Exam (elaborations)
BPL 5100 QUIZ 2 WITH CORRECT ANSWERS
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Exam of 7 pages for the course BPL 5100 at BPL 5100 (BPL 5100 QUIZ 2)
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BPL 5100 QUIZ 2To create a competitive edge companies need to focus on ________________ -
Answer -customers' evolving wants and needs
Porter's three generic strategies: - Answer -1. Overall Cost Leadership
2. Differentiation
3. Focus
Differentiation is perceived from the____________ - Answer -client/customer
Differentiated goods are the opposite of__________ - Answer -luxury goods
Luxury goods are only for__________. Differentiated goods are marketed to
____________ - Answer -a niche group of people; everyone
Corporate Level Strategies are also known as____________ - Answer
-growth/expansion strategy
Concentration Strategy - Answer --staying within your business segment (doing more of
the same thing in your area of expertise)
-Staying within your existing business area and opening more of the same in different
locations
Concentration Strategies add more ___________ - Answer -outlets/locations ex. Every
neighborhood has a Mcdonald's, every neighborhood has a Starbucks
The 3 components of concentration strategies are_____________ - Answer -1. Market
penetration
2. Market development
3. Product Development
market penetration - Answer -making your place known in a market
Market development - Answer -going into new markets. Taking existing products and
selling to new markets
Product Development - Answer -developing new products within the same market
Diversification (growth) Strategies - Answer -Branching out ot new business areas
, Modes of Diversification - Answer -Merger and Acquisitions
Alliances
Internal Development
mergers - Answer -joining with two equal companies
acquisitions - Answer -acquiring another company
Internal Development - Answer -the most organic because it is all done with their
organizational capabilities, internally, in house
Diversification is often times _______________and_________________ - Answer -
risky; costly
most mergers and acquisitons are____________ - Answer -unsuccessful
Why do companies still pursue mergers and acquisitons although they are
unsuccessful? - Answer -Without risk you can't make money
Synergy - Answer -the power that results from the combination of two or more forces
Related diversification - Answer -More of the same types of products. Trying to share
intangible and tangible resource benefits.
ex. Pepsico taking on Tropicana
Reasons why companies pursue Related Diversification: - Answer -1. Economics of
Scope
2. Enhancing Revenue/Differentiation
3. Market Power
4. Pooled Negotiation
5. Vertical Integration
Market Power - Answer -Restricting or controlling the supply chain to you
Pooled Negotiation (power) - Answer -restrict and keep competitors out
Backwards integration - Answer -buying out suppliers to control your upstream
Ex. toyota buying out seatbelt manufacturers so they can't sell those seatbelts to
anyone else)
Forward integration - Answer -buying out distributors to control your downstream)
(ex. Ford buying out dealerships so that everyone who sells Ford cars can sell it for the
same price)
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