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Презентация на тему HSJ Chapter 5. Business-Level Strategy

BUSINESS-LEVEL STRATEGYOverall competitive theme of a business.Whom to serveNeeds and desires trying to satisfyHow to satisfy
HSJ Chapter 5Business-Level Strategy BUSINESS-LEVEL STRATEGYOverall competitive theme of a business.Whom to serveNeeds and desires trying to satisfyHow to satisfy THE TWO FUNDAMENTAL STRATEGIESLow CostDifferentiation LOWERING COSTSEnables a company to:gain a competitive advantage in commodity markets.undercut rivals DIFFERENTIATIONDistinguishing oneself from rivals by offering something that they find hard to DIFFERENTIATIONAdvantagesAllows a company to charge a premium price.Helps a company to grow THE DIFF./LOW-COST TRADEOFFEfficiency frontierShows all the positions a company can adopt with THE DIFF./LOW-COST TRADEOFFTo get to the efficiency frontier, a company must:pursue the VALUE INNOVATION	Occurs when innovations push out the efficiency frontier in an industry, MARKET SEGMENTATIONDecision of a company to group customers based on important differences MARKET SEGMENTATIONStandardization strategy (no segmentation)Segmentation strategy - Producing different offerings for different COSTS AND CUSTOMIZATIONNormally customization > greater costsCosts reduced byMass customizationTextbook examples in COST REDUCTION: TWO APPROACHESCostco: 4K SKUsWal-Mart: 142K SKUs GENERIC BUSINESS-LEVEL STRATEGIES GENERIC BUSINESS-LEVEL STRATEGIES BLUE OCEAN STRATEGYValue Innovation: Creating a new market spaceSouthwest Airlines[From TIME article:] BLUE OCEAN STRATEGYRedefine product offeringManagers ask about factors:Eliminate?Reduce?Raise (about the standard)?Create? CasesVirgin AmericaIKEAMIcrosoft Office versus Google AppsNordstrom
Слайды презентации

Слайд 2 BUSINESS-LEVEL STRATEGY
Overall competitive theme of a business.
Whom to

BUSINESS-LEVEL STRATEGYOverall competitive theme of a business.Whom to serveNeeds and desires trying to satisfyHow to satisfy

serve
Needs and desires trying to satisfy
How to satisfy


Слайд 3 THE TWO FUNDAMENTAL STRATEGIES
Low Cost
Differentiation


THE TWO FUNDAMENTAL STRATEGIESLow CostDifferentiation

Слайд 4 LOWERING COSTS
Enables a company to:
gain a competitive advantage

LOWERING COSTSEnables a company to:gain a competitive advantage in commodity markets.undercut

in commodity markets.
undercut rivals on price.
gain market share.
maintain or

increase profitability.

Слайд 5 DIFFERENTIATION
Distinguishing oneself from rivals by offering something that

DIFFERENTIATIONDistinguishing oneself from rivals by offering something that they find hard

they find hard to match .
Product differentiation is achieved

through:
superior reliability, functions, and features.
better design, branding, point-of-sale service, after sales service, and support.


Слайд 6 DIFFERENTIATION
Advantages
Allows a company to charge a premium price.
Helps

DIFFERENTIATIONAdvantagesAllows a company to charge a premium price.Helps a company to

a company to grow overall demand and capture market

share from its rivals.


Слайд 9 THE DIFF./LOW-COST TRADEOFF
Efficiency frontier
Shows all the positions a

THE DIFF./LOW-COST TRADEOFFEfficiency frontierShows all the positions a company can adopt

company can adopt with regard to differentiation and low

cost.
Has a convex shape because of diminishing returns.
Multiple positions on the differentiation-low cost continuum are viable.
Have enough demand to support an offering.

Слайд 10 THE DIFF./LOW-COST TRADEOFF
To get to the efficiency frontier,

THE DIFF./LOW-COST TRADEOFFTo get to the efficiency frontier, a company must:pursue

a company must:
pursue the right functional-level strategies.
be properly organized.
ensure

its business-level strategy, functional-level strategy, and organizational arrangement align with each other.

Слайд 11 VALUE INNOVATION
Occurs when innovations push out the efficiency

VALUE INNOVATION	Occurs when innovations push out the efficiency frontier in an

frontier in an industry, enabling greater value to be

offered through superior differentiation.
At a lower cost than was thought possible.
Enable a company to outperform its rivals for a long period of time.

Слайд 13 MARKET SEGMENTATION
Decision of a company to group customers

MARKET SEGMENTATIONDecision of a company to group customers based on important

based on important differences in their needs to gain

a competitive advantage.
Standardization strategy - Producing a standardized product for the average customer, ignoring different segments.


Слайд 14 MARKET SEGMENTATION
Standardization strategy (no segmentation)
Segmentation strategy - Producing

MARKET SEGMENTATIONStandardization strategy (no segmentation)Segmentation strategy - Producing different offerings for

different offerings for different segments, serving many segments or

the entire market.
Focus strategy - Serving a limited number of segments or just one segment.


Слайд 15 COSTS AND CUSTOMIZATION
Normally customization > greater costs
Costs reduced

COSTS AND CUSTOMIZATIONNormally customization > greater costsCosts reduced byMass customizationTextbook examples

by
Mass customization
Textbook examples in Ch. 4: Dell; M&Ms; Pandora
Component

sharing

Слайд 16 COST REDUCTION: TWO APPROACHES
Costco: 4K SKUs
Wal-Mart: 142K SKUs

COST REDUCTION: TWO APPROACHESCostco: 4K SKUsWal-Mart: 142K SKUs

Слайд 17 GENERIC BUSINESS-LEVEL STRATEGIES

GENERIC BUSINESS-LEVEL STRATEGIES

Слайд 18 GENERIC BUSINESS-LEVEL STRATEGIES

GENERIC BUSINESS-LEVEL STRATEGIES

Слайд 20 BLUE OCEAN STRATEGY
Value Innovation: Creating a new market

BLUE OCEAN STRATEGYValue Innovation: Creating a new market spaceSouthwest Airlines[From TIME

space
Southwest Airlines
[From TIME article:] Stock appreciation from 1978 to

2016: 53,700% return (S&P: 2,300% return)
Jan 2016 to present: NYSE Airline index is up 3%; Southwest down by 4%


Слайд 21 BLUE OCEAN STRATEGY
Redefine product offering
Managers ask about factors:
Eliminate?
Reduce?
Raise

BLUE OCEAN STRATEGYRedefine product offeringManagers ask about factors:Eliminate?Reduce?Raise (about the standard)?Create?

(about the standard)?
Create?


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