Exam 3: Evaluating a Companys External Environment

A) Changes in the long-term industry growth rate
B) Increasing globalization of the industry
C) Product innovation and technological change
D) Movement in the economy and in interest rates
E) Regulatory influences and government policy changes

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A) which rivals have been in business longer and thus have greater access to experience curve effects.
B) which rivals have newer manufacturing facilities and thus have achieved greater product quality.
C) which strategic groups have the highest profit margins and the highest customer switching costs and thus represent key operating characteristics.
D) that some strategic groups are more favorably positioned than others because they confront weaker competitive forces and/or because they are more favorably impacted by industry driving forces.
E) which strategic groups are currently being shunned by customers because of high prices and relatively low product quality.

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A) When buyers are unlikely to integrate backward into the business of sellers
B) When buyers purchase the item frequently and are well-informed about sellers' products,prices,and costs
C) When the costs incurred by buyers in switching to competing brands or to substitute products are relatively low
D) When the products of rival sellers are weakly differentiated and buyers have considerable discretion over whether and when they purchase the product
E) When buyers are few in number and/or often purchase in large quantities

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A) identify the driving forces and evaluate their impact on (1) demand for the industry's product,(2) the intensity of competition,and (3) industry profitability.
B) predict future marketing innovations and how fast the industry is likely to globalize.
C) evaluate what stage of the life cycle the industry is in and when it is likely to move to the next stage.
D) determine who is likely to exit the industry and what changes can be expected in the industry's strategic group map.
E) forecast fluctuations in product demand and how buyer needs will most likely change.

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A) The industry's growth potential and whether competitive pressures will likely grow stronger or weaker,and whether strong competitive forces are squeezing industry profitability to subpar levels
B) Whether the company occupies a stronger market position than rivals
C) Whether the industry's future profitability will be favorably or unfavorably affected by the prevailing driving forces
D) The severity of the macro-environment problems confronting the industry
E) Whether the industry's product is strongly or weakly differentiated

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A) When incumbent firms are likely to launch competitive initiatives to strongly contest the entry of newcomers
B) When strong brand preference and a high degree of customer loyalty exists for the product offerings of incumbents
C) When buyer demand for the product is growing fairly slowly
D) When few outsiders have the expertise and financial resources and capabilities to hurdle whatever entry barriers exist
E) When new entrants can expect to earn attractive profits

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A) When incumbent firms are unable or unwilling to launch competitive initiatives to strongly contest the entry of newcomers
B) When industry members are struggling to earn good profits
C) When entry barriers are relatively low and buyer demand for the product is growing fairly rapidly
D) When existing industry members are looking to expand their market reach by entering product segments or geographic areas where they currently do not have a presence
E) When newcomers can expect to earn attractive profits and a number of outsiders have the expertise and resources to hurdle whatever entry barriers exist

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A) the race of industry members to build strong defenses against the industry's driving forces.
B) the constant rivalry of firms to strengthen their standing with buyers and win a competitive edge over rivals.
C) the ongoing race among rival sellers to have the highest-quality product.
D) the ongoing efforts of industry members to introduce new and improved products/services at a faster rate than their rivals.
E) the ongoing race among rivals to achieve the fastest rate of growth in revenues and profits.

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A) pursue avenues that expose the firm to as many of the different competitive pressures as possible.
B) shift the competitive battle in favor of the firm by altering the underlying factors driving the five forces.
C) pursue ways to identify and complement the five forces contradictions and inferences to attract competitive growth opportunities.
D) pursue avenues that promote strategic thinking about how to contest competitor strengths and weaknesses and to create a checklist of potential profitability preferences.
E) None of these.

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A) where on the map is the best place to be and why.
B) which companies/strategic groups are destined to prosper because of their positions.
C) which companies/strategic groups seem destined to struggle.
D) what accounts for why some parts of the map are better than others.
E) where on the map is the easiest position to shift from to a more favorably situated position.

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A) whether the profits of suppliers are relatively high or low.
B) the number of suppliers that each seller/industry member purchases from on average.
C) how aggressively rival industry members are trying to differentiate their products.
D) whether demand for supplier products is high and they are in short supply.
E) whether the prices of the items being furnished by the suppliers are rising or falling.

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A) are usually triggered by changing technology or stronger learning/experience curve effects.
B) usually are spawned by growing demand for the product,the outbreak of price-cutting,and big reductions in entry barriers.
C) are major underlying causes of changing industry and competitive conditions and have the biggest influences in reshaping the industry landscape and altering competitive conditions.
D) appear when an industry begins to mature but are seldom present during early stages of the industry life cycle.
E) are usually triggered by shifting buyer needs and expectations or by the appearance of new substitute products.

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A) it is rare for such partnerships to have much competitive impact on those industry members not having such partnerships.
B) one unfortunate outcome is that it tends to give the supply partners much enhanced bargaining power in their dealings with these industry members.
C) there is a strong likelihood such partnerships will put increased competitive pressure on those industry members who lack productive collaborative relationships with their suppliers.
D) there is a high likelihood of such partnerships reducing competitive pressures on ALL industry members,provided technological change in the suppliers' business is rapid and the item being supplied is a commodity.
E) the usual result is to reduce competitive pressures on all industry members,provided the costs of the items furnished by supply chain partners amount to 50 percent or more of total cost.

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A) whether the substitutes are strongly or weakly differentiated and whether the relative frequency of buyer purchases is high or low.
B) whether attractively priced substitutes are readily available and the ease with which buyers can switch to substitutes.
C) whether the available substitutes are products or services.
D) whether the producers of substitutes have ample budgets for new product R&D.
E) the speed with which buyer needs and expectations are changing.

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