Strategy Flashcards
What is strategy?
Long range planning to meet desired goals, decision-making to achieve and sustain advantage.
Three views of strategy
Positional (whom you are competing with?)
Resource-based (what have you got to work with?)
Value system (what value can you add or gain?)
Competitive v. Corporate strategy
Competitive: how should a business compete in its industry.
Corporate: where should a business compete.
What are Porter’s 5 forces?
- Bargaining power of suppliers.
- Bargaining power of buyers.
- Threat of new entrants.
- Threat of substitutes.
- Industry rivalry.
REF! Competitive strategy
5 forces (Porter, 79) Core competences (Teece, 97)
Critiques of 5 forces
- Only an industry definition, not firm specific.
- Assumes 0-sum game, whereas interdependency exists!
What are core competences?
Locating profitable new opportunities in things you’re already good at.
When should we adopt core competences? (3)
- Difficult to imitate
- Provide potential access to wide variety of markets
- Contribute to customer benefits
REF and DEF: corporate strategy
Whittington (2001): ‘strategy is something a firm does not has’
REF and EXPLAIN: Learning school of corporate strategy
Mintzberg and Waters (1985)
Deliberate strategies: realised as intended.
Emergent strategies: patterns realised despite intention (develops outside plan, one action at a time)
REF and EXPLAIN: Planning school of corporate strategy
Fayol (1949)
Useful in complex industries with non-dynamic markets
- uses trends data and other knowledge to construct strategies.
REF and EXPLAIN: Critique of planning school of corporate strategy
- Ignores tacit knowledge and internally constructed view of external envs.
- Forecasting past short-term=useless
Mintzberg (1994): Strategic thinking»_space; strategic planning.
QUOTE Mintzberg (1994)
‘most successful strategies are visions, not plans’
