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As a rule when the collective impact of the five competitive forces is moderate to weak

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As a rule when the collective impact of the five competitive forces is moderate to weak

Awareness of these forces can help a company stake out a position in its industry that is less vulnerable to attack.

As a rule when the collective impact of the five competitive forces is moderate to weak

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Major contending forces, says this expert on business strategy, determine the state of competition in an industry: the threat of new entrants, the bargaining power of customers and of suppliers, the intense rivalry of competitors, and the threat of substitute services or products. Once the corporate strategist has assessed these forces, he can identify his own company’s strengths and weaknesses and act accordingly to put up the best defense against competitive assaults.

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The essence of strategy formulation is coping with competition. Yet it is easy to view competition too narrowly and too pessimistically. While one sometimes hears executives complaining to the contrary, intense competition in an industry is neither coincidence nor bad luck.

A version of this article appeared in the March–April 1979 issue of Harvard Business Review.

  • Michael E. Porter is the Bishop William Lawrence University Professor at Harvard Business School. He has served as an adviser to governments and campaigns around the world on the advancement of social policy and economic policy, including Mitt Romney’s presidential campaign. His latest paper is The Role of Business in Society. He is an academic adviser to the Leadership Now Project.

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As a rule when the collective impact of the five competitive forces is moderate to weak
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As a rule when the collective impact of the five competitive forces is moderate to weak

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As a rule when the collective impact of the five competitive forces is moderate to weak
1
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Which of the following is not one of the questions that needs to be answered in thinking strategically about a company's industry and competitive environment?
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
What kinds of competitive forces are industry members facing, and how strong is each force?
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
What emerging opportunities and threats are evident in the industry environment?
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
What market positions do industry rivals occupy--who is strongly/weakly positioned and who is not?
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
What are the key factors for future competitive success?
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
What forces are driving changes in the industry, and what impact will these changes have on competitive intensity and industry profitability?
As a rule when the collective impact of the five competitive forces is moderate to weak
2
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

In identifying an industry's dominant economic features, there is a need to consider such things as:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
market size and growth rate, the number of buyers, the scope of competitive rivalry, the number of rivals, demand-supply conditions, product innovation, the degree of product differentiation, the presence of scale economies and/or learning/experience curve effects, and the pace of technological change.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
the threat of additional entry into the industry and what the industry's key success factors are.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
the strength of competitive pressures from producers of substitute products and which competitors are in which strategic groups.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
the extent and importance of seller-supplier collaborative partnerships, the extent and importance of seller-buyer collaborative partnerships, and the bargaining leverage of sellers and buyers.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
All of these.
As a rule when the collective impact of the five competitive forces is moderate to weak
3
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

According to both the text discussion and the summary in Figure 3.4, which of the following is not among the factors that determine whether competitive rivalry among industry members is strong, moderate, or weak?
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether buyer demand for the product is growing rapidly or slowly
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether customers' costs to switch brands is low or high
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
How active industry rivals are in initiating fresh competitive moves and in using the various weapons of competition to improve their market standing and business performance
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether there are few or many rival sellers and whether there are big differences in their sizes and competitive capabilities
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether industry members are vertically integrated and whether the industry is characterized by significant scale economies and rapid technological change
As a rule when the collective impact of the five competitive forces is moderate to weak
4
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

The rivalry among competing sellers in an industry intensifies:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
when buyer demand for the product is growing rapidly.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
when customers are brand loyal and their costs to switch to competing brands or substitute products are relatively high.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
when buyer demand is strong and sellers have little or no excess capacity and only minimal inventories.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
as the number of rivals increases and as they become more equal in size and competitive capability.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
when the products of rival sellers are highly differentiated products and the industry consists of so many rivals that any one company's actions have little direct impact on rivals' business.
As a rule when the collective impact of the five competitive forces is moderate to weak
5
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Factors that cause the rivalry among competing sellers to be weak include:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
low buyer switching costs.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
slow growth in buyer demand.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
strong buyer loyalty, rapid growth in buyer demand, and so many industry rivals that any one company's actions have little impact on the businesses of its rivals.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
standardized or else weakly differentiated products among rival sellers.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
the presence of one or more rivals that are dissatisfied with their current position and market share.
As a rule when the collective impact of the five competitive forces is moderate to weak
6
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

