BADM 449 EXAM 1 STUDY GUIDE
Competitve Advantage - Answers -superior performance relative to other competitors in
the same industry or industry average
Sustainable Competitve Advantage - Answers -a firm implements a value-creating
strategy of which other companies are unable to duplicate the benefits or find it too
costly to imitate
- an important basis is the development of resources and capabilities
Industry Effects - Answers -The results attributed to the choice of industry in which to
compete (20%)
Firm Effects - Answers -The results of the manager's actions to influence firm
performance (30-45%)
Corporate Level Strategy - Answers -Typically involves the decision making by the top
management team that includes the CEO, senior, executives, the board of directors,
and the corporate staff. Decisions include vertical integration, diversification, strategic
allainces, acqustions, new ventures, and restructuring.
Business Level Strategy - Answers -Includes the strategic choice of generic strategy
(cost leadership, differention, focus) and the benefits and costs of first-mover
advantages. Often an enterprise participating in multiple businesses will have different
business strategies.
Functional Level Strategy - Answers -Typically directed at improving the effectiveness
of functional operations within a company, such as manufacturing, materials
management, human resources, marketing, R&D and operations management
"Razor-blade model" - Answers -Give away or sell for a small fee the product and make
money on the replacement part needed (ex: laser printers with cheap printers and
expensive ink)
Multi-point Competition - Answers -Google and Microsoft compete with one another for
market share in several different product categories through quite different business
models.
- Google: benefits from network effects (increase of product value when more people
use it); give away products b/c business ads
- Microsoft: application software dominance; Bing provides countervailing power
Acceleration of technological change - Answers -- Initial innovations like the car, plane,
phone, and electricity now provide the necessary infrastructure for newer innovations to
diffuse more rapidly
, - Emergence of new business models that make innovations more accessible
- Internet, social networking sites, viral messaging
Stakeholders - Answers -Individuals or groups who can affect or are affected by the
actions of the firm; they have a claim or interest in the performance and continued
survival of the firm
- Internal Stakeholders: stockholders, all employees, board members
- External Stakeholders: customers, suppliers, alliance partners, creditors, unions,
communities, and governments at various levels
Customer-Oriented Mission - Answers -define the terms of solutions for customers
- Disney: "Make People Happy"
- Enhanced strategic flexibility
- Not the same as listening to customers
Product-Oriented Mission - Answers -define the terms of products or services
- U.S. Railrods: "Safest..Northern American Railroad"
Fall of the U.S. Railroads - Answers -- Lost customers b/c they assumed themselves to
be in the railroad business rather than the transportation business
- With the wide range of choices (trucks and planes), they missed the opportunity to
move into delivery like FedEx or UPS
Mission Statements - Answers -- The results are mixed, (inconclusive) on if they help
gain and sustain competitive advantage; need strategic commitments to succeed
(Boeing Dreamliner)
- Positive associations: visionary firms, like Merk
- Negative associations: Better World Books
- No associations: Intel
Strategic Planning - Answers -a top-down, rational process management programs
future successes; concentrates strategic intelligence and decision-making
responsibilities from the CEO
- Define mission, vision, and goal (strategic intent)
- SWOT Analysis
- Formulate and implement appropriate strategy
- Modify performance and modify if necessary
Scenario Planning - Answers -- Envision different what-if plans
- generates a dominant plans, implements the most probable option
- Keep other scenarios in the event of changes
- AFI framework (Analyze, Formulate, Implement)
Competitve Advantage - Answers -superior performance relative to other competitors in
the same industry or industry average
Sustainable Competitve Advantage - Answers -a firm implements a value-creating
strategy of which other companies are unable to duplicate the benefits or find it too
costly to imitate
- an important basis is the development of resources and capabilities
Industry Effects - Answers -The results attributed to the choice of industry in which to
compete (20%)
Firm Effects - Answers -The results of the manager's actions to influence firm
performance (30-45%)
Corporate Level Strategy - Answers -Typically involves the decision making by the top
management team that includes the CEO, senior, executives, the board of directors,
and the corporate staff. Decisions include vertical integration, diversification, strategic
allainces, acqustions, new ventures, and restructuring.
Business Level Strategy - Answers -Includes the strategic choice of generic strategy
(cost leadership, differention, focus) and the benefits and costs of first-mover
advantages. Often an enterprise participating in multiple businesses will have different
business strategies.
Functional Level Strategy - Answers -Typically directed at improving the effectiveness
of functional operations within a company, such as manufacturing, materials
management, human resources, marketing, R&D and operations management
"Razor-blade model" - Answers -Give away or sell for a small fee the product and make
money on the replacement part needed (ex: laser printers with cheap printers and
expensive ink)
Multi-point Competition - Answers -Google and Microsoft compete with one another for
market share in several different product categories through quite different business
models.
- Google: benefits from network effects (increase of product value when more people
use it); give away products b/c business ads
- Microsoft: application software dominance; Bing provides countervailing power
Acceleration of technological change - Answers -- Initial innovations like the car, plane,
phone, and electricity now provide the necessary infrastructure for newer innovations to
diffuse more rapidly
, - Emergence of new business models that make innovations more accessible
- Internet, social networking sites, viral messaging
Stakeholders - Answers -Individuals or groups who can affect or are affected by the
actions of the firm; they have a claim or interest in the performance and continued
survival of the firm
- Internal Stakeholders: stockholders, all employees, board members
- External Stakeholders: customers, suppliers, alliance partners, creditors, unions,
communities, and governments at various levels
Customer-Oriented Mission - Answers -define the terms of solutions for customers
- Disney: "Make People Happy"
- Enhanced strategic flexibility
- Not the same as listening to customers
Product-Oriented Mission - Answers -define the terms of products or services
- U.S. Railrods: "Safest..Northern American Railroad"
Fall of the U.S. Railroads - Answers -- Lost customers b/c they assumed themselves to
be in the railroad business rather than the transportation business
- With the wide range of choices (trucks and planes), they missed the opportunity to
move into delivery like FedEx or UPS
Mission Statements - Answers -- The results are mixed, (inconclusive) on if they help
gain and sustain competitive advantage; need strategic commitments to succeed
(Boeing Dreamliner)
- Positive associations: visionary firms, like Merk
- Negative associations: Better World Books
- No associations: Intel
Strategic Planning - Answers -a top-down, rational process management programs
future successes; concentrates strategic intelligence and decision-making
responsibilities from the CEO
- Define mission, vision, and goal (strategic intent)
- SWOT Analysis
- Formulate and implement appropriate strategy
- Modify performance and modify if necessary
Scenario Planning - Answers -- Envision different what-if plans
- generates a dominant plans, implements the most probable option
- Keep other scenarios in the event of changes
- AFI framework (Analyze, Formulate, Implement)
