Chap 8: Business Level Strategy Flashcards
This strategy is formulated at the middle level management with strong and close coordination with the corporate and functional levels
Business strategy
Is designed to outperform or battle against all competitors
Competitive strategy
Implies a wider geographic area, several types of buyers, different product lines, and complex distribution channels
Broad market
A business level strategy that enables a company to produce a comparatively similar product, more efficiently than its competitors
Lower cost strategy
Can be adopted by companies that aim to serve a broad target market with low cost products or services
Cost leadership
A strategy that is more appropriate to employ when a companies target market is narrow, and it aims to compete in cost
Cost focus
A company intends to compete using the uniqueness of its product from the perspective of the customers, relative to its value, quality, features, and even the services provided after the sale
Differentiation strategy
Can be in the form of packaging, features, design, technology, brand image, innovation, and customer service
Differentiation
Is strategy designed the serve a wider target market and achieve competitive advantage by offering products which are unique relative to the quality and value from the customers’ view
Differentiation
A competitive business strategy that focuses on the needs of a narrow market by providing a product or service that is differentiated from competitors
Differentiation focus
It aims to achieve competitive advantage by working with other companies
Cooperative strategy
Exists when competitors, expressly or impliedly agree to reduce their production, so that the prices of goods produce will increase or remain high
Collusion
Cooperating companies conspire through direct communication and negotiation
Explicit collusion
Cooperating companies conspire indirectly through informal means
Tacit collusion
A partnership established by similar companies in an industry, who put together their resources, but not their core competencies for a particular project that is too expensive for one company to undertake
Mutual service consortium
Similar participating companies, temporarily establish an independent separate unit
Joint venture
Happens when a company in a particular country grants rights to another company in another country to produce or sell the products of the former
Licensing
Is established when a company makes a long term agreement with its key supplier or distributor for mutual advantage
Value chain partnership
Are designed to provide overall direction of a company
Corporate level strategies
Illustrates that a strategic environmental analysis and evaluation must be conducted first before a strategy, whether planned a reactive, is formulated
Strategic management model
Competing in the market location of a competitor
Offensive tactic
Competing in the current market location
Defensive tactic
A company attacks, its competitor head to head from pricing down to distribution
Frontal assault
A company attacks the market where its competitor is weak
Flanking maneuver
An offensive attack characterized by the use of small intermittent attacks on the market, held by a competitor
Guerrilla warfare
This offensive attack redefines the market, where a company offers a new product that makes its competitors product outdated
Bypass attack
When the entry barriers are increased, considerably in new entrance is discouraged to enter a market
Increase entry barriers
Expected and trends are discouraged to join a market or industry when they perceive aggressive retaliation from existing companies
Increase the expected, aggressive retaliation
Possible new entrance are discouraged to join when they are expecting a low profit level in the market
Lower the inducement for possible attacks
