Term
Resources (Continued)
Are:
Represent: |
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Definition
Resources are a firm's assets: People, Value of Brand Name
Resources represent inputs into a firm's production process |
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Term
Types of Resources
What are they? |
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Definition
Tangible:
Financial Resources, Physical Resources, Technological Resources, Organizational Resources
Intangible: Human Resources, Innovation Resources, Reputation Resources |
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Term
Resources, Capabilities, Core Competencies
Assumption: |
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Definition
| A firms resources, capabilities, and core competencies have a relatively stronger influence on its performance than do external environment conditions. (WTF did I learn the other model for?) |
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Term
| Strategic competitiveness and above-average returns can result only when... |
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Definition
| A firm's core competencies are matched with opportunities. |
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Term
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Definition
| the firm's capabilities that demonstrate sustainable advantage by being valuable, rare, costly to imitate, and not having substitutes. |
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Term
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Definition
| the capacity to deploy resources that have been purposely integrated to achieve a desired end state |
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Term
Business-Level Strategy
Define |
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Definition
| An integrated and coordinated set of 'commitments and actions' the firm uses to gain a competitive advantage by exploiting core competencies in specific product markets |
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Term
Types of business-level strategies
Name them |
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Definition
Cost Leadership
Differentiation
Integrated Cost Leadership/Differentiation
Focused Cost Leadership
Focused Differentiation |
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Term
Cost Leadership Strategy
Define: |
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Definition
| An integrated set of actions taken to produce goods and services with features that are 'acceptable to customers at the lowest cost,' relative to that of competitors with features that are acceptable to customers. |
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Term
Cost Leadership Strategy
List some actions required for this strategy |
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Definition
Building efficient scale facilities
" " manufacturing facilities
Tightly controlling production costs and overhead
Minimizing cost of sales, R&D and service
Monitoring costs of activities provided by outsiders
Simplifying production processes |
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Term
Cost Leadership Strategy
What are the competitive risks? |
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Definition
Competitors can use cheaper factors of production and provide cheaper products
Processes used to produce and distribute good or service may 'become obsolete' due to competitors' innovations
Focus on cost reductions may occur 'at expense of customers' perceptions of differentiation'
Competitors, using their own core competencies, may successfully 'imitate the cost leader's strategy' |
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Term
Differentiation Strategy
Define: |
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Definition
| An integrated set of actions taken to produce goods or services (at an acceptable cost) that customer perceive as being different in ways that are important to them. |
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Term
Differentiation Strategy
What are some risks: |
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Definition
What if the features don't add as much value as the customers are willing to pay?
Users experiences of the product narrows their perceptions of the value of differentiated features.
What if the cost leaders make the price gap too large? |
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Term
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Definition
An integrated set of actions taken to produce goods or services that serve the needs of a 'particular competitive segment'
Particular buyer group: Ex. Youths and Senior Citizens
Different Segment of a product line: Ex. Craftsmen vs. Do-it-yourselfers
Different geographic markets: East Coast vs. West Coast |
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Term
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Definition
A focusing firm may be "outfocused" by its competitors
A large competitor may set its sights on a firm's niche market
Customer preferences in niche market may change to more closely resemble those of the broader market |
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Term
Integrated Cost Leadership/Differentiation Strategy
Explain (not define) |
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Definition
Provide relatively low cost products with valued differentiated features
Use primary and support activities to produce differentiated products at relatively low costs |
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Term
Integrated Cost Leadership/Differentiation Strategy
advantage of this compared to the others |
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Definition
Adapt quickly to environmental changes
Learn new skills and technologies more quickly |
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Term
Integrated Cost Leadership/Differentiation Strategy
Risks |
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Definition
Often involves compromises - not the best at either
Become "stuck in the middle" |
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Term
Corporate Level Strategy (Companywide)
Specify |
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Definition
Specifies actions taken by the firm to gain a competitive advantage by selecting and managing a group of different businesses competing in several industries and product markets
Think: Multiple Strategies |
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Term
Integrated Cost Leadership/Differentiation Strategy
Risks |
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Definition
Often involves compromises - not the best at either
Become "stuck in the middle" |
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Term
Corporate Level Strategy (Companywide)
Specify |
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Definition
| Specifies actions taken by the firm to gain a competitive advantage by selecting and managing a group of different businesses competing in several industries and product markets |
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Term
Business Level Strategy (Specific to divisions focused on select product markets)
Explain |
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Definition
Each business unit in a diversified firm chooses a business-level strategy as its means of competing in individual product markets
Think: one strategy |
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Term
Levels of Diversification: Low level
Name the two types |
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Definition
Single Business
Dominant Business |
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Term
Moderate to High Levels of Diversification
Name the 2 types |
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Definition
Related Constrained
Related Linked (mixed related and unrelated) |
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Term
Very High Levels of Diversification
Name the type |
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Definition
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Term
Define Single Business
Define Dominant Business |
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Definition
Single Business = More than 95% of revenue comes from a single business
Dominant Business = Between 70% and 95% of revenue comes from a single business |
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Term
Define: Related Constrained
Define: Related Linked (Mixed related and Unrelated) |
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Definition
Related Constrained = Less than 70% of revenue comes from the dominant biz, and all businesses share product, technological, and distribution linkages
Related Linked = Less than 70% of revenue comes from the dominant biz, and there are only limited links between businesses |
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Term
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Definition
| Less than 70% of revenue comes from the dominant biz, and there are no common links between businesses |
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