Policy Chapter 6 - Assignment Essays

question

business level strategy

answer

the goal-directed actions managers take in their quest for competitive advantage when competing in a single product market

question

5 forces model

answer

1. threat of entry
2. power of suppliers
3. power of buyers
4. threat of substitutes
5. rivalry among existing competitors

question

strategic groups

answer

A set of companies that pursue a similar strategy in a specific industry

question

Cost Leadership

answer

the positioning strategy of producing a product or service of acceptable quality at consistently lower production costs than competitors can, so that the firm can offer the product or service at the lowest price in the industry

question

Differentiation

answer

making a product different from other similar products

question

strategic tradeoffs

answer

Choices between a cost or value position. Such choices are necessary because higher value creation tends to generate higher cost.

question

differentiation strategy

answer

generic business strategy that seeks to create higher value for customers than the value that competitors create, while containing cost

question

cost leadership strategy

answer

a strategy that aims to provide a product or service at as low a price as possible to a broad audience

question

scope of competition

answer

the size - narrow or broad - of the market in which a firm chooses to compete

question

Blue Ocean Strategy

answer

Business-level strategy that successfully combines differentiation and cost-leadership activities using value innovation to reconcile the inherent trade-offs.

question

focused cost leadership strategy

answer

same as the cost-leadership strategy except with a narrow focus on a niche market

question

focused differentiation strategy

answer

same as the differentiation strategy except with a narrow focus on a niche market

question

economies of scope

answer

savings that come from producing two (or more) outputs at less cost than producing each output individually, despite using the same resources and technology

question

product features

answer

specific design characteristics that allow a product to perform certain tasks

question

complements

answer

Add value to a product or service when they are consumed in tandem

goods and services that are used together

question

economies or scale

answer

Decreases in cost per unit as output increases

the reduction in the cost of a good brought about especially by increased production at a given facility

question

minimum efficient scale

answer

output range needed to bring down the cost per unit as much as possible, allowing a firm to stake out the lowest-cost position that is achievable through economies of scale

question

diseconmies of scale

answer

increases in cost per unit when output increases

question

differences in timing

answer

Learning effects occur over time as output accumulates, while economies of scale are captured at one point in time when output increases.

question

value innovation

answer

the simultaneous pursuit of differentiation and low cost in a way that creates a leap in value for both the firm and the consumers; considered a cornerstone of blue ocean strategy

question

Value Innovation - Lower Costs

answer

1. Eliminate: Which of the factors that the industry takes for granted should be eliminated?

2. Reduce: Which of the factors should be reduced well below the industry's standard?

question

Value Innovation - Increase Perceived Consumer Benefits

answer

1. Raise. Which of the factors should be raised well above the industry's standards?

2. Create. Which factors should be created that the industry has never offered?

question

value curve

answer

horizontal connection of the points of each value on the strategy canvas that helps strategists diagnose and determine courses of action

question

strategy canvas

answer

graphical depiction of a company's relative performance vis-a-vis (face to face) its competitors across the industry's key success factors

question

...

answer

...

1 of 25

question

business level strategy

answer

the goal-directed actions managers take in their quest for competitive advantage when competing in a single product market

question

5 forces model

answer

1. threat of entry
2. power of suppliers
3. power of buyers
4. threat of substitutes
5. rivalry among existing competitors

question

strategic groups

answer

A set of companies that pursue a similar strategy in a specific industry

question

Cost Leadership

answer

question

Differentiation

answer

making a product different from other similar products

question

strategic tradeoffs

answer

Choices between a cost or value position. Such choices are necessary because higher value creation tends to generate higher cost.

question

differentiation strategy

answer

generic business strategy that seeks to create higher value for customers than the value that competitors create, while containing cost

question

cost leadership strategy

answer

a strategy that aims to provide a product or service at as low a price as possible to a broad audience

question

scope of competition

answer

the size - narrow or broad - of the market in which a firm chooses to compete

question

Blue Ocean Strategy

answer

Business-level strategy that successfully combines differentiation and cost-leadership activities using value innovation to reconcile the inherent trade-offs.

question

focused cost leadership strategy

answer

same as the cost-leadership strategy except with a narrow focus on a niche market

question

focused differentiation strategy

answer

same as the differentiation strategy except with a narrow focus on a niche market

question

economies of scope

answer

savings that come from producing two (or more) outputs at less cost than producing each output individually, despite using the same resources and technology

question

product features

answer

specific design characteristics that allow a product to perform certain tasks

question

complements

answer

Add value to a product or service when they are consumed in tandem

goods and services that are used together

question

economies or scale

answer

Decreases in cost per unit as output increases

the reduction in the cost of a good brought about especially by increased production at a given facility

question

minimum efficient scale

answer

output range needed to bring down the cost per unit as much as possible, allowing a firm to stake out the lowest-cost position that is achievable through economies of scale

question

diseconmies of scale

answer

increases in cost per unit when output increases

question

differences in timing

answer

Learning effects occur over time as output accumulates, while economies of scale are captured at one point in time when output increases.

question

value innovation

answer

the simultaneous pursuit of differentiation and low cost in a way that creates a leap in value for both the firm and the consumers; considered a cornerstone of blue ocean strategy

question

Value Innovation - Lower Costs

answer

1. Eliminate: Which of the factors that the industry takes for granted should be eliminated?

2. Reduce: Which of the factors should be reduced well below the industry's standard?

question

Value Innovation - Increase Perceived Consumer Benefits

answer

1. Raise. Which of the factors should be raised well above the industry's standards?

2. Create. Which factors should be created that the industry has never offered?

question

value curve

answer

horizontal connection of the points of each value on the strategy canvas that helps strategists diagnose and determine courses of action

question

strategy canvas

answer

graphical depiction of a company's relative performance vis-a-vis (face to face) its competitors across the industry's key success factors

question

...

answer

...

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