CHAPTER 6 Flashcards
Competitive and cooperative strategies that emphasize improvement of the competitive position of a corporation’s products or services in a specific industry or market segment.
business strategy
The active cooperation of firms within an industry to reduce output and raise prices in order to get around the normal economic law of supply and demand. This practice is usually illegal.
collusion
a unifying theme
common thread
The breadth of a company’s or a business unit’s target market
competitive scope
A strategy that states how a company or a business unit will compete in an industry.
competitive strategy
A strategy that states how a company or a business unit will compete in an industry
consolidated industry
Strategies that involve working with other firms to gain competitive advantage within an industry.
cooperative strategies
A low-cost competitive strategy that concentrates on a particular buyer group or geographic market and attempts to serve only that niche
cost focus
A low-cost competitive
strategy that aims at the broad mass market.
cost leadership
A competitive strategy that is aimed at the broad mass market and that involves the creation of a product or service that is perceived throughout its industry as
unique
differentiation
A differentiation competitive strategy that concentrates on a particular buyer group, product line segment, or geographic market
differentiation focus
differentiation strategy
The first company to manufacture and sell a new product or service
first mover
An industry in which no firm has large market share and
each firm serves only a small piece of the total market
fragmented industry
An independent business entity created by two or more companies in a strategic alliance
joint venture
Companies that enter a new market only after other companies have done so
late mover
An agreement in which the licensing firm grants rights to another firm in another country or market to produce and/or sell a branded product.
licensing arrangement
A strategy in which a company or business unit designs, produces, and markets a comparable product more efficiently than its competitors.
lower cost strategy
Tactics that determine where a company or business unit will compete
market location tactics
A partnership of similar companies in similar industries that pool their resources to gain a benefit that is
too expensive to develop alone
mutual service consortium
A portion of a market that is so well suited to a firm’s internal and external environment that other corporations are not likely to challenge or dislodge it.
propitious niche
Strategic factors by combining
the external factors from an EFAS table with
the internal factors from an IFAS table.
SFAS (Strategic Factors Analysis
Summary) Matrix
A partnership of two or more corporations or business units to achieve strategically significant objectives
that are mutually beneficial
strategic alliance
Development of long range plans for the effective management of environmental opportunities and threats in light of corporate strengths and weaknesses
strategy formulation
Identification of strengths, weaknesses, opportunities, and threats that may be strategic factors for a specific
company.
SWOT Analysis
A short-term operating plan detailing how a strategy is to be implemented.
tactic
Tactics that determines when a business will enter a market with a new product
timing tactic
A matrix that illustrates how external opportunities and threats facing a particular company can be matched with
that company’s internal strengths and weaknesses to result in four sets of strategic alternatives.
TOWS Matrix
A strategic alliance in which one company or unit forms a long-term arrangement with a key supplier or
distributor for mutual advantage
value-chain partnership
Michael Porter proposes two “generic” competitive strategies
Lower cost strategy
Differentiation strategy
Offensive Tactics.
Frontal assault
Flanking maneuver
Bypass attack
Encirclement
Guerrilla warfare
Defensive Tactics.
Raise structural barriers
Increase expected retaliation
Lower the inducement for attack
