10 Questions
What are the components of the general environment analysis in the context of strategy development?
Political, Economic, Sociocultural, Technological, Environmental, and Legal factors
What is the purpose of the Five Forces Framework in strategy development?
To determine industry's structural attractiveness (industry profitability) from the point of view of existing companies (incumbents)
What is the simple profit formula in the context of strategy development?
Profit Margin = Sales price per unit – cost per unit
Who are the new entrants in the context of the Five Forces Analysis for existing industry firms?
New entrepreneurial ventures or existing company diversifying
What is the purpose of the PESTEL analysis in strategy development?
To assess the general environment factors for a country
What determines the bargaining power of buyers in the Five Forces Analysis?
No. of buyers, No. of competitors, and switching cost for the buyer
What determines the supplier power in the Five Forces Analysis?
No. of suppliers, No. of buyers, and switching cost of the buyer
What determines the threat of substitutes in the Five Forces Analysis?
Availability of close substitutes and switching cost for the buyer
What determines competitive rivalry in the industry?
Nature of product offerings, balance of competitors, market share difference, and switching costs for the buyers
What are strategic groups in an industry?
Organizations with similar strategic characteristics, following similar strategies, or competing on similar bases
Test your knowledge of the external environment analysis in the context of competitive strategy development. Explore topics such as PESTEL analysis and the Five Forces Framework.
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