Strategy Test 1 - Class Notes

(1) look at missions and goals (2) analyze opportunities & threats /SWOT (3) select strategy that works the best (4) implement that strategy

what the organization should be

values: how employees are going to conduct themselves; how a company takes care of its employees.

precise and measurable; what they are & how to get there; challenging but realistic with a long term emphasis.

(1) corporate: where to compete (2) business: how to compete (3) functional: how to recruit more business strategies.

whether or not it benefits the company financially as well as on a technological stand point.

setting specific

begin w/SWOT analysis

(1) identify problem (2) disaggregate problem: clear clutter (3) select framework: have a hypothesis (4) data collection & analysis (5) synt

(1) general economic conditions (2) legislation and regulations (3) technology (4) societal values and lifestyles (5) population demographic

(1) suppliers (2) substitute products (3) buyers (4) rival firms (5) new entrants.

(1) identify the specific competitive pressures associated with each force (2) evaluate the strength of each competitive force (3) determine

lower prices

slow market growth

rapid market growth

sizable economies of scale

industry members incur high cost in switching suppliers

the item being supplied is readily available

reduce inventory and logistics costs

buyer switching costs are low

when items are purchases in small quantities or infrequently

rivalry is vigorous

rivalry is moderate

(1) insulate firm from competitive pressures (2) initiate actions to produce sustainable competitive advantage (3) allow firm to define the

long-term industry growth rate

a cluster of firms in an industry with similar competitive approaches and market position.

comparable product line breadth

(1) identify competitive characteristics that differentiate firms in an industry from one another (2) plot firms on a two variable map using

competitive factors and attributes that affect every industry member's ability to be competitively and financially successful.

specific strategy elements

(1) how well is the company's present strategy work (2) is the company's SWOT (3) are the company's prices and costs competitive (4) is the

low-cost leadership

broad or narrow geographic market coverage and how many stages of industry's production/distribution chain does the company operate.

(1) competitive approach (2) competitive scope (3) recent strategic moves (4) functional strategies.

qualitative and quantitative.

trend in sales and market share

the product of organizational learning and experience and represents real proficiency in performing an internal activity.

a well performed internal activity central to a company's competitiveness and profitability; often knowledge based residing in the people of

a competitively valuable activity a company performs better than its rivals.

(1) is the resource really competitively superior (2) is the resource rare/lacked by rivals (3) is the resource hard to copy (4) can the res

attempt to exploit company resources to offer value to customers in ways rival cannot match; can focus on eroding the competitive potency of

prospect for long-term growth and potential for competitive advantage.

value changing analysis and benchmarking.

all company activities undertaken in designing

(1) primary: where most of the value for customers is created (2) support activities: facilitate performance of primary activities.

supply chain management

human resources

the combined costs of all activities in company's value chain.

defining expense categories according to specific activities performed and assigning costs ot he activity responsible for creating the cost.

the cross-company comparisons of how certain activities are performed and costs associated with these activities.

purchase of materials

identify best and most efficient means of performing various value chain activities

depends on how well a company manages its value chain relative to their competitors.

(1) developing competencies and capabilities that rivals don't have or can't match creating a capability-based advantage (2) perform value c