LaserTech is a manufacturer of industrial lasers and has developed a new, patented technology that allows its customers to manufacture their products more precisely with a higher level of consistency and at a lower cost than they could previously. LaserTech's executives believe that no rivals have a similar technology and that it would be very difficult for rivals to copy this technology since the benefits of the new technology can only be realized within LaserTech's system, which includes processes that are protected by trade secrets, making it difficult for rivals to understand the relationship between the company's new technology and its competitive advantage.
-If one of LaserTech's rivals were to decide to divest its industrial laser manufacturing business in response to LaserTech's new technology, this would be an example of
A) competitive dynamics.
B) tacit collusion.
C) a sustainable distinctive competence.
D) competitive parity.

Question

Quizplus · Accepted Answer

The rival's decision to divest its industrial laser manufacturing business in response to LaserTech's new technology shows a change in competitive dynamics. This change could be driven by LaserTech's competitive advantage and the difficulty for other companies to replicate their technology, leading to a shift in the competitive landscape. This suggests that LaserTech's technology has disrupted the existing market and altered the competitive dynamics of the industry.

LaserTech Is a Manufacturer of Industrial Lasers and Has Developed