To be a first mover, the firm must have readily available resources to:
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-Invest significantly in R&D
-rapidly and successfully produce and market a stream of innovative
products
,Awareness
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refers to the extent to which competitors recognize the degree of their
mutual interdependence
Fast-cycle Markets
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markets in which competitors can imitate the focal firm's capabilities that
contribute to its competitive advantages and where that imitation is often
rapid and inexpensive
Down scoping:
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•Has a more positive effect on firm performance than does downsizing
•Causes firms to refocus on their core business
•Is often used with downsizing simultaneously
•Is used more frequently in U.S. firms than in European companies
Agency Relationship Problems
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, -Principals and agents sometimes have divergent interests and goals
-Dispersed shareholding makes it difficult and inefficient to monitor
management's behavior
-Need governance mechanisms to prevent opportunism
In a standard-cycle market
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o Competitive advantages are partially sustainable but only if the firm can
upgrade the quality of its capabilities continuously.
o The capabilities and core competencies in which firms base their
competitive advantages are less specialized.
o Imitation is faster and less costly than in slow-cycle markets.
o Imitation is slower and more expensive than in fast-cycle markets.
o Both incremental and radical innovations are critical to firms' efforts to
achieve strategic competitiveness.
Private synergy
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created when combining and integrating the acquiring and acquired firms'
assets, yield capabilities, and core competencies that could not be
developed by combining and integrating either firm's assets with another
company
In an effective due-diligence process, hundreds of items are examined in areas such
as:
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, § Financing for the intended transaction
§ Differences in cultures between the acquiring and target firm
§ Tax consequences of the transaction
§ Actions that would be necessary to successfully meld the two workforces
Executive compensation
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a governance mechanism that seeks to align the interests of managers and
owners through salaries, bonuses, and long-term incentives such as stock
awards and options
Competitive Action
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a strategic or tactical action the firm takes to build or defend its
competitive advantages or improve its market position
Due diligence
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process through which a potential acquirer evaluates a target firm for
acquisition
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-Invest significantly in R&D
-rapidly and successfully produce and market a stream of innovative
products
,Awareness
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refers to the extent to which competitors recognize the degree of their
mutual interdependence
Fast-cycle Markets
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markets in which competitors can imitate the focal firm's capabilities that
contribute to its competitive advantages and where that imitation is often
rapid and inexpensive
Down scoping:
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•Has a more positive effect on firm performance than does downsizing
•Causes firms to refocus on their core business
•Is often used with downsizing simultaneously
•Is used more frequently in U.S. firms than in European companies
Agency Relationship Problems
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, -Principals and agents sometimes have divergent interests and goals
-Dispersed shareholding makes it difficult and inefficient to monitor
management's behavior
-Need governance mechanisms to prevent opportunism
In a standard-cycle market
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o Competitive advantages are partially sustainable but only if the firm can
upgrade the quality of its capabilities continuously.
o The capabilities and core competencies in which firms base their
competitive advantages are less specialized.
o Imitation is faster and less costly than in slow-cycle markets.
o Imitation is slower and more expensive than in fast-cycle markets.
o Both incremental and radical innovations are critical to firms' efforts to
achieve strategic competitiveness.
Private synergy
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created when combining and integrating the acquiring and acquired firms'
assets, yield capabilities, and core competencies that could not be
developed by combining and integrating either firm's assets with another
company
In an effective due-diligence process, hundreds of items are examined in areas such
as:
Give this one a try later!
, § Financing for the intended transaction
§ Differences in cultures between the acquiring and target firm
§ Tax consequences of the transaction
§ Actions that would be necessary to successfully meld the two workforces
Executive compensation
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a governance mechanism that seeks to align the interests of managers and
owners through salaries, bonuses, and long-term incentives such as stock
awards and options
Competitive Action
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a strategic or tactical action the firm takes to build or defend its
competitive advantages or improve its market position
Due diligence
Give this one a try later!
process through which a potential acquirer evaluates a target firm for
acquisition
