Strategy chapter 1 - What is strategy and why is it important - MM

Strategy chapter 1 - What is strategy and why is it important - MM

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1–1 CHAPTER 1 CHAPTER 1 WHAT IS STRATEGY AND WHY IS IT IMPORTANT? WHAT IS STRATEGY AND WHY IS IT IMPORTANT?
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1–2 1. Learn what we mean by a company’s strategy. 2. Grasp the concept of a sustainable competitive advantage. 3. Develop an awareness of the five most basic strategic approaches for winning a sustainable competitive advantage. 4. Understand that a company’s strategy tends to evolve over time because of changing circumstances and ongoing management efforts to improve the company’s strategy. 5. Learn why it is important for a company to have a viable business model that outlines the company’s customer value proposition and its profit formula. 6. Learn the three tests of a winning strategy.
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1–3 Strategy means making clear-cut choices about how to compete Jack Welch Former CEO of General Electric One must have strategies to execute dreams Azim Premji CEO Wipro Technologies and one of the world's richest people If your firm’s strategy can be applied to any other firm, you don’t have a very good one David J. Collis and Michael G. Rukstad Consultants and professors
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1–4 Presentation 1 Presentation 1 defines the concept of strategy and describes its many facets. The presentation: explains what is meant by a competitive advantage, discusses the relationship between a company’s strategy and its business model, and introduces the kinds of competitive strategies that can give a company an advantage over rivals in attracting customers and earning above-average profits. The presentation examines what sets a winning strategy apart from others and why the calibre of a company’s strategy determines whether it will enjoy a competitive advantage over other firms or be burdened by competitive disadvantage. By the end of this presentation, participants will have a clear idea of why the tasks of crafting and executing strategy are core management functions and why excellent execution of an excellent strategy is the most reliable recipe for turning a company into a standout performer over the long term.
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CORE CONCEPT CORE CONCEPT 1–5 A company’s strategy is its action plan for outperforming its competitors and achieving superior profitability
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1–6 WHAT DO WE MEAN BY STRATEGY ? What is our present situation? Business environment and industry conditions Firm’s financial and competitive capabilities Where do we want to go from here? Creating a vision for the firm’s future direction How are we going to get there? Crafting an action plan for heading the firm in the intended direction, staking out a market position, attracting customers, achieving the targeted financial and market performance, and getting the firm where it wants to go is its strategy .
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1–7 WHAT IS STRATEGY ABOUT?
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