WPC 470 MOORE ASU FINAL EXAM
Business-level strategy - Answer -The goal-directed actions managers take in their
quest for competitive advantage when competing in a single product market
Blue ocean strategy - Answer -Business level strategy that successfully combines
differentiation and cost-leadership activities using value innovation to reconcile the
inherent tradeoffs
Cost-leadership strategy - Answer -Generic business strategy that seeks to create the
same or similar value for customers at a lower cost
Differentiation strategy - Answer -Generic business strategy that seeks to create higher
value for customers than the value that competitors create, while containing costs
Diseconomies of scale - Answer -Increases in cost per unit when output increases
Economies of scale - Answer -Decreases in cost per unit as output increases
Economies of scope - Answer -Savings that come from producing two or more outputs
at less cost than producing each output individually, despite using the same resources
and technology
Minimum efficient scale (MES) - Answer -Output range needed to bring down the cost
per unit as much as possible, allowing a firm to stake out the lowest-cost position that is
achievable through economies of scale
Strategic trade-offs - Answer -Choices between a cost or value position. Such choices
are necessary because higher value creation tends to generate higher cost
Architectural innovation - Answer -A new product which known components, based on
existing technologies, are reconfigured In a novel way to attack new markets
Disruptive innovation - Answer -An innovation that leverages new technologies to
attack existing markets from the bottom up
Incremental innovation - Answer -An innovation that squarely builds on an established
knowledge base and steadily improves an existing product or service
Process innovation - Answer -New ways to produce existing products or deliver existing
services
, Value innovation - Answer -The simultaneous pursuit of differentiation and low cost in a
way that creates a leap in value for both the firm and the consumers; considered a
cornerstone of blue ocean strategy
Crossing-the-chasm framework - Answer -Conceptual model that shows how each
stage of the industry life cycle is dominated by a different customer group
Platform business - Answer -An enterprise that creates value by matching external
producers and consumers in a way that creates value for all participants, and that
depends on the infrastructure or platform that the enterprise manages
Platform ecosystem - Answer -The market environment in which all players participate
relative to the platform
Reverse innovation - Answer -An innovation that was developed for emerging
economies before introduced in developed economies. Sometimes also called frugal
innovation
Social entrepreneurship - Answer -The pursuit of social goals while creating a profitable
business
Winner-take-all markets - Answer -Markets where the market leader captures almost all
of the market share and is able to extract a significant amount of the value created
Backward vertical integration - Answer -Changes in an industry value chain that involve
moving ownership of activities upstream to originating (inputs) point of value chain
Forward vertical integration - Answer -Changes in an industry value chain that involve
moving ownership of activities closer to the end (customer) point of value chain
Taper integration - Answer -A way of orchestrating value activities in which a firm is
backwardly integrated but also relies on outside-market firms from some of its supplies
and/or is forwardly integrated but also relies on outside-market firms for some of its
distribution
Boston Consulting Group (BCG) growth-share matrix - Answer -A corporate planning
tool in which the corporation is viewed as a portfolio of usiness units which are
represented graphically along relative market share (horizontal axis) and speed of
market growth (vertical axis). SBUs are plotted into four categories (dog, cash cow, star
and question mark), each of which warrants a different investment strategy
Entrepreneurship - Answer -The process by which people undertake economic risk to
innovate- to create new products, processes, and sometimes new organizations
First-mover advantages - Answer -Competitive benefits that accrue to the successful
innovator
Business-level strategy - Answer -The goal-directed actions managers take in their
quest for competitive advantage when competing in a single product market
Blue ocean strategy - Answer -Business level strategy that successfully combines
differentiation and cost-leadership activities using value innovation to reconcile the
inherent tradeoffs
Cost-leadership strategy - Answer -Generic business strategy that seeks to create the
same or similar value for customers at a lower cost
Differentiation strategy - Answer -Generic business strategy that seeks to create higher
value for customers than the value that competitors create, while containing costs
Diseconomies of scale - Answer -Increases in cost per unit when output increases
Economies of scale - Answer -Decreases in cost per unit as output increases
Economies of scope - Answer -Savings that come from producing two or more outputs
at less cost than producing each output individually, despite using the same resources
and technology
Minimum efficient scale (MES) - Answer -Output range needed to bring down the cost
per unit as much as possible, allowing a firm to stake out the lowest-cost position that is
achievable through economies of scale
Strategic trade-offs - Answer -Choices between a cost or value position. Such choices
are necessary because higher value creation tends to generate higher cost
Architectural innovation - Answer -A new product which known components, based on
existing technologies, are reconfigured In a novel way to attack new markets
Disruptive innovation - Answer -An innovation that leverages new technologies to
attack existing markets from the bottom up
Incremental innovation - Answer -An innovation that squarely builds on an established
knowledge base and steadily improves an existing product or service
Process innovation - Answer -New ways to produce existing products or deliver existing
services
, Value innovation - Answer -The simultaneous pursuit of differentiation and low cost in a
way that creates a leap in value for both the firm and the consumers; considered a
cornerstone of blue ocean strategy
Crossing-the-chasm framework - Answer -Conceptual model that shows how each
stage of the industry life cycle is dominated by a different customer group
Platform business - Answer -An enterprise that creates value by matching external
producers and consumers in a way that creates value for all participants, and that
depends on the infrastructure or platform that the enterprise manages
Platform ecosystem - Answer -The market environment in which all players participate
relative to the platform
Reverse innovation - Answer -An innovation that was developed for emerging
economies before introduced in developed economies. Sometimes also called frugal
innovation
Social entrepreneurship - Answer -The pursuit of social goals while creating a profitable
business
Winner-take-all markets - Answer -Markets where the market leader captures almost all
of the market share and is able to extract a significant amount of the value created
Backward vertical integration - Answer -Changes in an industry value chain that involve
moving ownership of activities upstream to originating (inputs) point of value chain
Forward vertical integration - Answer -Changes in an industry value chain that involve
moving ownership of activities closer to the end (customer) point of value chain
Taper integration - Answer -A way of orchestrating value activities in which a firm is
backwardly integrated but also relies on outside-market firms from some of its supplies
and/or is forwardly integrated but also relies on outside-market firms for some of its
distribution
Boston Consulting Group (BCG) growth-share matrix - Answer -A corporate planning
tool in which the corporation is viewed as a portfolio of usiness units which are
represented graphically along relative market share (horizontal axis) and speed of
market growth (vertical axis). SBUs are plotted into four categories (dog, cash cow, star
and question mark), each of which warrants a different investment strategy
Entrepreneurship - Answer -The process by which people undertake economic risk to
innovate- to create new products, processes, and sometimes new organizations
First-mover advantages - Answer -Competitive benefits that accrue to the successful
innovator
