BUSINESS STRATEGY GROWTH
STRATEGIES AND EXPANSION MODELS
PRACTICE TEST 2026
◉ Strategy as Planned Emergence
Answer: *strategies cannot be planned; they emerge from a set of
actions or behaviors consistent over time
*example: IKEA
◉ Strategy misconceptions
Answer: 1. hope is NOT a strategy
2. strategy is NOT a secret
3. goal is NOT a strategy
4. strategy is NOT operations improvement
◉ Porter's Generic Positioning Strategies
Answer: *Cost Leadership (broad)
*Focus Cost Leadership (narrow/niche)
*Differentiation (broad)
*Focus Differentiation (narrow/niche)
,◉ McDonald's industries...
Answer: *fast food
*franchising
*wholesale distribution
*real estate
◉ Strategic group
Answer: very similar business models, rivalry more intense
◉ More likely to drive sustainable competitive advantage...
Answer: INTANGIBLE ASSETS
◉ Concentration ratio
Answer: measure of aggregate market shares of the top competitors
in an industry
◉ Social Media PESTEL
Answer: Political: increasing scrutiny b/c free speech & fake news
Economic: rapid growth, primary income from ads
Socio-cultural: divisive, bombarded w/ ads
Technological: new technologies, regulatory scrutiny (ie, facial
recognition)
, Ecological: n/a
Legal: increasing regulation & legal hearings
◉ Productivity Frontier
Answer: best possible strategic positions that a firm can take
relating to value & low cost
*concave curve
◉ Index levels
Answer: (market share**2)
*Concentrated: 2500+
*Moderately concentration: 1500-2500
◉ Influence costs
Answer: source of costs for both related & unrelated diversification
◉ PESTEL: Political
Answer: *subsidies
*favorable tax policies
*pricing controls
*regulated access
*grants
STRATEGIES AND EXPANSION MODELS
PRACTICE TEST 2026
◉ Strategy as Planned Emergence
Answer: *strategies cannot be planned; they emerge from a set of
actions or behaviors consistent over time
*example: IKEA
◉ Strategy misconceptions
Answer: 1. hope is NOT a strategy
2. strategy is NOT a secret
3. goal is NOT a strategy
4. strategy is NOT operations improvement
◉ Porter's Generic Positioning Strategies
Answer: *Cost Leadership (broad)
*Focus Cost Leadership (narrow/niche)
*Differentiation (broad)
*Focus Differentiation (narrow/niche)
,◉ McDonald's industries...
Answer: *fast food
*franchising
*wholesale distribution
*real estate
◉ Strategic group
Answer: very similar business models, rivalry more intense
◉ More likely to drive sustainable competitive advantage...
Answer: INTANGIBLE ASSETS
◉ Concentration ratio
Answer: measure of aggregate market shares of the top competitors
in an industry
◉ Social Media PESTEL
Answer: Political: increasing scrutiny b/c free speech & fake news
Economic: rapid growth, primary income from ads
Socio-cultural: divisive, bombarded w/ ads
Technological: new technologies, regulatory scrutiny (ie, facial
recognition)
, Ecological: n/a
Legal: increasing regulation & legal hearings
◉ Productivity Frontier
Answer: best possible strategic positions that a firm can take
relating to value & low cost
*concave curve
◉ Index levels
Answer: (market share**2)
*Concentrated: 2500+
*Moderately concentration: 1500-2500
◉ Influence costs
Answer: source of costs for both related & unrelated diversification
◉ PESTEL: Political
Answer: *subsidies
*favorable tax policies
*pricing controls
*regulated access
*grants
