Final Flashcards
1
Q
What is strategy
A
integrated and coordinated set of commitments and actions that an organization takes to attain its ultimate goals
2
Q
Themes of strategy
A
- creative process
- recursive
- implies trade off
3
Q
Goal of industry analysis
A
identify the most important factors that are affecting your industry
4
Q
Porter’s + 3
A
- Bargaining power of suppliers
- threat of new entrants
- threat of substitutes
- bargaining power of buyers
- Rivalry
- threat of complementors
- new strategies
- social forces
5
Q
When is intensity of rivalry strong
A
- competitors numerous and equally balanced
- high exist barriers
- slow industry growth
- high fixed or storage costs
- little differentiation
- low switching costs
- overcapacity
- long history of bitter rivalry
6
Q
Threat of substitutes highest when
A
- low switching costs
- substitute price is lower
- substitute quality and performance capability are equal to or greater than competition product
7
Q
Key questions for managers in industry analysis
A
- what is our firm’s industry
- how stable are these characteristics
- what are the characteristics of the industry
- how can we counter the negative characteristics or turn them to our advantage
8
Q
Resource partitioning theory
A
- separate into core and peripherary
- core: generalist
- periphere: specialist, niche firms
9
Q
Generalist firm identity
A
- automated process
- large volumes
- global
- commoditized
- standard/low quality
10
Q
Specialist firm identity
A
- craftsmanship
- small volumes
- local
- authentic
- high-quality
11
Q
Value chain
A
- total of primary and support value-adding activities by which a company produces, distributes and markets a product/service
12
Q
Resources and capabilities
A
- Resources:
- inputs that firms use to create goods
- Capabilities:
- skill in using its resources to create goods and services
- core competency: source of competitive advantage
13
Q
Four criteria for a sustainable advantage: (VRIO)
A
- valuable
- rare
- costly to imitate
- exploitable by the organization
14
Q
Outsourcing vs. offshoring
A
- outsourcing: sourcing the function of a value chain activity from another company
- Offshoring: taking activity from high cost country to low cost country
15
Q
diseconomies of scale
A
- bureaucracy
- high labour costs
- inefficient operations
16
Q
3 market trajectories
A
- deterioration trap
- dominant low cost low benefit firm that swallows market share
- eg. zara
- proliferation trap
- multiple threats which create new price -benifit positions, surrounding and eroding the firms products’ uniquenss
- eg. hilton
- escalation trap
- rising benefits for the same or lower price
17
Q
How to escape market traps
A
- destroy trap
- escape trap
- turn trap to advantage