Chapter 2 - 3. Scale: Advantages related to size; economies...

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Chapter 2 Sustainable Competitive Advantage : Financial performance that consistently outperforms industry averages Operational Effectiveness : Performing the same tasks better than rivals perform them. Fast Follower Exists when: 1. Savvy rivals watch a pioneer’s efforts 2. Learn from their successes and missteps 3. Then enter the market quickly with a comparable or superior product at a lower cost 4. Before the first mover can dominate. Strategic Positioning : Performing different tasks than rivals or the same tasks in a different way. Straddling : When a firm attempts to match the benefits of a success position while maintaining its existing position. True sustainable advantage comes from assets and business models that are simultaneously (Resource-based Theory): Valuable Rare Difficult to imitate For which there are no substitutes . Powerful resources : 1. Imitation-Resistant Value Chains: Others find hard to replicate 2. Brand: Proxy for quality and inspires trust
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Unformatted text preview: 3. Scale: Advantages related to size; economies of scale 4. Switching Costs and Data: Costs consumer incur by switching providers 5. Differentiation: Be different; move away from being commoditized 6. Network Effects: When the value of a product or service increases as its number of users expands. 7. Distribution Channels: The path through which products or services get to customers 8. Patents. Role of Technology: Technology can play a key role in creating and reinforcing assets for sustainable advantage . This includes: a. Enabling an imitation resistant value chain b. Strengthening a firms brand c. Collecting useful data d. Establishing switching costs e. Creating a network effect f. Creating or enhancing a firms scale advantage g. Enabling product or service differentiation h. Offering an opportunity to leverage unique distribution channels....
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This note was uploaded on 03/02/2011 for the course BMGT 301 taught by Professor Wang during the Spring '08 term at Maryland.

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Chapter 2 - 3. Scale: Advantages related to size; economies...

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