Cap 3 Flashcards

1
Q

Environmental Scanning

A

monitoring, evaluation, and dissemination of information
relevant to the organizational development of strategy

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2
Q

External Environmental Variables

A
  • Natural environment
  • Societal environment
  • Task environment
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3
Q

Task environment

A

Industry analysis: an in-depth examination of key factors within a corporation’s task environment
- PESTEL Analysis

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4
Q

PESTEL Analysis

A

-Political:government policies, taxation changes
-Economic Factors: business cycles, interest rates
-Socio-cultural Factors: population changes, income distribution, lifestyle changes
-Technological Factors: new discoveries and technology developments
-Environmental Factors: environmental protection regulations, energy consumption
-Legal Factors: competition laws, health and safety laws

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5
Q

social generations

A

-Silent generation (1928-1945)
-Baby Boomers (1946-1964)
-Gen X (1965-1980)
-Millenials/Gen Y (1981-1996)
-Gen Z (1997-2012)
-Gen Alpha

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6
Q

Industry Analysis

A
  • Industry: Group of firms producing the same principal product
  • Market: Group of customers for specific products or services that are essentially the same
  • Sector: Group of firms producing similar products or services
  • Competitive Forces: Determine attractiveness of industry
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7
Q

Profit potential industry

A

-leverage of suppliers
-superior or lower cost substitute products
-competition among existing firms
-openness to new competitors
-buyers influence

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8
Q

Assessing competitive forces

A

-potential entrants (threat of entry)
-buyers (bargaining power)
-substitutes (threat of substitutes)
-suppliers (bargaining power)

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9
Q

Threat of New Entrants

A

New entrants to an industry bring new capacity, a desire to gain market
share and substantial resources
* Entry barrier: An obstruction that makes it difficult for a company to enter an industry
-economies of scale
-product differentiation

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10
Q

Bargaining Power of Suppliers

A

A buyer or a group of buyers is powerful if some of the following factors hold
true:
- Industry is dominated by a few companies
- Unique product or service
- Substitutes are not readily available

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11
Q

Bargaining Power of Buyers

A

Buyers affect an industry through their ability to force down prices, bargain
for higher quality or more services, and play competitors against each other.

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12
Q

Threat of Substitutes

A

identification of possible substitute products means searching for
products that can perform the same function, even though they have
a different appearance.* Substitute product: a product that appears to be different but can satisfy the same need as another product

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13
Q

Rivalry Among Existing Firms

A

A competitive move by one firm can be expected to have a noticeable
effect on its competitors and thus may cause retaliation.
* Intense rivalry is related to the presence of several factors

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14
Q

Assessing competitive forces

A

-Supplier power
-Threat of entry
-Competitive Rivalry
-Threat of substitutes
-Buyer power

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15
Q

Implications of five forces analysis

A

-Identifies the attractiveness of industries – which industries/markets to enter or leave.
-Identifies strategies to influence the impact of
the forces

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16
Q

Industry Evolution

A

-Fragmented industry: no firm has a large market share and each firm only serves a small piece of
the total market in competition with other firms
-Consolidated industry: domination by a few large firms, each struggles to differentiate products from
its competition

17
Q

International Industries

A

-Multi-domestic industries
-Global Industries
-Regional industries

18
Q

Strategic Groups

A

set of business units or firms that pursue similar strategies with
similar resources

19
Q

Strategic Gaps

A

opportunities in the business environment not being fully exploited by the competition
Examples:
-substitute industries
-new market segments
-complementary products and services

20
Q

Uses of Strategic Group Analysis

A

-Understanding competition
-Analysis of strategic opportunities

21
Q

Hyper-competition

A

frequency, boldness and aggression of competitor interactions accelerate to create a condition of constant disequilibrium and change.
-repositioning by incumbents
-new technologies