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26 Cards in this Set

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All three levels of strategy within a company have good internal and external consistency.
Strategic Fit
Components of a firm engaged in multiple industries or businesses.
Strategic Business Units (SBUs)
1. A homogeneous set of markets to serve with a limite number of related technologies
2. A unique set of product-markets
3. Control over those factors necessary for successful performance
4. Responsibility for their own profitability
Characteristics of an SBU (4)
1. Technical compatibility
2. Similarity in the customer needs
3. Similarity in the personal characteristics or behavior patterns of customers
How to cluster SBUs (3)
1. The attractiveness of their industries
2. The strength of their competitive positions within those industries
3. Resource allocation decisions by corporate management
Resource for different objectives in different SBUs (3)
1. Prospector
2. Defender (differentiated or low-cost defenders)
3. Analyzers (differentiated or low-cost analyzers)
4. Reactors
Generic Business-Level Competitive Strategies
Focuses on growth through the development of new products and markets.
Prospector Strategy
Concentrates on maintaining their positions in established product markets while paying less attention to new product development.
Defender Strategy
Attempts to maintain a strong position in its core product-market(s) but also seeks to expand into new -usually closely related- product-markets.
Analyzer Strategy
Businesses with no clearly defined strategy.
Reactor Strategy
1. Scope
2. Goals and objectives
3. Resource Deployments
4. Synergy
Components of Competitive Strategies (4)
The success of a business's products and programs relative to those of its competitors in the market (sales growth or changes in market share)
Effectiveness
The outcomes of a business's programs relative to the resources used in implementing them (profitability as a percent of sales and return on investment)
Efficiency
The business's success in responding over time to changing conditions and opportunities in the environment (number of successful new products, percentage of sales accounted for by products introduced within the last 5 years)
Adaptability
1. Scope - well defined, narrow, and stable domains where product technology and customer segments are mature
2. Goals and objectives – better return on investment
3. Resource Deployments – focus the bulk of their resources on preserving existing positions in established product-markets
Defender Strategy
1. Scope – operate in broad and rapidly changing domains where neither the technology nor the customer segments are well established
2. Goals and objectives - best on new product development and market-share growth.
3. Resource Deployments - large proportion of resources to the development of new product-markets
Prospector Strategy
1. Scope – usually have a well-established core business to defend, and often their domain is primarily focused on that business
Analyzer Strategy
1. Industry and market
2. Technology
3. Competition
4. Business's relative strengths
Environmental Factors that Affect Business Strategies
1. Industry and market - early growth stage, many potential customer segments
2. Technology - newly emerging technology, applications to develop
3. Competition - few established competitors, one competitor is the strongest
4. Business's relative strengths - strong R&D, product engineering and marketing and research & capabilities
Prospector
1. Industry and market - late growth or early maturity, some potential segments are undeveloped
2. Technology - basic technology well developed but still evolving
3. Competition - many competitors but structure still evolving
4. Business's relative strengths - good R&D, product engineering and marketing research & capabilities but not as strong as some competitors'
Analyzer
1. Industry and market - industry in maturity or decline stage
2. Technology - few major modifications likely
3. Competition - small or moderate well established competitors, stable
4. Business's relative strengths - no outstanding strengths in R&D, costs are higher than some competitors, its strengths are quality, process engineering and marketing, distribution, customer service
Differentiated Defender
1. Industry and market - industry in maturity or decline stage
2. Technology - few major modifications likely
3. Competition - small or moderate well established competitors, stable
4. Business's relative strengths - superior sources of supply and process engineering and production capabilities.
Low-Cost Defender
1. Product Policies
2. Price Policies
3. Distribution Policies
4. Promotion Policies
Marketing Policies (4)
1. Product-line diversity
2. Technical sophistication
3. Product quality
4. Service quality
Product policies concerns (4)
1. Degree of forward vertical integration
2. trade promotion expenses as percent of sales
Distribution policies concerns (2)
1. Advertising expenses as percent of sales
2. sales promotions expenses as percent of sales
3. Salesforce expenses as percent of sales
Promotion policies concerns (3)