Strategic competition perspective Flashcards
Explain the drivers of the strategic competition perspective
External drivers and planned nature of decision.
= opputinities&threats in the markets and well determined plan.
What are the assumptions fof the SCP?
- Firms should gain competitive advatange
- Internationalization is to achieve efficency
- The firm aims to increase profits and win the competition war by establishing significant market share globally
- Nothing about risk
What kind of theory is SCP?
Industrial economics; with focus on competive positioning and competitive advantage
Which researchers do we now about the SCP?
-George Yip: Global strategy model.
(Industry globalization drivers -> appropriate setting for global stratetic levels -> benefits/cost of global strategy
-Douglas and Craig: Global MARKETING strategy model (Scale, Scope and Synergy”)
- Douglas and Craig: Convergence and divergence:
> difficulty to use a globalized marketing strategy -> firms must establish a direction and manage operations in multiple countries.
Market vs industry
An industry is a group of firms that offer a product or class of products which are close substitutes for each other.
A market is a set of actual and potential buyers and sellers of a product
Explain Yin’s global strategy model
The organization ablity to implements a global straegy…. Shares below three variables.
Industry globalization drivers: Market factors, cost factros, government facotrs and competitive factors
- > appropriate setting for global stratetic levels: Priduct standardiation, uniform marketing.
- > benefits/cost of global strategy: Cost reducred, improved quality, increased competitive leverage.
Mention the three steps about how to globalize acc. to Douglas and Craige.
1.Initial foreign market entry:
Generally that the firm should tailer strategy and experience.
- As the experience builds up, the firms should shift to new product development that fit foreign market need.
- ) Expansion of national markets
Generally, that economics of scale and scope must be maximized.
- Economies of scale may be realized through attention to opportunities for marketing existing product lines on a broader geographic scale
3) Global rationalization
To achieve optimal integration and rationalization of operation and decision systems.
- Efficiency worldwide: Coordination and integration of strategy and decion systems
- Focus on unique advantages
How is Tesla aligned with the SCP?
- The firm does aim to replicate domestic strategy in a new country.
What is local expansion about?
achieving economies of scope
. The movement from sales subsidiary to production subsidiary is an example of?
- international penetration
- Adapting a product to a local market is an example of
- semi-global strategy
Local market expansion is about?
achieving economies of scope
Be able to draw the global marketing strategy + semiglobalization by Douglas and Craig
1 + 3 +1 phases:
Pre-international, initial entry, local market expansion, global rationalization
What are the key challenges and strategic imperatived in Douglas + Craigs’ semiglobalization?
As the firm has a diverse portfolio of firms in differnt markets it must pursue different strategies to each market and make synergies whereever possible.
Developmed markets: Innovaition in product and promotional strategies
Global segments:
identifyin consumers wihth similar taste and develop products for these.
Country-centric elements: Adapting products to fit these groups
Rural markets:
Low levels of consumer income -> develope low cost functional products
Country clusters:
Adapt products to dift consumer heterogenity
What are criticisms of the SCP?
- Too much focus on efficiency rather than international capabilities
- Unit of analysis: business unit
