CS CS Competitive Intelligence & Positioning 2 — Questions and Answers
Question 1: Strategic group mapping is used to:
- Assign employees to strategic projects
- Visualize clusters of competitors following similar strategies within an industry (Correct answer)
- Map customer demographics by region
- Plot financial performance over time
Correct answer: Visualize clusters of competitors following similar strategies within an industry
Strategic group maps plot industry competitors on two strategic dimensions to identify clusters of rivals with similar approaches and reveal mobility barriers.
Question 2: The concept of a 'first-mover advantage' in competitive strategy refers to:
- Being the first to lower prices in a market
- Gaining sustainable benefits by entering a market before competitors (Correct answer)
- Launching a product first within a company's portfolio
- Moving executives to the front of organizational charts
Correct answer: Gaining sustainable benefits by entering a market before competitors
First-mover advantages include brand loyalty, switching costs, resource preemption, and learning curve benefits that are difficult for followers to overcome.
Question 3: PESTEL analysis helps strategists understand competitive positioning by examining which factors?
- Price, Earnings, Sales, Technology, Expenses, Labor
- Political, Economic, Social, Technological, Environmental, Legal (Correct answer)
- Performance, Efficiency, Stakeholders, Teams, Execution, Leadership
- Profit, Equity, Strategy, Talent, Ethics, Leverage
Correct answer: Political, Economic, Social, Technological, Environmental, Legal
PESTEL scans the macro-environment across six dimensions to identify external forces that shape competitive conditions and strategic opportunities or threats.
Question 4: A company pursuing a 'fast follower' strategy attempts to:
- Lead the market with radical innovation
- Rapidly imitate and improve upon a pioneer's offering to capture market share (Correct answer)
- Acquire the first mover
- Compete solely on lowest cost
Correct answer: Rapidly imitate and improve upon a pioneer's offering to capture market share
Fast followers let pioneers absorb market-creation costs and then quickly enter with refined products, leveraging the established demand.
Question 5: Which of the following best describes sustainable competitive advantage?
- A temporary price reduction that outperforms competitors
- A distinctive capability that rivals cannot easily imitate or substitute (Correct answer)
- A large advertising budget
- A one-time technology upgrade
Correct answer: A distinctive capability that rivals cannot easily imitate or substitute
Sustainable competitive advantage stems from resources or capabilities that are valuable, rare, inimitable, and non-substitutable (the VRIN framework).
Question 6: Competitive benchmarking in strategic positioning involves:
- Setting internal goals without external reference
- Comparing a firm's processes and outcomes against best-in-class competitors (Correct answer)
- Publishing competitor data publicly
- Hiring benchmarking consultants only
Correct answer: Comparing a firm's processes and outcomes against best-in-class competitors
Benchmarking identifies performance gaps by measuring your firm's metrics against top performers, driving targeted improvements in competitive positioning.
CS CS Competitive Intelligence & Positioning 2
Strategic group mapping is used to: