Management

2 pages work

1 day

Look for an article about a current event happening in the business world.

Submit a 3–7 minute presentation, 2 – 4 slides, which provides an effective summary of the article. Tie in concepts we are learning from the course. 

MGMT 4890-01
Business Policy and Strategy
Week 4

Introduction to Strategy Formulation
Business Level Strategy
What are we going to do about these 5 forces?

2

3 Generic Strategies
Three generic strategies to overcome the five forces and achieve competitive advantage
Overall cost leadership is based on:
Creating a low-cost position relative to a firm’s peers
Managing relationships throughout the entire value chain
Differentiation implies:
Products and/or services that are unique & valued
Emphasis on nonprice attributes so customers will gladly pay a premium
A focus strategy requires:
Narrow product lines, buyer segments, or targeted geographic markets
Advantages obtained either through differentiation or cost leadership

3

Examples of Strategies
Companies pursuing an overall cost leadership strategy:
McDonalds
Walmart
Companies pursuing a differentiation strategy:
Apple
Companies pursuing a focus strategy:
Ikea

4

Soft Drink – 5 Forces Analysis

5

Soft Drink – 5 Forces Analysis

6

Soft Drink – 5 Forces Analysis

7

Soft Drink – 5 Forces Analysis

8

Soft Drink – 5 Forces Analysis

9

MGMT 4890-01
Business Policy and Strategy
Week 3

1

Strategy
Last Week – External Environment
Porter’s Five Forces / SWOT
Internal Environment

2

Analysis

Formulation

Implementation

Value Chain

3

INCO Terms

4

INCO Terms Definitions

5

The Value Chain in Service Organizations

6

Resource Based View
Types of Firm Resources
Tangible resources
Physical assets: plant & facilities, location, machinery & equipment
Financial assets: cash & cash equivalents, borrowing capacity, capacity to raise equity
Technological resources: trade secrets, patents, copyrights, trademarks, innovative production processes
Organizational resources: effective planning processes & control systems

Resource Based View
Types of Firm Resources
Intangible resources are difficult for competitors to imitate
Human resources: trust, experience & capabilities of employees; managerial skills & effectiveness of work teams
Innovation resources: technical & scientific expertise & ideas; innovation capabilities
Reputation resources: brand names, reputation for fairness with suppliers; reputation for reliability & product quality with customers

Resource Based View
Types of Firm Resources
Organizational capabilities
Capacity to combine tangible & intangible resources
Outstanding customer service
Excellent product development capabilities
Superb innovation processes & flexibility in manufacturing processes
Ability to hire, motivate, & retain human capital

Balanced Scorecard
Four key perspectives:
How do customers see us? (customer perspective)
What must we excel at? (internal perspective)
Can we continue to improve and create value? (innovation & learning perspective)
How do we look to shareholders? (financial perspective)

Balanced Scorecard

Best in Class Companies
Source: Competitive Strategy Analysis, Grant, 2013
Function Capability
Corporate Financial Control
Corporate 2. Strategic Innovation
R&D 3. Research Capability
R&D 4. New Product Development
Operations 5. Continuous Improvement
Marketing 6. Responding to Customer Requirements
Distribution 7. Fast Order Processing
Service 8. Customer Service

Exxon
Google
Merck
Apple
Toyota
L’Oreal
Dell
Caterpillar

12

Completion of Strategy Analysis
Intellectual Assets

13

Industry Environment
Suppliers
Competitors
Customers

Demographics / Sociocultural

Economics / Technology

Legal / Political

Ratio of Market Value to Book Value
The market value = equal to the value of a share of its common stock times the number of shares outstanding.
The book value of the firm is primarily a measure of the value of its tangible assets

14

Intellectual Property
Patents – Exclusive to a new and useful product, process, substance or design. In US is valid for 17 years (14 for design).
Copyrights – Exclusive production, publication, or sales rights to the creation of artistic, literary, dramatic, or musical works.
Trademarks – Words, symbols, or other marks used to distinguish the goods or services supplied by the firm. In the US and UK trademarks are registered with the Patent Office.
Trade Secrets – Offer a modest degree of protection for recipes, formulae, industrial processes, customer lists, and other knowledge, acquired in the course of business.

Protection of Intellectual Assets
Intellectual property rights = intangible property owned by a firm in the forms of patents, copyrights, trademarks, or trade secrets
Intellectual property rights are more difficult to define and protect than property rights for physical assets.

Effectiveness of Different Mechanisms for Protecting Product Innovations
Secrecy % Patents% Lead Time%
Food 59 18 53
Drugs 54 50 50
Medical Equip 51 55 58
Telecom 47 21 46

Note; % of companies reporting that the mechanism was effecting in protection
Source: Cohen, Nelson, Ross Why firm Patent or Not

Effectiveness of Different Mechanisms for Protecting Process Innovations
Secrecy % Patents% Lead Time%
Food 56 16 42
Drugs 68 36 36
Medical Equip 49 34 45
Telecom 35 15 43

Note; % of companies reporting that the mechanism was effecting in protection
Source: Cohen, Nelson, Ross Why firm Patent or Not

Conclusion – Creating Value with Intellectual Assets
Human capital: does the organization effectively attract, develop, and retain talent? Does the organization value diversity?
Social capital: does the organization have positive personal and professional relationships among employees?
Technology: does the organization effectively use technology to transfer best practices across the organization, codify knowledge, and develop dynamic capabilities for competitive advantage?

MGMT 4890-01
Business Policy and Strategy
Week 2

Strategy Analysis – External
Assessing External Environment
The General Environment
The Industry Environment
Competitors

2

External Environment
Predicts environmental changes to come
Detects changes already under way
Streams of activities or trends from outside the organization
Identifies rivals’ strengths & weaknesses
Collect data on competitors
Interpret intelligence data

3

SWOT Analysis
Firm or internal conditions = Strengths & Weaknesses
Environmental or external conditions = Opportunities & Threats
General environment
Activities among firms competing for the same customers

4

Environmental Analysis to Industry Analysis

5

Industry Environment
Suppliers
Competitors
Customers

Demographics / Sociocultural

Economics / Technology

Legal / Political

Porter’s Five-Forces Model of Industry Competition
A tool for examining the industry-level competitive environment

6

Look for an article about a current event happening in the business world.

Submit a 3–7 minute presentation, 2 – 4 slides, which provides an effective summary of the article. Tie in concepts we are learning from the course. 

Current Event Presentation

Full Marks
Submitted Presentation on Time

2.0 pts

Submitted One Day Late

5.0 pts

Current Event Presentation
Criteria	Ratings	Pts
This criterion is linked to a Learning OutcomeTimely Submittal of Presentation		5.0 pts
This criterion is linked to a Learning OutcomeOrganization and Flow	30.0 to >25.0 pts Accomplished Presentation is well organized and flows well. 25.0 to >20.0 pts Developing Some parts of the presentation are unorganized and/or presentation doesn’t flow well. 20.0 to >0 pts Beginning Presentation is not organized and doesn’t flow well.	30.0 pts
This criterion is linked to a Learning OutcomeCourse Content Strong use of Concepts from our Course.	40.0 to >32.0 pts Accomplished Superb use of concepts learned from our course. 32.0 to >22.0 pts Developing Brief Mention of Concepts from the Course, but little explanation. 22.0 to >0 pts Beginning Little mention of course concepts and lacks explanation of relevance.	40.0 pts
Total Points: 75.0