Deck 6: Step 3: The Strategyaction Match

Question 1

Michael Porter believes strategic advantage can only take three forms:

A) cost, distribution and access
B) distribution, price and utility
C) focus, differentiation, product
D) cost, focus and differentiation

Answer 1

D

Question 2

When an organization specializes in a particular service line this is a _______ advantage.

A) cost
B) differentiation
C) focus
D) utility

Answer 2

C

Question 3

An after hours clinic that is open also on weekends as well as offering SKYPE consults is attempting to provide a ________advantage:

A) differentiation
B) value
C) cost
D) service

Answer 3

A

Question 4

When a delivery system is more efficient than the current standard that system has which form of a competitive advantage:

A) distribution
B) cost
C) price
D) delivery

Question 5

The key to a successful differentiation advantage is:

A) having a market competitive price
B) having a unique product
C) having a unique selling proposition
D) creating a different service guarantee

Question 6

Strategy has been defined as not so much beating the competition, but more so …

A) Providing a product or service at the most competitive price
B) Delivering the most unique service
C) Meeting the needs of the customer
D) Offering a value driven product in as many locations as possible

Question 7

The Boston Consulting Group Matrix evaluates the portfolio of products or services on two dimensions.

A) market share and growth potential
B) sales growth and market growth
C) market growth and margin
D) margin growth and expense ratio

Question 8

A service that has high growth potential but low share in the BCG matrix would be considered

A) Star
B) Dog
C) cash cow
D) problem child

Question 9

A cash cow is a service which has:

A) low share, high growth potential
B) high share, high growth potential
C) high share, low growth potential
D) low share, low growth potential

Question 10

Services which are placed in the quadrant of being a cash cow in terms of resource allocation would tend to:

A) get more cash infusion to get back on the growth curve
B) have the dollars they generate redirected back into these services for continued growth
C) have their dollars directed into other services
D) be eliminated

Question 11

In the General Electric-McKinsey model, management examines services in terms of two dimensions:

A) industry strength and business growth
B) business attractiveness and industry growth
C) industry attractiveness and business strength
D) industry growth and business competitiveness

Question 12

Compared to the BCG matrix the General Electric model makes more explicit comparisons between, external opportunities and:

A) internal capabilities
B) competitive intensity
C) growth opportunities
D) capital requirements

Question 13

Both the BCG matric and the General Electric model are limiting for health care executives in that they do not:

A) are not useful in making decisions about new investment opportunities
B) do not offer ways to solve problems
C) do not help in making decisions about new opportunities
D) these are all problems with these two frameworks

Question 14

The safest strategy for growth in the Ansoff Product-Growth Matrix is:

A) diversification
B) market development
C) service development
D) market penetration

Question 15

In the Ansoff Product Growth-Market Strategy Matrix, the most extreme growth option for a business would be:

A) market penetration
B) service development
C) diversification
D) market penetration

Question 16

Which of the following is not a premise upon which the product life cycle concept is not based?

A) all products and services have a finite life
B) products and services pass through four distinct phases
C) profits rise and fall at different opportunities at each stage
D) margins remain relatively constant through each stage although market share changes

Question 17

In the introduction stage of the life cycle, sales and revenue are slow. A major objective is to:

A) generate primary demand
B) open multiple locations to encourage many buyers
C) coupon in order to get interest
D) do all of the above as quickly as possible before competitors enter

Question 18

The objective of generating selective demand occurs in which stage of the product life cycle?

A) introduction
B) growth
C) maturity
D) decline

Question 19

The strategy/ action match matches the:

A) Boston consulting group to the General electric model cells
B) the MAC Group Positioning matrix to the field positioning model
C) the organization's life cycle to the marketplace life cycle
D) the power of buyers and suppliers to the barriers to entry

Question 20

Empirical results have shown that in terms of the life cycle, a business' likelihood of survival:

A) is unrelated to the stage of the life cycle
B) depends on when the firm enters the life cycle
C) is a function of the size of the firm and when it enters
D) is a function of the industry

Question 21

A "Go-for-It" strategy is suggested when:

A) there is niche possibilities that are available
B) the firm is large
C) the service is first being introduced and the overall market demand is just beginning
D) "a" and "b"

Question 22

The key to success in the "Go-for-It "strategy is to obtain:

A) strong marketplace recognition
B) sufficient distribution
C) a low price point
D) efficient production or delivery systems

Question 23

Which of the following reasons is not used for setting a high price in the "Go-for-It" strategy?

A) spigot on demand
B) image
C) hedge against lack of knowledge of cost curves
D) all are correct

Question 24

A low price/low promotion strategy in the "Go-for-It" approach is often used for which type of services:

A) primary care
B) specialty services
C) services mandated to be offered by regulatory agencies
D) elective procedures

Question 25

Distribution is often intensive in which strategy?

A) Go-for-it
B) Differentiation
C) Maintenance
D) Drop

Question 26

When an organization is in the introduction stage but the marketplace is in the growth stage, the strategy required is:

A) drop
B) maintenance
C) differentiation
D) go-for-it

Question 27

The most common way for health care services to achieve differentiation is through:

A) product
B) price
C) promotion
D) distribution

Question 28

When the marketplace is mature and the service is in the introductory or growth stage of the life cycle, an organization may adopt which strategy?

A) Go-for-it
B) necessity
C) maintenance
D) drop

Question 29

In the necessity strategy, the service or product offering must be:

A) at least equal to the level of the competition
B) priced dramatically lower than the completion
C) must be significantly higher in quality than the competition
D) a niche product or service

Question 30

Promotion is particularly difficult under which strategy?

