Beruflich Dokumente
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Level
Strategy:
Creating and
Sustaining
Competitive
Advantages
chapter 5
Copyright 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
5-2
Sustaining a Competitive
Advantage
Consider
The viability of a firms success is driven
by both the internal operations of the firm
and the desires and preferences of the
market. Firms that succeed have the
appropriate resources and cost structure to
meet the needs of the environment.
They also have a strategy
5-3
Sustaining a Competitive
Advantage
What
Who
How
Customer Groups
Market Segmentation
Alternatives to Market
Segmentation
Distinctive Competencies
#-12
Business-Level Strategy
Cost-Leadership Strategy
Cost-Leadership Strategy
Advantages:
Disadvantages:
Differentiation Strategy
Differentiation Strategy
Advantages:
Customers develop
brand loyalty for a
product
Differentiation
creates barriers to
entry for other
companies
Disadvantages:
Difficult to
maintain
uniqueness in the
customers eye
Threat of
substitute
products
Focus Strategy
Geographic area
Type of customer
Segment of the product line
Focus Strategy
Advantages:
Customer loyalty
lessens the threat
of substitutes
Power over buyers
because they
cannot get the
same product
elsewhere
Disadvantages:
Suppliers have
power over
focused firms,
making the firms
vulnerable to
changes
Vulnerable to
attack, therefore
must define its
niche constantly
#-21
#-23
Strategies in Consolidating a
Fragmented and Growing
Industry
Copyright 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
IT and the
Internet
chaining
Franchising
Horizontal
Merger
STRATEGIES
STRATEGIES IN
IN FRAGMENTED
FRAGMENTED INDUSTRIES
INDUSTRIES
Franchising
Franchising
Horizontal
Horizontal Merger
Merger
Strategy in Fragmented or
Growing Industry
Strategy in a Mature
Industry
Manage rivalry
Deter entry
STRATEGY
STRATEGY IN
IN MATURE
MATURE INDUSTRIES
INDUSTRIES
6-31
Product Proliferation
Proliferation
Product
6-32
Price
Price Cutting
Cutting
time a
new company enters the
(continued)
industry--then raise prices
An entry-deterring strategy is to cut prices every
STRATEGIES
STRATEGIES TO
TO DETER
DETER ENTRY
ENTRY
The established company initially charges a high price
for a product and seizes a short-term profit, but then
aggressively cuts prices to build market share; thus
deterring potential entrants.
Maintaining
Maintaining Excess
Excess Capacity
Capacity
STRATEGIES
STRATEGIES TO
TO MANAGE
MANAGE RIVALRY
RIVALRY
STRATEGIES
STRATEGIES TO
TO MANAGE
MANAGE RIVALRY
RIVALRY
Non-price competition also includes:
Market development where a company finds a new
market segment for its products.
Product proliferation generally means that large
companies in an industry all have a product in each
market segment and compete head-to-head for
customers. It allows for stability based on product
differentiation rather than on product price.
Capacity control refers to preventing the accumulation
of costly excess capacity. Technology allows firms to
produce the same or more with less spacethus
causing excess capacity.
6-35
STRATEGIES
STRATEGIES IN
IN DECLINING
DECLINING INDUSTRIES
INDUSTRIES
1) Leadership strategy
2) Niche strategy
3) Harvest strategy
4) Divestment strategy
STRATEGIES
STRATEGIES IN
IN AA DECLINING
DECLINING INDUSTRY
INDUSTRY
6-37