According to both the text discussion and the summary in Figure 3.5, competitive pressures associated with the threat of new entrants grow stronger when:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
buyer demand is growing slowly and the pool of entry candidates is small.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
the number of customers for the industry's product is large and the product offerings of rival sellers are strongly differentiated.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
industry members are looking to expand their market reachby entering product segments or geographic areas where they currently do not have a presence, when current industry members are unable or unwilling to strongly contest the entry of newcomers, and when a newcomer can reasonably expect to earn attractive profits.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
there are not many competitors already in the industry, their products are highly differentiated, and buyers are brand loyal.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
a small percentage of companies in the industry are currently earning above-average profits, entry barriers are high, and buyers are not brand loyal.
As a rule when the collective impact of the five competitive forces is moderate to weak
7
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Which of the following conditions generally raise the barriers to entering an industry?
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
Low levels of brand loyalty on the part of customers and the presence of more than 20 rivals in the industry
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
Rapid market growth, low buyer switching costs, and weak brand preferences and customer loyalty
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
Product offerings that are pretty much standardized from rival to rival
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
High capital requirements, difficulties in building a network of distributors-retailers and securing adequate space on retailers' shelves, and the likelihood that industry incumbents will strongly contest the efforts of new entrants to gain a market foothold
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
The industry is not characterized by scale economies and/or sizable learning/experience curve effects and few firms in the industry hold key patents and/or possess significant proprietary technology not readily available to a newcomer
As a rule when the collective impact of the five competitive forces is moderate to weak
8
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Based on both the chapter discussion and the summary in Figure 3.6, competitive pressures stemming from substitute products are weaker when:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
substitutes are higher-priced, buyers don't believe substitute products have equal or better features, and buyers' costs of switching to substitutes are relatively high.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
the industry consists of a relatively large number of rival sellers that are fairly equal in size and competitive capability.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
entry barriers are moderately high but by no means prohibitive and there is a fairly small pool of entry candidates.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
a number of customers buy in large volumes and are in a strong bargaining position to win concessions from sellers.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
buyer loyalty to the products they are currently purchasing is relatively low.
As a rule when the collective impact of the five competitive forces is moderate to weak
9
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Which of the following is not a factor in determining whether the suppliers to an industry are a source of strong, moderate, or weak competitive pressures?
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether certain needed inputs are in short supply and whether the item being supplied is a standard commodity that is readily available from many suppliers at the going market price
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether it is difficult or costly for industry members to switch their purchases from one supplier to another or to switch to attractive substitute inputs
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether industry members are major customers of suppliers and whether suppliers' sales to members of this one industry constitute a big percentage of their total sales
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether the industry supply chain is global or mostly national, whether suppliers have a wide or narrow product line, and whether industry members place orders frequently or infrequently with suppliers
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether certain suppliers provide a differentiated input that enhances the performance or quality of the industry's product
As a rule when the collective impact of the five competitive forces is moderate to weak
10
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Which of the following is not a reason that industry rivals are often motivated to enter into strategic partnerships with key suppliers?
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
To enhance the quality of parts and components being supplied and/or to reduce defect rates
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
To speed the availability of next-generation components
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
To reduce the bargaining power they face from buyers of their products
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
To squeeze out important cost savings for both themselves and their suppliers
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
To reduce inventory and logistics costs
As a rule when the collective impact of the five competitive forces is moderate to weak
11
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Whether the buyers of an industry's product have strong or weak bargaining leverage over the terms and conditions of sale depends on:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
how often that sellers alter their prices, how sensitive buyers are to price differences among sellers, whether the item being purchased is a good or a service, and whether buyers buy frequently or infrequently.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
the frequency with which rival firms change strategies and the amount of advertising that sellers utilize.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
whether all buyers have the same degree of negotiating power, whether the item carries a high or low price tag, and whether there are many or few collaborative partnerships between sellers and buyers.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
whether buyers purchase in relatively large or small quantities, whether the costs of switching to competing brands or to substitute products are high or low, and how well informed buyers are about sellers' prices, products, and costs.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
whether buyer demand is seasonal or year-round, whether entry barriers are high or low, and whether competitive pressures from substitutes are strong or weak.
As a rule when the collective impact of the five competitive forces is moderate to weak
12
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

As a rule, the stronger the collective impact of the five competitive forces,
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
the more strategic groups there are in an industry.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
the lower the number of industry key success factors.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
the lower the combined profitability of industry participants and the more "competitively unattractive" is the industry environment.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
the weaker the industry's driving forces.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
the higher the barriers to entry and the less likely it is that industry members will make fresh strategic moves very frequently.
As a rule when the collective impact of the five competitive forces is moderate to weak
13
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

The task of driving forces analysis is to:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
identify all the underlying factors that can cause industry profitability to rise or fall in the years ahead.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
predict what new forces of competitive and market change will emerge next.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
determine which of the five competitive forces is the biggest driver of industry change.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
identify which companies are being driven to move from one strategic group to another strategic group.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
identify what the driving forces are, assess whether the drivers of change are, on the whole, acting to make the industry more or less attractive, and determine what strategy changes are needed to prepare for the impacts of the driving forces.
As a rule when the collective impact of the five competitive forces is moderate to weak
14
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Which of the following is not among the most common types of driving forces?
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
Product innovation, marketing innovation, increasing globalization of the industry, and reductions in uncertainty and business risk
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
Changes in the long-term industry growth rate, changes in who buys the product and how they use it, and growing buyer preferences for differentiated products
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
Ups and downs in interest rates, changes in the number of seller-supplier collaborative alliances, and changes in overall industry profitability
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
Emerging new Internet applications and capabilities, technological change, and the diffusion of technical know-how across more companies and more countries
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
Changes in cost and efficiency, the entry or exit of major firms, and changing societal concerns, attitudes, and lifestyles
As a rule when the collective impact of the five competitive forces is moderate to weak
15
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

