Question 1

While doing industry analysis on five forces,which of the following is a force that shapes an organization's profit potential?

Accepted Answer

The bargaining power of suppliers is one of the five forces that shape an organization's profit potential. This force determines how much power suppliers have over the prices and quality of materials or services they provide to the organization. It can affect the organization's profitability by either allowing it to negotiate favorable prices or by driving up costs and reducing profit margins. The other options, such as previous and current year profit figures, and research and development, are not considered forces that shape an organization's profit potential in the context of the five forces analysis.

Question 2

Which of the following statements best define strategy?

Accepted Answer

Strategy refers to how an organization creates value for its customers while differentiating itself from its competitors. It involves making choices that enable the organization to achieve its goals and objectives, and to succeed in the long term. Option A correctly defines the concept of strategy. Option B describes cost leadership, option C describes differentiation, and option D describes employee motivation, which are not the complete definitions of strategy.

Question 3

Higher selling prices,rather than unique products or services,provide a competitive advantage for the cost leader companies.

Accepted Answer

Cost leader companies compete on the basis of offering products or services at lower prices than their competitors. Therefore, unique products or services may not necessarily provide a competitive advantage for cost leader companies.

Question 4

Terbium Corporation manufactures water toys.It plans to grow by producing high-quality water toys that are delivered in a timely manner.There are a number of other manufacturers who produce similar water toys.Terbium believes that continuously improving its manufacturing processes and reengineering processes to downsize and eliminate excess capacity are critical to implementing its strategy.Out of the two basic strategies,Terbium's strategy is ________.

Accepted Answer

Terbium Corporation's focus on improving manufacturing processes and eliminating excess capacity aligns with a cost leadership strategy, which aims to become the lowest-cost producer in the industry.

Question 5

________ is the fundamental rethinking and redesign of business processes to achieve improvements in critical measures of performance such as cost,quality,service,speed,and customer satisfaction.

Accepted Answer

Reengineering involves the fundamental rethinking and redesign of business processes to achieve improvements in critical measures of performance such as cost, quality, service, speed, and customer satisfaction. This approach looks beyond improving existing processes and strives to create completely new and better ways of performing work.

Question 6

In general,profit potential of an organization decreases with ________.

Accepted Answer

Greater competition within an industry and the presence of stronger potential entrants both contribute to reducing the profit potential of an organization. High competition pressures margins and prices, while strong potential entrants threaten market share and can intensify competition further.

Question 7

One of the five forces of industry analysis is understand the bargaining power of customers.

Accepted Answer

Understanding the bargaining power of customers is one of the five forces of industry analysis in Porter's Five Forces model. This force considers the degree to which customers can influence pricing and other aspects of the industry, as well as the availability of alternative options for customers.

Question 8

Bosely Corporation is reviewing its business strategy.The first step for Bosely is to perform an industry analysis.You have been hired to help the company go through the strategy formulation process.
Required:
To perform the industry analysis,what areas should Bosely focus on and give at least one example of how Bosely can effectively deal with each area.

Accepted Answer

The answer of Bosely Corporation is reviewing its business strategy.The...

Question 9

The cost leadership strategy is best for a company if the engineering staff is more skilled at creatively designing new products than at making process improvements.

Accepted Answer

The cost leadership strategy is best for a company if the engineering staff is more skilled at making process improvements than at creatively designing new products.

Question 10

The cost leadership strategy is for products and services that are similar to competitor's products and services.

Accepted Answer

The cost leadership strategy involves offering products or services at lower costs than competitors, which is applicable to similar products and services in the market.

Question 11

An organization that is using the product differentiation approach would ________.

Accepted Answer

Product differentiation approach focuses on distinguishing a product or service from others in the market. This can be achieved through innovative research and development, unique features, superior quality, branding, etc. Therefore, option B is the correct answer as it aligns with the strategy of product differentiation. The other options, such as tight cost control (A), offering similar products (C), or offering lower costs (D) do not align with this approach.

Question 12

Which of the following statements best define a product differentiation strategy?

Accepted Answer

A product differentiation strategy involves offering products or services that are perceived by customers as superior and unique compared to those offered by competitors. This can be achieved through features, technology, design, service, or branding. A differentiation strategy typically involves charging a premium price for the unique features or benefits provided.

Question 13

An organization which uses product differentiation strategy will charge higher prices.

Accepted Answer

Product differentiation strategy involves creating unique and distinct products in the market, and charging premium prices for them because of their perceived value to the customer. This allows the organization to differentiate itself from competitors, and target customers who are willing to pay a higher price for a superior product.

Question 14

________ refers to an organization's ability to achieve lower costs relative to competitors through productivity and efficiency improvements,elimination of waste,and tight cost control.

Accepted Answer

Cost leadership refers to an organization's ability to achieve lower costs relative to competitors through productivity and efficiency improvements, elimination of waste, and tight cost control. This can give the organization a competitive advantage by being able to offer lower prices to customers or to achieve higher profit margins than competitors.

Question 15

Strategy describes how an organization matches its own capabilities with the opportunities in the marketplace to accomplish its overall objectives.

Accepted Answer

This is a basic definition of strategy. It is about aligning an organization's resources and strengths with the external environment to achieve specific goals.

Question 16

Explain the term cost leadership.What are the possible ways through which a company would try to become a cost leader? How far is it desirable to implement cost reduction measures?

Accepted Answer

The answer of Explain the term cost leadership.What are the...

Question 17

Cost-leadership strategy always advocates cuts in personnel to achieve cost reduction.

Accepted Answer

While cost reduction is an important aspect of cost-leadership strategy, it does not necessarily involve cuts in personnel. Cost reduction can be achieved through various means such as process improvement, efficient supply chain management, and technology adoption. In fact, some companies adopting cost-leadership strategy may focus on developing and retaining skilled and motivated employees to reduce labor turnover and associated costs.

Question 18

________ is an organization's ability to offer products or services that are perceived by its customers as being superior and unique relative to those of its competitors.

Accepted Answer

Product differentiation refers to an organization's ability to offer unique and superior products or services compared to competitors. It can lead to higher customer loyalty and profitability. Strategy refers to a broad plan for achieving organizational goals, while cost leadership involves offering products or services at the lowest cost possible. The balanced scorecard is a framework for measuring and managing organizational performance.

Question 19

An organization that is using the cost leadership approach would ________.

Accepted Answer

An organization using the cost leadership approach focuses on reducing costs and achieving efficiency improvements in production and operations in order to offer products at lower prices than competitors. This approach requires a focus on productivity and cost containment rather than investing in innovative R&D or bringing products to market rapidly at higher costs.

Question 20

Stewart Corporation plans to grow by offering a sound system,the SS3000,that is superior and unique from the competition.Stewart believes that putting additional resources into R&D and staying ahead of the competition with technological innovations is critical to implementing its strategy.Stewart's strategy is ________.

Accepted Answer

Stewart Corporation plans to grow by offering a sound system, the SS3000, that is superior and unique from the competition. This is an example of product differentiation, which is a strategy that focuses on creating products that are different from those of the competition.

Quiz 12: Strategy, balanced Scorecard, and Strategic Profitability Analysis