STRATEGY 390 – Midterm Study Guide – Core Concepts, Frameworks,
and Strategic Analysis
What are the five major elements of strategy? - correct answer 1. Arenas
2. Vehicles
3. Differentiators
4. Staging
5. Economic Logic
Arenas Main Question - correct answer Where will we be active? (and with how much
emphasis)
Arena Questions - Where will we be active? (and with how much emphasis) - correct answer 1.
Which product categories?
2. Which market segments?
3. Which geographic segments?
4. Which core technologies?
5. Which value creation stages?
Vehicles Main Question - correct answer How will we get there?
Vehicles Questions - How will we get there? - correct answer 1. Internal development?
2. Joint ventures?
3. Licensing / Franchising?
4. Acquisitions
Differentiators Main Question - correct answer How will we win?
Differentiators Questions - How will we win? - correct answer 1. Image?
2. Customization?
3. Price?
4. Styling?
5. Product reliability?
Staging Main Question - correct answer What will be our speed and sequence of moves?
,Staging Questions - What will be our speed and sequence of moves? - correct answer 1. Speed
of expansion
2. Sequence of initiatives
Economic Logic Main Question - correct answer How will we obtain our returns?
Economic Logic Questions - How will we obtain our returns? - correct answer 1. Lowest cost
through scale?
2. Lowest cost through scope and replication advantages?
3. Premium prices due to unmatchable service?
4. Premium price due to proprietary product features
Competitive Level Strategy Questions - correct answer 1. How do we compete in this market
today?
2. What activity choices will allow us to have competitive advantage?
3. How will we compete in this market in the future?
Corporate Level Strategy Questions - correct answer 1. In which markets should we compete
today and in the future?
2. How does our ownership of a business ensure its competitiveness today and in the future?
3. How do we organize to maximize corporate advantage?
Applying 5 Element to Corporate Strategy: Arenas - Where will we be active? (and with how
much emphasis) - correct answer In which businesses, markets, and parts of the value chains
should we participate?
Applying 5 Element to Corporate Strategy: Vehicles - How will we get there? - correct answer
How should we organize for coordination, control, and corporate advantage?
Applying 5 Element to Corporate Strategy: Differentiators - How will we win? - correct answer
How is the firm going to be unique in each of its businesses?
Applying 5 Element to Corporate Strategy: Staging - What will be our speed and sequence of
moves? - correct answer When and how is the firm going to acquire and allocate resources for
effective coordination and control of all the firm's activities across its businesses?
Applying 5 Element to Corporate Strategy: Economic Logic - How will we obtain our returns? -
correct answer 1. How is the firm going to create and sustain competitive advantage in each of
its businesses?
2. How is the firm going to create and sustain the corporate advantage over time?
,Why Did Ryannair Fail? - correct answer 1. Competitive Advantage is the Essence of Strategy:
Ryanair entered the market and challenged the incumbents with choices closely resembling
those of existing competitors. It has no clear "competitive advantage" since it does not have a
distinctive position
2. Imitation and innovation by the competition should be anticipated: In this case, since the BA
and Aer Lingus have such low marginal cost, Ryanair should have anticipated price competition
especially from Aer Lingus. As a new entrant, can Ryanair withstand price competition?
Cycle of Aspirations - correct answer 1. Set and Revisit Aspirations - Mission, Vision and Values
2. Conduct a comprehensive assessment of the external and internal environment
3. Formulate strategy - Business strategy and Corporate strategy
4. Execute Strategy - Organization structure, resource allocation and management of innovation
and technology
5. Monitor and adjust as needed
Aspirations - correct answer What the organization aims to be as a company and are reflected
in the organization's vision, mission, and values. Collectively defines an organization's identity,
direction, and character
Mission - correct answer Identity - WHY we exist
Vision - correct answer Direction - WHERE we are going
Values - correct answer Character - HOW we go about our work
Difference between Aspiration vs. Strategy. Aspiration Questions - correct answer 1. Why do
we exist?
