The concept of strategic groups is relevant to industry and competitive analysis because
A)firms in the same strategic groups are rarely close competitors-a firm's closest competitors are usually in distant strategic groups.
B)strategic group maps help identify how each competing firm is positioned and the relationship to its closest competitors.
C)competition grows in intensity as the number and diversity of the strategic groups in an industry increases.
D)the profit potential of firms in the same strategic group is usually very similar.
E)competitive pressures tend to be weaker within strategic groups than across strategic groups.

Question

Quizplus · Accepted Answer

The concept of strategic groups is relevant to industry and competitive analysis because strategic group maps help identify how each competing firm is positioned and the relationship to its closest competitors. This is important in understanding the competitive landscape and developing effective competitive strategies. Option A is incorrect as firms in the same strategic groups are typically close competitors. Option C is incorrect as competition tends to increase as the number and diversity of strategic groups increase. Option D is incorrect as the profit potential of firms in the same strategic group can vary. Option E is incorrect as competitive pressures can be strong within strategic groups.

The Concept of Strategic Groups Is Relevant to Industry and Competitive