Divergent unveils part 3d printed supercar

1. Use the articles, “Divergent unveils part-3D printed supercar” on page 1 and “Google hopes all or nothing bet on robot cars will pay off soon,” on page 3 in answering the following questions concerning commitment:(14points) a.What is meant by the term "commitment"? (2 points) b.What is Google’s commitment, as described in that article? (2 points) c.What are the three characteristics that distinguish a strategic move as creating a strong commitment? (3 points) d.Is Divergent making a strong commitment to develop a high- performance, lightweight car? (3 points) e.What is meant by the term "real option"? (2 point) f.Explain Divergent’s commitment in terms of Divergent’s real options. (2 points) a. Commitment is defined as a decision which is strategic with a long term impact on the rival moves or rather rival expectations and that require great investment in terms of energy, time, and difficult to reverse. b. Google’s commitment is successfully market an autonomous car. Their large investment is on the production and innovation alongside making its products known publicly. c. Characteristics which differentiate strategic move from creating a strong commitment lies in the move which should be understandable, visible, and creditable. In addition, strong commitment should be irreversible and is mean to negatively affect the profits of the rivals and benefit the host firm. d. It is true that Divergent is making a strong commitment. This has been attributed by the fact that they have invested a lot on both time and energy, and the firm is well known to the public. The firm is also in the move to raise extra capital of $10m in order to build a plant. e. Real option can be defined as the flexibility of a plan to adequately create opportunities which allow change in the event of a new information in the future. f. The real option available to Divergent as a commitment is to build the new plant which will allow the firm to reduce the variable costs and have the opportunity to outsource steps such as assembly which could be down in local small plants if the costs are lower depending on the market environment. 2. Using the article, “Federal Panel Backs Approval of New Drug to Fight Heart Attacks” on page 2, select one of these 3 firms mentioned in the article: Sanofi, Regeneron Pharmaceuticalsand Amgen; and then answer the following questions for the firm you’ve chosen: (6 points: 3 points each) 1. a. A. Explain why any particular one of the 5 forces has considerable power over this firm. Defend your answer. b. B. Explain why another particular one of these 5 forces has little power over this firm. Defend your answer. a. Entry barriers would have considerable power over the firms which would want to join the industry or to the firms that are already in the industry. This is because of the FDA approval and also the supplier power as a result of potential price discrimination. b. Currently, the substitute threat is low due to the presence of high entry barriers and lack of close substitutes. However, with time the competitors will catch up with the current situation or pass the challenges after the approval has been made. In addition, due to the fact that they are the first in the market, the friction of internal rivalry might be low until that moment when the more seller enter the market. 3.Use the article, “Use the article, “Federal Panel Backs Approval of New Drug to Fight Heart Attacks” on page 2, and answer the following questions for Sanofi: (6 points: 2 points each) a.How would you argue that Sanofi is positioning its product to make it a benefit leader in the reduction of LDL (bad cholesterol)? b.Strategically, how does this company plan to compete with other companies? (NOTE: Your answer should mention price and elasticity of demand.) c.Why might this move into this new type of drug cause a SPECIFIC other company (name it!) to make strategic moves to enhance its cost leadership OR its benefit leadership? a. Benefit leader offers a product or service to its clients at a benefit which extremely better as compared to the costs of its competitors. b. Since they are the first in the market they have the ability to control the prices and also as a result of the benefit they have on their drugs,