Limitations of Benchmarking Quiz

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What is exemplified when a confectionery business acquires a dairy farm to lower production costs?

A backward vertical integration (correct)

A horizontal merger

A conglomerate merger

A limited liability partnership between firms

Applying Porter's Five Forces framework to the luxury hotel scenario, what can be concluded about the caviar supplier?

There is no threat of new entry.

The power of suppliers is likely to be high. (correct)

The threat of substitutes is very high.

The extent of rivalry between competitors is high.

What strategy should a company adopt if its target consumers are very strong according to Porter's Five Forces framework?

They should raise the barriers to entry for new companies.

They should differentiate their products to appeal to a specific customer group. (correct)

They should acquire rival companies to get access to their customer base.

They should lower product prices to attract more customers.

Which of the following statements correctly describes the importance of resources and capabilities for companies?

They are not enough to triumph over competitors. Signup and view all the answers

Which components should be considered while analyzing the value of resources and capabilities?

Whether the resources and capabilities seize available opportunities and address threats in an organisation's environment. Signup and view all the answers

Which type of product fulfills the rarity aspect required for resources and capabilities to be competitive?

A product with a patent Signup and view all the answers

In Lubna's scenario, what distinctive capability is most likely to help her restaurant business grow?

Creating a unique dining experience or theme. Signup and view all the answers

Which competitive strategy has Furnico most likely employed?

Differentiation strategy Signup and view all the answers

In the context of competitive strategies, identify a factor that is important for a successful focus strategy.

Distinct segment needs Signup and view all the answers

What is a challenge posed by hybrid strategies?

The generic strategies of low cost and differentiation sometimes conflict with one another. Signup and view all the answers

How does the strategy canvas tool assist companies in finding potential strategies for the future?

By comparing competitors based on their performance on critical success factors. Signup and view all the answers

What is a limitation of benchmarking?

It produces results that are too general because it compares numerous firms in a market. Signup and view all the answers

What dynamic capability relates to dealing with threats efficiently, as exemplified by Microsoft in the text?

By seizing the opportunity to launch their own cloud computing platform. Signup and view all the answers

Which statement accurately describes dynamic capabilities?

They refer to a company's ability to reorganise its resources and capabilities to take advantage of new opportunities. Signup and view all the answers

What do dynamic capabilities involve according to the text?

Reorganising resources and capabilities to exploit new opportunities. Signup and view all the answers

What does benchmarking mainly fail to provide for organizations according to the text?

Inputs for achieving competitive advantage. Signup and view all the answers

In what way are resources and capabilities presented by benchmarking in organizations according to the text?

As identical across all firms within an industry. Signup and view all the answers

Which of the following best describes market development?

Introducing existing products to a new market Signup and view all the answers

What is an obstacle to market penetration?

Severe economic limitations Signup and view all the answers

In the context of diversified strategies, what does Glamour Co.'s acquisition of an OTT platform represent?

Backward integration Signup and view all the answers

Which of the following constitutes unrelated diversification?

LNM acquiring struggling steel companies Signup and view all the answers

What does it mean when a company engages in backward integration?

Integrating operations backward in the supply chain Signup and view all the answers

How does market development differ from market penetration?

Market development involves expanding existing products into new markets, whereas market penetration focuses on increasing sales in existing markets. Signup and view all the answers