SEVI 3013 EXAM 2- UARK STUDY GUIDE
Strategic Action - Answer -a market-based move that involves a significant commitment
of organizational resources and is difficult to implement and reverse
Tactical action - Answer -a market-based move that is taken to fine-tune a strategy; it
involves fewer resources and is relatively easy to implement and reverse
Competitive Action - Answer -a strategic or tactical action the firm takes to build or
defend its competitive advantages or improve its market position
Competitive Response - Answer -a strategic or tactical action the firm takes to counter
the effects of a competitor's competitive action
Competitors - Answer -firms operating in the same market, offering similar products,
and targeting similar customers
Competitive rivalry - Answer -the ongoing set of competitive actions and competitive
responses that occur among firms as they maneuver for an advantageous market
position
The outcomes of competitive rivalry influence the firms: - Answer -§ Ability to develop
and then sustain its competitive advantages
§ Level (average, below average, or above average) of financial return.
Competitive Behavior - Answer -the set of competitive actions and competitive
responses the firm takes to build or defend its competitive advantages and to improve
its market position
Multimarket Competition - Answer -occurs when firms compete against each other in
several product or geographic markets
Competitive dynamics - Answer -The total set of actions and responses taken by all
firms competing within a market.
competitor analysis - Answer -how companies gather and interpret information about
their competitors- to understand
Competitor analysis studies: - Answer -Future objectives, current strategies,
assumptions, capabilities
To complete a competitor analysis, firms study: - Answer -market commonality and
resource similarity
, market commonality and resource similarity shape the firms: - Answer -Awareness,
motivation, ability
Awareness - Answer -refers to the extent to which competitors recognize the degree of
their mutual interdependence
First mover - Answer -a firm that takes an initial competitive action in order to build or
defend its competitive advantages or to improve its market position
First-mover benefits are often critical to a firm's success in industries: - Answer --
experiencing rapid technological developments
-with relatively short product life cycles
In addition to earning above-average returns until its competitors respond to its
successful competitive action, the first mover can gain: - Answer --the loyalty of
customers
-market share
First movers tend to: - Answer -•Be aggressive
•Be willing to experiment with innovation
•Take higher yet reasonable levels of risk
To be a first mover, the firm must have readily available resources to: - Answer --Invest
significantly in R&D
-rapidly and successfully produce and market a stream of innovative products
Organizational slack - Answer -the buffer or cushion provided by actual or obtainable
resources that aren't currently in use and are in excess of the minimum resources
needed to produce a given level of organizational output
-makes it possible for firms to have the ability to be first movers
Second Mover - Answer -a firm that responds to the first mover's competitive action,
typically through imitation
The Second Mover: - Answer --Studies customers' reactions to product innovations
-Tries to find any mistakes the first mover made so that it can avoid them and the
problems they created
-Has the time to develop processes and technologies that:
-Are more efficient than those the first mover used
-Create additional value for consumers
Late Mover - Answer -a firm that responds to a competitive action a significant amount
of time after the first mover's action and the second mover's response
Late Movers: - Answer -- Achieve considerably less success than do first and
second movers
Strategic Action - Answer -a market-based move that involves a significant commitment
of organizational resources and is difficult to implement and reverse
Tactical action - Answer -a market-based move that is taken to fine-tune a strategy; it
involves fewer resources and is relatively easy to implement and reverse
Competitive Action - Answer -a strategic or tactical action the firm takes to build or
defend its competitive advantages or improve its market position
Competitive Response - Answer -a strategic or tactical action the firm takes to counter
the effects of a competitor's competitive action
Competitors - Answer -firms operating in the same market, offering similar products,
and targeting similar customers
Competitive rivalry - Answer -the ongoing set of competitive actions and competitive
responses that occur among firms as they maneuver for an advantageous market
position
The outcomes of competitive rivalry influence the firms: - Answer -§ Ability to develop
and then sustain its competitive advantages
§ Level (average, below average, or above average) of financial return.
Competitive Behavior - Answer -the set of competitive actions and competitive
responses the firm takes to build or defend its competitive advantages and to improve
its market position
Multimarket Competition - Answer -occurs when firms compete against each other in
several product or geographic markets
Competitive dynamics - Answer -The total set of actions and responses taken by all
firms competing within a market.
competitor analysis - Answer -how companies gather and interpret information about
their competitors- to understand
Competitor analysis studies: - Answer -Future objectives, current strategies,
assumptions, capabilities
To complete a competitor analysis, firms study: - Answer -market commonality and
resource similarity
, market commonality and resource similarity shape the firms: - Answer -Awareness,
motivation, ability
Awareness - Answer -refers to the extent to which competitors recognize the degree of
their mutual interdependence
First mover - Answer -a firm that takes an initial competitive action in order to build or
defend its competitive advantages or to improve its market position
First-mover benefits are often critical to a firm's success in industries: - Answer --
experiencing rapid technological developments
-with relatively short product life cycles
In addition to earning above-average returns until its competitors respond to its
successful competitive action, the first mover can gain: - Answer --the loyalty of
customers
-market share
First movers tend to: - Answer -•Be aggressive
•Be willing to experiment with innovation
•Take higher yet reasonable levels of risk
To be a first mover, the firm must have readily available resources to: - Answer --Invest
significantly in R&D
-rapidly and successfully produce and market a stream of innovative products
Organizational slack - Answer -the buffer or cushion provided by actual or obtainable
resources that aren't currently in use and are in excess of the minimum resources
needed to produce a given level of organizational output
-makes it possible for firms to have the ability to be first movers
Second Mover - Answer -a firm that responds to the first mover's competitive action,
typically through imitation
The Second Mover: - Answer --Studies customers' reactions to product innovations
-Tries to find any mistakes the first mover made so that it can avoid them and the
problems they created
-Has the time to develop processes and technologies that:
-Are more efficient than those the first mover used
-Create additional value for consumers
Late Mover - Answer -a firm that responds to a competitive action a significant amount
of time after the first mover's action and the second mover's response
Late Movers: - Answer -- Achieve considerably less success than do first and
second movers
