Plans to get Ahead
1. What is an organizational strategy?
A) A financial report
B) A type of product a company sells
C) A marketing campaign
D) A plan of action to achieve long-term company goals
D) A plan of action to achieve long-term company goals
What is the main focus of a functional strategy in a business?
A) Setting long-term company goals
B) Determining how business units compete
C) Implementing and achieving tactical plans
D) Conducting market research
C) Implementing and achieving tactical plans
This tool helps businesses understand who they’re competing with and what challenges they face in their industry.
A) SWOT Analysis
B) Porter’s Five Forces Model
C) PESTLE Analysis
D) Miles-Snow Typology
B) Porter’s Five Forces Model
What is the position of a company with low market share and low market growth in the BCG Matrix?
A) Stars
B) Cash Cows
C) Dogs
D) Question Marks
C) Dogs
Which strategy focuses on increasing revenue, profits, market share, or territories?
A) Stability
B) Growth
C) Defensive
D) Retrenchment
B) Growth strategies aim to expand the business through more sales, new products, or entering new markets.
2. Which business model allows companies like Costco to sell products at low prices and maintain customer loyalty?
A) Franchise model
B) Membership-based model
C) Advertising model
D) Wholesale-only model
B) Membership-based model
Which company is an example of a defender strategy that focuses on improving existing products?
A) SpaceX
B) WD-40
C) Netflix
D) Zara
B) WD-40
Which of the following is not one of Porter’s Five Forces?
A) Threat of New Entrants
B) Bargaining Power of Buyers
C) Government Regulations
D) Threat of Substitute Products
C) Government Regulations
In a SWOT analysis, where would you place 'emerging competitors'?
A) Strengths
B) Weaknesses
C) Opportunities
D) Threats
D) Threats
Steel Authority of India focuses on improving efficiency rather than expanding. Which strategy is this an example of?
A) Stability
B) Growth
C) Defensive
D) Diversification
A) Stability strategies focus on maintaining current operations and improving efficiency without significant change.
3. What is the primary goal of all organizational strategies according to the text?
A) To gain competitive advantage
B) To increase employee satisfaction
C) To reduce production costs
D) To expand into new markets
A) To gain competitive advantage
Which of the following best describes a prospector company according to the Miles-Snow typology?
A) Focuses on stable growth and existing products
B) Maintains products while pursuing limited innovation
C) Pursues high-risk, fast growth through innovation
D) Has inconsistent strategies and lacks adaptation
C) Pursues high-risk, fast growth through innovation
In the video-streaming industry, customers can easily switch between Netflix, Disney+, and Amazon Prime. This best represents which force?
A) Threat of New Entrants
B) Bargaining Power of Buyers
C) Rivalry Among Competitors
D) Bargaining Power of Suppliers
B) Bargaining Power of Buyers
Which of the following best defines a blue ocean strategy?
A) Competing for more market share in an existing crowded market
B) Creating a new market space with little or no competition
C) Eliminating competition through price wars
D) Focusing only on improving internal weaknesses
B) Creating a new market space with little or no competition
Airstream differentiates itself from competitors with a unique, high-quality design. This is an example of which Porter strategy?
A) Cost Leadership
B) Cost Focus
C) Differentiation
D) Differentiation Focus
C) Differentiation strategies give a company a competitive advantage by offering unique products or services.
4. Why must managers adopt a growth mindset when designing strategies?
A) To focus only on short-term profits
B) To reduce employee turnover
C) To fully understand strategic goals and competitive forces
D) To avoid innovation and risk
C) To fully understand strategic goals and competitive forces
What is a characteristic of a reactor company?
A) Consistently adapts to market changes
B) Rapidly innovates and leads markets
C) Fails to respond well to environmental changes
D) Is the first to introduce new products
C) Fails to respond well to environmental changes
Professors Brandenburger and Nalebuff added this sixth force to Porter’s model to represent companies that add value by offering compatible products.
A) Collaborators
B) Complementors
C) Competitors
D) Customers
B) Complementors
What is one limitation of the BCG Matrix?
A) It ignores external threats completely
B) It assumes low market share companies can never be profitable
C) It only focuses on company revenue
D) It excludes any form of market growth analysis
B) It assumes low market share companies can never be profitable
Virgin Atlantic provides specialized services for passengers with hidden disabilities. Which Porter strategy does this illustrate?
A) Cost Leadership
B) Cost Focus
C) Differentiation
D) Differentiation Focus
D) Differentiation focus targets a narrow market and offers unique products or services to meet the specific needs of that group.
5. How do subscription-based business models, like those used by Netflix and SnackCrate, contribute to a company’s competitive advantage?
A) By offering surprise products that confuse competitors
B) By generating steady revenue and maintaining customer loyalty
C) By focusing only on large-scale corporate customers
D) By eliminating the need for marketing campaigns
B) By generating steady revenue and maintaining customer loyalty
Which strategic mistake did Nokia make that illustrates competitive inertia?
A) Investing too much in product innovation
B) Ignoring sleek, innovative products from competitors
C) Being the first mover in the mobile phone market
D) Expanding too quickly into unrelated markets
B) Ignoring sleek, innovative products from competitors
Which of the following is not an example of a barrier to entry mentioned in the reading?
A) Capital requirements
B) Customer switching costs
C) Brand loyalty
D) Flexible pricing by competitors
D) Flexible pricing by competitors
According to the case study, what is the best strategy for The Clean Drinks Company to overcome its lack of capital?
A) Launching a social media marketing campaign
B) Offering an app for mobile orders
C) Looking for more investors
D) Attending local events with pop-up stands
C) Looking for more investors
Starbucks buys and roasts its own coffee before selling it in its stores. This type of vertical integration is called:
A) Forward Integration
B) Backward Integration
C) Horizontal Integration
D) Diversification
B) Backward integration occurs when a company produces its own supplies to control quality and reduce costs.