Mqm 385 - Chapter 5

Front 1

A business's overall competitive theme; the way it positions itself in the marketplace to gain a competitive advantage, and the different positioning strategies that it can use in different industry settings.

Back 1

Business Level Strategy

Front 2

A company has competitive advantage through two main ways:

Back 2

Lowering Costs

Differentiation

Front 3

In commodity markets , a competitive advantage goes to the company who ________

Back 3

the lowest costs.

Front 4

Differentiation often (but not always) raises the ___________

Back 4

cost structure of a firm.

Front 5

Differentiation gives a company two advantages:

Back 5

1. Allows the company to charge a premiem price for a good or service.

2. Can help the company grow overall demand and capture market share from its rivals.

Front 6

In some cases, successful differentiation can actually lower costs. T or F?

Back 6

True

Front 7

What options does a manager have with successful differentiation?

Back 7

1. Raise the price to reflect the differentiated nature of the product offereing and cover any incremental costs.

2. Hold prices constant, or slight increase, sell more, and boost profitability through attainment of scale economies.

Front 8

An example of successful differentiation?

Back 8

Starbucks, Apple iPhone.

Front 9

When it comes the differentiation-low cost trade off, it is about __________?

Back 9

achieveing the right balance, not solely choosing one.

Front 10

efficiency frontier?

Back 10

shows all the different positions that a company can adopt with regard to differentiation and low cost, ASSUMING that its internal functions and organizational arrangements are configured efficiently to support a particular position.

Front 11

Only those companies who get to the frontier have ________

Back 11

a competitive advantage

Front 12

Getting to the frontier requires excellence in ___________

Back 12

strategy implementation.

Front 13

Not all positions on an industry's efficiency frontier are equally attractive. T or F?

Back 13

True

Front 14

The effiencey curve is static. T or F?

Back 14

False

Front 15

Value innovation is ________

Back 15

when the effiencey curve is pushed outward through innovation.

Front 16

Business level strategy starts with ________

Back 16

market segmentation.

Front 17

What are the three approaches to market segmentation? examples?

Back 17

1. Standardization Strategy - Average consumer

- Walmart

2. Segmentation Strategy - many or all segments

- Toyota/Scion/Lexus and Coke/Diet Coke/Cherry Coke

3. Focus Strategy - limited or one segment

- Porsche

Front 18

A strategy that gives a company a specific form of competitive position and advantage in comparison to its rivals, resulting in above-average profitability.

How many are there?

Back 18

Generic business level strategy

4

Front 19

when a company lowers cost so much that it can lower prices and still make a profit.

Back 19

broad low-cost strategy

Front 20

when a company differentiates its product in some way, such as by recognizing different segments or offering different products to each segment.

Back 20

Broad differentiation strategy

Front 21

when a company targets a certain segement or niche and tries to be the low-cost player in that niche.

Back 21

focus low cost strategy

Front 22

when a company targets a certain segment or niche and customizes its offerins to the needs of that particular segment through the addition of features and functions.

Back 22

focus differentiation strategy

Front 23

Business level strategy is executed through actions taken at the _________ level and through ____________.

Back 23

functional

organizational arrangements

Front 24

Many successful companies have built their competitive advantage by redifining their product offering through _________ and __________

Back 24

value innovation

creating a new market space

Front 25

The process of thinking through value innovation has been described as searching for a "________" a wide open market space where a company can chart its own course.

Back 25

Blue Ocean