Business Strategy

  1. How many of the efficiencies do you use?
    As many as you can!
  2. How many efficiencies are there?
  3. What are the efficiencies?
    • 1. Economies of Scale and Scope
    • 2. Experience curve and learning effects
    • 3. Flexible production & mass customization
    • 4. Just in Time
    • 5. TQM/ Reliability
    • 6. Customer Focus
    • 7. Cross-functional Intergration
    • 8. Response Times
  4. What is Economies of Scale and Scope?
    • Scale: Selling more of the product to spread out fixed costs
    • Scope: Selling different products to spread out fixed costs
  5. What is Experience Curve and Learning effects?
    The more we do it the better we get
  6. What is Flexible Production and Mass Cutomization?
    • Flexible Production: Manufacturing that is able to adapt to changes
    • Mass customization: Have a list of different ways you can have a product
  7. What is Just in Time?
    Get products when we need it (we dont want products sitting around)
  8. What is TQM/ reliability?
    • TQM: Making sure that every part of the production process was doing their job the right way and not making mistakes (minimize defective products)
    • Reliability: Making products that are reliable
  9. What is customer focus?
    Making products based on what the customers want
  10. What is cross functional integration?
    Having different parts of the value chain work together (ex: walkman from class)
  11. What is Response time?
    How fast they can adapt to change
  12. What are the different parts of Business level strategy?
    • 1. Define the industry
    • 2. Valuie creation Frontier
    • 3. Generic business level strategy
    • 4. Market Segments, Strategic Groups,¬†and rivals
    • 5. Tactics for managing rivals
  13. What are the generic business level strategies?
    • 1. Broad price/cost leadership
    • 2. Focused price leadership
    • 3. Broad differentiation
    • 4. Focused differentiation
  14. What is value creation frontier?
    Its difereantiation vs. cost
  15. What are market segments?
    Who their targeting as a customer
  16. What is strategic group?
    What companies targeting the same type of people
  17. What are rivals?
    Based off of strategic group, anyone in your strategic group is a rival
  18. What are the different tactics for managing rivals?
    • 1. Price signaling
    • 2. Price leadership
    • 3. Non-price competition
    • 4. Market Penetration
    • 5. Capacity control
    • 6. Product Proliferation
  19. What is price signaling "tit-for-tat"?
    Match rivals in price to send a message
  20. What is Price leadership?
    One company assumes the position in taking the lead to determing pricing strategy to maximize industry profits
  21. What is product proliferation?
    Swamping customers options so they accidently choose their product.
  22. What is scope of firm?
    Different type of industries in the corporation 
  23. What is synergies?
    Doing everything that can be done together as one. Share resources, skills, and market power
  24. What are the three benefits?
    • 1) Shared resources and skills
    • 2)Synergies
    • 3)Control
  25. What are the costs?
    • 1) Loss of competitive pressure
    • 2)Bureaucratic costs
  26. What are the 6 generic corporate level strategies?
    • 1)Outsourcing
    • 2)Alliances
    • 3)Horizontal Mergers
    • 4)Vertical Mergers
    • 5)Related Diversification
    • 6)Unrelated Diversification
  27. OUTSOURCING:disadvantages?
    What is hostage taking and credible commitments?
    • Flexible: Not stable; costs will raise
    • Hostage taking: Take part of a company so they dont fault on contract
    • Credible Comitments: try to get both companies more commited
  28. What is horizontal mergers?
    Buying out competitors
  29. What are vertical mergers?
    Buying the suppliers or buyers
  30. What is related diversification?
    Buying out related companies, its to help the companies operations.
  31. What is unrelated diversification?
    Buying out unrelated companies, it is done to boost finances
Card Set
Business Strategy
Business strategy exam 2