MGMT 3000 1st Edition Lecture9Outline of Last Lecture I. Sustainable Competitive advantage Outline of Current Lecture I. Google’s sustainable competitive advantageII. 3 Steps of Strategy making process: a. Assessing need for changeb. Situational analysis c. Choosing Strategic Alternatives Current Lecture Google’s sustainable competitive advantage: Mission: organize the world’s information and make it universally accessible Competitors: Yahoo and bald are the biggest competitors but Yahoo is the only one powered by Bing. Market share is greater than 90% in Europe, 67% of market share around the world Google does things so that people don’t have to leave the Google website Ex. When you type in the name of a restaurant it will give you the address, phone number and hours of operations so that you don’t even have to leave the website. Duckduckgo: Does not track the searches of the user which makes it very different from Google Yahoo’s competitive advantage: It used to be the most popular website but it failed to keep up with Google 3 steps of strategy making process: 1. Assessing need for ChangeCompetitive inertia: occurs when top-level managers are slow to recognize need for change in strategy - Stems from a reluctance to change strategies or competitive practices that have been successful in the past Strategic dissonance: divergence between upper management’s strategy and the strategy actually implemented by lower levels of management Can indicate a problem with missile or lower management or strategy has2. Situational Analysis: helps managers determine the need for strategic change SWAT analysis These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.Strengths, weaknesses, opportunities, threats Strengths and weaknesses are internal wile opportunities and threats are external Strengths/ weaknesses include- Distinctive competencies: something a company can do better than its competitors - Core capabilities: Less visible factors that determine how efficiently inputs can be turned into outputs - Shadow-strategy task force: Actively seeks out its own company’s weaknesses and then thinking like a competitor, determines how other companies could exploit them Opportunities/ threats include - Environmental Scanning: managers must identify specific opportunities and threats that affect a company’s ability to sustain competitive advantage - Strategic group: A group of companies within an industry against which top managers compare, evaluate and benchmark their company’s strategic threats and opportunities o Compete directly - Core firms: central companies in a strategic group - Secondary firms: firms that use strategies related to but somewhat different than those of core firms 3. Choosing strategic alternativesStrategic reference points: goals/ objectives that managers use to measure whether their firm has developed the core competencies that it needs to achieve a sustainable competitive advantage Managers can influence strategies chosen by company by actively changing and adjusting strategic reference points Managers pick between 2 alternatives: - Risk avoiding: conservative strategy aimed at protecting existing competitive advantage - Risk-Seeking: aggressive strategy aimed at extending or creating a sustainable advantage Not deterministic and managers are not predestined to choose risk averse or seeking strategies Managers can influence the strategies chosen by actively changing and adjusting strategic reference points they use to judge strategic
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