Marketing Implications of Corporate and Business Strategies

Question 1

Essence of strategic planning

Answer 1

Identify attractive markets to serve and attractive industries in which to compete to which the company’s capabilities are well suited (3M)

Question 2

Marketing Concept

Answer 2

the planning and coordination of all company activities around the primary goal of satisfying customer needs is the most effective way to attain and sustain a competitive advantage and achieve company objectives over time.

Question 3

3-legged stool of marketing concept

Answer 3

1. customer focus 2. cross functional coordination 3. profitability

Question 4

market orientation has positive effect of various dimensions of performance (3)

Answer 4

1. return on assets 2. sales growth 3. new product success

Question 5

Why some companies don’t have a marketing focus (3)

Answer 5

1. competitive conditions may allow a company to be successful in the short run without being sensitive to customer desires (tech)
2. Different levels of economic development across industries and countries may favour different philosophies
3. firms can suffer from strategic inertia - automatic continuation of strategies successful in the past.

Question 6

Strategy

Answer 6

a fundamental pattern of objectives, resource deployments, and interactions of an organization with markets, competitors, and other environmental factors

Question 7

Strategy should (3):

Answer 7

1. suggest what objectives to be accomplished 2. where (on which industries and product focus) 3. how (which resources and activities to allocate to each product market to meet environmental opportunities and threats and to gain competitive advantage)

Question 8

Strategy Components (5)

Answer 8

1. Scope - breadth of strategic domain
2. Goals and objectives - dimensions of performance (ROI)
3. Resource deployments
4. Identification of a competitive advantage
5. Synergy

Question 9

3 Levels of Strategy

Answer 9

Corporate, Business, Marketing

Question 10

Corporate Strategy 6 Decisions

Answer 10

1. overall scope and mission of the company
2. company goals and objectives
3. source of competitive advantage
4. deployment strategy for future growth
5. allocation of resources across firm’s various business
6. search for synergy across corporate shared resources

Question 11

Theodore Levitt (mission)

Answer 11

What customer needs are to be satisfied and the functions the firm must perform to satisfy them

Question 12

BHAG

Answer 12

Big, Hairy, Audacious, Goal

Question 13

Collins and Porras on mission

Answer 13

Core purpose, reason for being, soul of organization - not just markets and industries it serves

Question 14

FCPA

Answer 14

Foreign Corrupt Practices Act

Question 15

Corporate Objectives 4 Components

Answer 15

A performance dimension sought, a measure or index for evaluating, a target or hurdle to be achieved, a timeframe

Question 16

SMART Goals

Answer 16

Specific, Measurable, Achievable, Realistic, Time-bound

Question 17

2 directions of future growth

Answer 17

expansion or diversification

Question 18

Forward Vertical Integration

Answer 18

Move downstream - manufacturer acquires a wholesale distributor

Question 19

Backward Vertical Integration

Answer 19

Move upstream - firm acquiring a supplier

Question 20

Value Based Planning

Answer 20

a resource allocation tool that attempts to address such questions by assessing the shareholder value a given strategy is likely to create

Question 21

Economic Value Added (EVA)

Answer 21

return a strategy or operating program generates in excess of the cost of capital

Question 22

customer equity

Answer 22

sum of values for current and future customers

Question 23

SBU Managers must recommend (4)

Answer 23

1. objectives 2. scope of target customers and offerings 3. broad competitive strategy to build competitive advantage in a product line 4. resource allocation across product entries and functional departments

Question 24

SBU Design (4)

Answer 24

1. homogeneous set of markets 2. unique set of product markets 3. controls necessary for performance 4. responsibility over own profitability

Question 25

SBU Scope Definition (3)

Answer 25

1. Technical compatibility 2. Similarity of customer needs or product benefits 3. Similarity of customer characteristics in target markets

Question 26

SBU competitive advantage 2 Decisions

Answer 26

1. What is the SBU competitive domain or scope 2. How can the SBU distinguish itself from its competitors

Question 27

Competitive Strategy 3 Characteristics

Answer 27

1. Should generate customer value 2. Superior Value must be perceived by customers 3. advantage should be difficult to copy

Question 28

Market oriented firms

Answer 28

plan company activities around the primary goal of satisfying customer needs; outperforming competitors

Question 29

Corporate Growth (4)

Answer 29

1. market penetration 2. market development 3. product development 4. diversification

Question 30

Competitive advantage of superior value to customers

Answer 30

development of resources, marketing, brand, information systems, long term customer relationships (hard to acquire)