Question 1

What problem with its car lines did General Motors face in the early 1920s?

Accepted Answer

In the early 1920s, General Motors (GM) faced a significant problem with its car lines that revolved around a lack of product differentiation. At the time, GM's lineup consisted of several brands, including Chevrolet, Pontiac, Oldsmobile, Buick, and Cadillac. However, these brands were not distinctly differentiated from one another, which led to internal competition and confusion among consumers.

The cars offered by GM's various divisions were often similar in terms of price, features, and styling. This overlap meant that the brands were competing against each other for the same market segments, rather than targeting different groups of consumers. As a result, GM was not able to effectively cover the market spectrum or capitalize on the potential for brand loyalty.

To address this issue, GM's then Vice President in charge of operations, Alfred P. Sloan, implemented a strategy known as "a car for every purse and purpose." Sloan reorganized the company to ensure that each of GM's automotive divisions targeted a specific market segment. This strategy involved clearly defining each brand to represent a distinct step up in terms of price, luxury, and features:

- Chevrolet was positioned as the entry-level, value brand.
- Pontiac was aimed at offering a more upscale and stylish option than Chevrolet.
- Oldsmobile was marketed to the middle-class segment, offering a balance of performance and luxury.
- Buick was targeted at the upper-middle-class market, providing more refinement and power.
- Cadillac was established as the luxury brand, representing the pinnacle of comfort, technology, and prestige.

This strategic repositioning, which became known as the "ladder of success," allowed consumers to enter the GM family with a Chevrolet and move up through the brands as their wealth and status increased. It effectively solved the problem of product differentiation and helped GM to become one of the largest and most successful automakers in the world. This approach also laid the groundwork for modern brand management and is still studied in business schools today.

Question 2

Which of the following are examples of business definitions?
A) Increasing earnings per share
B) Increasing shareholder value
C) Maximize shareholder wealth
D) All of these
E) None of these

Accepted Answer

E

Question 3

Business definition can help to focus management attention on ______________.
A) the main thing.
B) the bottom line.
C) their compensation packages.
D) All of these
E) None of these

Accepted Answer

Business definition is about identifying and focusing on the main thing or core competencies of the organization. It helps to clarify the organization's purpose and direction, and directs management attention to what is most important for achieving success. Bottom line and compensation packages can also be important, but they are secondary to having a clear business definition.

Question 4

To which of the following concepts is a business definition not closely related?
A) positioning
B) incumbency
C) branding
D) differentiation
E) None of these

Accepted Answer

Incumbency refers to the current holder of a particular position or office. It is not closely related to the other concepts listed, which all have to do with marketing and branding strategies.

Question 5

A business definition is ______________.
A) the major way in which firms describe themselves to customers,
B) employees, suppliers, and investors.
C) the primary way customers, employees, and other constituencies develop an image of companies.
D) allows managers to describe or identify their companies while also helping customers, employees, and other constituencies develop an image of their companies and how they differ from other business organizations.
E) All of these
F) None of these

Accepted Answer

A business definition encompasses how firms present themselves to various stakeholders, including customers, employees, suppliers, and investors, and plays a crucial role in shaping the perception of the company among these groups. It serves both as a self-description tool for managers and as a means for stakeholders to understand and differentiate the company from others.

Question 6

In which of the following have both practicing managers and academic researchers shown great interest?
A) Mission
B) Purpose
C) Identity
D) All of these
E) None of these

Accepted Answer

Both practicing managers and academic researchers have shown great interest in all three concepts of mission, purpose, and identity in a business context. These concepts are crucial for defining and communicating a company's values, goals, and objectives, which are essential for long-term success.

Question 7

"White space" in industry environments represents competitive areas that are ______________.
A) occupied by incumbent rivals
B) out-of bounds to incumbent firms due to regulatory restrictions
C) unprofitable market segments
D) All of these
E) None of these

Accepted Answer

"White space" in industry environments refers to unexplored or underutilized areas where there is potential for innovation and growth, rather than areas that are heavily contested, regulated, or unprofitable.

Question 8

____________ is the process by which firms and businesses select positions in their industry environments.
A) strategy confirmation
B) strategy content
C) strategy process
D) All of these
E) None of these

Accepted Answer

Strategy process is the correct term for how firms and businesses select their positions within their industry environments. This involves the steps and actions that companies take to formulate and implement strategies to achieve competitive advantage and meet their goals.

Question 9

A business definition is ______________.
A) strategy confirmation
B) strategy intent
C) strategy process
D) All of these
E) None of these

Accepted Answer

The answer of A business definition is ______________.
A) strategy confirmation
B)...

