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76 Cards in this Set
- Front
- Back
A Good Strategy consists of: |
Analysis, Formulation, and Implementation |
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Diagnosis of the competitive advantage |
Analysis |
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Guiding policy to address the competitive challenge |
Formulation |
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Set of coherent actions to implement the firm's guiding policy |
Implementation |
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Superior performance relative to other competitors in the same industry or the industry average |
Competitive Advantage |
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Outperforming over a prolonged period |
Sustainable Competitive Advantage |
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Trade-offs are required in ____ ____ |
Strategic Positioning |
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What strategy is not? |
Grandiose statements, failure to face competitive challenges, operational effectiveness, competitive benchmarking, or other tactical tools |
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Determined primarily by two factors: industry effects and firm effects |
Firm Performance |
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Firm performance attributed to the industry structure which a firm competes |
Industry Effects |
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Firm performance attributed to the actions managers take |
Firm Effects |
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There is an important relationship between _____ and ______ |
Strategic management and role of business |
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an integrative approach to managing a diverse set of stakeholders effectively in order to gain and sustain competitive advantage |
Stakeholder Strategy |
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Concerned with how the firm exchange with various stakeholders to create and trade value |
Stakeholder Strategy |
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Stakeholder Impact Analysis Levels? |
Power, Legitimacy, Urgency |
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A decision tool with which managers can recognize, assess, and address the needs of difference stakeholders, allowing the firm to achieve competitive advantage while acting as a good corporate citizen |
Stakeholder Impact Analysis |
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A framework that helps firms recognize and address the economic, legal, social, and philanthropic expectations that society has toward business. |
Corporate Social Responsibility (CSR) |
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CSR has four components of responsibility: |
Economic, Legal, Ethical, and Philanthropic |
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Process employed by strategic leaders to conceive and implement a strategy, which leads to sustainable competitive advantage |
Strategic Management process |
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Executives’ use of power and influence to direct assets in the pursuit of an organization’s goal |
Strategic Leadership |
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Aspiration of the firm that lays the foundation for its mission - “to” is a common word |
Vision |
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What an organization does, including products, services, and which makes markets - “by” is a common word |
Mission |
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_______ vision statements allow firms to adapt to changing environments |
Customer-oriented |
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_______ vision statements are less flexible |
Product-oriented |
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______ is a necessary condition to achieve competitive advantage |
Strategic flexibility |
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_______ are ethical standards/norms that govern the behavior of individuals within a firm |
Values |
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Values form a foundation for a firm’s ______ and _____ |
vision and mission |
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Values serve as the ______ to keep the company on track |
guardrails |
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Where to compete (industry, markets, and geography) |
Corporate Strategy |
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How to compete (cost leadership, differentiation, or integration) |
Business Strategy |
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How to implement a business strategy |
Functional Strategy |
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When strategizing for competitive advantage, managers rely on three different approaches. This order represents how these approaches were developed over time: |
Strategic Planning Scenario Planning Strategy as Planned Emergence |
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Rational, top-down process aiding in programming for future success |
Top-Down Strategic Planning |
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In top-down strategic planning, Information flows only one way: ______ and it has _____ strategic intelligence and decision-making |
top-down; Centralized |
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the behaviors and styles of executives that influence others to achieve the organization’s vision and mission |
Strategic Leadership |
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impact firm performance as do leaders whose decisions lead to huge destruction of shareholder wealth and jobs. |
Strategic Leaders |
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Managers envision different ______ to anticipate plausible futures. |
what-if scenarios |
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Scenario planning takes place at both the ______ and ______ levels of strategy. |
corporate and business |
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Scenario Planning addresses both _____ and _____ futures |
optimistic and pessimistic |
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Critics of top-down and scenario planning argue that strategic planning is not the same as ________. |
strategic thinking |
