Chapter 6

Question 1

attempts to achieve sustainable competitive advantage by preserving what is distinctive about a company.

Answer 1

strategic positioning

Question 2

focuses on the organization as a whole.

Answer 2

corporate-level strategy

Question 3

focuses on individual
business units or product/service lines.

Answer 3

business-level strategy

Question 4

a plan of action
by each functional area of the organization to support higher level strategies.

Answer 4

functional-level strategy

Question 5

(organizational assessment), to look at where the organization stands and see what is working and what could be different so as to maximize efficiency and effectiveness in achieving the organization’s mission.

Answer 5

current reality assessment

Question 6

Putting strategic plans into effect

Answer 6

strategy implementation

Question 7

consists of monitoring the execution of strategy and making adjustments

Answer 7

strategy control

Question 8

exists when other companies cannot duplicate the value delivered to customers.

Answer 8

sustainable competitive advantage

Question 9

a situational analysis in which a company assesses its strengths, weaknesses, opportunities, and threats.

Answer 9

SWOT analysis

Question 10

the skills and capabilities that give the organization special competencies and competitive advantages in executing strategies in pursuit of its vision.

Answer 10

organizational strengths

Question 11

the drawbacks that hinder an organization in executing strategies in pursuit of its vision.

Answer 11

organizational weaknesses

Question 12

environmental factors that the organization may exploit for competitive advantage.

Answer 12

organizational opportunities

Question 13

environmental factors that hinder an organization’s achieving a competitive advantage.

Answer 13

organizational threats

Question 14

a framework for analyzing a resource or capability to determine its competitive strategic potential by answering four questions
about its value, rarity, imitability, and organization

Answer 14

VRIO

Question 15

a vision or projection of the future.

Answer 15

forecast

Question 16

a hypothetical extension of a past series of events into the future.

Answer 16

trend analysis

Question 17

(scenario analysis), the creation of alternative
hypothetical but equally likely future conditions.

Answer 17

contingency planning

Question 18

a process by which a company compares its performance with that of high-performing organizations

Answer 18

benchmarking

Question 19

a grand strategy that involves expan-or (for nonprofits) clients served.
sion-as in sales revenues, market share, number of employees, or number of customers

Answer 19

growth strategy

Question 20

growing market share or profits by innovating improvements in products or services

Answer 20

innovation strategy

Question 21

a grand strategy that involves little or no significant change.

Answer 21

stability strategy

Question 22

(retrenchment strategy), is a grand strategy that involves reduction in the organization’s efforts.

Answer 22

defensive strategy

Question 23

a management strategy used by companies to evaluate their strategic business units on the basis of (1) their business growth rates and (2) their share of the market.

Answer 23

BCG matrix

Question 24

The strategy of moving into new lines of business, such as Amazon purchasing Whole Foods or CVS buying Aetna

Answer 24

diversification

Question 25

When a company purchases a new business that is related to the company’s existing business portfolio, the organization

Answer 25

related diversification

Question 26

occurs when a company acquires another company in a completely unrelated business.

Answer 26

unrelated diversification

Question 27

a firm expands into businesses that provide the supplies it needs to make its products or that distribute and sell its products.

Answer 27

vertical integration

Question 28

business-level strategies originate in five primary competitive forces in the firm’s environment: (1) threats of new entrants, (2) bargaining power of suppliers, (3) bargaining power of buyers, (4) threats of substitute products or services, and (a) rivalry among competitors.

Answer 28

porter’s model for industry analysis

Question 29

(also called four generic strategies) are (1) cost-leadership, (2) differentiation, (3) cost-focus, and (4) focused-differentiation.

Answer 29

porter’s four competitive strategies

Question 30

keep the costs, and hence prices, of a product or service below those of competitors and to target a wide market.

Answer 30

cost-leadership strategy

Question 31

to offer products or services that are of unique and superior value compared with those of competitors but to target a wide market.

Answer 31

differentiation strategy

Question 32

to keep the costs, and hence prices, of a product or service below those of competitors and to target a narrow market.

Answer 32

cost-focus strategy

Question 33

to offer products or services that are of unique and superior value compared to those of competitors and to target a narrow market.

Answer 33

focused-differentiation strategy

Question 34

not simply tactics; it is a central part of any company’s strategy.

Answer 34

execution