BADM-449-Class-3 - BADM 449 Business Strategy / Management...

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BADM 449 Business Strategy / Management Policy Class #3: Industry Analysis
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Competitive Strategy: The Core Concepts Aim: establish a favorable and sustainable position against the forces that determine profitability Two key (dynamically changing) factors: attractiveness of the industry relative position of the firm within the industry
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INDUSTRY RETURN ON EQUITY (1985-'97) Drugs 20.3 Tobacco 14.8 Electrical, and electronic equipment 11.0 Printing and publishing 10.6 Aircraft, guided missiles, and parts 9.7 Petroleum and coal products 9.6 Paper and allied products 8.5 Machinery, exc. electrical 6.0 Motor vehicles and equipment 5.5 Iron and Steel 2.6 Airlines 1.1 ROE for some industries
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From Grant, Table 3.1
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McGahan & Porter, 1997 (Grant, Table 4.1)
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Porter’s 5 Forces Model: Industry Structure Industry Competitors Rivalry Among Existing Firms Substitutes Suppliers Buyers Potential Entrants Power Power Threat Threat
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Threat of New Entrants Barriers to Entry Absolute cost advantages Economies of Scale
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This note was uploaded on 04/02/2012 for the course BADM 449 taught by Professor Echambadi during the Fall '10 term at University of Illinois, Urbana Champaign.

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BADM-449-Class-3 - BADM 449 Business Strategy / Management...

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