Chapter 5 Flashcards
Marketing’s Strategic Role
The hierarchy of Strategies:
Three major levels of strategy dominate most large multiproduct organizations; Corporate strategy, business-level strategy and functional strategy.
Corporate strategy
is the overall scope and direction of a firm that defines the businesses in which a company competes, preferably in a manner that uses resources to convert distinctive competence into competitive advantage.
Business-level strategy
focuses on how a firm competes in a given industry and positions itself against its competitors. The focus of competition is not between corporations; rather, it is between their individual business units.
Strategic business unit (SBU)
Is a single business or collection of businesses that has a distinct mission, a responsible manager, and its own competitors and that is relatively independent of other business units.
Functional strategy
focuses on how resources allocated to the various functional areas can be used most efficiently and effectively to support the business-level strategy.
Thought-worlds
is a subculture that exists when one subunit shares different values, beliefs, and goals than another subunit.
Responsibility charting
is an approach that can classify decision-making roles and high-light the multifunctional nature of business marketing decision making.
Marketing strategy center
is a business unknit that constitutes the members of the organization involved in the business marketing decision-making process.
Components of a business model/concept
consist of four major components, Customer interface , Core strategy, Strategic resources, Value network
Customer interface
Fulfillment and support refers to the channels a business marketing firm uses to reach customers and the level of service support it provides.
Information and insight refers to the knowledge captured from customers and the degree to which this information is used to provide enhanced value to the customer.
Relationship dynamics is the nature of the interaction between the firm and its customers (for example, the proportion of relational versus transactional customers)
Pricing structure refers to a business concept that may offer several pricing choices. For example, a firm can bundle products and services or price them on a menu of basis.
Core strategy
determines how the firm chooses to compete
Business mission describes the overall objectives of the strategy, sets the course and direction, and defines a set of performance criteria that are used to measure progress.
Product/market scope defines where the firm competes. The product markets that constitute the domain of a business can be defined by customer benefits, technologies customer segments, and channels of distribution.
Basis for differentiation Captures the essence of how a firm competes differently than its rivals
Strategic resources
Core competencies is the set of skills, systems, and technologies a company uses to create uniquely high value for customers.
Strategic assets are tangible requirements for advantage that enable a firm to exercise its capabilities. Included are brands, customer data, distribution coverage, patents, and other resources that are both rare and valuable.
Core processes are methodologies and routines that companies use to transform competencies assets, and other inputs into value for customers.
Value network
is a component that complements and further enriches the firm’s research
Building a Strategy plan
The exectution of a successful strategy involves two basic rules; “Understand the management cycle that links strategy and operations, and know what tools to apply at each stage of the cycle”
