STRATEGIC MANAGEMENT
INHOUD
C1. Introduction Strategy ........................................................................................................................................ 6
Strategy ............................................................................................................................................................... 6
Case: Netflix .................................................................................................................................................... 6
The quest for competitive advantage ............................................................................................................. 6
The Honda case ............................................................................................................................................... 7
Business = Value creation ................................................................................................................................... 8
What is strategy about? ...................................................................................................................................... 9
Is our strategy likely to be successful? ............................................................................................................ 9
Definition of a strategy ................................................................................................................................... 9
The basic framework - Michael Porter .......................................................................................................... 10
Business............................................................................................................................................................. 11
Layers of leadership influence ...................................................................................................................... 11
How to create value in financial terms ......................................................................................................... 12
C2. External analysis: understanding the industry ................................................................................................ 14
Purpose (why) and strategy .............................................................................................................................. 14
Purpose need to be embedded in strategy ................................................................................................... 15
Strategy making ................................................................................................................................................ 16
Who is involved in strategy making .............................................................................................................. 16
Describing strategy: current positioning, Future direction ........................................................................... 17
Industry evolution ......................................................................................................................................... 18
Management = leadership? .............................................................................................................................. 19
Strategic leadership....................................................................................................................................... 19
C3. An industry or external analysis ...................................................................................................................... 21
The components of an organisation’s macro environment .............................................................................. 21
Identifying key success factors ...................................................................................................................... 21
Attractiveness of industries .............................................................................................................................. 21
Industry attractiveness & differences ........................................................................................................... 22
Analyzing the industry: 5 forces of Michael porter ........................................................................................... 23
5 forces of Michael Porter ............................................................................................................................. 24
Pest(le) analysis of industry .............................................................................................................................. 24
Pestle combines with 5 forces of Porter ....................................................................................................... 25
Does industry matter? ...................................................................................................................................... 25
The Most Common Drivers of Industry Change ............................................................................................ 25
1
, Financial perspective ..................................................................................................................................... 25
GUCCI case ............................................................................................................................................................ 27
Gucci Strategy ............................................................................................................................................... 27
Conferring identity ........................................................................................................................................ 28
Ryanair case ...................................................................................................................................................... 28
Ryanair’s activity system ............................................................................................................................... 28
Value for 2 airlines ........................................................................................................................................ 29
Ecosystems changing the strategic landscape .............................................................................................. 30
Importance of artificial intelligence as complementary force to human capital .......................................... 30
C3. Internal analysis & competitive advantage ..................................................................................................... 32
The impact of resources & capabilities in firms ................................................................................................ 32
Resources and capabilities ............................................................................................................................ 32
The interface between strategy and the firm ............................................................................................... 32
The resource base ......................................................................................................................................... 32
Some strategic tools .......................................................................................................................................... 33
SWOT-analysis ............................................................................................................................................... 33
Use your distinctive capabilities wisely ............................................................................................................. 36
Strategizing distinctive capabilities ................................................................................................................... 36
C4. Competitive advantage through positioning .................................................................................................. 38
Positioning adopting to existing structure ........................................................................................................ 38
The product offering – exam ......................................................................................................................... 38
Competitive Advantage based on 3 value disciplines ................................................................................... 39
Competitive Advantage through Positioning ................................................................................................ 39
Competitive Strategy as Positioning - Generic Competitive Strategies ........................................................ 39
Gaining competitive advantage ........................................................................................................................ 42
Overview strategies – competitive advantage .............................................................................................. 42
Preliminary strategic options ........................................................................................................................ 42
Creating a competitive advantage ................................................................................................................ 43
Segmentation ................................................................................................................................................ 44
Cases on positioning ......................................................................................................................................... 46
Victoria Secret (exam question) .................................................................................................................... 46
Zara ............................................................................................................................................................... 47
Renova .......................................................................................................................................................... 49
Reinterprenting “positioning”: addressing the supply and demand ................................................................. 49
Competitive advantage and a good strategy ................................................................................................ 49
Zipcar ............................................................................................................................................................. 50
Tailored value chain creating customer value .............................................................................................. 50
2
, Case of linking VP and VC .................................................................................................................................. 52
