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Exam 5: Business-Level Strategy: Creating and Sustaining Competitive Advantages

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Question 71

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The three generic strategies that Michael Porter believes a firm can use to overcome the five forces and achieve competitive advantage include overall price leadership.

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Question 72

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Mass customization permits companies to manufacture unique products in relatively _________ quantities at ______ costs.

A) large; higher
B) large; lower
C) small; higher
D) small; lower

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Question 73

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Integration of information systems, logistics, and transportation at Walmart helps it to drive down costs and provide outstanding product selection. This serves to erect low entry barriers to potential competitors.

With reverse positioning, a strategy to be used during the mature stage of the industry life cycle, a product escapes its category by deliberately associating with a different one.

Which of the following is not a reason for the successful turnaround HSN experienced by 2014 under CEO Mindy Grossman?

In the textbook example of Atlas Door, it integrated many value-chain activities with the firm in order to support its just-in-time strategy. This, however, did not provide sustainable competitive advantage.

Discount retailers like Walmart and dollar stores are prime substitutes for Aldi, because Aldi focuses on minimizing costs across its operations.

The market life cycle should be used for short run forecasting, because it provides a conceptual framework for understanding what changes typically occur over the life of an industry.

HSN CEO Mindy Grossman tailored the company offerings to meet the changing needs of her customer base in her quest to turnaround the company.

By separating the value of the actual flight from the services associated with flying, airlines have greatly expanded the __________ associated with flying.

Which of these statements regarding the industry life cycle is true?

By separating the value of the actual flight from the services associated with flying, airlines have greatly expanded the profit pool associated with flying. This combines the advantages of integrating overall low cost and differentiation strategies.

In the textbook example of Atlas Door, the threat of new rivals who could bring new technologies and processes to a similar business model diminishes the sustainability of the Atlas Door just-in-time model.

Firms can underestimate the challenges and expenses associated with coordinating value-creating activities in the extended value chain. This is an advantage of integrated overall cost leadership and differentiation.

One aspect of using a cost leadership strategy is that experience effects may lead to lower costs. Experience effects are achieved by

A manufacturing business pursuing cost leadership is likely to

A successful differentiation strategy increases rivalry since buyers become more price-sensitive.

The most likely time to pursue a harvest strategy is in a situation of

The experience curve concept suggests that production costs tend to decrease as production increases.

Atlas Door tightly controlled logistics so that it always shipped only fully complete orders to construction sites. In regards to the five forces model, which of the following is a reason this might give them competitive advantage?