A) Go-for-it
B) Differentiation
C) Niche
D) Necessity

Question 31

In the necessity strategy, distribution:

A) must be significantly better than the competition
B) have a niche that provides some competitive advantage
C) match the competition as its role is small.
D) should be scaled back to minimum levels.

Question 32

When both the organization and the marketplace are in the mature stage, the appropriate strategy is:

A) niche
B) maintenance
C) harvest
D) maturation

Question 33

The leader in the maintenance strategy stage can follow one of two approaches:

A) segment and fortify or withdraw
B) withdraw or innovate
C) segment and fortify or innovate
D) innovate or reposition

Question 34

In the maintenance strategy, price is used as a:

A) defensive position
B) a means of differentiation
C) a way to innovate
D) a means to segment the market

Question 35

When overall market demand is decreasing, but organizational life cycle is increasing, this strategy is:

A) differentiation
B) go-for-it
C) niche
D) harvest

Question 36

Declining services have been found to:

A) Be able to still have viable niches
B) offer segments that can be price insensitive
C) cross-subsidize other services
D) consume a disproportionate share of management time and financial resources

Question 37

Strategic advantage can take only two forms: cost or product.

Question 38

A delivery system that is more efficient has a differentiation advantage.

Question 39

Having a unique selling proposition over time can often be done through better technology.

Question 40

Focusing on a specific target market can be a form of a strategic advantage.

Question 41

Meeting the needs of the customer has been defined as the basis of strategy as opposed to beating the competition.

Question 42

The Boston Consulting Group matrix evaluates each service within the hospital on an individual share basis.

Question 43

The two dimensions of the BCG matrix are share and growth.

Question 44

The foundation of the Boston Consulting Group matrix is to view the hospital's services as a portfolio of services.

Question 45

Products or services with high market share but low growth potential in the BCG matrix are classified as "Cash cows."

Question 46

Problem children are services in the BCG matrix that have high market share but low growth potential.

Question 47

Dogs are services in the BCG matrix with low share and low growth potential.

Question 48

It is important when a service is identified as a 'Dog' to eliminate it from the hospital's service offering in every case as there is little share and no growth potential.

Question 49

In health care as one evaluates the decision to drop a service based on its placement in the BCG matrix, it is essential to consider the cross subsidization value of the service to other services in the portfolio.

Question 50

The BCG matrix is a great prescriptive strategic planning tool.

Question 51

The General Electric-Mckinsey Model evaluates services on market share and industry attractiveness.

Question 52

An advantage of the GE model for evaluating services is it makes explicit comparisons between external opportunities and internal capabilities or business strengths.

Question 53

The Ansoff Product-market matrix identifies the strongest markets for an organization to enter and exit

Question 54

The Ansoff model examines services on the dimensions of high cost and high revenue.

Question 55

Service development in the Ansoff model is the growth opportunity for new services entering existing markets.

Question 56

Diversification is taking existing services into existing markets.

Question 57

The strategy action match is based on the concept of the product and marketplace life cycle.

Question 58

A difficult aspect of the product life cycle is that not every product or service has a defined, limited life cycle.

Question 59

From an industry or marketplace perspective, the number of entrants tends to peak then decline over the life cycle of a product.

Question 60

In the Introductory stage of the life cycle, the promotional challenge is to generate selective demand for the product or service.

Question 61

The size of the total market tends to expand in the growth phase of the life cycle.

Question 62

In the mature phase of the Life Cycle, there is no new growth in unit sales or volume.

Question 63

In health care, reimbursement as an externality can move a service or product (technology) that is growing quickly to the decline phase of the life cycle..

Question 64

The concept of marketplace life cycles is useful for entire product categories

Question 65

The Patient centered medical home life cycle will most likely have an extended introductory period to its life cycle since it will be necessary to educate buyers (families) to the benefits of this concept and to how they will interact with the clinical team of providers.

Question 66

The strategy action match is designed to match the organization's life cycle with the market share goals of the organization.

Question 67

The strategy/action match is essentially an overlapping of the organization's life cycle and the marketplace's life cycle.

Question 68

An organization's life cycle can never logically be in a different place than the marketplace's life cycle.

Question 69

The probability of a business' survival differs significantly across the stages of the life cycle.

Question 70

Survival rates of a firm have no correlation to the level of competitive intensity in the marketplace.

Question 71

A "Go-for-It" strategy is warranted when the organization is in the introductory stage of the life cycle and the marketplace is in the same stage.

Question 72

A key objective in the 'Go-For-It" strategy is establishing a premium price for the initial buyers of the service.

Question 73

In the "Go-for-It: strategy product quality is a central concern as well as a limited amount of service or product variations.

Question 74

A major limitation to utilizing a high price in the "Go-for-It "strategy is that it is the quickest way to encourage competitive entry.

Question 75

In the "Go for it" strategy the less sure the organization is of its ability to meet demand relative to its capacity constraints, the better it is to set a lower initial price.

Question 76

A "premium" approach in the "Go-for-It" strategy is very appropriate when buyers are price insensitive.

Question 77

The best way for an organization to try to meet the objective of market share in the "Go for it" stage is with a premium approach.

Question 78

When regulatory agencies require a service to be offered or it is a necessary service to be offered as part of a bundled service, a low price, low promotion strategy is often the common strategy employed.

Question 79

In the "Go-for-It" stage it is important to expand distribution access as rapidly as possible of a service before competitors enter.

Question 80

The differentiation strategy can be used in two points in the strategy action match:
introduction /growth and growth/growth.