Ch 13 Flashcards
Product differentiation
Organization offered products or services perceived by
Customers to be superior and unique relative to
Products and services of competitors
Ex apple, Johnson and johnson
5 forces of industry analysis strategy?
1 competitors 2 potential entrants into market 3 equivalent products 4 bargaining power of customers 5 bargaining power of input suppliers
2 basic strategies of company?
1 product differentiation
2 cost leadership
Cost leadership
Organizations ability to achieve lower costs relative to
Competitors through productivity and efficiency improvements,
Elimination of waste and tight cost control
Ex. Walmart, home depot
Reengineering
Fundamental rethinking and redesign or business
Processes to achieve improvements in critical performance
Critical performance 5 things
Cost, quality, service, speed and customer satisfaction
Balanced scorecard
Translate’s an organization’s mission and strategy into
Set of performance measures
provides framework for implementing its strategy
Four perspectives measured on balanced scorecard?
1 financial
2 customer
3 internal business
4 learning and growth
Balanced scorecard perspective: financial
Profits and value created for shareholders
Balanced scorecard perspective: customer
Success of company in its target markets
Balanced scorecard perspective: internal business processes
Internal operations that create value for customers
Balanced scorecard perspective: learning and growth
People and system capabilities that support operations
Strategy map
Diagram describes how organization creates value by
Connecting strategic objectives in explicit cause and effect
Relationships with 4 balanced score card perspectives
Innovation process
Creating products, services and processes that meet
Needs of customers
Operations process
Producing and delivering existing products and services
That will meet needs of customers
Post sales service process
Providing service and support to customers after sale
Of product or service
How does a company choose its strategy?
Based on understanding of customer preferences and
It’s own internal capabilities compared to competitors
