Chapter 5 Flashcards
a strategy designed for a firm or a division of a firm that competes within a single business
business-level strategy
basic types of business level strategies based on breadth of target market (industrywide versus narrow market segment) and type of competitive advantage (low cost versus uniqueness).
generic strategies
firm’s generic strategy based on appeal to the industrywide market using a competitive advantage based on low cost.
Overall cost leadership
the decline in unit costs of production as cumulative output increases.
experience curve
a firm’s achievement of similarity, or being “on par,” with competitors with respect to low cost, differentiation, or other strategic product characteristic.
competitive parity
a firm’s generic strategy based on creating differences in the firm’s product or service offering by creating something that is perceived industrywide as unique and valued by customers.
differentiation strategy
a firm’s 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 its storage, transmission, analysis and manipulation.
digital technologies
the stages of introduction, growth, maturity, and decline that typically occur over the life of an industry.
industry life cycle
the first 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.
introduction stage
the second 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 valuechain activities such as marketing, sales, customer service, and research and development.
growth stage
the third stage of the product life cycle, characterized by (1) slowing demand growth, (2) saturated markets, (3) direct competition, (4) price competition, and (5) strategic emphasis on efficient operations.
maturity stage
