Chapter 5 Flashcards
an analysis of business strategy into basic types of based on breadth of target market (industrywide versus narrow market segment) and type of competitive advantage (low cost versus uniqueness).
Generic Strategies
A firms generic strategy based on appeal to the industrywide market using a competitive advantage based on low cost.
Overall cost leadership
The decline in the unit cost of production as cumulative output increases
Experience curve
A firms achievement of similarity or being “on par” with competitors with respect to low-cost, differentiation, and other strategic product characteristics
Competitive parity
A firms generic strategy based on creating differences in the firms product or service offering by creating something that is perceived industrywide as unique in valued by customers
Differentiation strategy
A firms generic strategy based on appeal to a narrow market segment within an industry
Focus strategy
Firms’ integrations of various strategies to provide multiple types of value to customers
Combination strategies
A firm’s ability to manufacture unique products in small quantities at low-cost
Mass customization
The total profits in an industry at all points along the industry’s value chain.
Profit pool
Information that is in numerical form, which facilitates it’s storage, transmission, analysis and manipulation
Digital technologies
The process of bypassing buyer channel intermediaries such as wholesalers, distributors, and retailers.
Disintermediation
The stages of introduction, growth, maturity, and decline it typically occur over the life of an industry
Industry life cycle
The first stage of the industry lifecycle, 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
Introduction stage
The second stage of the product lifecycle, characterized by (1) strong increases in sales; (2) growing competition; (3) developing brand recognition; (4) and a need for financing complementary value chain activities such as marketing, sales, customer service, and research and development
Growth stage
The third stage of the product lifecycle, characterized by (1) slowing demand a growth, (2) saturated market, (3) direct competition, (4) price competition, and (5) strategic emphasis on efficient operations
Maturity stage
