SEVI 3013 - UARK EXAM QUESTIONS
AND ANSWERS
In a standard-cycle market - Answer-o Competitive advantages are partially sustainable
but only if the firm can upgrade the quality of its capabilities continuously.
o The capabilities and core competencies in which firms base their competitive
advantages are less specialized.
o Imitation is faster and less costly than in slow-cycle markets.
o Imitation is slower and more expensive than in fast-cycle markets.
o Both incremental and radical innovations are critical to firms' efforts to achieve
strategic competitiveness.
Firms imitate competitive actions and responses in standard-cycle markets to: -
Answer--Seek large market shares
-Gain customer loyalty through brand names
-control a firms operations carefully
The competition for market share is intense in standard-cycle markets because of: -
Answer--Large Volumes
-The size of mass markets
-The need to develop scale economies
Corporate-Level Strategy - Answer-specifies actions a firm takes to gain a competitive
advantage by selecting and managing a group of different businesses competing in
different product markets
Ability - Answer-refers to the quality of resources available to the firm to attack and
respond
Resource Dissimilarity - Answer-the more significant the difference between resources
owned by the acting firm and those against whom it has taken action, the longer is the
delay by the firm with a resource disadvantage
-influences competitive actions and responses firms choose to take
Cost - Answer-the amount of money a firm pays to deliver products or services to the
customer
Price - Answer-what the customer pays to obtain the product or service
Competitive Dynamics differ in: - Answer-slow, fast, and standard cycle markets
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
- Require considerable time to understand how to create at least as much customer
value as that
offered by the first and second movers' products
--Thus, typically only earn average returns
(LIKELIHOOD OF ATTACK) Three more specific factors affect the likelihood a
competitor will take competitive actions: - Answer-first mover benefits, organizational
size, quality
AND ANSWERS
In a standard-cycle market - Answer-o Competitive advantages are partially sustainable
but only if the firm can upgrade the quality of its capabilities continuously.
o The capabilities and core competencies in which firms base their competitive
advantages are less specialized.
o Imitation is faster and less costly than in slow-cycle markets.
o Imitation is slower and more expensive than in fast-cycle markets.
o Both incremental and radical innovations are critical to firms' efforts to achieve
strategic competitiveness.
Firms imitate competitive actions and responses in standard-cycle markets to: -
Answer--Seek large market shares
-Gain customer loyalty through brand names
-control a firms operations carefully
The competition for market share is intense in standard-cycle markets because of: -
Answer--Large Volumes
-The size of mass markets
-The need to develop scale economies
Corporate-Level Strategy - Answer-specifies actions a firm takes to gain a competitive
advantage by selecting and managing a group of different businesses competing in
different product markets
Ability - Answer-refers to the quality of resources available to the firm to attack and
respond
Resource Dissimilarity - Answer-the more significant the difference between resources
owned by the acting firm and those against whom it has taken action, the longer is the
delay by the firm with a resource disadvantage
-influences competitive actions and responses firms choose to take
Cost - Answer-the amount of money a firm pays to deliver products or services to the
customer
Price - Answer-what the customer pays to obtain the product or service
Competitive Dynamics differ in: - Answer-slow, fast, and standard cycle markets
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
- Require considerable time to understand how to create at least as much customer
value as that
offered by the first and second movers' products
--Thus, typically only earn average returns
(LIKELIHOOD OF ATTACK) Three more specific factors affect the likelihood a
competitor will take competitive actions: - Answer-first mover benefits, organizational
size, quality
