Chapter 7 - Organisational Strategy In Global Environment

Structure in sales rd and production production

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Unformatted text preview: ow­cost or differentiation advantage. R&D can reduce costs by developing cheaper ways of making a product. Low-Cost and Differentiation Advantages Advantages Functional-level Strategy Functional-level Functional­level strategy and structure – According to contingency theory, each function should develop a structure that suits its skills and resources. – In the most effective organizations, each department (production, sales, and research and development) need to develop its own way of responding to its environment. Structure in Sales, R&D, and Production Production FUNCTIONAL-LEVEL STRATEGY AND CULTURE CULTURE Organizational culture: a set of shared values that organizational members use when they interact with one another and with other stakeholders The importance of culture for functional­level strategy If culture is embedded in the day­to­day interactions of functional personnel, it is difficult for a competitor to imitate another organization’s culture. A company that has an effective culture has an important source of competitive advantage. BUSINESS-LEVEL STRATEGY BUSINESS-LEVEL The business­level strategy involves: 1. Selection of the domain the organization will compete in 2. Positioning the organization so that it can use its resources and abilities to manage its specific and general environments in order to protect and enlarge that domain STRATEGIES TO LOWER COSTS OR DIFFER...
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