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Portfolio Test 3

The document discusses various concepts related to strategic management, including strategic drift, the Blue Ocean strategy process, and disruptive innovation theory. It outlines key factors in industry competition, symptoms of misinterpreted architectural innovation, and the importance of understanding customer pain points. Additionally, it examines the failure of Blockbuster in the context of disruptive innovation and the significance of value networks in strategic analysis.

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Trang Nguyen Thi Ha
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52 views6 pages

Portfolio Test 3

The document discusses various concepts related to strategic management, including strategic drift, the Blue Ocean strategy process, and disruptive innovation theory. It outlines key factors in industry competition, symptoms of misinterpreted architectural innovation, and the importance of understanding customer pain points. Additionally, it examines the failure of Blockbuster in the context of disruptive innovation and the significance of value networks in strategic analysis.

Uploaded by

Trang Nguyen Thi Ha
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Portfolio Test 3

1. Strategic drift is best described as


a. The tendency of a firm and an industry to slowly move out of alignment with the needs of
customers and other stakeholders. Even customers might not realize the industry’s current
offering doesn’t quite match their needs.
b. The process by which a firm, under pressure from stakeholders to grow or improve quarterly
financial results, slowly straddles two strategic positions. In doing so the firm becomes stuck in
the middle and loses its competitive advantage in its original strategic position.

2. The key competing factors that are mapped in the industry’s “as is” value curve are
a. The different products and product features offered by the firm.
b. The key value factors for buyers in making their purchase decision.
c. The competencies possessed by the firm.
d. The areas that firms in an industry have historically focused on and invested in as they
compete with each other.

3. What are the 4 steps in the Blue Ocean strategy process?


(Select ALL that apply)
a. Brainstorm the strategic moves that should be adopted.
b. Identify the firm’s core competencies.
c. Map how the industry currently competes.
d. Assess current customer pain points.
e. Make trade off choices in the firms strategic position and value chain.
f. Select and validate the new target value proposition.
4. Which of the following were competing factors in the “as is” value curve for Blockbuster
and other video rental stores
(Select ALL that apply)
a. Proximity of physical store to residential areas.
b. The customer value delivered by the video store offering.
c. Number of Stores.
d. Number of copies available in store of new release hit films.
e. Rental price.

5. As a product or service passes through its life cycle - from invention to maturity - a
dominant design will emerge in an industry. At early stages of the life cycle there will be
wide variations in the components used and also in the product and production
architecture. However, in maturity, when a dominant design is established, the architecture
will be set and often taken for granted, with competition taking place on changes to
components.
a. True
b. False
6. Which of the following are symptoms you will tend to see if a firm has
innovation as component or modular misinterpreted architectural innovation?

(Select ALL that apply)


a. The firm does not possess the competencies needed to make the change and can not obtain
them.
b. Managers are unsure of what existing architectural knowledge can be retained and what needs
to be replaced.
c. Change is being interpreted through existing, usually effective, frameworks (e.g. capital
allocation processes, capacity planning) and explained by making links to previous events.

d. The firm makes rational choices to serve the needs of it’s best customers for whom the new
approach does not offer the required performance.
e. The firm is reluctant or unable to redirect time and resources to the new approach (often the
firm is still reliant on the revenue generated by the old approach).
f. Legacy processes and systems (e.g. IT systems) hinder the transitioning to a new architecture.

7. Which of the following does Christensen identify as a disruptive innovation that fits his
theory?
a. UBER Select.
b. UBER.
c. Intel Pentium processor.
d. Tesla Motors.

8. How should you use the theories of disruption to analyze a case or business?
a. Work through the case drawing in which ever element of the theory fits what you see.
b. Pick the theory you prefer and just use that in your analysis
c. Work through each of the two theories separately and see what facts from the case or business
fit the theory.
9. In Christensen’s theory of disruptions what reasons might there be for an existing firm
in an industry to choose to ignore a new low end innovation
(Select ALL that apply)
a. There are many critical and pressing strategic and operational issues that need the
organization’s attention and resources.
b. Managers’ credibility with investors for significantly diverting resources to a new
development that doesn’t meet customer’s needs and, as all firms have limited resources, reduces
focus on initiatives that do.
c. The performance does not meet that required by customers in its value network.
d. Itis just one of many new developments in the industry.

10. Which of the following suggest that Christensen’s theory of disruptive innovation may
explain the failure of Blockbuster?
a. The focus by Blockbuster on to in-store cross-sales to its regular (best) customers.
b. Initially Netflix was a low performing market entrant that could not match the performance of
Blockbuster on traditional industry metrics (e.g. availability of latest Hollywood film releases).
c. Netflix/streaming was just one of the competitive changes faced by the video rental market in
the early 2000s (e.g. supermarket sales, vending machines, Amazon).
d. Recruitment of a new CEO with retail turnaround experience.

11. Before mapping customer pain points on the Buyer Utility Matrix, a firm’s
management need to agree how the stages of the buyer experience cycle relate to their
industry
a. True.
b. False.
12. Where would the following competing factors be placed in an ERIC grid for Netflix:
Physical stores; Focus on Blockbuster Hollywood films; Availability of niche and non
English language films; Streaming technology infrastructure
a. Eliminate: Physical stores
b. Reduce: Focus on Blockbuster Hollywood films
c. Increase: Availability of niche and non English language films
d. Create: Streaming technology infrastructure

13. Which of the following theories suggest that firms can fail when faced with strategic
innovation and change?
(Select ALL that apply)
a. Blue Ocean Strategy.
b. Cognitive Limits.
c. Open Innovation
d. Christensen’s Disruptive Innovation

14. According to Christensen’s disruptive innovation theory, in most industries the rate of
improvement in the performance of a product or service will exceed the rate most
customers need those improvements
a. True.
b. False.

15. With the architecture of a product or service and its production becoming taken for
granted as part of the dominant design for an industry, there is a significant risk that firms
will misidentify architectural strategic changes as being a component or modular
innovation.
a. True.
b. False.
16. According to Christensen what is a “value network”
a. The activity system within the firm where individual activity choices align with strategic
themes and reinforce each other.
b. The result of a Blue Ocean process depicting the industry’s “as is” proposition and a firm's
target value curve that creates new market space.
c. An ecosystem - a set of connections between organizations interacting with each other to the
benefit of the group. Each member has adjusted to play its specific role in the functioning of the
whole network.

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