2. Where are we going?
3. How will we go about our work?
Difference between Aspiration vs. Strategy. Strategy Questions - correct answer 1. Where do
we compete?
2. What unique value do we offer customers?
3. How do we deliver that value?
4. How do we sustain our ability to deliver value?
Types of Aspirations - correct answer 1. Motivational
2. Strategic
, Motivational Aspiration - correct answer Provide an important connection between employees'
motivation and behavior and the organization's strategy
Strategic Aspiration - correct answer Be a pre-requisite for strategy and help to guide the
development of strategy
When are aspirations most useful - correct answer When they are COHERENT i.e. when they
are shared by employees' personal aspirations and when they complement a carefully
developed strategy based on an understanding of the business environment
Coherence and Alignment of Organizational Aspirations - correct answer 1. Every employee's
personal aspirations aligned with the organization's aspirations
2. Few or no people with personal aspirations aligned with the organization's aspirations
3. Aspirations specify no choices about how to compete
4. Aspirations specify sufficient choices about how to compete and guide all other choices and
decisions
Importance of Aspiration - correct answer Compelling mission, vision and values embedded in
an organization's aspirations often enhance the likelihood of success. People execute strategy,
and you need to get people on board
When does a company create corporate advantage? - correct answer When it improves the
average competitiveness of the individual business units, meaning it helps the business units
create and capture more value
Key Question Topics of Objective Corporate Strategy - correct answer 1. Scope
2. Organizational Design
3. Technology, Innovation, and Platforms
4. Alliances, Mergers, and Acquisitions
Scope Key Question of Objective Corporate Strategy - correct answer Which business units
should be a part of a single company to maximize corporate advantage?
Organizational Design Key Question of Objective Corporate Strategy - correct answer How to
manage organization to achieve corporate advantage?
Technology, Innovation, and Platforms Key Question of Objective Corporate Strategy - correct
answer How can companies gain corporate advantage using these more advanced business
models
Alliances, Mergers, and Acquisitions Key Question of Objective Corporate Strategy - correct
answer How to handle operations across companies to achieve corporate advantage?
and Strategic Analysis
What are the five major elements of strategy? - correct answer 1. Arenas
2. Vehicles
3. Differentiators
4. Staging
5. Economic Logic
Arenas Main Question - correct answer Where will we be active? (and with how much
emphasis)
Arena Questions - Where will we be active? (and with how much emphasis) - correct answer 1.
Which product categories?
2. Which market segments?
3. Which geographic segments?
4. Which core technologies?
5. Which value creation stages?
Vehicles Main Question - correct answer How will we get there?
Vehicles Questions - How will we get there? - correct answer 1. Internal development?
2. Joint ventures?
3. Licensing / Franchising?
4. Acquisitions
Differentiators Main Question - correct answer How will we win?
Differentiators Questions - How will we win? - correct answer 1. Image?
2. Customization?
3. Price?
4. Styling?
5. Product reliability?
Staging Main Question - correct answer What will be our speed and sequence of moves?
,Staging Questions - What will be our speed and sequence of moves? - correct answer 1. Speed
of expansion
2. Sequence of initiatives
Economic Logic Main Question - correct answer How will we obtain our returns?
Economic Logic Questions - How will we obtain our returns? - correct answer 1. Lowest cost
through scale?
2. Lowest cost through scope and replication advantages?
3. Premium prices due to unmatchable service?
4. Premium price due to proprietary product features
Competitive Level Strategy Questions - correct answer 1. How do we compete in this market
today?
2. What activity choices will allow us to have competitive advantage?
3. How will we compete in this market in the future?
Corporate Level Strategy Questions - correct answer 1. In which markets should we compete
today and in the future?
2. How does our ownership of a business ensure its competitiveness today and in the future?
3. How do we organize to maximize corporate advantage?
Applying 5 Element to Corporate Strategy: Arenas - Where will we be active? (and with how
much emphasis) - correct answer In which businesses, markets, and parts of the value chains
should we participate?
