Introduction Flashcards
Strategy Defintion and what it is
Strategy is a plan of action to achieve a major overall aim.
It is an integrated and coordinated set of commitments and actions and designed to exploit core competencies. The end of it is a competitive advantage serving long-term performance.
It includes, which markets I enter, which materials I use and how I will gain competitive advantage over my competitors
Industrial Organization Model
Where should we play? 1. Analyse the external environment 2. Identify an attractive industry 3. Formulate Strategy 4. Develop or acquire necessary assets 5. Implement strategy > above-average returns
Resource-based model
How should we play? 1. Identify Strengths and Weaknesses in resources 2. Determine capabilities 3. Identify competitive advantage 4. Identify an attractive industry 5. Formulate and implement strategy > above-average returns
Stakeholders, Stakeholder Theory & Stakeholder Analysis
Individuals and groups who can affect are affected by the strategic outcomes by a firm. (Market vs. Nonmarket Stakeholder)
Theory
> Corporation serves the broader purpose to create value for society
> a firm must make profit for owners to survive but creates other values to
> all stakeholders must be taken into account
Owner, Customers, Employees, Suppliers, Creditors, Distributors
Analysis > Who are the relevant stakeholders > What interests do they have > How much power do they have > How are coalitions likely to form
Vission vs Mission
Mission specifies the business a firm wants to compete in. It specifies the present business and has a more concrete, near-term focus than the firm’s vision. It gives detailed and specified information.
Vission is a picture of what a firm ultimately wants to achieve. It as an enduring word picture, challenge its people and reflect the firm’s values.
Industries
Group of firms producing products that are close substitutes. Has direct effect on strategic competitiveness.
