Graded Homework

1. Based on your reading of the Coke and Pepsi case, which
of the following statements about a Porter’s Five Forces
Analysis of the Industry is true
a. Barriers to entry – relatively low
b. Suppliers – very powerful
c. Substitutes – very powerful
d. Rivalry – very powerful
2. Taking a resource-based view, factors important to firm strategy include:
a.
b.
c.
d. powerful brand names
resources and capabilities
deal-making skills
All of the above 3. Which of the following statements is TRUE?
a. Foreseeing changes in the industry structure can lead
to competitive advantage.
b. Industry analysis is a tool for strategists, not for
entrepreneurs.
c. Industry structure is fixed.
d. Technology is irrelevant to a five forces analysis.
e. Industry analysis is useful only within national
boundaries.
4. Imagine that you have been asked to apply the industrial
organization (I/O) model to explain why a firm is
performing poorly. What is the most likely explanation
for the firm’s poor performance according to this model?
a. Lack of core or distinctive competencies
b. Inability to achieve a sustainable competitive
advantage
c. Failure to carefully examine opportunities and threats
in the external environment
d. All of these
5. A company’s choice of which strategies to implement is a
function of
a. conditions in the firm’s external and internal
environments
b. conditions in the firm’s external environment
c. conditions in the firm’s external environment
d. how comfortable the firm’s managers are with risk
6. What is the primary reason why managers conduct an
internal analysis of their company’s resources and
capabilities? a. To make sure that managers are not being
compensated too much for the value chain activities
that they perform on a daily basis.
b. To identify the opportunities and threats that are
present in the internal environment, especially those
things that are beyond the managers’ control.
c. To make sure that the firm is charging customers
enough for the value that is being provided in the
company’s goods and services.
d. None of the above
7. Which of the following is NOT considered to be a distinct
force in Porter’s Five Forces Framework?
a. Direct competitors
b. New entrants
c. Government
d. Suppliers
e. Customers
8. True or false: A supplier basing its competitive
advantage on a unique standard (for example, a supplier
whose product will only work on Google Chrome or
Internet Explorer) for its product makes it easier for
customers to switch to another supplier.
a. True
b. False
9. Based on your reading of the Coca Cola/Pepsi case (in
your Harvard Course Pack), there are two kinds of
"buyers". These are:
a. syrup concentrate providers and advertisers
b. bottlers and consumers
c. millenials and Gen X
d. syrup concentrate providers and bottlers
10.
Which of the following players would NOT be
relevant for a Fives Forces analysis for a car-sharing
service?
a. Larger car-rental services
b. Commuter groups sharing a car to go to work
c. Car-leasing companies
d. Uber
e. Satellite navigation service providers 11.
True or false: Conglomerates compete in several
countries and in several industries. Thus, industry
analysis is not applicable for these firms.
a. True
b. False
12.
True or false: The results from an industry analysis
can be used forever — like fruit cake, they never get too
old to eat — or use, in this case.
a. True
b. False
13.
When should you use an industry analysis?
a. To identify an industry for entry
b. To identify a suitable positioning for a firm
c. To improve a firm’s positioning within an industry
d. None of the answers are correct.
e. All of the answers are correct.
14.
True or false: The entrepreneurial capacity of
managers is a building block of industry analysis. (Put
another way, is what an individual firm does part of
industry analysis, which is about how the whole industry
operates).
a. True
b. False
15.
Porter’s Five Forces Framework is used for industry
analysis in all of the following ways EXCEPT to:
a. identify opportunities to increase profit.
b. decide whether to enter or exit the market.
c. identify intangible assets that are crucial for a firm to
compete successfully in a given industry.
d. identify which market niche to penetrate.
e. complement a strengths, weaknesses, opportunities,
threats (SWOT) analysis.
16.
Typical barriers to entry include:
a. Economies of scope.
b. high barriers to exit.
c. All of the answers are correct.
d. restrictive government policies.
e. key locations that are crucial for a business ( e.g.,
access to natural resources). 17.
In the Porter’s Five Forces analysis below, assume
you are the CEO of GAP. What does it mean when a force
is LOW or WEAK?
Porter’s Five Forces Analysis of the Retail Apparel Industry Competitive Forces Strength NEW ENTRANTS High SUPPLIERS Low BUYERS Low SUBSTITUTES Low to moderate barriers to entry with the exception of scale economies, which are available to larger enterprises. Strength is limited by Gap’s 780­vendor network in over 50 countries and by keeping vendors below 4% of the firm’s overall purchases. Demand for quality and pricing varies. No cumulative bargaining power, and individual demands do not drive significant pricing pressures. Moderate COMPETITION Comments Many choices in apparel, but clothing trends remain stylishly casual. Peer firms aggressively act to gain market share. High a. There is opportunity for your brand in the market,
position yourself here
b. There is no opportunity here: if others can’t
succeed, you can’t either
c. It is impossible to judge without knowing the retail
industry >
d. It is impossible to judge without anything about
Michael Porter. 18.
Which of the following is NOT a tactic for reducing
the bargaining power of customers?
a. Exploit economies of scale
b. Target small customers
c. Differentiate the product
d. Increase switching costs
e. Target customers who are less sensitive to price
19.Porter’s Five Forces Framework suggests which of the
following?
a. Firms can gain competitive advantage leveraging their
strengths regardless of environmental factors.
b. Changes in suppliers’ technologies can alter the
competitive environment within the focal industry.
c. The entrepreneurial abilities of managers are a central
requirement for competing successfully in an industry.
d. Complementary products are most likely to rise in
importance as substitutes to existing technologies.
e. Switching costs are lower for suppliers than for
buyers.