BUS-J 306 : EXAM 1
47 Cards in this Set
| Front | Back |
|---|---|
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Strategy
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A firm's theory about how to gain
competitive advantages
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The Strategic Management Process
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Mission ---> objectives --> external/internal analysis --> strategic choice -->strategy implement -->comp adv.
increases likelihood firm will choose good strategy
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a firms mission
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encompasses the entire strategic management process
long term purpose
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objectives
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specific, measurable targets to help firm determine if its realizing its mission, tightly connected to mission and easy to measure
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external/internal analysis
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Systematic Examination of the Environment
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external analysis
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• interest rates • demographics • social trends • technology
threats/oppurtunites from the environment
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internal analysis
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internal analysis • human resources (knowledge)
• manufacturing abilities
• technology
helps a firm determine its own strengths/weaknesses
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Corporate-level strategies
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operating in multiple markets or industries simultaneously
vertical integration, diversification, mergers, alliances
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strategy implementation
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formal/informal management controls, formal organizational structure, employee compensation policies
basically who's doing what, and how
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competitive advantage
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more economic value than rivals
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business strategies
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Cost Leadership
Product Differentiation
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accounting performance
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using information from a firm's published profit and loss and balance sheet statements.
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T or F - strategy implementation is just as important as strategy formulation
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True
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two types of comp adv
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preference for firms output, and/or coast advantage
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why is a firms corporate strategy almost always based on theory?
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difficult to predict how competition will evolve
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general external environment includes..
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tech change
demographic trends
cultural trends
economic climate
legal/politcal conditions
specific international events
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The Structure-Conduct-Performance Model
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industry structure
firm conduct
performance
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environmental threats
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threat of new competition
threat from existing competitors
threat of subs
threat of supplier leverage
threat from buyers influence
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T or F
Complementary Increase the Value of
the Focal Firms Product
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True
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four industry structures
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fragmented
emerging industry
mature industry
declining industry
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fragmented firm structure
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large # of small firms - no one is dominate, build power, exploit economies of scale
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Emerging Industry Structure
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new tech, no dominant leader, new customers come from non consumption (not competitors), first mover advantage, create switching costs
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mature industry structure
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slow demand growth, profits declining, exit begins, refine current products
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declining industry structure
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sales sustained decline, firms exiting, harvest, divest, niche
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SCP
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strategy, conduct, performance
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conduct
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strategies a firm chooses to implement in SCP model
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barrier to entry based on knowledge/info needed to compete in industry on daily basis
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managerial know how
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all of these are considered a barrier to entry
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economies of scale
cost adv independent of scale
gov regulation
product differentiation
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forward vertical integration
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suppliers ability to enter into and compete in a firms industry
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threats of suppliers in an industry
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subs
suppliers sell unique products
few firms in industry
suppliers threaten forward vertical integration
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rivalry tends to be low in competing firms when...
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substitutes are available
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primary drivers of comp. adv?
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resources and capabilities
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4 categories of resources
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financial, physical, human, organizational
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critical assumptions for RBV
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resource heterogeneity and resource immobility
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VRIO framework
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value, rarity, imitability, organization
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valuable but not rare resources
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competitive parity
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costs of imitation
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casual ambiguity, unique historical conditions, social complexity
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valuable, rare, and costly to imitate
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...
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product differentiation
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focus directly on attributes of service/good
product features
product complexity
timing of production
location/relationship among customers
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architectural Competence
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firms organize a structure that facilities coordination among disciplines to conduct research example of linkages
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cooperative strategic alliances
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linkages between firms that differeinate their product
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product differentiation helps reduce...
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threat of subs
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basis of product differentiation
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value!
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n a decline industry where should product differentiation efforts be focused?
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becoming industry leaders based on reputation
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to differentiate a firm can choose one of the following to focus on...
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attributes of product/service
relationship with customers
linkages within firm
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attributes of product/service differentiation
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product features, product complexity, product introduction, product location,
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attributes of relationship differentiation
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product customization, consumer marketing, reputation, product mix, distribution channels, service, support
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BUS-J 306: EXAM 2 STUDY GUIDE