BM Flashcards
(68 cards)
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1:46 PM Thu Dec 26
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..•
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:= BM Summarize chp. 1 final
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Chapter 1: Strategy
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Business Models
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Summary
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- What is Strategy?
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Strategy refers to the coordinated actions taken by managers to achieve long-term
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success
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outperform competitors
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i involve eating ecisions abou hol to ceo pete in the market y
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duding
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posterin development
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suppi chain tery hus pros fein
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marketing
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distribution and human resources).
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- The focus of strategy is on achieving long-term growth
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stability and remaining
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competitive over time.
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- Why Does a Company Need a Distinctive Strategy?
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@ 99% C
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© Done
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competitors don’t have.
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Key Points of a Distinctive Strategy
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- Competing Differently: This means the company does something unique or
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in a way that competitors are not doing.
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- Leveraging Strengths: This means making the best possible use of a
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company’s strengths.
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These strengths include:
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- Cost-Efficiency: Producing goods at lower costs than competitors.
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2. Product Quality: Offering products of higher quality than rivals.
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3. Innovation: Introducing new ideas
products
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don't have.
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3. What is a Business Model?
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A business model is a blueprint that outlines how a company will deliver value to
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customers while generating profits.
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Two key elements of the business model:
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1. Customer Value Proposition: Describe how the company fulfills customers'
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needs or solves their problems better than competitors.
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2. Profit Formula: Explain how the company generates revenue and manages
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costs to ensure profitability from its operations (production
supply chain
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activities. sales and marketing
customer service and Human Resources).
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4. Sustainable Competitive Advantage
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A sustainable competitive advantage is when a company has a long-term edge
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over competitors
creating value that rivals can't easily replicate.
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There are various Strategie Approaches to gain sustainable competitive
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1. Low-Cost Provider Strategy: The company focuses on being the cheapest
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options in the market by reducing its costs to attract Price-Sensitive customers.
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2. Broad Differentiation Strategy: Offers Unique Features or qualities that
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appeal to a broad range of customers (many customers).
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3. Focused Differentiation Strategy: It's similar to the broad differentiation
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strategy
but the company serves a small
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quality
specialized
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a Bot epins
or Sing a proThie stray pins ve plan
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These strategies help a company attract customers
maintains profitability and stay
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competitive over time.
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5. Why Does Strategy Evolve Over Time?
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A company's strategy does not stay fixed because it must adapt to internal and
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external changes.
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Strategies Change:
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2. Chen is action ang hei prefereed chr larkes arise in the market.
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Sire o everies ev milkes in the aritis or at. sister us ma stren
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Reared Stray is ate categy acon ay halous any emergent
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changes: unplanned
reactive changes that happen in response to unexpected
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challenges
new opportunities
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6. Tests of a Winning Strategy
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A successful strategy must meet three key criteria: that helps to achieve long-
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term success. These criteria are:
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W.Siyanegic Siyagic italias with coms the singhen in the come com dang
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operates).
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2. Competitive Advantage: Does the strategy provide sustainable competitive
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edge over rivals that they can't easily replicate.
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3. Performance: Does the strategy delivers strong results
such as growth and
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profitability.
