STRATEGIC MANAGEMENT UARK
EXAM QUESTIONS AND ANSWERS
Motivation - Answer-e.g. - Japan's entrance into the US auto market was largely ignored
by the big American manufacturers until it was too late
Ability - Answer-e.g. - Blackberry did not have the design/patent a viable competitor to
Apple's smartphone
improve margins - Answer-firms constantly competing with each other to REDUCE
COSTS
increase market share - Answer-firms constantly competing with each other to REDUCE
PRICE
agency - Answer-companies act as platforms that attract both suppliers and consumers
to a central platform where they gain commissions
bundling - Answer-products are bundled together with accessories or complementary
goods and presented in a single package to consumers
multimarket competition - Answer-firms competing against each other in several product
or geographic markets
competitive dynamics - Answer-total set of actions and responses taken by all firms
competing within a market
broad competitors defined - Answer-- customers
- geographic resources
- inputs
- talent
- capital
- technology
competitor analysis - Answer-firm studies competitors' future objectives, current
strategies, assumptions, and capabilities
- help a firm UNDERSTAND its competitors
first step of comp analysis - Answer-evaluate the level of Market Commonality and
Resource Similarity
Market Commonality - Answer-firms compete in similar geographies or industries
, less, more - Answer-Firms engaged in high levels of multimarket competition are ____
likely to initiate aggressive strategic moves against one another but ____ likely to
respond aggressively.
Resource Similarity - Answer-the extent that competing firms use the same set of
resources or compete on the basis of similar technology
drivers of competitive behavior - Answer-- Awareness
- Motivation
- Ability
dominant - Answer-Competitive rivalry has a _______ influence on the firm's business-
level strategy or strategies.
Awareness - Answer-e.g. - a company may "subtly" compete by increasing packaging
size while not changing price
new features (and technologies) - Answer-firms always trying to incrementally add these
as incentives for customers to buy their product
- less focused on cost/price, more on improving CVC
Strategic action - Answer-a market-based move that involves a significant commitment
of organizational resources
- DIFFICULT to implement and reverse
Tactical action - Answer-market-based move that is taken to fine-tune a strategy
- fewer resources
- EASY to implement and reverse
First Mover - Answer-allocate funds for:
- product innovation and development
- aggressive advertising
- R&D
Second Mover - Answer-responds to first mover's competitive action
- study customer reactions
- find mistakes
- may develop more efficient processes
Late Mover - Answer-action after considerable time
- any success will be slow
- average returns
- delays understanding of CVC
Learning Curve - Answer-the cost of producing a product over time decreases on a per-
unit basis
EXAM QUESTIONS AND ANSWERS
Motivation - Answer-e.g. - Japan's entrance into the US auto market was largely ignored
by the big American manufacturers until it was too late
Ability - Answer-e.g. - Blackberry did not have the design/patent a viable competitor to
Apple's smartphone
improve margins - Answer-firms constantly competing with each other to REDUCE
COSTS
increase market share - Answer-firms constantly competing with each other to REDUCE
PRICE
agency - Answer-companies act as platforms that attract both suppliers and consumers
to a central platform where they gain commissions
bundling - Answer-products are bundled together with accessories or complementary
goods and presented in a single package to consumers
multimarket competition - Answer-firms competing against each other in several product
or geographic markets
competitive dynamics - Answer-total set of actions and responses taken by all firms
competing within a market
broad competitors defined - Answer-- customers
- geographic resources
- inputs
- talent
- capital
- technology
competitor analysis - Answer-firm studies competitors' future objectives, current
strategies, assumptions, and capabilities
- help a firm UNDERSTAND its competitors
first step of comp analysis - Answer-evaluate the level of Market Commonality and
Resource Similarity
Market Commonality - Answer-firms compete in similar geographies or industries
, less, more - Answer-Firms engaged in high levels of multimarket competition are ____
likely to initiate aggressive strategic moves against one another but ____ likely to
respond aggressively.
Resource Similarity - Answer-the extent that competing firms use the same set of
resources or compete on the basis of similar technology
drivers of competitive behavior - Answer-- Awareness
- Motivation
- Ability
dominant - Answer-Competitive rivalry has a _______ influence on the firm's business-
level strategy or strategies.
Awareness - Answer-e.g. - a company may "subtly" compete by increasing packaging
size while not changing price
new features (and technologies) - Answer-firms always trying to incrementally add these
as incentives for customers to buy their product
- less focused on cost/price, more on improving CVC
Strategic action - Answer-a market-based move that involves a significant commitment
of organizational resources
- DIFFICULT to implement and reverse
Tactical action - Answer-market-based move that is taken to fine-tune a strategy
- fewer resources
- EASY to implement and reverse
First Mover - Answer-allocate funds for:
- product innovation and development
- aggressive advertising
- R&D
Second Mover - Answer-responds to first mover's competitive action
- study customer reactions
- find mistakes
- may develop more efficient processes
Late Mover - Answer-action after considerable time
- any success will be slow
- average returns
- delays understanding of CVC
Learning Curve - Answer-the cost of producing a product over time decreases on a per-
unit basis
