According to Michael Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), there are two central questions that underlie the choice of competitive strategy. One is “What are the determinants of relative competitive position within an industry?” What is his second central question?
Which generic strategy fits with the competitive situation found in a particular environment?
When is it appropriate to seek ‘first-mover advantage’ in an industry?
How attractive is the industry for long-term profitability (and what factors determine it)?
What are the determinants of successful generic strategies?
According to Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), what is the fundamental determinant of a firm’s profitability?
Bargaining power of buyers
Industry attractiveness
Threat of new entrants
Competitive rivalry.
According to Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), which of the following statements is true?
In any industry, the framework reduces the odds of a competitor discovering a desirable strategic innovation
In any particular industry, not all the five forces are equally important
In any particular industry, the five forces framework eliminates the need for creativity by finding new ways of competing in an industry
In any industry, all the five forces are equally important.
According to Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), there are two central questions that underlie the choice of competitive strategy. One of these is “what are the determinants of relative competitive position within an industry?” According to Porter, what do firms have to do in order to improve their competitive position?
Adopt one of the three generic strategies
Adopt a process of ‘muddling through’
Ensure the firm is ‘stuck in the middle’
Try and affect industry structure, so that the impact of the five forces is minimized.
Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1) suggests that there are three generic strategies. If a firm has successfully pursued cost leadership and fails to sustain it, what does Porter say will be the consequences?
The bases for cost leadership will be eroded
Firms focusing on differentiation will achieve even greater differentiation
Competitors will imitate the firm’s strategy
The target market will become structurally unattractive.
The view that successful organizations are externally orientated and market driven is known as the outside-in perspective. Which author(s) is/are representative of this view?
Miller, Eisenstat and Foote
Porter
Mason and Mitroff
Barney.
According to Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), what are two central factors that underlie the choice of competitive strategy?
The competitive position and capital requirements
The organizational internal strengths and environmental opportunities
The product differences and competitors concentration
The attractiveness of industry for long-term profitability and competitive position.
According to Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), what is the ultimate aim of competitive strategy?
To change the rules of competition, that determine an industry’s attractiveness, in the company’s favor
To stabilize the industry structure
To achieve the company’s growth through economies of scale and scope
To overpower other competitors in the industry and gain the dominant position.
Porter’s (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1) arguments about competitive forces encourage:
Trying to find and secure ‘strong suppliers’
Correctly positioning the organization within its industry
A ‘game theory’ approach to strategy, which emphasizes one winner and many losers
Trying to find and secure ‘strong buyers’.
According to Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), which of the following is a way of coping with competitive forces?
Invest more in creating a strong strategic intent
Influence the balance among the competitive forces to improve the company’s position
Establish a greater degree of congruence within the firm’s operating core
Seek greater consistency between internal and external stakeholders.
Porter’s (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1) concept of purposefully positioning within an industry is similar to:
Day’s view of capabilities of market driven organizations
Finding the best way to structure the organization
Finding a market niche
Improving the value chain.
According to Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), when does the power of buyers increase?
The threat of entry is high
The industry’s product is important to the buyers’ products or services
Competitors are few
The threat of substitutes is high.
According to Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), what are two basic types of competitive advantage that a company can possess?
Low cost OR differentiation
Low cost AND differentiation
Product development OR market development
Product development AND market development.
According to Porter (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1), what is a differentiation strategy based on?
The product itself; it adopts the perspective of the customer
The market served; it adopts the perspective of the producer
The industry structure; it adopts the perspective of the competitor
The specific industry segment; it adopts the perspective of a new entrant.
Porter’s (‘Competitive strategy’, in De Wit & Meyer, 2010, Reading 5.1) structural analysis of industries supports:
The ideas about organizational dynamics, elaborated in the continuous change perspective
The ideas about organizational purpose, emphasized in the stakeholder values perspective
The ideas about corporate governance, elaborated in the principal-agent theory
The ideas about organizational purpose, emphasized in the shareholder value perspective.