Question 10

A business definition is ______________.
A) strategy content
B) strategy intent
C) strategy confirmation
D) All of these
E) None of these

Accepted Answer

The answer of A business definition is ______________.
A) strategy content
B)...

Question 11

A business definition ______________.
A) is the way a firm or a business describes itself to employees, customers, and other constituencies
B) distinguishes a firm from other business organizations that may or may not be its competitors
C) provides an organization with an identity that describes what is "central, distinctive, and enduring" about it
D) All of these
E) None of these

Accepted Answer

All of these options define a business definition. A business definition is a statement that communicates the core purpose, values, and strategy of the organization, and sets it apart from competitors. Business definitions are important for establishing a clear identity and direction for the organization, and for communicating that identity to stakeholders.

Question 12

Which of the following is not a characteristic of an effective business definition?
A) Multi-focused
B) Distinctive
C) Timely and appropriate
D) Clear and readily understandable
E) All of these

Accepted Answer

An effective business definition should be focused and specific, rather than multi-focused. A clear and concise definition helps all stakeholders understand the purpose, goals, and objectives of the business.

Question 13

Which of the following is a characteristic of innovative workplaces that foster creativity?
A) playfulness
B) autonomy
C) experimentation
D) All of these
E) None of these

Accepted Answer

Playfulness, autonomy, and experimentation are all characteristics of innovative workplaces that foster creativity. These factors encourage employees to think outside the box and generate new ideas. Playfulness can inspire a relaxed and fun environment where employees are encouraged to take risks and be creative. Autonomy allows employees to have more control over their work and pursue ideas they are passionate about. Experimentation encourages employees to try new things and learn from failure. All of these factors working together create a workplace environment that inspires and supports creativity.

Question 14

Which of the following is a personality trait associated with creativity?
A) antipathy
B) complexity
C) parsimony
D) reticence
E) None of these

Accepted Answer

Complexity is a personality trait associated with creativity, as it involves a willingness to explore multiple perspectives and consider various possibilities. Antipathy, parsimony, and reticence do not align with characteristics typically associated with creativity.

Question 15

What is meant when it is said that "business definition" allows firms to play offense rather than defense?

Accepted Answer

The answer of What is meant when it is said...

Question 16

How would the business definition adopted by a luxury goods maker likely affect its decisions about its brand image, pricing, marketing, and distribution decisions?

Accepted Answer

The answer of How would the business definition adopted by...

Question 17

Why did Kendall-Jackson sue Gallo Winery after Gallo's successfully entry into the varietal wine market?

Accepted Answer

The answer of Why did Kendall-Jackson sue Gallo Winery after...

Question 18

How might Kodak's history of always promoting from within the firm's ranks have created problems in its efforts to successfully redefine itself?

Accepted Answer

The answer of How might Kodak's history of always promoting...

Question 19

What two key factors in the business redefinition process are highlighted by Kodak's efforts to redefine itself in an increasingly digital world?

Accepted Answer

The answer of What two key factors in the business...

Question 20

Explain Intel's exit from the memory chip business as it relates to the three key characteristics of effective business definitions.

Accepted Answer

The answer of Explain Intel's exit from the memory chip...

Quiz 6: Business Definition and Positioning

What problem with its car lines did General Motors face in the early 1920s?

Which of the following are examples of business definitions?

Business definition can help to focus management attention on ______________.

To which of the following concepts is a business definition not closely related?

A business definition is ______________.

In which of the following have both practicing managers and academic researchers shown great interest?

"White space" in industry environments represents competitive areas that are ______________.

____________ is the process by which firms and businesses select positions in their industry environments.

A business definition is ______________.

A business definition is ______________.

A business definition ______________.

Which of the following is not a characteristic of an effective business definition?

Which of the following is a characteristic of innovative workplaces that foster creativity?

Which of the following is a personality trait associated with creativity?

What is meant when it is said that "business definition" allows firms to play offense rather than defense?

How would the business definition adopted by a luxury goods maker likely affect its decisions about its brand image, pricing, marketing, and distribution decisions?

Why did Kendall-Jackson sue Gallo Winery after Gallo's successfully entry into the varietal wine market?

How might Kodak's history of always promoting from within the firm's ranks have created problems in its efforts to successfully redefine itself?

What two key factors in the business redefinition process are highlighted by Kodak's efforts to redefine itself in an increasingly digital world?

Explain Intel's exit from the memory chip business as it relates to the three key characteristics of effective business definitions.