New Firms' Business Models Cannot Be Imitated Quickly by Incumbents

question 37

True/False

New firms' business models cannot be imitated quickly by incumbents because of tradeoffs with value-chain activities that are essential to the incumbents.

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Definitions:

Decentralized Company

A decentralized company allows for decision-making authority to be distributed among various levels within the organization rather than being concentrated at the top.

Decision Making

Choosing among alternative actions; a component inherent in the other management processes of planning, directing, controlling, and improving.

Negotiated Price Approach

An approach to transfer pricing that allows managers of decentralized units to agree (negotiate) among themselves as to the transfer price.

Transfer Price

The price at which goods and services are sold between divisions within the same company.