Topic2.StrategyRevisited

Positions on the map are equally attractive

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: tify the competitive characteristics that differentiate firms in the industry UPF - International Strategic Management 2012 76 Strategic Group Map Illustrations  38 28/04/12 UPF - International Strategic Management 2012 77 Interpreting Strategic Group Maps •  Firms in the same strategic group are the closest rivals; the next closest rivals are in the immediately adjacent groups •  Firms in strategic groups that are far apart on the map may hardly compete at all •  Not all positions on the map are equally attractive •  Prevailing competitive pressures and driving forces often favor some strategic groups and hurt others •  Profit potential of different strategic groups varies due to strengths and weaknesses in each group’s market position UPF - International Strategic Management 2012 78 Key Factors for Competitive Success •  Key Success Factors (KSFs) are those competitive factors that affect every industry member’s ability to be competitively and financially successful •  KSFs can relate to: •  Specific strategy elements •  Product attributes •  Resource, capabilities, competencies •  Market achievements 39 28/04/12 UPF - International Strategic Management 2012 79 Identifying Industry KFSs Prerequisites for success What do customers want? How does the firm survive competition? Analysis of competition Analysis of demand - What drives competition? - Who are our customers? -  What are the main dimensions of competition? -  What do they want? -  How intense is competition? - How can we obtain a superior competitive position? Key success factors UPF - International Strategic Management 2012 80 Illustration: KSFs for Bottled Water Industry •  Access to distribution •  Low-cost production capabilities •  Sufficient sales volume •  Strong network of retailers/company-owned stores •  Image, appealing designs and color combinations •  Clever advertising 40 28/04/12 UPF - International Strategic Management 2012 81 Remember… Does the industry present opportunities to earn ‘above average returns’??? UPF - International Strategic Management 2012 82 LEVELS OF STRATEGIES 41 28/04/12 83 UPF - International Strategic Management 2012 CORPORATE-LEVEL STRATEGIES The overall organizational strategy that addresses the question: “What business(es) are we in OR should we be in?” 84 UPF - International Strategic Management 2012 WHAT LIES BEHIND CORPORATE STRATEGY? Create value in a way that… the value of the corporate whole increases 2+2=5 investors (shareholders) cannot create the same value through portfolio investing 42 28/04/12 UPF - International Strategic Management 2012 85 Corporate-level strategies A. Choice of Scope B. Grand strategies   Vertical Integration   Portfolio strategies: single business, related diversification, unrelated diversification   BCG Matrix: an assessment tool  Stars  Question marks  Cash cows  Dogs   Growth   Stability   Retrenchment/ recovery UPF - International Strategic Management 2012 86 Corporate-level strategies (a) Choice of Scope 43 28/04/12 87 UPF - International Strategic Management 2012 Corporate-level strategies (a) 1. Vertical Integ...
View Full Document

This note was uploaded on 10/18/2012 for the course BUSI 102 taught by Professor X during the Spring '12 term at Universitat Pompeu Fabra.

Ask a homework question - tutors are online