Business Strategy Sustainability 130 Other Firms Cannot Imitate Other firms

Business strategy sustainability 130 other firms

This preview shows page 130 - 141 out of 142 pages.

Business Strategy & Sustainability130Other Firms Cannot ImitateOther firms CANNOT imitateUnique resource or capabilityUnique property or contractsCustomers, suppliers locked-inReputation and RelationshipsOrganizational capabilitiesPersonality and character
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Business Strategy & Sustainability131Other Firms do not want to ImitateOther firms do not WANT to imitatePost-imitation profitability is lowConflicts with / hurts other parts of the business
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Business Strategy & Sustainability132Facing the realitiesNo. of Brands832Market Share20 %19 %11 %No, of Dealers7,0001,5001,000
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Business Strategy & Sustainability133The environment does matter
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Business Strategy & Sustainability134Globalization of Strategy
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Business Strategy & Sustainability135Globalization of Strategy
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Business Strategy & Sustainability136Strategy and operating decisions are decentralized to strategic business units (SBU) in each countryProducts and services are tailored to local marketsBusiness units in each country are independentAssumes markets differ by country or regionsFocus on competition in each marketProminent strategy among European firms due to broad variety of cultures and marketsMulti-domestic Strategy
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Business Strategy & Sustainability137Strategy results in less knowledge sharing for the corporation as a whole Strategy isolates the firm from global competitive forcesEstablish protected market positionsCompete in industry segments most affected by differences among local countriesDeals with uncertainty from differences across marketsMulti-domestic Strategy
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Business Strategy & Sustainability138Firm offers standardized products across country markets, with the competitive strategy being dictated by the home officeStrategic and operating decisions are centralizedat the home officeInvolves interdependent SBUs operating in each country Home office attempts to achieve integration across SBUs, adding management complexityProduces lower riskGlobal Strategy
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Business Strategy & Sustainability139Facilitated by improved global reporting standards (i.e., accounting and financial) Emphasizes economies of scaleLess responsive to local market opportunitiesRequires 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
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Business Strategy & Sustainability140Seeks to achieve both global efficiency and local responsiveness—competing goalsRequires both:Centralization - global coordination and control Decentralization - local flexibilityGlobal competitive landscape fosters intense competition, thus pressures to reduce costs.
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