Chapter 5 Flashcards
Business-Level Strategy
a strategy designed for a firm or a division of a firm that competes within a single business
Generic Strategies
an analysis of business strategy into basic types based on breadth of target market (industrywide vs narrow segment market) and type of competitive advantage (low cost vs uniqueness)
Overall Cost Leadership
A firm’s generic strategy based on appeal to the industrywide market using a competitive advantage based on low cost
Experience Curve
the decline in unit costs of production as cumulative output increases
Competitive Parity
a firm’s achievement of similarity, or being “on par,” with competitors with respect to low cost, differentiation, or other strategic product characteristics
Differentiation Strategy
a firm’s generic strategy base on creating differences in the firm’s product or service offering by creating something that is perceived industrywide to be unique and valued by customers
Focus strategy
a firms generic strategy based on appeal to narrow market segment within an industry
Combination Strategies
firms’ integrations of various strategies to provide multiple types of value to customers
Mass Customization
A firms ability to manufacture unique products in small quantities at low cost
Profit Pool
the total profits in an industry at all points along the industry’s value chain
Digital Technologies
information that is in numerical form, which facilitates its storage transmission, analysis and manipulation
Disintermediation
The process of bypassing buyer channel intermediaries such as wholesalers, distributers, and retailers
Industry Life Cycle
The stages of introduction, growth, and decline that typically occur over the life of an industry
Introduction Stage
the 1st stage of the industry life cycle. Characterized by (1) new products that are not known to customers, (2) poorly defined market segments (3) unspecified product features (4) low sales growth (5) rapid technological change (6) operating losses, and (7) a need for financial support
Growth Stage
the 2nd stage of the product life cycle. Characterized by (1) strong increases in sales (2) growing competition (3) developing brand recognition; and (4) a need for financing complementary value-chain activities, such as marketing, sales, customer service, and R&D.
