BSG Exam 3
Strategic Offensive - ✔✔ correct answer called for when a company spots opportunities to gain
profitable market share at its rival's expense or when a company has no choice but to try to whittle
away at a strong rival's competitive advantage
Blue Ocean Strategy - ✔✔ correct answer offers growth in revenues and profits by discovering or
inventing new industry segments that create altogether new demand
Offensive Strategies - ✔✔ correct answer sometimes a company's best strategic option is to seize the
initiative, go on the attack, and launch a strategic offensive to improve its market position
Principal Offensive Strategy Options - ✔✔ correct answer 1. Offer an equally good or better product
at a lower price.
2. Leapfrog competitors by being first to market with next-generation products.
3. Pursue continuous product innovation to draw sales and market share away from less innovative
rivals.
4. Pursue disruptive product innovations to create new markets.
5. Adopt and improve on the good ideas of other companies (rivals or otherwise).
6. Use hit-and-run or guerrilla marketing tactics to grab market share from complacent or distracted
rivals.
7. Launch a preemptive strike to secure an industry's limited resources or capture a rare opportunity
Defensive Strategies - ✔✔ correct answer Can help protect a competitive advantage but rarely are
the basis for creating one
First Mover Advantages - ✔✔ correct answer If market responds well to its initial move, the pioneer
will benefit from a monopoly position that enables it to recover its investment costs and make an
attractive profit
First Mover Disadvantages - ✔✔ correct answer 1. When costs are high relative to the benefits
accrued and imitative followers can achieve similar benefits with far lower costs.
2. When an innovator's products are somewhat primitive and do not live up to a buyer expectations
3. When rapid market evolution gives second movers the opening to leapfrog a first mover's products
with more attractive next-version products
4. When market uncertainties make it difficult to ascertain what will eventually succeed, allowing
late movers to wait until these needs are clarified
, BSG Exam 3
5. When customer loyalty to the pioneer is low and first mover's skills, know-how, what actions are
easily copied or even surpassed
Scope of the Firm - ✔✔ correct answer refers to the range of activities that the form performs
internally, the breadth of its product and service offerings, the extent of its geographic market
presence, and its mix of businesses.
Horizontal Scope - ✔✔ correct answer the range of product and service segments that a firm serves
within its focal market
Vertical Scope - ✔✔ correct answer the extent to which a firm's internal activities encompass the
range of activities that make up and industry's entire value chain system, from raw-material
production to final sales and service activities
Threat Analysis - ✔✔ correct answer the awareness of close competitors and the kinds of actions
they make
Signaling - ✔✔ correct answer the goal is to dissuade challengers from attacking at all or to divert
them to less threatening options
Organizational Structure - ✔✔ correct answer formalized patterns of interaction that link tasks and
people, typically changes as the size and complexity of the company increases, a function of
company growth and diversification strategies
Simple Organizational Structure - ✔✔ correct answer the owner makes decisions and controls
activities, most common form in which staff is an extension of the top executive
Functional Organizational Structure - ✔✔ correct answer the major functions of the firm are grouped
internally, it recognizes that the owner is not skilled in all aspects, so owners hire specialists in
various functional areas
Multidivisional Structure - ✔✔ correct answer a decentralized structure consisting of a set of
operating divisions organized along business, product, customer group, or geographic lines and
central corporate headquarters that allocates resources, provides support functions, and monitors
divisional activities
Strategic Offensive - ✔✔ correct answer called for when a company spots opportunities to gain
profitable market share at its rival's expense or when a company has no choice but to try to whittle
away at a strong rival's competitive advantage
Blue Ocean Strategy - ✔✔ correct answer offers growth in revenues and profits by discovering or
inventing new industry segments that create altogether new demand
Offensive Strategies - ✔✔ correct answer sometimes a company's best strategic option is to seize the
initiative, go on the attack, and launch a strategic offensive to improve its market position
Principal Offensive Strategy Options - ✔✔ correct answer 1. Offer an equally good or better product
at a lower price.
2. Leapfrog competitors by being first to market with next-generation products.
3. Pursue continuous product innovation to draw sales and market share away from less innovative
rivals.
4. Pursue disruptive product innovations to create new markets.
5. Adopt and improve on the good ideas of other companies (rivals or otherwise).
6. Use hit-and-run or guerrilla marketing tactics to grab market share from complacent or distracted
rivals.
7. Launch a preemptive strike to secure an industry's limited resources or capture a rare opportunity
Defensive Strategies - ✔✔ correct answer Can help protect a competitive advantage but rarely are
the basis for creating one
First Mover Advantages - ✔✔ correct answer If market responds well to its initial move, the pioneer
will benefit from a monopoly position that enables it to recover its investment costs and make an
attractive profit
First Mover Disadvantages - ✔✔ correct answer 1. When costs are high relative to the benefits
accrued and imitative followers can achieve similar benefits with far lower costs.
2. When an innovator's products are somewhat primitive and do not live up to a buyer expectations
3. When rapid market evolution gives second movers the opening to leapfrog a first mover's products
with more attractive next-version products
4. When market uncertainties make it difficult to ascertain what will eventually succeed, allowing
late movers to wait until these needs are clarified
, BSG Exam 3
5. When customer loyalty to the pioneer is low and first mover's skills, know-how, what actions are
easily copied or even surpassed
Scope of the Firm - ✔✔ correct answer refers to the range of activities that the form performs
internally, the breadth of its product and service offerings, the extent of its geographic market
presence, and its mix of businesses.
Horizontal Scope - ✔✔ correct answer the range of product and service segments that a firm serves
within its focal market
Vertical Scope - ✔✔ correct answer the extent to which a firm's internal activities encompass the
range of activities that make up and industry's entire value chain system, from raw-material
production to final sales and service activities
Threat Analysis - ✔✔ correct answer the awareness of close competitors and the kinds of actions
they make
Signaling - ✔✔ correct answer the goal is to dissuade challengers from attacking at all or to divert
them to less threatening options
Organizational Structure - ✔✔ correct answer formalized patterns of interaction that link tasks and
people, typically changes as the size and complexity of the company increases, a function of
company growth and diversification strategies
Simple Organizational Structure - ✔✔ correct answer the owner makes decisions and controls
activities, most common form in which staff is an extension of the top executive
Functional Organizational Structure - ✔✔ correct answer the major functions of the firm are grouped
internally, it recognizes that the owner is not skilled in all aspects, so owners hire specialists in
various functional areas
Multidivisional Structure - ✔✔ correct answer a decentralized structure consisting of a set of
operating divisions organized along business, product, customer group, or geographic lines and
central corporate headquarters that allocates resources, provides support functions, and monitors
divisional activities