IKEA – Exam ................................................................................................................................................... 52
C5. Blue Ocean strategy & non-disruptive innovation -> creating a new demand ............................................... 55
Positioning......................................................................................................................................................... 55
Reconstructionist perspective ........................................................................................................................... 55
Value innovation and Blue Ocean Strategy ................................................................................................... 55
Body shop - Reconstructionist approach of Blue Ocean Strategy ................................................................. 56
Case NetJets .................................................................................................................................................. 57
Four grid framework for blue ocean ............................................................................................................. 57
Major difference – exam ............................................................................................................................... 57
Case: Cirque du soleil .................................................................................................................................... 58
Case Yellow tail - Value innovation in the US wine industry ......................................................................... 59
Case Zwift – exam ............................................................................................................................................. 61
Non-disruptive strategic innovation ................................................................................................................. 61
Non-Disruptive Strategic Innovation ............................................................................................................. 61
Market creation ............................................................................................................................................ 63
C6. The importance of Innovation to sustain competitive advantage .................................................................. 64
Growth driven by innovation ............................................................................................................................ 64
Case IBM (exam) ............................................................................................................................................... 65
The IBM Emerging Business Opportunities Model ....................................................................................... 65
IBM’s EBO as % of total IBM revenue ........................................................................................................... 65
The importance of strategic innovation ............................................................................................................ 66
Offensive or defensive strategic moves ........................................................................................................ 66
Case eReader................................................................................................................................................. 67
Strategic innovation: what, why; where, who & how ....................................................................................... 67
Timing innovation: to lead or to follow? ....................................................................................................... 68
(Digital) innovation ............................................................................................................................................ 68
Technologies that today change our lives ..................................................................................................... 68
Business model innovation ........................................................................................................................... 69
Disruptive innovation ........................................................................................................................................ 70
A job to be done (exam) ................................................................................................................................ 70
Niche oriented products – services / Job to be done.................................................................................... 71
The advantage of big data ................................................................................................................................. 71
Digital innovation .......................................................................................................................................... 71
Artificial intelligence based on the use of Big Data ........................................................................................... 71
What kind of AI ............................................................................................................................................. 72
Where do computers beat us ....................................................................................................................... 73
3
, AI talent expertise ......................................................................................................................................... 74
2 different realities ........................................................................................................................................ 75
The bad & the ugly of AI .................................................................................................................................... 76
The Bad of AI - Ethical challenges & Risks of AI & Digitization/Deep Learning ............................................. 76
A new logic of competition ............................................................................................................................... 77
The changed reality and new logic of competition ....................................................................................... 77
Principles rather than Procedures are what matter ..................................................................................... 77
Netflix Case (exam) ........................................................................................................................................... 79
Culture at Netflix: radical transparent and talent density ............................................................................ 79
An algorithmic company ............................................................................................................................... 79
c7: A global strategy for international expansion ................................................................................................. 82
Harnessing the best of globalization ................................................................................................................. 82
Operating beyond national borders .............................................................................................................. 82
Case Microsoft .............................................................................................................................................. 85
Competing Internationally: The Three Main Strategic Approaches .............................................................. 86
C8. The corporate strategy in a diversified multi-business organization .............................................................. 88
M&A, Strategic Alliances, Vertical/Horizontal Integration................................................................................ 88
Scope of opterations (exam) ......................................................................................................................... 88
HORIZONTAL M&A STRATEGIES .................................................................................................................... 88
STRATEGIC ALLIANCES & PARTNERSHIPS ...................................................................................................... 89
Creating value in a diversified firm ................................................................................................................... 89
An Economic Interpretation of Corporate Strategy: creating value in a multi-business firms ..................... 89
Six ways to create synergy ............................................................................................................................ 91
Corporate Composition ................................................................................................................................. 92
Scope ............................................................................................................................................................. 93
Vertical integration ....................................................................................................................................... 95
Diversification ............................................................................................................................................... 97
T9: Making a strategy work: Governance, Ethics & Sustainability ........................................................................ 98
Strategy and sustainability .............................................................................................................................. 100
Social responsibility Nike & slavery ............................................................................................................. 100
Shareholder versus Stakeholder theory .......................................................................................................... 101
Corporate Citizenship & Stewardship ............................................................................................................. 103
Corporate Social Responsibility? (CSR) ........................................................................................................... 104
The triple bottom line + ESG ....................................................................................................................... 104
ESG (exam) .................................................................................................................................................. 105
Additional question: notion of double materiality ...................................................................................... 106
Does doing good helps CEO’s as well? ........................................................................................................ 106
