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79 Cards in this Set
- Front
- Back
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Propitious Niche |
Niche that is well suited to a firm's external and internal environment that not many challenge you |
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Business Strategy |
improve the position of a company's products within the specific market segment |
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Lower cost strategy |
ability to produce a product more effectively than competitors |
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Differentiation strategy |
Ability to provide unique value to the buyer in terms of product quality, features, or after sale service |
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Cost Leadership |
aims at a broad mass market and requires efficient scale facilities, cost reductions, overhead control EXample fedex or ups |
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competitive scope |
breadth of a company's target market |
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Differentiation |
creating a product that's perceived as unique. like brand image, tech features, customer service |
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Cost Focus |
low cost strategy that focuses on a buyer group or geographic market to serve the niche |
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Differentiation focus |
Concentrates on product line segment, or georgraphic market to serve needs of a narrow strategic market more effectively |
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Competitive strategies |
entrepreneurial firms follow focus strategies where they focus their product on customer needs in a market segment to differentiate based on quality and service |
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Fragmented industry |
small and medium sized companies compete for relatively small shares of the total market focus strategy is used early stages of product life cycle |
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consolidated industry |
dominated by few large companys large economies of scale national brands |
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Hypercompetition |
-short product life cycles -new technologies -frequent new and unexpected entries -constantly changing strategies due to large companies |
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Tactic |
plan that details how to implement a strategy |
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cooperative strategies |
wokring with other firms to gain competitive advantage |
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collusion |
firms within an industry reduce output and raise prices to avoid supply and demand |
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strategic alliances |
long arrangement with 2 or more companies that work together for mutual gain |
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corporate strategy |
how will they develop ways to capture synergy among the business it owns |
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Directional Strategy |
the firms overall orientation -growth -stability -retrenchment |
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Growth strategies |
Internal -new products -new markets External -mergers and acquisitions -strategic alliances |
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Growth Strategies: Concentration |
current product lines have real growth potential |
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Vertical growth |
taking over a function provided by a supplier or distributor |
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Vertical integration |
firm operates in multiple locations on the value chain
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backward integration
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assuming a function previously provided by a supplier |
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forward integration |
assume a function previously done by a distributor |
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taper integration |
firm internally produces les than half of its own requirement |
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quasi integration |
company doesn't make any of its key supplies but purchases most from outside suppliers |
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long term contract |
two firm agree upon selling goods and services to each other |
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Horizontal growth |
expanind operations into other geographic locations and markets |
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horizontal integration |
degree where a firm operates in multiple locations at the same point on an industrys value chain |
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production sharing |
combin higher labor skills available in developed countries with lower cost labor available in developing countries |
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turnkey operation |
contracts for construction of operating facilities in exchange for a fee |
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BOT |
company operates the facility for a fixed period of time to earn back investment |
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management contracts |
use personnel to assist a firm for a specific amount of time |
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diversification |
used when a company's products, companies have limited now growth potential |
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concentric diversification |
firm uses strengths to diversify into related products into another country |
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conglomerate diversification |
move into another industry to provide products unrelated to its current products |
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pause/proceed strategy |
a timeout before continuing a strategy |
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no change strategy |
decision to do nothing new |
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profit strategy |
do nothing new in a worsening situation but act as though the problems are only temporary. stop investments and expenses |
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Turnaround strategy |
emphasize improvement of operational efficiency |
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captive company strategy |
another company gives funds and takes over temporarily to improve situtation |
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sell out divestment |
sell out: sell company Divestment: sell off a division with low growth potential |
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bankruptcy/liquidation strategy |
Bankruptcy: give up MGMT to courts in return for a settlement of debts Liquidation: termination of a firm |
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contraction |
across the board series of cutbacks in size |
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consolidation |
implement plan to stabilize now leaner company |
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BCG matrix |
question marks stars cash cows dogs |
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question marks |
new products with potential for success but require a lot of cash for development |
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stars |
market leaders at peak of product cycle |
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cash cows |
products bring in far more money than needed to maintain share |
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dogs |
products with low market share and do not have potential to bring in much cash |
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Functional Strategy |
approach a functional area takes to achieve corporate and business unit objectives and strategies by maximizing productivity |
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Marketing strategy |
pricing, selling, and distributing a product |
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market development strategy |
tries to capture a larger share of existing market through penetration and saturation strategies |
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product development strategy |
develop new products for both new and existing markets |
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brand extension |
using a successful brand name to market other products |
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push strategy |
promotions to gain or hold shelf space in retail outlets |
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pull strategy |
advertising to make people think they need it and then demand through distribution channels |
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skim pricing |
skim the cream from the top of the demand curve with a high price while having little competitors |
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penetration pricing |
try to hasten market development and offer opportunity to use experience to gain market share with low price more likely to raise profit |
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Financial strategy |
examines financial implications of corporate and business level strategy options to find best course of action |
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leveraged buyout |
company acquired in a transaction financed largely by debt, usually an insurance company or banker |
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R+D Strategy |
deals with product and process innovation and improvement |
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technological leader |
pioneers innovation |
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technological follow |
imitates products of competitors |
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open innovation |
use alliance and connections with corporate, government, academic labs and consumers to develop new products and process |
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operations strategy |
determines how and where product to be manufactured |
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purchasing strategy |
obtaining raw materials, parts and supplies needed to perform the operations function |
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sole suppliers |
one manufacturer supplies the part |
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just in time |
having parts arrive as they are needed |
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parallel sourcing |
two suppliers are the sole of two different parts, but are their backups too |
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logistics strategy |
flow of products into and out of the manufacturing process |
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trends of logistics strategy |
centralization, outsourcing, internet |
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HRM strategy |
self managed teams, 360 degree appraisal, diverse workforce |
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information technology strategy |
internet extranet intranet |
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outsourcing |
purchasing from someone else a product or service that had been previously provided internally |
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offshoring |
outsource activity to wholly owned company or independent provider in another country |
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when to outsource |
low activity for competitive advange and low value added to firm |
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strategies to avoid |
follow the leader hit another home run arms race do everything losing hand |
