A group of firms in an industry following the same and similar strategies are called:

Question

Accepted Answer

The correct option is 1:
A Strategic Group is a fundamental concept in competitive analysis within strategic management, defined as a cluster of firms within an industry that pursue similar competitive strategies, offer comparable products, or serve similar market segments. The key characteristic is the similarity of strategic choices—such as pricing, quality, distribution, or geographic scope—that binds these firms together as direct rivals. Analyzing industries through the lens of strategic groups, a concept developed by researchers like Michael Porter, helps explain why profitability can vary significantly among different sets of competitors even within the same industry, as these groups often face similar "mobility barriers" that restrict movement between groups.

The incorrect option is 2:
Benchmarking Group is an intentional grouping of companies, often selected based on common cohort characteristics like size, revenue, or business type, for the purpose of performance comparison and best practice identification. Benchmarking is a management process of measuring products, services, and processes against those of "best-in-class" organizations. While firms within a strategic group may engage in benchmarking against each other or external leaders, the term itself refers to the *comparative process* or the *peer group* chosen for that comparison, not the naturally occurring cluster of firms following a similar strategy.

The incorrect option is 3:
Group Cohesiveness is a concept from organizational behavior and sociology, which refers to the degree of unity and the strength of the bonds linking members of a *single* team or group. It is a measure of the internal solidarity and motivation of a team to stick together and work toward a common goal, often influenced by factors like interpersonal attraction and shared commitment. This term describes the internal dynamic of a work unit, department, or committee, and has no direct relevance to classifying external rival companies within an industry.

The incorrect option is 4:
Core Competence Group is not a standard term used in strategic management to describe a cluster of firms. The term *Core Competence* is an internal resource-based concept referring to a unique, harmonized combination of a *single firm's* multiple resources and skills that provides it with a sustainable competitive advantage. This collective learning is difficult for competitors to imitate and forms the foundation of a company's ability to innovate and deliver value to customers. Therefore, it is a term for an individual company's unique strengths, not for a category of multiple competing firms.