4
INHOUD
C1. Introduction Strategy ........................................................................................................................................ 6
Strategy ............................................................................................................................................................... 6
Case: Netflix .................................................................................................................................................... 6
The quest for competitive advantage ............................................................................................................. 6
The Honda case ............................................................................................................................................... 7
Business = Value creation ................................................................................................................................... 8
What is strategy about? ...................................................................................................................................... 9
Is our strategy likely to be successful? ............................................................................................................ 9
Definition of a strategy ................................................................................................................................... 9
The basic framework - Michael Porter .......................................................................................................... 10
Business............................................................................................................................................................. 11
Layers of leadership influence ...................................................................................................................... 11
How to create value in financial terms ......................................................................................................... 12
C2. External analysis: understanding the industry ................................................................................................ 14
Purpose (why) and strategy .............................................................................................................................. 14
Purpose need to be embedded in strategy ................................................................................................... 15
Strategy making ................................................................................................................................................ 16
Who is involved in strategy making .............................................................................................................. 16
Describing strategy: current positioning, Future direction ........................................................................... 17
Industry evolution ......................................................................................................................................... 18
Management = leadership? .............................................................................................................................. 19
Strategic leadership....................................................................................................................................... 19
C3. An industry or external analysis ...................................................................................................................... 21
The components of an organisation’s macro environment .............................................................................. 21
Identifying key success factors ...................................................................................................................... 21
Attractiveness of industries .............................................................................................................................. 21
Industry attractiveness & differences ........................................................................................................... 22
Analyzing the industry: 5 forces of Michael porter ........................................................................................... 23
5 forces of Michael Porter ............................................................................................................................. 24
Pest(le) analysis of industry .............................................................................................................................. 24
Pestle combines with 5 forces of Porter ....................................................................................................... 25
Does industry matter? ...................................................................................................................................... 25
The Most Common Drivers of Industry Change ............................................................................................ 25
1
, Financial perspective ..................................................................................................................................... 25
GUCCI case ............................................................................................................................................................ 27
Gucci Strategy ............................................................................................................................................... 27
Conferring identity ........................................................................................................................................ 28
Ryanair case ...................................................................................................................................................... 28
Ryanair’s activity system ............................................................................................................................... 28
Value for 2 airlines ........................................................................................................................................ 29
Ecosystems changing the strategic landscape .............................................................................................. 30
Importance of artificial intelligence as complementary force to human capital .......................................... 30
C3. Internal analysis & competitive advantage ..................................................................................................... 32
The impact of resources & capabilities in firms ................................................................................................ 32
Resources and capabilities ............................................................................................................................ 32
The interface between strategy and the firm ............................................................................................... 32
The resource base ......................................................................................................................................... 32
Some strategic tools .......................................................................................................................................... 33
SWOT-analysis ............................................................................................................................................... 33
Use your distinctive capabilities wisely ............................................................................................................. 36
Strategizing distinctive capabilities ................................................................................................................... 36
C4. Competitive advantage through positioning .................................................................................................. 38
Positioning adopting to existing structure ........................................................................................................ 38
The product offering – exam ......................................................................................................................... 38
Competitive Advantage based on 3 value disciplines ................................................................................... 39
Competitive Advantage through Positioning ................................................................................................ 39
Competitive Strategy as Positioning - Generic Competitive Strategies ........................................................ 39
Gaining competitive advantage ........................................................................................................................ 42
Overview strategies – competitive advantage .............................................................................................. 42
Preliminary strategic options ........................................................................................................................ 42
Creating a competitive advantage ................................................................................................................ 43
Segmentation ................................................................................................................................................ 44
Cases on positioning ......................................................................................................................................... 46
Victoria Secret (exam question) .................................................................................................................... 46
Zara ............................................................................................................................................................... 47
Renova .......................................................................................................................................................... 49
Reinterprenting “positioning”: addressing the supply and demand ................................................................. 49
Competitive advantage and a good strategy ................................................................................................ 49
Zipcar ............................................................................................................................................................. 50
Tailored value chain creating customer value .............................................................................................. 50
2
, Case of linking VP and VC .................................................................................................................................. 52
