Deck 7: Business-Level Strategy

Question 1

In a large company, each business unit typically faces different challenges

Answer 1

True
Customer requirements, competitive circumstances, technology and so on will almost certainly vary across businesses

Question 2

Competitive strategy must be either low cost or differentiation

Answer 2

False
A false dichotomy, as discussed in Chapter 7

Question 3

Performance of a corporate parent often influences business unit strategy

Answer 3

True
Poor parental performance will limit business unit strategy

Question 4

A business unit's vision, values and mission are quantitative and directional

Question 5

Business unit objectives should be measurable and time-specific

Question 6

The PESTLE model should be applied mechanically to all businesses

Question 7

Technology and deregulation have narrowed the scope of competition

Question 8

Many factors can influence the distribution of value in a value chain

Question 9

Customers buy on the difference between cost and the economic value of a product

Question 10

Managers should understand the drivers of both cost and value enhancement

Question 11

If all costs are variable, economies of scale become critically important

Question 12

Creativity is unimportant in strategy development, analysis is the key

Question 13

Vertical integration is motivated by the perceived benefits of common ownership

Question 14

Outsourcing is one factor contributing to the increased importance of the service sector

Question 15

Setting transfer prices is often a source of political conflict in vertically integrated firms

Question 16

Employee career paths may improve as a result of outsourcing decisions

Question 17

Heterogeneous marketplace needs and wants complicate operations management

Question 18

Differentiation and low cost are not necessarily in conflict

Question 19

Low costs need not translate into low prices

Question 20

Market segmentation and targeting are marketing issues unimportant for business unit strategy