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To create a powerful foundation for strategy formulation and implementation, the basis for gaining and sustaining a competitive advantage: First, the firm needs an inspiring vision and mission backed up by ______. Second, the firm needs an effective strategic _____. |
ethical values management process |
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In the PESTEL Framework, Managers mitigate threats and exploit opportunities by analyzing the ________ |
external environmental forces |
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In the PESTEL Framework, factors are ______ |
independent |
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_______ is the framework to scan, monitor, and evaluate important external factors/trends impacting a firm in its quest for competitive advantage. |
PESTEL Framework |
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A group of (incumbent) firms that face the same set of suppliers and buyers |
Industry |
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Identifies the industry's profit potential and derives implications for a firm’s strategic position within an industry |
Industry Analysis |
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A firm’s ability to create value (V) for customers while containing costs (C) |
Strategic Position |
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Competitive Advantage = |
a large value gap (V -C) |
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_____ impact firm profitability |
Industry Forces |
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A ______ industry makes sustainable competitive advantage easier, has high profit potential, and the five forces are weaker |
Attractive Industry |
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A ______ industry makes sustainable competitive advantage harder, has low profit potential, and the five forces are stronger |
unattractive industry |
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Incumbent firms can benefit from several important sources of entry barriers: |
Economies of scale Network effects Customer switching costs Capital requirements Advantages independent of size Government policy Credible threat of retaliation |
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______ can demand higher prices for their inputs and captures part (sometimes a large part) of the economic value created. |
Powerful Suppliers |
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Suppliers industry is concentrated.They don’t depend heavily on the incumbent’s industry.Incumbent firms face high switching costs.Suppliers’ products are differentiated.Limited substitutesSuppliers have credible forward integration threats. All these are signs of _______ |
Strong Suppliers |
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The bargaining power of _____ impacts industry profit potential |
buyers |
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________ can demand a lower price or higher product quality and reduce industry profit potential:Through price discounts (limited revenue) Through increased quality / better service (higher costs) As they capture part of the economic value created |
Powerful Buyers |
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The threat of ______ derives from products/services fulfilling the needs of current customers from outside the industry |
Substitutes |
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The power of substitute are ____ when:Price-performance: Has an attractive trade-off. The buyer’s switching cost is low. |
high |
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______ limit the price that industry competitors can charge for their products/services. |
Substitutes |
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Which industry competitive structure has many small firms, firms are price takers, commodity product, and low entry barriers? |
Perfect Competition |
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Which industry competitive structure has many firms, some pricing power, differentiated product, and medium entry barriers |
Monopolistic Competition |
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Which industry competitive structure has few (large) firms, some pricing power, differentiated product, and high entry barriers? |
Oligopoly |
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Which industry competitive structure has one firm, considerable pricing power, unique product, and very high entry barriers? |
Monopoly |
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______ industry competitive structure has low profit potential |
fragmented |
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_____ industry competitive structure has high profit potential |
Consolidated |
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A product, service, or competency that adds value when used in tandem with the original product offering |
Complement |
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A firm that provides a good/service that leads customers to value your firm's offering more when the two are combined |
Complementor |
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Cooperation by competitors to achieve a strategic objective |
Co-opetition |
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As consolidated industries tend to be more profitable than fragmented ones, firms tend to change their industry structures toward being more consolidated through ________ |
(horizontal) mergers and acquisitions. |
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Firms in the same ______ follow a similar strategy. |
strategic group |
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Strategic group differences identify ______ |
business-level strategies. |
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______ competitors – same strategic group firms. |
Direct |
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_______ rivalry exceeds inter-group rivalry:Rivalry among firms within a strategic group is more intense than the rivalry between strategic groups. |
Intra-group |
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________ guiding consideration: How the external factors identified affect the firm’s industry environment |
PESTEL analysis |
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_________ identifies industry profit potential and firm positioning for gaining and sustaining competitive advantage. |
Porter’s five forces model |
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__________ helps to find performance differences within the focal industry. |
Strategic group map |