IKEA – Exam ................................................................................................................................................... 52
C5. Blue Ocean strategy & non-disruptive innovation -> creating a new demand ............................................... 55
Positioning......................................................................................................................................................... 55
Reconstructionist perspective ........................................................................................................................... 55
Value innovation and Blue Ocean Strategy ................................................................................................... 55
Body shop - Reconstructionist approach of Blue Ocean Strategy ................................................................. 56
Case NetJets .................................................................................................................................................. 57
Four grid framework for blue ocean ............................................................................................................. 57
Major difference – exam ............................................................................................................................... 57
Case: Cirque du soleil .................................................................................................................................... 58
Case Yellow tail - Value innovation in the US wine industry ......................................................................... 59
Case Zwift – exam ............................................................................................................................................. 61
Non-disruptive strategic innovation ................................................................................................................. 61
Non-Disruptive Strategic Innovation ............................................................................................................. 61
Market creation ............................................................................................................................................ 63
C6. The importance of Innovation to sustain competitive advantage .................................................................. 64
Growth driven by innovation ............................................................................................................................ 64
Case IBM (exam) ............................................................................................................................................... 65
The IBM Emerging Business Opportunities Model ....................................................................................... 65
IBM’s EBO as % of total IBM revenue ........................................................................................................... 65
The importance of strategic innovation ............................................................................................................ 66
Offensive or defensive strategic moves ........................................................................................................ 66
Case eReader................................................................................................................................................. 67
Strategic innovation: what, why; where, who & how ....................................................................................... 67
Timing innovation: to lead or to follow? ....................................................................................................... 68
(Digital) innovation ............................................................................................................................................ 68
Technologies that today change our lives ..................................................................................................... 68
Business model innovation ........................................................................................................................... 69
Disruptive innovation ........................................................................................................................................ 70
A job to be done (exam) ................................................................................................................................ 70
Niche oriented products – services / Job to be done.................................................................................... 71
The advantage of big data ................................................................................................................................. 71
Digital innovation .......................................................................................................................................... 71
Artificial intelligence based on the use of Big Data ........................................................................................... 71
What kind of AI ............................................................................................................................................. 72
Where do computers beat us ....................................................................................................................... 73
3
, AI talent expertise ......................................................................................................................................... 74
2 different realities ........................................................................................................................................ 75
The bad & the ugly of AI .................................................................................................................................... 76
The Bad of AI - Ethical challenges & Risks of AI & Digitization/Deep Learning ............................................. 76
A new logic of competition ............................................................................................................................... 77
The changed reality and new logic of competition ....................................................................................... 77
Principles rather than Procedures are what matter ..................................................................................... 77
Netflix Case (exam) ........................................................................................................................................... 79
Culture at Netflix: radical transparent and talent density ............................................................................ 79
An algorithmic company ............................................................................................................................... 79
c7: A global strategy for international expansion ................................................................................................. 82
Harnessing the best of globalization ................................................................................................................. 82
Operating beyond national borders .............................................................................................................. 82
Case Microsoft .............................................................................................................................................. 85
Competing Internationally: The Three Main Strategic Approaches .............................................................. 86
C8. The corporate strategy in a diversified multi-business organization .............................................................. 88
M&A, Strategic Alliances, Vertical/Horizontal Integration................................................................................ 88
Scope of opterations (exam) ......................................................................................................................... 88
HORIZONTAL M&A STRATEGIES .................................................................................................................... 88
STRATEGIC ALLIANCES & PARTNERSHIPS ...................................................................................................... 89
Creating value in a diversified firm ................................................................................................................... 89
An Economic Interpretation of Corporate Strategy: creating value in a multi-business firms ..................... 89
Six ways to create synergy ............................................................................................................................ 91
Corporate Composition ................................................................................................................................. 92
Scope ............................................................................................................................................................. 93
Vertical integration ....................................................................................................................................... 95
Diversification ............................................................................................................................................... 97
T9: Making a strategy work: Governance, Ethics & Sustainability ........................................................................ 98
Strategy and sustainability .............................................................................................................................. 100
Social responsibility Nike & slavery ............................................................................................................. 100
Shareholder versus Stakeholder theory .......................................................................................................... 101
Corporate Citizenship & Stewardship ............................................................................................................. 103
Corporate Social Responsibility? (CSR) ........................................................................................................... 104
The triple bottom line + ESG ....................................................................................................................... 104
ESG (exam) .................................................................................................................................................. 105
Additional question: notion of double materiality ...................................................................................... 106
Does doing good helps CEO’s as well? ........................................................................................................ 106
4
