Question Details

The integration of a cost leadership





1.	Focus strategies are
a.	sheltered from the risks associated with industry-wide strategies because of their niche focus.
b.	able to avoid global risk by focusing on niches in national or regional markets.
c.	faced with additional types of risks than are industry-wide strategies.
d.	more subject to failure than industry-wide strategies.



	2.	New Balance Athletic Shoes target Baby Boomers’ needs for well-fitting shoes. The company is unique in that it offers a very broad range of shoe widths. A realistic potential risk New Balance runs in this focused differentiation strategy includes the possibility that:
a.	Baby Boomers may find that they do not need well-fitting shoes, since they will become increasingly sedentary as they age.
b.	A competitor may be able to better use flexible manufacturing systems to make shoes with an individualized fit.
c.	Athletic shoes may go out of style.
d.	New Balance shoes may begin to appeal to a wider market, thus losing New Balance- focus advantage.




	3.	Zara has developed capabilities to compete in the “fast fashion” portion of the clothing market, including quickly copying runway fashions; vertical integration from design to point of sale; flexible, just-in-time manufacturing systems; and a time to market for new items of just three weeks compared to an industry average of nine months. These are all characteristics of what business level strategy?
a.	Cost leadership
b.	Differentiation
c.	Integrated, low-cost differentiated
d.	Stuck-in-the-middle



4.	It is more common for firms to attempt to use the integrated cost leadership/differentiation strategy now than in the past because
a.	other firms have established unassailable market dominance with the other four strategies.
b.	global markets allow for much broader competitive scope.
c.	customers have increasingly high expectations when purchasing a good or service.
d.	one strategy is not enough for most large firms.



	5.	The integration of a cost leadership and a differentiation strategy
a.	is challenging because of the inherent difficulties in balancing primary and support activities.
b.	forces a firm to adapt more slowly to changes in its environment.
c.	allows the firm to avoid being “stuck in the middle.”
d.	requires such a large customer base that it is most practical for firms in the global marketplace.




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