Management Ch. 6 Vocab pt 2

Character of the rivalry

a measure of intensity of competitive behavior between companies in an industry

Threat of new entrants

a measure of the degree to which barriers to entry make it easy or difficult for new companies to get started in an industry

Threat of substitute products or services

a measure of the ease with which customers can find substitutes for an industry's products or services

Bargaining power of buyers

a measure of the influence that customers have on a firm's prices

Bargaining power of suppliers

a measure of the influence that suppliers of parts, materials, and services to firms in an industry have on the prices of these inputs.

Stability strategy

a strategy that focuses on improving the way in which the company sells the same products or services to the same customers.

Growth strategy

a strategy that focuses on increasing profits, revenues, market share, or the number of places in which the company does business

Retrenchment strategy

a strategy that focuses on turning around very poor company performance by shrinking the size or scope of the business.

Reactors

companies that do not follow a consistent adaptive strategy, but instead react to changes in the external environment after they occur.

Defenders

companies using an adaptive strategy aimed at defending strategic positions by seeking moderate, steady growth and by offering a limited range of high-quality products and services to a well-defined set of customers.

Prospectors

companies using an adaptive strategy that seeks fast growth by searching for new market opportunities, encouraging risk taking, and being the first to bring innovative new products to market

Analyzers

companies using an adaptive strategy that seeks to minimize risk and maximize profits by following or imitating the proven successes of prospectors.

Related Diversification

creating or acquiring companies that share similar products, manufacturing, marketing, technology, or cultures.

Market commonality

the degree to which two companies have over-lapping products, services, or customers in multiple markets

Resource similarity

the extent to which a competitor has similar amounts and kinds of resources

Cost leadership

the positioning strategy of producing a product or service of acceptable quality at consistently lower production costs than competitors can, so that the firm can offer the product or service at the lowest price in the industry

Differentiation

the positioning strategy of providing a product or service that is sufficiently different from competitors' offerings that customers are willing to pay a premium price for it

Focus strategy

the positioning strategy of using cost leadership or differentiation to produce a specialized product or serve for a limited, specially targeted group of customers in a particular geographic region or market segment.

Direct competition

the rivalry between two companies that offer similar products and services, acknowledge each other as rivals, and act and react to each other's strategic actions

Recovery

the strategic actions taken after retrenchment to return to a growth strategy

Firm-level strategy

a corporate strategy that addresses the question "How should we compete against a particular firm?"

Industry-level strategy

a corporate strategy that addresses the question "How should we compete in this industry?"

Grand strategy

a broad corporate-level strategic plan used to achieve strategic goals and guide the strategic alternatives that managers of individual businesses or subunits may use.

Dog

a company with a small share of a slow-growing market

Response

a competitive countermove, prompted by a rival's attack, to defend or improve a company's market share or profit.

Attack

a competitive move designed to reduce a rival's market share or profits.