2 Types of strategy Corporate strategy Diversiﬁcation Vertical Integration Takeover Entry into new business segments Disinvestments Role of headquarter Competitive strategy Product strategy Advertising measures Price strategy Make of buy Innovation strategy Building up market entry barriers Usage of economies of scale Building up alliances Competitive advantages 1. Company 2. Competitor 3. Customer Unique Selling Proposition The unique feature of a product, which enables to have a competitive advantage over other providers. The marketing concept of the unique selling proposition facilitates the successful promotion of products. Highlighting of an outstanding product feature ...view middle of the document...
(Zott/Amit) Central elements: 1. Product-/Market combination Which products on which markets? 2. Conﬁguration and implementation of value creating activities Disposal and integration of value-adding stages 3. Revenue mechanism How to generate revenues? Revenue model (mechanisms?) Describes the way in which a business model enables revenue generation. (Zott/Amit) Value chain
2. 10 schools of thought
The 3 groups of thought Premisses of the 10 schools
3. Industry environment
Role of industry in investments Venture capitalists invest in good industries, and it’s a myth that they invest in good people and good ideas. The industries that are more competitively forgiving than the market as a whole. In 1980, for example, nearly 20% of venture capital investments went to the energy industry. More recently, the ﬂow of capital has shifted rapidly from genetic engineering, specialty retailing, and computer hardware to CDRoms, multimedia, telecommunications, and software companies. Now, more than 25% of disbursement are devoted to the Internet “space”. Structure-Conduct-Performance paradigm
5-forces model (Porter)
The cross-price elasticity (minimum value for same industry?) The cross-price elasticity of demand is a measure, in how far a 1% change in the price of one product inﬂuences the demand for another product (percentage). In other words, this elasticity is the ration of percentaged change between the demand xi and the causally related, one percent- change in price pj. (Percentile change in demand for good/product/service B) / (Percentile price change of good/product/service A) Rule of thumb: Two companies belong to the same industry, if their cross-price elasticity is bigger than 5(%) Output classiﬁcations Real assets Non-durable goods (food, textile) Durable goods (electronic devices, automobiles) Investment goods (machines, buildings) Commodities (cotton wool, coal, steel) Services Services for individual payment (bank, insurances, transportation) Services for ﬂat rate payment (charitable organizations) Services without payment (charitable organisations) Strategic groups A strategic group consists of companies in a market, which display a homogeneous strategic behavior, i.e. they are similar in terms of certain strategic dimensions.
4. Open Source
Industrial evolution model
Who beneﬁts from innovation? Pioneer Technology leadership Discriminatory appropriation of scarce resources Speciﬁc restrictions of customer behavior Follower Exploitation of free-rider eﬀects Avoiding technical or demand-related uncertainties Technological innovations or shifts in demand Social factors of innovation Institutional setups Legitimisations (generation of trust) Regulation (rules, norms, laws) Technological standards Resource endowment Scientiﬁc/technological research Financing and insurance Soft skills / human competencies (education and acquisition) Proprietary functions Technological development: R&D, testing, production and marketing...