Swift Competitive Actions Quiz

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What should a firm do when choosing the basis for competitive attack?

Avoid directly challenging a targeted competitor where it is strongest. (correct)

Be aggressive and challenge competitors on all fronts.

Attack the competitor's strengths with matching strength.

Use the firm's weakest strategic assets to attack a competitor's strengths.

Which offensive strategy option involves offering a product at a lower price than competitors?

Offering an equally good or better product at a lower price. (correct)

Continuous product innovation to draw sales away from rivals.

Leapfrogging competitors by being first to market with next-generation products.

Disruptive product innovations to create new markets.

What is the goal of pursuing disruptive product innovations as an offensive strategy?

To copy ideas from other companies.

To offer products at a lower price than competitors.

To maintain the same product line as rivals.

To create new markets with innovative products. (correct)

How can a firm gain an advantage by adopting and improving on good ideas of other companies?

By enhancing existing good ideas from competitors. Signup and view all the answers

In the context of competitive attacks, what should a firm be prepared for if market rivals are strong competitors?

Patience and the potential for counter-responses. Signup and view all the answers

What is the importance of being first to market with next-generation products as an offensive strategy?

To leapfrog over competitors. Signup and view all the answers

What is one form of defensive strategies mentioned in the text?

Launching new products to broaden product lines Signup and view all the answers

How does a company employing defensive strategies influence competitors?

By discouraging buyers from trying competitors' brands Signup and view all the answers

What is a signaling strategy that indicates a firm's commitment to maintaining market share?

Announcing commitment to maintaining present market share Signup and view all the answers

How can a company lower the risk of being attacked, according to the text?

Making early announcements about new products or price changes Signup and view all the answers

What is an action that blocks the avenues open to challengers?

Introducing new features to broaden product lines Signup and view all the answers

How can defensive strategies weaken the impact of an attack that occurs?

By challenging the quality or safety of rivals' products Signup and view all the answers

What is a first mover in business?

A company that innovates and introduces a new product or service to the market before others Signup and view all the answers

What is a potential disadvantage of being a first mover?

When competitors quickly come out with better versions of the first mover's products Signup and view all the answers

What situation makes it difficult to ascertain what will succeed in the market?

When market uncertainties exist Signup and view all the answers

In what scenario can late movers have an advantage over first movers?

When imitating is more expensive than pioneering Signup and view all the answers

Why might people choose a first mover's product according to the text?

Because everyone else is using it too due to network effects Signup and view all the answers

What can enable fast followers to come out with more attractive next-version products than a first mover?

Rapid market evolution Signup and view all the answers

What is the definition of a vertically integrated firm?

A firm that participates in multiple stages of an industry's value chain. Signup and view all the answers

What is the main difference between full integration and partial integration?

The number of vertical stages involved. Signup and view all the answers

Which is a potential disadvantage of a vertical integration strategy?

Slow acceptance of technological advances. Signup and view all the answers

What is the main difference between a horizontal merger and an acquisition?

In a horizontal merger, two or more firms combine into a single entity, while in an acquisition, one firm purchases and absorbs another firm. Signup and view all the answers

What could be a consequence of not having enough flexibility in accommodating shifting buyer preferences?

Not being able to change quickly when customers want something different. Signup and view all the answers

What is a strategic objective for horizontal mergers and acquisitions?

Creating a cost-efficient operation from the combined firms. Signup and view all the answers

How does tapered integration differ from full integration?

Tapered integration uses both in-house and outsourced activities at any stage of the vertical chain. Signup and view all the answers

What is a common reason why mergers and acquisitions may fail to produce anticipated results?

Cost savings may be smaller than expected due to unforeseen circumstances. Signup and view all the answers

Why might a firm experience increased business risk with a vertical integration strategy?

Spending large amounts on capital investment. Signup and view all the answers

What could be a consequence of cultures, operating systems, and management styles failing to mesh after a merger?

Loss of key employees at the acquired firm. Signup and view all the answers

Why might gains in competitive advantage take longer to achieve or never materialize after a merger?

Because merging firms usually have different objectives and strategies. Signup and view all the answers

What does leading the convergence of industries involve according to the text?

Bringing different industries together due to new market opportunities regardless of technologies. Signup and view all the answers