This preview shows page 130 - 141 out of 142 pages.
Business Strategy & Sustainability130Other Firms Cannot ImitateOther firms CANNOT imitate•Unique resource or capability•Unique property or contracts•Customers, suppliers locked-in•Reputation and Relationships•Organizational capabilities•Personality and character
Business Strategy & Sustainability131Other Firms do not want to ImitateOther firms do not WANT to imitate•Post-imitation profitability is low•Conflicts with / hurts other parts of the business
Business Strategy & Sustainability132Facing the realitiesNo. of Brands832Market Share20 %19 %11 %No, of Dealers7,0001,5001,000
Business Strategy & Sustainability133The environment does matter
Business Strategy & Sustainability134Globalization of Strategy
Business Strategy & Sustainability135Globalization of Strategy
Business Strategy & Sustainability136•Strategy and operating decisions are decentralized to strategic business units (SBU) in each country•Products and services are tailored to local markets•Business units in each country are independent•Assumes markets differ by country or regions•Focus on competition in each market•Prominent strategy among European firms due to broad variety of cultures and marketsMulti-domestic Strategy
Business Strategy & Sustainability137•Strategy results in less knowledge sharing for the corporation as a whole •Strategy isolates the firm from global competitive forces•Establish protected market positions•Compete in industry segments most affected by differences among local countries•Deals with uncertainty from differences across marketsMulti-domestic Strategy
Business Strategy & Sustainability138•Firm offers standardized products across country markets, with the competitive strategy being dictated by the home office•Strategic and operating decisions are centralizedat the home office•Involves interdependent SBUs operating in each country •Home office attempts to achieve integration across SBUs, adding management complexity•Produces lower riskGlobal Strategy
Business Strategy & Sustainability139•Facilitated by improved global reporting standards (i.e., accounting and financial) •Emphasizes economies of scale•Less responsive to local market opportunities•Requires resource sharing and coordination across borders (hard to manage)•Offers less effective learning processes (pressure to conform and standardize)•Strategy more effective in areas where regional integration is occurringGlobal Strategy
Business Strategy & Sustainability140•Seeks to achieve both global efficiency and local responsiveness—competing goals•Requires both:•Centralization - global coordination and control •Decentralization - local flexibility•Global competitive landscape fosters intense competition, thus pressures to reduce costs.