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25 Cards in this Set
- Front
- Back
A business's overall competitive theme; the way it positions itself in the marketplace to gain a competitive advantage, and the different positioning strategies that it can use in different industry settings. |
Business Level Strategy |
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A company has competitive advantage through two main ways: |
Lowering Costs Differentiation |
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In commodity markets , a competitive advantage goes to the company who ________ |
the lowest costs. |
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Differentiation often (but not always) raises the ___________ |
cost structure of a firm. |
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Differentiation gives a company two advantages: |
1. Allows the company to charge a premiem price for a good or service. 2. Can help the company grow overall demand and capture market share from its rivals. |
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In some cases, successful differentiation can actually lower costs. T or F? |
True |
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What options does a manager have with successful differentiation? |
1. Raise the price to reflect the differentiated nature of the product offereing and cover any incremental costs. 2. Hold prices constant, or slight increase, sell more, and boost profitability through attainment of scale economies. |
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An example of successful differentiation? |
Starbucks, Apple iPhone. |
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When it comes the differentiation-low cost trade off, it is about __________? |
achieveing the right balance, not solely choosing one. |
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efficiency frontier? |
shows all the different positions that a company can adopt with regard to differentiation and low cost, ASSUMING that its internal functions and organizational arrangements are configured efficiently to support a particular position. |
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Only those companies who get to the frontier have ________ |
a competitive advantage |
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Getting to the frontier requires excellence in ___________ |
strategy implementation. |
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Not all positions on an industry's efficiency frontier are equally attractive. T or F? |
True |
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The effiencey curve is static. T or F? |
False
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Value innovation is ________ |
when the effiencey curve is pushed outward through innovation. |
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Business level strategy starts with ________ |
market segmentation. |
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What are the three approaches to market segmentation? examples? |
1. Standardization Strategy - Average consumer - Walmart 2. Segmentation Strategy - many or all segments - Toyota/Scion/Lexus and Coke/Diet Coke/Cherry Coke 3. Focus Strategy - limited or one segment - Porsche |
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A strategy that gives a company a specific form of competitive position and advantage in comparison to its rivals, resulting in above-average profitability. How many are there? |
Generic business level strategy
4 |
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when a company lowers cost so much that it can lower prices and still make a profit. |
broad low-cost strategy |
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when a company differentiates its product in some way, such as by recognizing different segments or offering different products to each segment. |
Broad differentiation strategy |
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when a company targets a certain segement or niche and tries to be the low-cost player in that niche. |
focus low cost strategy |
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when a company targets a certain segment or niche and customizes its offerins to the needs of that particular segment through the addition of features and functions. |
focus differentiation strategy |
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Business level strategy is executed through actions taken at the _________ level and through ____________. |
functional organizational arrangements |
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Many successful companies have built their competitive advantage by redifining their product offering through _________ and __________ |
value innovation creating a new market space |
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The process of thinking through value innovation has been described as searching for a "________" a wide open market space where a company can chart its own course. |
Blue Ocean |