07 Strategy and General Management

07 Strategy and General Management - Understanding the...

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Unformatted text preview: Understanding the Competitive Environment Strategy Professor Peter Arnold with material from Professor Dixon Professor Tomas Kohn Professor John Mahon Professor Melissa Schilling Strategy Defined What is strategy? Strategy is a coherent, integrated set of objectives and actions for using an organizations resources to gain and secure a sustainable position of advantage vis a vis ones competitors; No position of advantage is sustainable forever--- that is, a position of advantage will either erode or be overcome by the actions of others over time Strategies The Choices Managers Make Question: Which choices (strategies) are better? Question: Which choices (strategies) are better? Answer: Answer: IT DEPENDS!! IT DEPENDS!! 2. What the firm may do (environmental factors) 2. What the firm may do (environmental factors) Question: Depends on what? Question: Depends on what? Answer: Answer: 1. What the firm wants to do (objectives) 1. What the firm wants to do (objectives) It depends on It depends on 3. What the firm can do (capabilities) 3. What the firm can do (capabilities) 4. What management wishes to do (leadership) 4. What management wishes to do (leadership) Strategic Dimensions - a short list Choice of distribution channels Quality standards for product or service Cost / Price position Degree of specialization By customer By location Technology policy Open Proprietary Brand-use policy Degree of vertical integration Ownership of operations Wholly-owned Joint-ventures (majority- or minority-owned) Alliances (equity and non-equity based) Interaction with governments Mostly External Issues (Industry Analysis) Mostly External Issues (Industry Analysis) Opportunities - Opportunities - seek them out seek them out Threats - Threats - fend them off fend them off Mostly Internal Issues Mostly Internal Issues Strengths - Strengths - build, reinforce, and go with them build, reinforce, and go with them Weaknesses Weaknesses - - reduce them, compensate for them reduce them, compensate for them S.W.O.T Analysis A tool for strategy definition Look Look from from OUTSIDE OUTSIDE Effective Strategies Effective Strategies can come about when senior can come about when senior managers: managers: Look Look from from INSIDE INSIDE Position the company so Position the company so competitors cannot challenge competitors cannot challenge it easily....
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07 Strategy and General Management - Understanding the...

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