Module 1 (Lecture 1, Articles) Flashcards
(26 cards)
Definition of strategy
Strategy is about making choices; it’s about deliberately choosing to be different (Porter)
3 elements of successful strategies
- consistent and long-term goals
- formulated based on analyses
- effectively exploit resources
Business strategy
The search for a favourable competitive positioning
Marketing strategy
A functional strategy aimed at customer value creation, market orientation, segmentation, targeting, and positioning. Decisions that involve selling products on the market.
McDonald’s standardisation strategy
Anywhere the company operates it offers identical food products such as McNuggets and happy meal
McDonald’s adaptation strategy
McDonald’s adapts to the needs of the customers as required by the cultures of specific countries
Incorporating quantitive applications in entrepreneurship
Moving from opinion based or intuitive decision-making also called, conceptual entrepreneurship, to data-based decision-making with an experience component. You need to find the right balance between intuitive and data-based decision-making.
Characteristics of intuitive thinking
Automatic, unconscious, quick, implicit, emotional, effortless
Characteristics of reflective thinking
Controlled, conscious, slow, explicit, logical, effortful
Six principles that describe the essentials of strategy for company practice by Wunder
- Quest for competitive advantage
- Fit of markets and resources
- Being different and making choices
- Path to a destination
- Consistency in behaviour
- Multiple level and theme alignment
Principal 1 of strategy “quest for competitive advantage”
Strategy is about gaining, sustaining, and renewing competitive advantage to ensure superior performance
Principal 2 of strategy “Fit of markets and resources”
Strategy is about creating a dynamic fit between the company and its environment.
Market based view of strategy + resource based view of strategy =
dynamic perspective on markets and resources for competitive survival.
Principle 3 of strategy “being different and making choices”
Strategy is about being different and choosing what to do and what not to do
Principle 4 of strategy “path to a destination”
Strategy pursues the achievement of a desired long-term aspiration. It is a means to an end.
A company’s vision, mission, and values represent its fundamental strategy intent and identity which guide strategy formulation.
Principal 5 of strategy “consistency in behaviour”
Strategy is consistency in behaviour, whether intended or not intended
Principle 6 of strategy “multiple level and theme alignment”
Strategy is the symphony that results from multiple areas and strategic themes in an organisation
Life-cycle of a strategy
conception, elaboration, decay, death
Porter’s five forces
- Rivalry among existing competitors
- Bargaining power of buyers
- Bargaining power of suppliers
- Threat of new entrants
- Treat of substitute products or services
Variety positioning
Based on the choice of product or service varieties rather than customer segments. this can serve a wide range of customers but for most of them it will only meet a subset of their needs
Need-based positioning
Arises when there are groups of customers with different needs, and when a tailored set of activities can serve those needs best
Access based positioning
Means reaching customer who are difficult to serve in a standard way, by adapting how you deliver your product or service, often based on geography, customer size, or barriers to access
3 types of order fit
- First order fit = consistency with strategy
- Second order fit = activities reinforce each other
- Third order fit = system is optimized as a whole
How can strategy formation be viewed?
As the interplay between a dynamic environment and bureaucratic momentum, with leadership mediating between the two
Around what three forces does strategy formation revolve?
An environment that keeps changing, an organisational operating system that seeks to stabilise its actions, and leadership mediating between the first two
