WPC 480 Chapter 4 Exam With Complete
Solutions
Business-Level Strategy
Integrated and coordinated set of commitments and actions used to gain competitive advantage by
exploiting core competencies in a SPECIFIC product market.
Digital Strategy
Uses digital technology to understand customers' needs and develop innovations for creating more
value.
Business Model
Describes how a firm creates, delivers, and captures value for its stakeholders.
Cost Leadership
- Strategy to produce products with acceptable features at the lowest cost
- achieved through process innovations
- Competitive risks: 1. could become obsolete due to competitors innovations
2. cost reductions may come at expense of trying to understand customer's perceptions
3. imitation
Differentiation
- Strategy to produce products perceived as different in important ways to target customers
- Competitive risks:
1. may decide price difference is too large
2. means of differentiation may cease
3. narrow customers perceptions of value of a products differentiated features
Focus Strategies
- produce products serving the needs of a particular customer segment
-Competitive risks:
1. "out focus"
2. company on industry wide basis may decide segment is attractive and worthy of competitive
pursuit
3. customer needs may be similar to industry wide competitors
Integrated Cost Leadership/Differentiation
- Engages in primary value chain activities and support functions to achieve a low-cost position with
some product differentiation
-Competitive risks:
1. difficult to perform value chain and support activities inexpensively and differentiate
2. reducing costs and differentiation is necessary simultaneously
Market Segmentation
Process of dividing customers into groups based on their needs.
, Business Model Innovation
Occurs when a firm replaces its current business model with a newer one in response to changing
conditions.
Freemium Model
Offers basic services for free and charges for premium features.
Subscription Model
Offers a product to customers on a regular basis such as once-per-month or once-per-year.
Digital Platform
Internet-based location for exchanges of information, goods, or services between producers,
consumers, and other members of the platform community.
Flexible Manufacturing Systems
Computer-controlled process used to produce a variety of products in moderate, flexible quantities
with minimal manual intervention.
Total Quality Management Systems
Implementation of appropriate tools/techniques to provide products and services to customers with
the best quality.
Stuck in the Middle
Firms that compete at a disadvantage and are unable to earn more than average returns.
Which of the following strategies helps a firm concentrate on understanding its customers and their
needs with greater clarity as a foundation for innovation?
Digital strategy
Business model strategy
Cost leadership strategy
Market segmentation strategy
Digital strategy
_____ strategy indicates the choices the firm has made about how it intends to compete in individual
product markets.
Cooperative
Global-competition
Corporate-level
Business-level
Business-level
When selecting a business-level strategy geared toward customers, the firm determines all of the
following EXCEPT:
who will be served.
what needs those target customers have that it will satisfy.
when to start implementing the strategy.
how the needs of target customers will be satisfied.
Solutions
Business-Level Strategy
Integrated and coordinated set of commitments and actions used to gain competitive advantage by
exploiting core competencies in a SPECIFIC product market.
Digital Strategy
Uses digital technology to understand customers' needs and develop innovations for creating more
value.
Business Model
Describes how a firm creates, delivers, and captures value for its stakeholders.
Cost Leadership
- Strategy to produce products with acceptable features at the lowest cost
- achieved through process innovations
- Competitive risks: 1. could become obsolete due to competitors innovations
2. cost reductions may come at expense of trying to understand customer's perceptions
3. imitation
Differentiation
- Strategy to produce products perceived as different in important ways to target customers
- Competitive risks:
1. may decide price difference is too large
2. means of differentiation may cease
3. narrow customers perceptions of value of a products differentiated features
Focus Strategies
- produce products serving the needs of a particular customer segment
-Competitive risks:
1. "out focus"
2. company on industry wide basis may decide segment is attractive and worthy of competitive
pursuit
3. customer needs may be similar to industry wide competitors
Integrated Cost Leadership/Differentiation
- Engages in primary value chain activities and support functions to achieve a low-cost position with
some product differentiation
-Competitive risks:
1. difficult to perform value chain and support activities inexpensively and differentiate
2. reducing costs and differentiation is necessary simultaneously
Market Segmentation
Process of dividing customers into groups based on their needs.
, Business Model Innovation
Occurs when a firm replaces its current business model with a newer one in response to changing
conditions.
Freemium Model
Offers basic services for free and charges for premium features.
Subscription Model
Offers a product to customers on a regular basis such as once-per-month or once-per-year.
Digital Platform
Internet-based location for exchanges of information, goods, or services between producers,
consumers, and other members of the platform community.
Flexible Manufacturing Systems
Computer-controlled process used to produce a variety of products in moderate, flexible quantities
with minimal manual intervention.
Total Quality Management Systems
Implementation of appropriate tools/techniques to provide products and services to customers with
the best quality.
Stuck in the Middle
Firms that compete at a disadvantage and are unable to earn more than average returns.
Which of the following strategies helps a firm concentrate on understanding its customers and their
needs with greater clarity as a foundation for innovation?
Digital strategy
Business model strategy
Cost leadership strategy
Market segmentation strategy
Digital strategy
_____ strategy indicates the choices the firm has made about how it intends to compete in individual
product markets.
Cooperative
Global-competition
Corporate-level
Business-level
Business-level
When selecting a business-level strategy geared toward customers, the firm determines all of the
following EXCEPT:
who will be served.
what needs those target customers have that it will satisfy.
when to start implementing the strategy.
how the needs of target customers will be satisfied.
