BM Flashcards
1:46 PM Thu Dec 26
..•
:= BM Summarize chp. 1 final
Chapter 1: Strategy
Business Models
Summary
- What is Strategy?
Strategy refers to the coordinated actions taken by managers to achieve long-term
success
outperform competitors
i involve eating ecisions abou hol to ceo pete in the market y
duding
posterin development
suppi chain tery hus pros fein
marketing
distribution and human resources).
- The focus of strategy is on achieving long-term growth
stability and remaining
competitive over time.
- Why Does a Company Need a Distinctive Strategy?
@ 99% C
© Done
competitors don’t have.
Key Points of a Distinctive Strategy
- Competing Differently: This means the company does something unique or
in a way that competitors are not doing.
- Leveraging Strengths: This means making the best possible use of a
company’s strengths.
These strengths include:
- Cost-Efficiency: Producing goods at lower costs than competitors.
- Product Quality: Offering products of higher quality than rivals.
- Innovation: Introducing new ideas
products
don’t have.
- What is a Business Model?
A business model is a blueprint that outlines how a company will deliver value to
customers while generating profits.
Two key elements of the business model:
- Customer Value Proposition: Describe how the company fulfills customers’
needs or solves their problems better than competitors.
- Profit Formula: Explain how the company generates revenue and manages
costs to ensure profitability from its operations (production
supply chain
activities. sales and marketing
customer service and Human Resources).
- Sustainable Competitive Advantage
A sustainable competitive advantage is when a company has a long-term edge
over competitors
creating value that rivals can’t easily replicate.
There are various Strategie Approaches to gain sustainable competitive
- Low-Cost Provider Strategy: The company focuses on being the cheapest
options in the market by reducing its costs to attract Price-Sensitive customers.
- Broad Differentiation Strategy: Offers Unique Features or qualities that
appeal to a broad range of customers (many customers).
- Focused Differentiation Strategy: It’s similar to the broad differentiation
strategy
but the company serves a small
quality
specialized
a Bot epins
or Sing a proThie stray pins ve plan
These strategies help a company attract customers
maintains profitability and stay
competitive over time.
- Why Does Strategy Evolve Over Time?
A company’s strategy does not stay fixed because it must adapt to internal and
external changes.
Strategies Change:
- Chen is action ang hei prefereed chr larkes arise in the market.
Sire o everies ev milkes in the aritis or at. sister us ma stren
Reared Stray is ate categy acon ay halous any emergent
changes: unplanned
reactive changes that happen in response to unexpected
challenges
new opportunities
- Tests of a Winning Strategy
A successful strategy must meet three key criteria: that helps to achieve long-
term success. These criteria are:
W.Siyanegic Siyagic italias with coms the singhen in the come com dang
operates).
- Competitive Advantage: Does the strategy provide sustainable competitive
edge over rivals that they can’t easily replicate.
- Performance: Does the strategy delivers strong results
such as growth and
profitability.
