Quiz chap 5 & 6

to create a sustainable competitive advantage, a company must have a strategy. what is the 3 steps of the strategy-making process?

(1) assess need for strategic change (2) conduct situational analysis (3) Choose strategic alternatives

What is a portfolio strategy?

A corporate-level strategy that minimizes risk by diversifying investment among various business or product lines.

when assessing the need for strategic change, top-level managers are often slow to recognize the need for strategic change. so... success often leads to _______ _____ which is: a reluctance to change strategies or competitive practices that have been successful in the past. "why change something thats worked in the past?"

Competitive Inertia inertia = means a tendency to do nothing or to remain unchanged siarah.

When choosing strategic alternatives, managers choose between two basic alternative strategies. ________________ = is a risk avoiding strategy that aims to protect an existing competitive advantage. _______________ = is a risk seeking strategy that aims to extend or create a sustainable competitive advantage.

Conservative or aggressive

the central companies in a strategic group

Core Firms

The overall organizational strategy that addresses the question "what business or businesses are we in or should we be in?" — we ask the questions. Who are we.

Corporate level strategy

an analysis of an organization's internal environment (that is, a companies strengths and weaknesses) often begins with an assessment of its ____________ competencies and _____ capabilities. fill in and define.

Distinctive competence: what a company can make, do, or perform better than its competitors - more tangible Core capabilities: the internal decision-making routines, problem-solving processes, and organizational cultures that determine how efficiently inputs can be turn into outputs. - less visible

This strategy reduces risk by buying a variety of items so that the failure of one stock or one business.... Does not doom the entire portfolio. - "I'm a variety... Let's mix so it's not so its not too much trust in one"

Diversification

ok, so. valuable and rare resources can create temporary competitive advantage.... but sustained competitive advantage however, other firms must be unable to imitate or find substitutes for those valuable, rare resources. what is this referring to? what kind of resources are hard to duplicate? what is the cost to this financially?

Imperfectly imitable resources: a resource that is impossible or extremely costly or difficult for other firms to duplicate.

Valuable, rare, imperfectly imitable resources can produce sustainable competitive advantages yes.... BUT only if they are ALSO __________ resources. and define what this means.

NON-substitutable resources. these are resources that produces value or competitive advantages and has no equivalent substitutes or replacements. ex: iTunes software.

___________________________________ is a committee within a company that analyzes the companys own weaknessess to determine how competitors could exploit them for competitive advantage.

Shadow-strategy task force

SWOT analysis is what? define this term.

Situational analysis. an assessment of the strengths and weaknesses in an organization's internal environment and the opportunities and threats in its external environment.

Besides being aware of the dangers of competitive inertia... what can manager do to improve the speed and accuracy with which they determine the need for strategic change??? a method they use is called _______ ______ to actively look for these signs. what is this?

Strategic Dissonance a discrepancy between a company's intended strategy and the strategic actions managers take when actually implementing that strategy.

__________ are not groups that actually work together..... they are are companies -- core firms-- (usually competitors) that managers closley follow. these groups are within an industry against which top managers compare, evaluate and benchmark strategic threats and opportunities.

Strategic Group

The choice to seek risk or avoid risk typically depends on whether too management views the company as falling above or below _______________. This is the strategic target managers use to measure whether a firm has developed the core competencies it needs to achieve a sustainable competitive advantage.

Strategic reference points

Secondary firms

The firms in a strategic group that follow strategies related to but somewhat different from those of the core firms

Managers can either develop new businesses internally.... Or look for acquisitions. Define acquisitions

The purchase of a company by another company

what kind of resource allows companies to improve efficiency and effectiveness?

a valueable resource

organizations can achieve a _______ ______ by using their resources to provide greater value for customers than competitors can.

competitive advantage

the goal of most organizational strategies is to create and then sustain a competitive advatange. A competitive advantage soon becomes a _____ _____ if competitors have tried (unsuccessfully) to duplicate and have for the moment... just stopped trying to duplicate the advantage.

sustainable competitive advantage Sustainable, competitive advantages are advantages that are not easily copied and, thus, can be maintained over a long period of time. The competition must not be able to do it right away or it is not sustainable.

resources is defined as what?

the assists, capabilities, processes, employee time, information, and knowledge hat an organization uses to improve its effectiveness and efficiency and create and sustain competitive advantage

for sustained competitive advantage... valuable resources must also be rare resources. define what a rare resources means.

this is a resource that is NOT controlled or posses by many competing firms. its rare. thus, valued because of it.