Chapter 2—The External Environment: Opportunities, Threats, Competition, and Competitor Analysis

| September 28, 2018

71. The competition within each strategic group is

a.

more intense than
is the competition between strategic groups.

b.

less intense than
is the competition between strategic groups.

c.

typically very low.

d.

an unknown factor
in the analysis of competitive practices within a firm’s strategic group.

72. Firms within strategic groups

a.

follow dissimilar
strategies.

b.

follow similar
strategies across certain dimensions.

c.

typically engage in
greater amounts of intergroup rivalry than intragroup rivalry.

d.

exist almost
exclusively in the manufacturing sector.

73. All of the following are implications of strategic groups EXCEPT

a.

the strength of the
five forces differ across strategic groups.

b.

the strength of the
five forces is the same across strategic groups.

c.

competitive rivalry
within strategic groups is greater than between strategic groups.

d.

the closer the
strategic groups are in terms of strategies, the greater is the likelihood of
rivalry.

74. Competitor analysis focuses on

a.

firms with which
the company competes directly.

b.

firms that produce
products that are substitutes.

c.

all firms in the
industry.

d.

companies that
might enter the industry.

75. Which of the following pairs of companies would be least likely to
be examined together as part of competitive analysis?

a.

Home Depot and
Lowe’s

b.

Boeing and Airbus

c.

IBM and Microsoft

d.

Coca Cola and
PepsiCo

76. Competitor intelligence is

a.

legally or
illegally-gained data about competitors’ internal strategic processes and
competitive decisions.

b.

strategic
information gained from industrial espionage targeting international
competitors.

c.

the data that the
firm gathers to understand competitors’ objectives, strategies, assumptions,
and capabilities.

d.

illegal to gather
under the Sarbanes-Oxley Act.

77. Once a firm has determined its competitor’s future objectives,
current strategy, assumptions, and strengths and weaknesses, its next step is
to develop

a.

an environmental
assessment.

b.

a marketing plan.

c.

a response profile.

d.

a task force to
implement the plan.

78. A competitor analysis includes all of the following about
competitors EXCEPT

a.

future objectives.

b.

current strategy.

c.

assumptions.

d.

traditions.

79. Clarissa is a sales representative for a large pharmaceutical
firm. While calling on one of her major clients, the purchasing director of a
hospital, the client told her confidential information that a sales
representative from a competing firm had passed on to him. The information
completely contradicts Clarissa’s firm’s understanding of the competitor’s
business strategy, and would allow Clarissa’s employer to gain many of the
competitor’s clients.

a.

There is no ethical
or legal concern here for Clarissa.

b.

The ethical dilemma
is not Clarissa’s but her client’s, since he passed on confidential
information to her voluntarily.

c.

The ethical dilemma
here is the right of competitors not to reveal certain information.

d.

This is an example
of ethical competitor intelligence obtained as eavesdropping.

80. All the following are ethical sources of data for external
analysis EXCEPT

a.

trade shows.

b.

competitor’s annual
reports.

c.

competitor’s help
wanted advertisements

d.

a competitor’s
confidential memos.

81. Competitor intelligence could ethically come from all the
following EXCEPT

a.

court records.

b.

financial reports.

c.

trade show
discussions.

d.

eavesdropping.

82. Which of the following represents a competitive intelligence
practice that is both legal and ethical?

a.

A firm hires a
competitor’s employee and asks that employee to share the names and addresses
of business contacts from his/her previous job.

b.

An executive
attends a trade show solely to obtain a competitor’s brochures, listen to
sales pitches, and ask questions about the competitor’s products.

c.

A city council
member shares information about the decision process for selecting a
contractor to build a new library wing with his wife, an executive with a
construction firm bidding on the contract.

d.

A marketing manager
at Smith-Phillips, Inc., sells confidential plans for the company’s expansion
into the Far East to a firm that is not a direct competitor.

83. Which of the following intelligence gathering techniques is most
likely to be legal and ethical?

a.

hiring
investigators to examine the competitor’s trash

b.

entering a
competitor’s production plant without authorization

c.

redirecting a competitor’s
emails to one’s own company

d.

attending trade
show presentations given by a competitor’s employees

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