Question 1

With the growth of the Internet,globalization,and increased competition,the business environment has become more turbulent and challenging.

Accepted Answer

The statement accurately reflects the current state of the business environment. The Internet has enabled companies to connect with customers from all over the world, leading to increased globalization and competition. As a result, businesses must navigate more complex and unpredictable markets.

Question 2

In order for the control process to work,the business owner must:

Accepted Answer

Identifying and tracking key performance indicators (KPIs) is essential to the control process as it allows the business owner to measure progress towards goals and identify areas that need improvement. Making few changes in operational plans may lead to stagnation and missed opportunities for growth. Concentrating solely on competitive information may not provide a comprehensive view of the business's performance. Maintaining control and delegating little authority can hinder the growth of the business and stifle employee development.

Question 3

Small companies' core competencies are often the result of benefits such as agility,speed,closeness to customers,superior service,and innovative ability all of which are size advantages that allow them to do things that their larger competitors cannot.

Accepted Answer

Small companies often have advantages such as agility, speed, closeness to customers, superior service, and innovative ability that allow them to compete in ways that larger companies cannot. These advantages can become core competencies and lead to success.

Question 4

Rather than attempting to serve the total market,the small firm pursuing a ________ strategy specializes in serving a specific target segment.

Accepted Answer

The focus strategy is all about catering to the specific needs or requirements of a particular group of customers. This strategy is more suitable for small businesses as they can't cater to the needs of all customers. Instead, they should narrow down their focus to a specific segment of customers, which they can serve better than their competitors. This could be based on factors like demographics, geography, lifestyle, etc. This approach can help small businesses achieve a competitive advantage and stand out in the market.

Question 5

Which of the following is NOT one of the four important perspectives a balanced scorecard should look at a business from?

Accepted Answer

The four important perspectives a balanced scorecard should look at a business from are the internal business perspective, innovation and learning perspective, financial perspective, and customer perspective. The competitor perspective is not included as one of the four perspectives, although it can be important for companies to monitor their competition.

Question 6

A company that offers superior product quality,extra customer service,and fast delivery times is pursuing a:

Accepted Answer

The company is pursuing a differentiation strategy by offering superior product quality and extra customer service. The fast delivery times also add to the differentiation factor. A cost-leadership strategy would focus on offering products at lower prices than competitors. A concentration strategy would involve focusing on a specific market segment. A strategic alliance would involve partnering with another company for mutual benefit.

Question 7

The most effective way for a small business to establish a competitive advantage is by offering lower prices.

Accepted Answer

While offering lower prices may attract customers initially, it is not always sustainable or profitable for a small business. Instead, small businesses can establish a competitive advantage through offering unique products or services, providing exceptional customer service, having a strong online presence or brand, or implementing cost-saving efficiencies in their operations.

Question 8

Narrower product lines,smaller customer bases,and more limited geographic areas give small companies a natural advantage over large businesses when preparing a strategic plan.

Accepted Answer

Small companies have the advantage of being able to focus on a specific niche market and develop expertise in that area, which can lead to a competitive advantage. Smaller customer bases and geographic areas also allow for more personalized and targeted marketing efforts. However, this advantage might be limited in terms of reaching economies of scale and accessing a wider customer base.

Question 9

Shere Vincente operates a travel service that specializes in arranging trips for women,giving special attention to their needs and preferences,from security and comfort to activities and events designed to appeal to her target customers.Vincente is pursuing a ________ strategy.

Accepted Answer

Shere Vincente is targeting a specific segment of the market (women) and tailoring her travel services to their needs and preferences. This is an example of a focus strategy, which involves targeting a narrow market segment and catering specifically to its needs. Cost-leadership and differentiation strategies aim to compete more broadly in the market, while positioning is the process of creating a unique image or brand in the minds of customers.

Question 10

The balanced scorecard ideally looks at a business from four important perspectives relating to:

Accepted Answer

The balanced scorecard framework involves looking at a business from four important perspectives: customers, internal processes, innovation and learning, and finances. These four perspectives provide a balanced view of the business, and ensure that a company is not solely focused on financial metrics, but also considers customer satisfaction, internal processes, and innovation and learning opportunities. Choice A is incorrect because low-cost, differentiation, focus, and initiative are not the four key perspectives of the balanced scorecard. Choice B is incorrect because customers, buyers, suppliers, and substitute products are not the four key perspectives of the balanced scorecard. Choice C is somewhat close, but it does not include innovation and learning as a separate perspective, which is a major component of the balanced scorecard framework.

Question 11

Although developing a strategic plan is important for large companies,it is not essential to managing a small company successfully because of its limited resources.

Accepted Answer

Developing a strategic plan is essential for managing a small company successfully, as it helps to prioritize goals, allocate resources effectively, and make informed decisions on the direction of the company.

Question 12

A small company following a ________ strategy seeks to build customer loyalty by positioning its goods and services in a unique fashion.

Accepted Answer

A differentiation strategy involves positioning goods and services in a unique way that creates customer loyalty. This strategy emphasizes building a brand and creating a unique identity that sets the company apart from its competitors. This type of strategy is particularly effective for small companies that may not be able to compete on price or scale, but can differentiate themselves in other ways that attract and retain loyal customers.

Question 13

A differentiation strategy:

Accepted Answer

A differentiation strategy seeks to build customer loyalty by positioning goods or services in a unique fashion. It is built on a company's core competence and must create the perception of value in the customer's eyes. Therefore, all of the above options are correct.

Question 14

The principle behind a ________ strategy is to select one or more market segments,identify customers' special needs,and approach them with a good or service designed to excel in meeting these needs.

Accepted Answer

The given principle describes a focus strategy, which involves targeting a specific market segment with a product or service that caters to their unique needs. Option A) cost-leadership focuses on offering products at the lowest possible cost. Option B) differentiation focuses on creating a unique product or service that stands out in the market. Option D) concentration focuses on expanding within a specific geographical region.

Question 15

The three components of intellectual capital are human,structural,and customer.

Accepted Answer

The three components of intellectual capital are indeed human, structural, and customer. Human capital refers to the knowledge, skills, and expertise of employees, structural capital refers to the processes, systems, and intellectual property of an organization, and customer capital refers to the relationships and knowledge about customers that an organization possesses.

Question 16

Small companies must develop strategies that exploit all of the competitive advantages of their size by:

Accepted Answer

Small companies have the advantage of being able to respond quickly to customers' needs, remaining flexible and willing to change, and constantly innovating. By utilizing all of these advantages, they can compete effectively with larger companies in the market.

Question 17

Which of the following is a danger in choosing a differentiation strategy?

Accepted Answer

The answer of Which of the following is a danger...

Question 18

Large companies have a natural advantage over small firms when it comes to preparing a strategic plan.

Accepted Answer

The answer of Large companies have a natural advantage over...

Question 19

One of the biggest changes entrepreneurs face is the shift in the economy from a base of financial to intellectual capital.

Accepted Answer

With the rise of technology and globalization, the value of intellectual capital (i.e. knowledge, skills, and ideas) has become more important than traditional financial capital in many industries. Entrepreneurs must adapt to this shift in order to succeed.

Question 20

The ideal strategic planning process for a small company should start with setting objectives.

Accepted Answer

The answer of The ideal strategic planning process for a...

Quiz 3: Designing a Competitive Business Model and Building a Solid Strategic Plan