When evaluating whether an industry's environment presents a company with an above-average profitability and an attractive business opportunity, it primarily involves

Multiple Choice

1. determining the industry's outlook for future profitability.
2. determining which firms in the industry have a competitive advantage and how they got their advantage.
3. determining the overall strength of the five competitive forces.
4. constructing a strategic group map and assessing the attractiveness of the competitive position of each strategic group to determine the overall attractiveness of all the strategic groups.
5. using value chain analysis to determine the relative cost positions of rival firms and to learn who the industry's low-cost producer is.
6. Which of the following factors should a company consider when determining if an industry offers good prospects for attractive profits?

Multiple Choice

the industry's growth potential, whether competition appears destined to become stronger or weaker, how the industry's driving forces might affect overall industry profitability, the company's competitive position relative to rivals, and the company's proficiency in performing industry key success factors

1. an assessment of which firms in the industry have the best and worst competitive strategies, whether the number of strategic groups in the industry is increasing or decreasing, and whether economies of scale and experience curve effects are a key success factor
2. whether there are more than five key success factors, more than five barriers to entry, and more than five industry drivers
3. whether the market leaders enjoy competitive advantages and how difficult it is to promote innovation to develop a strongly differentiated product or service for which a price premium may be charged
4. constructing a strategic group map and assessing the attractiveness of the competitive position of each strategic group

A superior indicator of how sound W.L. Gores strategy is and whether or not the strategy signals strong execution is

Multiple Choice

1. falling short of its stated financial objectives, that is, its financial performance is well below the industry average, and its market share gains reflect short-term preferences for capacity maximization.
2. remaining inattentive to possible improvements in its functional areas, creating stretch business goals, and providing a product-focused value proposition to customers.
3. foregoing initiatives designed to build market share and to promote corporate responsibility.
4. achieving its stated financial and strategic objectives via improvements in its internal processes such as defect rate, order fulfillment, delivery times, days of inventory, and employee productivity.
5. undertaking new initiatives to promote corporate social responsibility.