The procedure for constructing a strategic group map involves:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
identifying the competitive characteristics that differentiate firms' market positions and competitive approaches.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
selecting variables for the map's axes that are highly correlated.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
using only variables for the map's axes that are quantitative in nature (qualitative measures of market positions and competitive approaches are too subjective and unreliable).
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
plotting the firms on a two-variable or two-dimensional map, drawing circles around those firms occupying about the same strategy space, and making the size of the circles for each strategic group proportional to the size of its members' share of total industry sales revenues.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
Both A and D
As a rule when the collective impact of the five competitive forces is moderate to weak
16
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

A strategic group map is a helpful analytical tool for:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
assessing why competitive pressures and driving forces usually impact the biggest strategic groups more so than the smaller groups.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
determining which companies have how big a competitive advantage and how good their prospects are for increasing their market shares.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
determining which company is the most profitable in the industry and why it is doing so well.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
determining who competes most closely with whom; evaluating whether industry driving forces and competitive pressures favor some strategic groups and hurt others; and ascertaining whether the profit potential of different strategic groups varies due to the strengths and weaknesses in each group's respective market positions.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
pinpointing which of the five competitive forces is the strongest and which is the weakest.
As a rule when the collective impact of the five competitive forces is moderate to weak
17
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Trying to determine what strategic moves rivals are likely to make next:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
is interesting but usually has little bearing on a company's own best strategic moves.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
usually requires evaluating the industry's key success factors as well as determining how many driving forces are present.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
is best done by monitoring each rival's market share, earnings per share, and stock price--adverse changes in these measures signal the coming of a fresh move but as long as a company's performance on these measures is satisfactory the chance of fresh moves is slim.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
cannot be done effectively without first drawing a strategic group map.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
entails understanding rivals' strategies, watching their actions on a regular basis, sizing up their strengths and weaknesses, gauging how well they are faring in the marketplace, assessing how much pressure they are under to improve their performance, and evaluating the relative merits of their strategic options and alternatives so as to better predict their likely next moves.
As a rule when the collective impact of the five competitive forces is moderate to weak
18
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

An industry's key success factors:
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
can best be determined by studying the strategies of those companies in the industry's best strategic group and those in the worst strategic group.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
concern the particular strategy elements, product attributes, resources, competencies, competitive capabilities, and market achievements that spell the difference between being a strong competitor and a weak competitor--and sometimes between profit and loss.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
are mainly a function of an industry's macro-environment and dominant economic features.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
can best be determined by identifying the similarities in the strategies of rival companies--those strategy elements that are most commonly found in the strategies of rivals can be considered key success factors.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
usually relate to technology and manufacturing-related capabilities and rarely to distribution or marketing capabilities.
As a rule when the collective impact of the five competitive forces is moderate to weak
19
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Which of the following is not an important factor for company managers to consider in drawing conclusions about whether the industry presents an attractive opportunity?
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether powerful competitive forces are squeezing industry profitability to subpar levels and whether competition appears destined to grow stronger or weaker
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
The industry's growth potential and the degree of uncertainty and risk in the industry's future
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
Whether industry profitability will be affected favorably or unfavorably by the prevailing driving forces
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
How many of the industry's key success factors do companies in the industry typically incorporate into their strategies
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
The company's ability to capitalize on the vulnerabilities of weakly positioned rivals and whether the company has sufficient competitive strength to defend against or counteract the factors that make the industry unattractive
As a rule when the collective impact of the five competitive forces is moderate to weak
20
As a rule when the collective impact of the five competitive forces is moderate to weak
As a rule when the collective impact of the five competitive forces is moderate to weak

Which one of the following statements is false?
As a rule when the collective impact of the five competitive forces is moderate to weak
A)
As a rule when the collective impact of the five competitive forces is moderate to weak
A company's macro-environment includes all relevant external factors and influences that bear upon a company's decision to move to a different strategic group, change its strategic intent, or modify its objectives, strategy, or business model.
As a rule when the collective impact of the five competitive forces is moderate to weak
B)
As a rule when the collective impact of the five competitive forces is moderate to weak
A company's strategy is increasingly effective the more it provides some insulation from competitive pressures and shifts the competitive battle in the company's favor.
As a rule when the collective impact of the five competitive forces is moderate to weak
C)
As a rule when the collective impact of the five competitive forces is moderate to weak
The task of driving forces analysis is to separate the major causes of industry change from the minor ones.
As a rule when the collective impact of the five competitive forces is moderate to weak
D)
As a rule when the collective impact of the five competitive forces is moderate to weak
Scouting competitors well enough to anticipate their next moves allows managers to prepare effective countermoves (perhaps even beat a rival to the punch) and to take rivals' probable actions into account in crafting their own best course of action.
As a rule when the collective impact of the five competitive forces is moderate to weak
E)
As a rule when the collective impact of the five competitive forces is moderate to weak
The degree to which an industry is attractive or unattractive is not the same for all industry participants or all potential entrants because the attractiveness of the opportunities an industry presents depends heavily on whether a company has the resource strengths and competitive capabilities to capture them.

rule collective impact competitive forces moderate weak

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