Applying 5 Element to Corporate Strategy: Vehicles - How will we get there? - correct answer
How should we organize for coordination, control, and corporate advantage?
Applying 5 Element to Corporate Strategy: Differentiators - How will we win? - correct answer
How is the firm going to be unique in each of its businesses?
Applying 5 Element to Corporate Strategy: Staging - What will be our speed and sequence of
moves? - correct answer When and how is the firm going to acquire and allocate resources for
effective coordination and control of all the firm's activities across its businesses?
Applying 5 Element to Corporate Strategy: Economic Logic - How will we obtain our returns? -
correct answer 1. How is the firm going to create and sustain competitive advantage in each of
its businesses?
2. How is the firm going to create and sustain the corporate advantage over time?
,Why Did Ryannair Fail? - correct answer 1. Competitive Advantage is the Essence of Strategy:
Ryanair entered the market and challenged the incumbents with choices closely resembling
those of existing competitors. It has no clear "competitive advantage" since it does not have a
distinctive position
2. Imitation and innovation by the competition should be anticipated: In this case, since the BA
and Aer Lingus have such low marginal cost, Ryanair should have anticipated price competition
especially from Aer Lingus. As a new entrant, can Ryanair withstand price competition?
Cycle of Aspirations - correct answer 1. Set and Revisit Aspirations - Mission, Vision and Values
2. Conduct a comprehensive assessment of the external and internal environment
3. Formulate strategy - Business strategy and Corporate strategy
4. Execute Strategy - Organization structure, resource allocation and management of innovation
and technology
5. Monitor and adjust as needed
Aspirations - correct answer What the organization aims to be as a company and are reflected
in the organization's vision, mission, and values. Collectively defines an organization's identity,
direction, and character
Mission - correct answer Identity - WHY we exist
Vision - correct answer Direction - WHERE we are going
Values - correct answer Character - HOW we go about our work
Difference between Aspiration vs. Strategy. Aspiration Questions - correct answer 1. Why do
we exist?
2. Where are we going?
3. How will we go about our work?
Difference between Aspiration vs. Strategy. Strategy Questions - correct answer 1. Where do
we compete?
2. What unique value do we offer customers?
3. How do we deliver that value?
4. How do we sustain our ability to deliver value?
Types of Aspirations - correct answer 1. Motivational
2. Strategic
, Motivational Aspiration - correct answer Provide an important connection between employees'
motivation and behavior and the organization's strategy
Strategic Aspiration - correct answer Be a pre-requisite for strategy and help to guide the
development of strategy
When are aspirations most useful - correct answer When they are COHERENT i.e. when they
are shared by employees' personal aspirations and when they complement a carefully
developed strategy based on an understanding of the business environment
Coherence and Alignment of Organizational Aspirations - correct answer 1. Every employee's
personal aspirations aligned with the organization's aspirations
2. Few or no people with personal aspirations aligned with the organization's aspirations
3. Aspirations specify no choices about how to compete
4. Aspirations specify sufficient choices about how to compete and guide all other choices and
decisions
Importance of Aspiration - correct answer Compelling mission, vision and values embedded in
an organization's aspirations often enhance the likelihood of success. People execute strategy,
and you need to get people on board
When does a company create corporate advantage? - correct answer When it improves the
average competitiveness of the individual business units, meaning it helps the business units
create and capture more value
Key Question Topics of Objective Corporate Strategy - correct answer 1. Scope
2. Organizational Design
3. Technology, Innovation, and Platforms
4. Alliances, Mergers, and Acquisitions
Scope Key Question of Objective Corporate Strategy - correct answer Which business units
should be a part of a single company to maximize corporate advantage?
Organizational Design Key Question of Objective Corporate Strategy - correct answer How to
manage organization to achieve corporate advantage?
Technology, Innovation, and Platforms Key Question of Objective Corporate Strategy - correct
answer How can companies gain corporate advantage using these more advanced business
models
Alliances, Mergers, and Acquisitions Key Question of Objective Corporate Strategy - correct
answer How to handle operations across companies to achieve corporate advantage?
