2eIM-LN-Chapter6 - Section 6 C hapter Lecture Notes for Chapter 6 6 Supplementing the Chosen Competitive Strategy Other Important Strategy Choices

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379 Section 6 Lecture Notes for Chapter 6 Chapter 6 Supplementing the Chosen Competitive Strategy – Other Important Strategy Choices Chapter Summary Chapter Six identifi es that once a company has settled on which of the fi ve basic competitive strategies to employ, attention must turn to what other strategic actions can be taken in order to complement its competitive approach and round out its business strategy. As discussed in earlier chapters, a company’s overall business strategy includes not only the details of its competitive strategy, but also other strategic initiatives that can promote competitive advantage. Several measures to enhance a company’s strategy have to be considered: Whether to enter into strategic alliances or partnerships arrangements with other enterprises. Whether to bolster the company’s market position via merger or acquisition. Whether to integrate backward or forward into more stages of the industry value chain. Which value chain activities, if any, should be outsourced. Whether and when to go on the offensive and initiate aggressive strategic moves to improve the company’s market position. Whether and when to employ defensive strategies to protect the company’s market porisiton. When to undertake strategic moves—whether it is advantageous to be a fi rst-mover or a fast follower or a late-mover. to expedite the development of promising new technologies or products, to overcome defi cits in their own technical and manufacturing expertise This chapter presents the pros and cons of each of these business strategy choices. Lecture Outline I. Strategic Alliances and Collaborative Partnerships 1. Companies in all types of industries and have elected to form strategic alliances and partnerships to add to their accumulation of resources and competitive capabilities and strengthen their competitiveness in domestic and international markets. 2. The most common reasons why companies enter into strategic alliances are: to expedite the development of promising new technologies or products, to overcome defi cits in their own technical and manufacturing expertise 379
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to acquire or improve market access through joint marketing agreements. Section 6 Instructor’s Manual for Essentials of Strategic Management 380 to bring together the personnel and expertise needed to create desirable new skill sets and capabilities, to improve supply chain effi ciencies, to gain economies of scale in production and/or marketing, and Core Concept Strategic alliances are collaborative arrangements where two or more companies join forces to achieve mutually beneF cial strategic outcomes. The competitive attraction of alliances is in allowing companies to bundle competencies and resources that are more valuable in a joint effort than when kept separate. A.
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This note was uploaded on 10/28/2011 for the course BUSINESS 205 taught by Professor Lewis during the Spring '11 term at AIB College of Business.

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2eIM-LN-Chapter6 - Section 6 C hapter Lecture Notes for Chapter 6 6 Supplementing the Chosen Competitive Strategy Other Important Strategy Choices

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