Sustainable Competitive Advantage
Providing greater value for customers than competitors can
What is competitive advantage?
a reluctance to change strategies or competitive practices that have been successful in the past?
What is competitive inertia?
A strategy for reducing risk by buying a variety of items so that the failure of one stock or business does not doom the entire portfolio?
What is diversification?
a corporate strategy that addresses the question, "How should we compete in this industry?"
What is industry-level strategy?
a corporate strategy that addresses the question, "How should we compete against a particular firm?"
What is firm-level strategy?
a resource that is not controlled or possessed by many competing firms?
What is a rare resource?
What a company make, do, or perform better than its competitors
What is distinctive competence?
A portfolio strategy ceveloped by Boston Consulting Group that categorizes a corporation's businesses by growth rate and relative market share and helps managers decide how to invest corporate funds?
What is a BCG Matrix?
a measure of the influence that customers have on a firm's prices
What is bargaining power of buyers?
the degree to which two companies have overlapping products, services, or customers in multiple markets
What is market commonality?
a competitive advantage that other companies have tried unsuccessfully to duplicate and have, for the moment, stopped trying to duplicate
What is a sustainable competitive advantage?
the central companies in a strategic group?
What are core firms?
Creating or acquiring companies in completely unrelated businesses.
What is unrelated diversification?
a measure of the intensity of competitive behavior between companies in an industry
What is character of the rivalry?
the extent to which a competitor has similar amounts and kinds of resources
What is resource similarity?
a resource that produces value or competitive advantage and has no equivalent substitutes or replacements?
What is a nonsubstitutable resource?
strategic group
What is a group of companies within an industry against which top managers compare, evaluate, and benchmark strategic threats and opportunities?
A broad corporate-level strategic plan used to achieve strategic goals and guide the strategic alternatives that managers or individual businesses or subunits may use.
What is grand strategy?
the positioning strategy of providing a product or service that is sufficiently different from competitors' offerings that customers are willing to pay a premium price for it
What is differentiation?
A competitive move designed to reduce a rival's market share or profits.
What is an attack?
a resource that is impossible or extremely costly or difficult for other firms to duplicate
What is an imperfectly imitatable resource?
strategic reference points
What are the strategic targets managers use to measure whether a firm has developed the core competencies it needs to achieve a sustainable competitive advantage?
A strategy that focuses on turning around very poor company performance by shrinking the size and scope of the business.
What is a retrenchment strategy?
the positioning strategy of using cost leadership or differentiation to produce a specialized product or service for a limited, targeted group of customers
What is focus strategy?
the rivalry between two companies that offer similar products and services, acknowledge each other as rivals, and act and react to each other's strategic actions
What is a direct competition?