economic returns generated from realizing its
business strategy exceeds the cost of capital employed to realize it.
a. business process
b. customer value
c. marketing value
d. shareholder value
The key objective in managing individual development projects, _______, is how well
the product meets the requirements and preferences that target customers have specified
development speed.
a. development speed
b. product cost
c. product performance
d. development program expense
The comprehensive, practical approach for demonstrating and documenting the value of
present and prospective market offerings is _______.
a. customer incentive to purchase
b. customer value management
c. estimate of value changes
d. concept of value in the business markets
To ensure that superior value is delivered to customers, suppliers provide help in the
form of _______ which includes courses, seminars, certification programs and building
skills.
a. training and coaching
b. sales and marketing programs
c. operational and technical support
d. pricing support
The firm’s _______, defines the target market segments and customers and a course of
action that the firm will pursue to deliver superior value to them.
a. technology strategy
b. market strategy
c. learning strategy
d. project strategy
Identify the six steps of designing superior value-adding marketing channels.
Write a value proposition for the Precision 2000.
What are the four closely coordinated activities of integrated marketing
communications (IMC)?
Explain the three tests discussed in the text that can be applied to identify core
competencies.
To test the reliability and validity of its benefit and cost estimates, Zeus management
has proposed conducting a series of field value-in-use assessments featuring
side-by-side tests. What will those assessments likely involve?
What points of difference favor the GLM 7Z84?
What points of difference favor the Zeus Precision 2000?
Explain the basic principle of the Loyalty Ladder.
Would you recommend that Zeus use a skimming or penetration pricing strategy for
the Precision 2000? Why?
How are business marketers experimenting with mixing online and traditional media
channels to spur interest from prospects?
Congratulations! You”ve just been promoted to business market manager at your firm.
You would like to adopt the BuyGrid Framework as a more orderly process for
acquiring goods. Your boss would like to know more about the framework. Explain the
BuyGrid Framework to her.
Business market managers would like to know which market segments will have the
largest growth in total market demand over some time horizon of interest, such as the
next year, three years, or five years. Barnett describes the four basic steps needed in any
forecast of total market demand. What are the four steps?
Discuss and give two examples of developments in buying.
Identify one point of contention between the Precision 2000 and the GLM 7Z84.
Describe “customer incentive to purchase” and explain how a supplier firm can take
action to increase it.
Explain breakthrough projects.