Skip to content

CS Professional · Strategic Management and Corporate Finance · Analyzing the External and Internal Environment

Which of the following best describes a strategic group in competitor analysis of an industry?

A strategic group is a set of firms within an industry that follow similar strategies on dimensions such as price, product quality and distribution channels. Grouping rivals this way helps a firm identify its closest competitors and the mobility barriers that protect or restrict movement between groups.

  1. AA set of firms in the same industry that follow similar strategies on key dimensions such as price, quality and distributionCorrect
  2. BAll firms in the industry irrespective of the strategy they follow
  3. CA set of shareholders who hold equal voting rights in a company
  4. DA department that prepares the annual budget of a firm

Explanation

A strategic group clusters rivals that pursue similar strategies on key competitive dimensions. The second option describes the whole industry, not a group within it. The remaining options are unrelated to competitor analysis.

Did you get it right without looking?

One question tells you little. A timed set on Analyzing the External and Internal Environment shows your real accuracy, how long you take and where you lose marks.

Practise Analyzing the External and Internal EnvironmentFree diagnostic mock

More Analyzing the External and Internal Environment questions