Chapter 1 Flashcards
What is Strategy?
Strategy is an integrated and coordinated set of commitments and actions designed to exploit core competencies (resources & capabilities) and gain a competitive advantage to achieve some long-term performance objectives/goals.
What should a vision answer to?
A vision statement should answer the basic question “What do we want to become?”
challenges its people.
reflects the firm’s values and aspirations.
is most effective when its development includes all stakeholders.
recognizes the firm’s internal and external competitive environments.
is supported by upper management decisions and actions
What is a mission?.
asking the question “What is our business?” is synonymous with asking the question “What is our mission?”.
It’s essential for establishing objectives formulating strategies.
specifies the present business or businesses in which the firm intends to compete and customers it intends to serve.
What’s the goal of a strategy?
Achieve and sustain competitive advantage
and earn above average returns
When does a firm have a copetitive advantage?
when it implements a strategy that creates superior value for customers and that competitors are unable to duplicate or find too costly to try to imitate
What are above-average returns
returns in excess of what an ivestor would earn in another investment with the same risk
What levels of strategy are there and at what do they aim?
Business Level Strategy: how to compete/position yourself in a given product market
Competitive Level Strategy:
actions and responses to competition
Corporate Strategy: expand scope of the firm, in terms of products and geographic markets
International Strategy:
how to expand and compete across borders
What are two perspectives on earning above-average returns ?
o I/O Model – External Perspective
o Resource Based View – Internal Perspective
Q: What is the Industrial organization model?
Considers a firm’s strategy to be a set of commitments formed in response to the characteristics of the industry where the firm competes
(DESENHAR)
Q: What is the resource-based model of above-average returns?
Considers a firm’s uniqueness of its resources and capabilities is the basis for a firm’s strategy and its ability to earn above-average returns. (desenhar)
