Chapter 9: Organizational Strategies

example of new company winning with unique strategy

airbnb: sharing economy, sharing unoccupied space = cheaper price for customers, make use and generate profits for owners

business model

how a company is going to make money

strategy

plan for how the organization will do what it's in business to do, how it will compete successfully, and how it will attract and satisfy its customers in order to achieve its goals doing it differently and that difference is better

3 types of corporate strategy

(1) Growth strategy: used when an organization wants to expand the number of markets served or products offered, either through its current business or through new business (concentration in Bose, vertical integration in Apple, horizontal integration in L'Oreal) (2) Stability strategy: organization continues to do what it is currently doing (Cadbury Schweppes) (3) Renewal strategy: designed to address declining performance (Panasonic)

6 steps in developing a strategy

(1) Identifying the organization's current mission, goals, and strategies (2) Doing an external analysis (3) Doing an internal analysis (4) Formulating strategies (5) Implementing strategies (6) Evaluating results

Kotter's 5 forces of competition TTBBC

(1) Threat of new entrants (2) Threat of substitutes (3) Bargaining power of buyers (4) Bargaining power of suppliers (5) Current rivalry

8 Key dimensions of strategic leadership

- determining organizations purpose or vision - developing and maintaining core competencies - developing human capital - creating and sustaining a strong organizational culture - creating and maintaining organizational relationships - reframing prevailing views by asking penetrating questions and questioning assumptions - emphasizing ethical organizational decisions and practices - establishing appropriately balanced organizational controls - purpose/vision - core competencies - human capital - culture - relationships - views - ethical decisions and practices - establish balanced controls

% executives believe company is not prepared for growth

60

3 examples of organizational strategies

E-Business Strategies: online bidding and order processing, decrease sales force expenses (Walgreen's establishment of online prescription) Customer Service Strategies: giving customers what they want, communicating effectively with them, customer service training (New Balance and shoe width) Innovation Strategies: breakthrough products or applying existing technology to new uses (Procter & Gamble bought pet-food maker)

company's core competency

an organization's major value-creating capabilities that determine its competitive weapons

SWOT analysis

to identify a strategy: strengths & weaknesses (internal), opportunities & threats (external)