Ch. 5 Functional & Competitive Strategies

Question 1

What are the 3 functional concerns of an organization? Give examples for each.

Answer 1

1. Product strategies (design, ops, marketing)
2. People strategies (hr)
3. Support process strategies (information systems, financial accounting)

Question 2

What are the 3 perspectives on defining who competitors are? Explain each briefly.

Answer 2

1. Industry perspective (supermarket, cars, credit card)
2. Market perspective (entertainment, video games, netflix, theme park)
3. Strategic groups
4. Competitors are organizations that make/sell same or similar goods. Industries are described by number of sellers and differentiation.
5. Competitors are organizations that satisfy the same customer needs. Intensity depends on how well customer needs are understood, defined and met.
6. Competitors are groups of firms in an industry with similar strategies, resources and customers. Strategic factors are price & distribution strategy.

Question 3

What are the 2 broad types of competitive strategy?

Answer 3

• Miles & Snows (traditional)

- Generic competitive strategies (Porter)

Question 4

Explain the 4 components of the Miles and Snows competitive strategy

Answer 4

1. prospectors (first movers)
2. analyzers (follows first mover after proven succes)
3. defenders (defensive strategy)
4. reactors (no distinct strategy)

Question 5

What are the 2 strategic dimensions of Porter and what 4 strategies result from that?

Answer 5

• Competitive scope (narrow or broad)
• Competitive advantage (cost/differentiation)

1. Cost leadership
2. Differentiation
3. Cost focus
4. Differentiation focus

Question 6

What are the origins of competitive advantage

Answer 6

• people
• organization
• technology

Question 7

How does competitive advantage progress over time?

Answer 7

1. product
2. manufacturing
3. organisational processes
4. people driven processes

Question 8

What are the 8 high-peformance work practices

Answer 8

1. Self-managed work teams
2. Decentralized decision making
3. Flexible job assignments
4. Open communication
5. Performance-based compensation
6. Staffing based on person-job and person-organization fit
7. Extensive employee involvement
8. Giving employees more control over decision making

Question 9

What are some possible dimensions for identifying strategic groups?

Answer 9

1. price
2. quality
3. level of vertical integration
4. geographic scope
5. product line breath/depth
6. level of diversification
7. R&D expenditures
8. market share
9. profit
10. product characteristics