Business Strategy and Models

Question 1

What is a business strategy

Answer 1

Business strategy is about having a clear set of plans,
actions and goals that outlines how a business will compete in a particular market (or markets) with a product,
number of products or services”

Question 2

Strategic Business Units (SBU’s)

Answer 2

A strategic business unit (SBU) supplies goods or services for a distinct domain of activity:
1. What is Business Strategy?
* SBU = divisions or profit centres
* SBU can be identified by:
1. Market-based criteria
2. Capabilities criteria

Question 3

What types of Business Strategy exists?

Answer 3

1.Competitive Strategy ->Competitive Advantage->Creating
Value

Question 4

What is Generic Strategy?

Answer 4

Basic types of competitive strategy
that hold across many kinds of business situations.
You can look at the porter’s model and Treacy &
Wiersema

Question 5

Cost-leadership strategy

Answer 5

involves becoming the lowest-cost organisation in a domain of activity;

1. Lower input costs
2. Economies of scale
3. Experience
4. Product/process design

Question 6

Differentiation strategy - Apple

Answer 6

Differentiation involves uniqueness along some dimension
that is valued by customers to allow a price premium
Key drivers of differentiation:
* Product & service attributes
* Customer relationships
* Complements

Question 7

Cost-focus Strategy - Ryanair

Answer 7

A Cost-focus strategy identifies areas where broader cost based strategies fail because of the added cost of trying to satisfy a wide range of needs
* Competing based on price
* Target a niche market (at first)

Question 8

Differentiation focus strategy

Answer 8

Differentiation focusers look for specific needs that broad
differentiators do not satisfy so well
* Focus on unique features
* Niche market

Question 9

Hybrid strategy

Answer 9

A hybrid strategy combines different generic strategies.

Question 10

Interactive strategies

Answer 10

usiness strategy choices depend on what competitors do
-> they are interactive
1. HYPER COMPETITION* Impossible to plan for long-term
* Planning ≠ competitive advantage
* Speed & initiative
2.GAME THEORY* Competitors’ likely moves and the
implications for own strategy
* Competitors are interdependent

Question 11

What are the Business Models components?

Answer 11

1.VALUE CREATION - What is offered to what customer
segment?
2.VALUE CONFIGURATION - How is the value
proposition structured?
3.VALUE CAPTURE - Why does the model generate a
margin?
4. Strategic Flexibility - Strategic flexibility is the
capability to respond to major changes in the external
environment by committing the resources necessary to respond to those changes