WPC 480 Ch1 UPDATED ACTUAL
Questions and CORRECT Answers
Strategic Management - CORRECT ANSWER - an integrative management field that
combines analysis, formulation, and implementation in the quest for competitive advantage.
Strategy - CORRECT ANSWER - The set of goal-directed actions a firm takes to gain and
sustain superior performance relative to competitors.
Good Strategy - CORRECT ANSWER - 1. A diagnosis of the competitive challenge
(accomplished through strategy analysis of the firm's external and internal environments);
2. A guiding policy to address the competitive challenge (accomplished through strategy
formulation, resulting in the firm's corporate, business, and functional strategies);
3. A set of coherent actions to implement the firm's guiding policy (accomplished through
strategy implementation).
Competitive advantage - CORRECT ANSWER - Superior performance relative to other
competitors in the same industry or the industry average.
Sustainable competitive advantage - CORRECT ANSWER - Outperforming competitors
or the industry average over a prolonged period of time.
Competitive disadvantage - CORRECT ANSWER - Underperforming relative to other
competitors in the same industry or the industry average.
Competitive parity - CORRECT ANSWER - Performance of two or more firms at the
same level.
Industry effects - CORRECT ANSWER - Firm performance attributed to the structure of
industry in which the firm competes.
Questions and CORRECT Answers
Strategic Management - CORRECT ANSWER - an integrative management field that
combines analysis, formulation, and implementation in the quest for competitive advantage.
Strategy - CORRECT ANSWER - The set of goal-directed actions a firm takes to gain and
sustain superior performance relative to competitors.
Good Strategy - CORRECT ANSWER - 1. A diagnosis of the competitive challenge
(accomplished through strategy analysis of the firm's external and internal environments);
2. A guiding policy to address the competitive challenge (accomplished through strategy
formulation, resulting in the firm's corporate, business, and functional strategies);
3. A set of coherent actions to implement the firm's guiding policy (accomplished through
strategy implementation).
Competitive advantage - CORRECT ANSWER - Superior performance relative to other
competitors in the same industry or the industry average.
Sustainable competitive advantage - CORRECT ANSWER - Outperforming competitors
or the industry average over a prolonged period of time.
Competitive disadvantage - CORRECT ANSWER - Underperforming relative to other
competitors in the same industry or the industry average.
Competitive parity - CORRECT ANSWER - Performance of two or more firms at the
same level.
Industry effects - CORRECT ANSWER - Firm performance attributed to the structure of
industry in which the firm competes.
