MAN 4720 Midterm || with Complete Solutions.
The Threat of New Entrants is High When: correct answers - customer switching cost are low
- capital requirements are low
- incumbents do not posses:
* technology
* established brand equity
- new entrants expect that incumbents will not or cannot retaliate
The Power of Suppliers is High When: correct answers - incumbent firms face significant
switching cost when changing suppliers
- suppliers offer products that are differentiated
- there are no readily available substitutes for the products or services that the suppliers offer
- suppliers can credibly threaten to forward-integrate into the industry
The Power of Buyers is High When correct answers - there are a few large buyers
- each buyer purchases large quantitates relative to the size of a single seller
- the industry's products are standardized or undifferentiated commodities
- buyers face little or no switching cost
- buyers can credibly threaten to backward-integrate into the industry
The Threat of Substitutes is High When correct answers - the substitution offers an attractive
price -- performance trade off
- the buyers cost of switching to the substitute is low
The Rivalry Among Existing Competitors is High When correct answers - there are many
competitors int he industry
- the competitors are roughly of equal size
- industry growth is slow, zero, or even negative
- exit barriers are high
- products and services are direct substitutes
Strategy: correct answers a set of goal-directed actions a firm takes to gain and sustain
competitive advantage relative to competitors
AFI framework: correct answers - Analysis: Vision, mission, and values/ External analysis/
Internal analysis
- Formulation: Corporate strategy/ Business strategy / Functional strategy
- Implementation: Structure, culture, and control/ Corporate governance and business ethics
Values: correct answers What commitments do we make and what guardrails do we put in place,
to act both legally and ethically as we pursue our vision and mission
Mission: correct answers How do we accomplish our goals?
Vision: correct answers What do we want to accomplish ultimately?
, ASI Mission statement: correct answers "Empowering excellence through creative strategic
planning, one client at a time" - Ezequiel Frieman
Steps in Industry Analysis: correct answers 1. Define your clients industry
2. Evaluate Relevant External Forces
3. Conduct "Five Forces"Analysis
4. Determine Key Success factors (KSF)
5. Analyze Competitors via Strategic Group Mapping (SGM)
Strategic Group Maps: correct answers - Are a set of firms that follow similar strategies to one
another
- Offer important insights to executives
Three things a strategic map does correct answers 1) emphasizing the members of the firm's
group is helpful because these firms are usually it's closet rivals
2) the strategies pursued by firms within other strategic groups highlight alternative paths to
success
3) the analysis of strategic groups can reveal gaps in the industry that represent untapped
opportunities
What does PESTEL stand for correct answers 1. political 2. economic 3. sociocultural 4.
technological 5. environmental 6. Legal
What is the most important PESTEL force? correct answers none * relative - depends on the
industry
What are the Porter's 5 forces? correct answers 1. competitive rivalry
2. power of buyers
3. power of suppliers
4. threat of substitutes
5. threat of new entrants
What is not one of the 5 forces? correct answers barriers to entry
How to apply the 5 forces correct answers identify the key forces
identify the drivers
Structure Conduct Performance (SCP): (4) correct answers 1. perfect competition
2. monopolistic competition
3. oligopoly
4. monopoly
Perfect Competition correct answers - many small firms
- firms are price takers
- commodity product
The Threat of New Entrants is High When: correct answers - customer switching cost are low
- capital requirements are low
- incumbents do not posses:
* technology
* established brand equity
- new entrants expect that incumbents will not or cannot retaliate
The Power of Suppliers is High When: correct answers - incumbent firms face significant
switching cost when changing suppliers
- suppliers offer products that are differentiated
- there are no readily available substitutes for the products or services that the suppliers offer
- suppliers can credibly threaten to forward-integrate into the industry
The Power of Buyers is High When correct answers - there are a few large buyers
- each buyer purchases large quantitates relative to the size of a single seller
- the industry's products are standardized or undifferentiated commodities
- buyers face little or no switching cost
- buyers can credibly threaten to backward-integrate into the industry
The Threat of Substitutes is High When correct answers - the substitution offers an attractive
price -- performance trade off
- the buyers cost of switching to the substitute is low
The Rivalry Among Existing Competitors is High When correct answers - there are many
competitors int he industry
- the competitors are roughly of equal size
- industry growth is slow, zero, or even negative
- exit barriers are high
- products and services are direct substitutes
Strategy: correct answers a set of goal-directed actions a firm takes to gain and sustain
competitive advantage relative to competitors
AFI framework: correct answers - Analysis: Vision, mission, and values/ External analysis/
Internal analysis
- Formulation: Corporate strategy/ Business strategy / Functional strategy
- Implementation: Structure, culture, and control/ Corporate governance and business ethics
Values: correct answers What commitments do we make and what guardrails do we put in place,
to act both legally and ethically as we pursue our vision and mission
Mission: correct answers How do we accomplish our goals?
Vision: correct answers What do we want to accomplish ultimately?
, ASI Mission statement: correct answers "Empowering excellence through creative strategic
planning, one client at a time" - Ezequiel Frieman
Steps in Industry Analysis: correct answers 1. Define your clients industry
2. Evaluate Relevant External Forces
3. Conduct "Five Forces"Analysis
4. Determine Key Success factors (KSF)
5. Analyze Competitors via Strategic Group Mapping (SGM)
Strategic Group Maps: correct answers - Are a set of firms that follow similar strategies to one
another
- Offer important insights to executives
Three things a strategic map does correct answers 1) emphasizing the members of the firm's
group is helpful because these firms are usually it's closet rivals
2) the strategies pursued by firms within other strategic groups highlight alternative paths to
success
3) the analysis of strategic groups can reveal gaps in the industry that represent untapped
opportunities
What does PESTEL stand for correct answers 1. political 2. economic 3. sociocultural 4.
technological 5. environmental 6. Legal
What is the most important PESTEL force? correct answers none * relative - depends on the
industry
What are the Porter's 5 forces? correct answers 1. competitive rivalry
2. power of buyers
3. power of suppliers
4. threat of substitutes
5. threat of new entrants
What is not one of the 5 forces? correct answers barriers to entry
How to apply the 5 forces correct answers identify the key forces
identify the drivers
Structure Conduct Performance (SCP): (4) correct answers 1. perfect competition
2. monopolistic competition
3. oligopoly
4. monopoly
Perfect Competition correct answers - many small firms
- firms are price takers
- commodity product
