QUESTIONS FOR GROUP ASSIGNMENT

Question one

a) Using relevant examples, explain five (5) advantages and disadvantages of vertical
integration
b) Describe the horizontal integration as it is applied in strategic management of
organisations
c) When is horizontal integration applicable?

Question two

a) What do you understand by the term diversification strategy?

b) Provide five (5) reasons why should organisations apply diversification strategy
c) Use relevant examples to explain differences between concentric diversification
and conglomeration diversification

Question three

a) Use relevant examples to discuss professor Porter’s Generic strategies (cost leadership;
differentiation; and focus)
b) In what circumstances is each one of generic strategy applicable?
c) What are the advantages and disadvantages of generic strategies?

Question Four

a) In which situations do you think that the neither a low cost nor a differentiation strategy
would be possible for an organisation?
b) There are many risks in cost leadership strategy. What are they and how would it affect
you as a manager?
c) Under what condition(s) do you think would the cost leadership strategy work better?
Key Words

1. Backward Integration: Gaining ownership or increased control of a firm's suppliers.

Corporate Strategy: primarily about the choice of direction for the corporation as a whole
2. Diversification: process of adding new businesses to the existing businesses of the
company
3. Horizontal Integration: The strategy of seeking ownership or increased control over a
firm's competitors.
4. Integration: Integration basically means combining activities relating to the present
activity of a firm.
5. Intensive Strategy: firms intensify their efforts to boost sales and grow market share
6. Market Development: seeks to increase market share by selling the present products in
new markets
7. Market Penetration: seeks to increase market share for existing products in the existing
markets through greater marketing efforts.
8. Vertical Integration: Expanding the firm's range of activities backward into the sources
of supply and/or forward into the distribution channels
9. Cost Leadership: A strategy whereby a firm aims to deliver its product or service at a
price lower than that of its competitors.
10. Differentiation: Offering a product or service that is perceived as unique or distinctive by
the customer.
11. Focus Strategy: The strategy in which a firm focuses on a specific niche in the market
place and develops its competitive advantage by offering products especially developed
for that niche.
12. Industry: A collection of firms offering goods or services that are close substitutes of each
other.
13. Positioning: Occupying a distinct position in the minds of consumers.