Chapter 1b Flashcards
(24 cards)
Bowmans: Low Price / low added value
no frills approach
Bowmans: Low price
price product relatively low to attempt to sell high volumes
Bowmans: Hybrid
Mid-range price and moderate value
Bowmans: Differentiation
high perceived value, branding is often important
Bowmans: Focused differentiation
designer products, high price for perceived high value
Bowmans: Risky, High Margins
Increase price, standard product
Prices are raised without adding any value to the product, potentially to make short-term gains
Bowmans: Monopoly pricing
high price, low value
a classic monopoly where higher prices can be charged
Bowmans: Loss of market share
low value, standard price
The design school
strategy development is a formal process, use of the SWOT model
The planning school
Formal, use of planning specialists, rational model
The positioning school
sees strategy driven by the industry structure
The environmental school
Strategy is reactive with respect to the environment
The cognitive school
understanding strategy development requires an understanding of how the human mind works
The entrepreneurial school
strategy development depends upon the vision of a key individual
The power school
strategy results from power struggles between groups within the organisation and the market
The cultural school
strategy development is a process of social interaction within the confines of the organisation’s culture
The learning school
Strategy emerges through trial and error
The configuration school
strategy is a conscious act of transformation in the organisation
Mintzberg’s strategic safari: Prescriptive tools (others are descriptive)
Design school
Planning school
Positioning school
Drucker: 5 fundamental questions that drive strategy
Mission? Customer? Customer values? Results? Plan?
Barney: VRIN characteristics
Value
Rarity
Inimitability
Non-substitutability
Define “competitive advantage”
An advantage over competitors that cannot be easily copied, and so can be maintained over a significant period of time.
Positioning View (outside-in)
Competitive advantage flows from how an organisation positions itself in relation to its competitors, customers and stakeholders (its environment)
The resource-based view (inside-out)
The organisation should focus on developing one or more unique competencies or assets, and then leveraging these for competitive advantage (outdated)
