BADM 449 Midterm 2 || with 100% Error-free Answers.
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Course
BADM 449
Institution
BADM 449
Business-level strategy correct answers an integrated and coordinated set of commitments and actions designed to provide value to customers and gain a competitive advantage by utilizing core competencies in specific individual product markets
How to compete?
determines a firm's strategic posi...
BADM 449 Midterm 2 || with 100% Error-free Answers.
Business-level strategy correct answers an integrated and coordinated set of commitments and
actions designed to provide value to customers and gain a competitive advantage by utilizing
core competencies in specific individual product markets
How to compete?
determines a firm's strategic position in its quest for competitive advantage in a single industry or
product market
Three key-questions for defining a business: correct answers 1) Who is being satisfied?
(customer groups)
2) What is being satisfied? (customer needs)
3) How are customer needs satisfied? (distinctive competencies)
How do industry and firm effects influence competitive advantage? correct answers industry
effects = industry attractiveness and from within the industry (strategic groups)
firm effects = value vs cost position and business strategy
Does market share necessarily generate competitive advantage? correct answers NO
When can market share work to generate and sustain competitive advantage? correct answers -
when there are significant economies of scale
-can sustain this by investing in large and specialized assets that make exiting difficult
Factors that lead to a sustainable competitive advantage: correct answers 1) barriers to imitation
2) how long will it be before the first rival imitates the first mover?
3) how fast does new imitation occur once it starts?
What is tacit knowledge correct answers knowledge that is not easily transferable without seeing
or doing (in employees minds)
How is tacit knowledge related to sustainable competitive advantage? correct answers tacit
knowledge leads to a sustainable competitive advantage because other firms cannot easily
access/learn from it
Forms of competitive advantage: correct answers 1) cost advantage (similar product at lower
cost)
2) Differentiation Advantage (price premium from unique product)
What is a differentiation advantage? correct answers occurs when a firm is able to obtain from its
differentiation a price premium in the market which exceeds the cost of providing differentiation,
focus of competition is non-price attributes
What are some drivers of cost advantage? correct answers cost of input factors, economies of
scale, learning and experience curve effects, production techniques, product design, location
advantages
What is minimum efficient scale? correct answers the lowest point where the plant/firm can
produce such that its long run average costs are minimized
What are sources of gain in learning curves? correct answers 1) economies of scale travels along
the curve
2) gain from economies of learning is from one curve compared to another
3) economies of scale can also be seen from one firm to another when one produces more output
than the other
What are limits of learning curve advantages? correct answers 1) copying and reverse
engineering of products 2) hiring a competitors employees 3) purchasing the know-how from
consultants 4)obtaining the know-how from customers 5) experience advantages are often
nullified by innovations
How can firms attain competitive advantage using leaning and experience curves? correct
answers
What is integration strategy? correct answers requires trade offs between differentiation and low
cost, often very difficult because the two distinct strategic positions require internal value chain
activities that are different from one another
What is meant by the innovation funnel? correct answers describes the steps that take place in
developing a process or product, the purpose of all innovation is to create processes or products
that neet market needs in manufacturable or economic forms
What is the difference between invention and innovation? correct answers invention = discovery
of new idea/product (ex: Wright brothers)
innovation = commercialization of invention (ex: Boeing)
Provide examples that illustrate that the imitation process for technologies has sped up over time:
correct answers Ex: Xerography took 34 years, Fuzzy Logic controllers took 7 years
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