SEVI 30103 EXAM 1 CHAPTERS 1 & 4 STUDY GUIDE
Strategy - Answers - A set of goal-directed actions a firm takes to gain and sustain
superior performance relative to competitors
Strategic Management - Answers - An integrative management field
Combines analysis, formulation, and implementation for Comp. Adv.
3 elements that make a Good Strategy: - Answers - -A diagnosis of the competitive
challenge (Analysis of the firm's internal and external environments)
-A guiding policy to address the competitive challenge (Formulation of corporate,
business, and functional strategies)
- A set of coherent actions to implement the firm's guiding policy (Strategy
implementation)
The competitive challenge (Tesla) - Answers - Manufacture attractive and affordable
vehicles
A guiding policy (Tesla) - Answers - -Build cost-competitive vehicles
-Make significant investments in global vehicle manufacturing and lithium-ion battery
production
Coherent actions (Tesla) - Answers - -Ramp up productive to achieve economies of
scale
-Expand network of charging stations
Porter's Five Forces (Power of Suppliers) - Answers - They can raise prices and can
reduce quality
Suppliers are powerful when:
1. There are a few, large suppliers
2 . Suppliers sell to multiple industries
3 . There are no good substitutes
Competitive Advantage - Answers - achieved when a firm's performance exceeds that
of its competitors
Competitive parity - Answers - achieved when two or more firms perform at the same
level
sustainable competitive advantage - Answers - firm is able to outperform its competitors
over long period of time (Ex. Apple Smart phone industry)
How to gain competitive advantage - Answers - -Provide goods or services that
consumers value more highly than those of competitors
, -Profitability and Market share
Why should a firm establish Unique strategic positioning? - Answers - Performing
different activities than rival and perform the same activities differently than rivals
Who are Stakeholders? - Answers - Are organizations, groups or individuals who can
affect or be affected by a firm's actions
What are the interests/claims of different stakeholder groups? - Answers - shareholders
seeking profit, employees desiring job security, customers wanting quality products,
What role do stakeholders play in strategic decision-making? - Answers - influencing
priorities, providing insights, and holding organizations accountable
Competitive disadvantage - Answers - firm underperforms its rivals or the industry
average
Internal Stakeholders - Answers - Employees, Stakeholders and Board Members
External Stakeholders - Answers - Customers, suppliers, creditors, Communities
Characteristics of Stakeholders (Power) - Answers - A stakeholder can get the company
to do something it might not otherwise do
Characteristics of Stakeholders (Legitimacy) - Answers - A stakeholder's claim is
perceived to be legally valid or otherwise appropriate
Stakeholder Impact Analysis - Answers - provides a decision tool with which managers
can recognize, prioritize, and address the needs of different stakeholders
Pyramid of Social Responsibility - Answers - a model that suggests corporate social
responsibility is composed of economic, legal, ethical, and philanthropic responsibilities
and that the firm's economic performance supports the entire structure
Economic Level responsibility - Answers - to be profitable
Legal Level responsibility - Answers - Obey the Law
Ethical Level responsibility - Answers - Be ethical
Philanthropic Level responsibility - Answers - be a good global corporate citizen
Vision - Answers - -Captures an organization's purpose and aspiration
-Instills a sense of purpose
Mission - Answers - Describes what the organization actually does
Strategy - Answers - A set of goal-directed actions a firm takes to gain and sustain
superior performance relative to competitors
Strategic Management - Answers - An integrative management field
Combines analysis, formulation, and implementation for Comp. Adv.
3 elements that make a Good Strategy: - Answers - -A diagnosis of the competitive
challenge (Analysis of the firm's internal and external environments)
-A guiding policy to address the competitive challenge (Formulation of corporate,
business, and functional strategies)
- A set of coherent actions to implement the firm's guiding policy (Strategy
implementation)
The competitive challenge (Tesla) - Answers - Manufacture attractive and affordable
vehicles
A guiding policy (Tesla) - Answers - -Build cost-competitive vehicles
-Make significant investments in global vehicle manufacturing and lithium-ion battery
production
Coherent actions (Tesla) - Answers - -Ramp up productive to achieve economies of
scale
-Expand network of charging stations
Porter's Five Forces (Power of Suppliers) - Answers - They can raise prices and can
reduce quality
Suppliers are powerful when:
1. There are a few, large suppliers
2 . Suppliers sell to multiple industries
3 . There are no good substitutes
Competitive Advantage - Answers - achieved when a firm's performance exceeds that
of its competitors
Competitive parity - Answers - achieved when two or more firms perform at the same
level
sustainable competitive advantage - Answers - firm is able to outperform its competitors
over long period of time (Ex. Apple Smart phone industry)
How to gain competitive advantage - Answers - -Provide goods or services that
consumers value more highly than those of competitors
, -Profitability and Market share
Why should a firm establish Unique strategic positioning? - Answers - Performing
different activities than rival and perform the same activities differently than rivals
Who are Stakeholders? - Answers - Are organizations, groups or individuals who can
affect or be affected by a firm's actions
What are the interests/claims of different stakeholder groups? - Answers - shareholders
seeking profit, employees desiring job security, customers wanting quality products,
What role do stakeholders play in strategic decision-making? - Answers - influencing
priorities, providing insights, and holding organizations accountable
Competitive disadvantage - Answers - firm underperforms its rivals or the industry
average
Internal Stakeholders - Answers - Employees, Stakeholders and Board Members
External Stakeholders - Answers - Customers, suppliers, creditors, Communities
Characteristics of Stakeholders (Power) - Answers - A stakeholder can get the company
to do something it might not otherwise do
Characteristics of Stakeholders (Legitimacy) - Answers - A stakeholder's claim is
perceived to be legally valid or otherwise appropriate
Stakeholder Impact Analysis - Answers - provides a decision tool with which managers
can recognize, prioritize, and address the needs of different stakeholders
Pyramid of Social Responsibility - Answers - a model that suggests corporate social
responsibility is composed of economic, legal, ethical, and philanthropic responsibilities
and that the firm's economic performance supports the entire structure
Economic Level responsibility - Answers - to be profitable
Legal Level responsibility - Answers - Obey the Law
Ethical Level responsibility - Answers - Be ethical
Philanthropic Level responsibility - Answers - be a good global corporate citizen
Vision - Answers - -Captures an organization's purpose and aspiration
-Instills a sense of purpose
Mission - Answers - Describes what the organization actually does
