In Order to Be Successful with a Low-Cost Leadership Strategy

question 59

Multiple Choice

In order to be successful with a low-cost leadership strategy, company managers have to

• A)eliminate wholesale and retail intermediaries and instead sell directly to users of their product or service.
• B)perform value chain activities more cost-effectively than rivals and be proactive in revamping the firm's overall value chain to eliminate or bypass "nonessential" cost-producing activities.
• C)outsource the majority of value chain activities to nations that have lower wage rates and fewer regulations.
• D)develop and market products and services at that absolute lowest possible cost.
• E)pursue backward or forward integration to deter suppliers or buyers with considerable bargaining power and leverage.

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Definitions:

Intellectual Property

Legal rights given to individuals or organizations over creations of the mind, such as inventions, literary and artistic works, designs, and symbols.

Venture Capitalist

An investor who provides capital to startup companies and small businesses with perceived long-term growth potential in exchange for equity, or an ownership stake.

Due Diligence

An investigation or audit of a potential investment or product to confirm all facts, such as reviewing all financial records plus anything else deemed material.

Thalamus

A part of the brain that acts as a principal relay station for sensory information, directing it to appropriate areas of the brain for processing.