Page 80 - DCOM506_DMGT502_STRATEGIC_MANAGEMENT

Strategic Management

Notes 4.8 Self Assessment

Fill in the blanks:
1. At the level of marketing strategy, a competitor has four variables: ................, ................,
................ and ................
2. Competitors' reactions can be studied at ................ levels.
3. The five forces and strategic group models present a ................ picture of competition
while emphasizing the role of ................
4. The shakeout stage ends when the industry enters its ................ stage.
5. Under the shakeout stage, ................ are forced out, and a small number of industry leaders
emerge.
6. The ................ represents all the players in the game and analyses how their interactions
affect the firm's ability to generate and appropriate value.

7. Buyers, suppliers, new entrants and substitute products are all ................ forces.
8. A primary industry may be considered as a group of ................, whereas a secondary
industry includes ................

9. ................, ................ and ................ are essential for conducting an environmental survey.
10. Analyzing a company's industry begins with identifying the industry's dominant ................
features.

11. A ................ industry is dominated by a small number of large companies.
12. Defining an industry's boundaries is incomplete without an understanding of its ................
attributes.

13. Firms that enjoy ................ can charge lower prices than their competitors.
14. With Porter's framework, a strong competitive force can be regarded as a ................
15. ................ are the one-time costs that a customer has to bear to switch from one product to
another.
16. The new entrant's need to secure ................ for the product can create a barrier to entry.

4.9 Review Questions

1. "The five forces model provides the rationale for increasing or decreasing resources
commitment". Comment.
2. Are there any disadvantages in using Porter's five forces model? Elucidate the pros and
cons of using the model.

3. "The five forces theory is a short-sighted theory". Why/why not?
4. Discuss Industry analysis using Porter's five forces theory.
5. Present at least 7 points to highlight the importance of industry analysis.

6. Do you think it is important to define an industry's boundaries? Why/why not?
7. Suppose a firm competes in the microcomputer industry. Where in your opinion, the
boundaries of this industry begin and end?

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