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Strategic Analysis

1 2 3 4

Strategic Management: Creating Competitive Advantages 4 Analyzing the External Environment of the Firm 36 Assessing the Internal Environment of the Firm 68 Recognizing a Firms Intellectual Assets 114

5 Business-Level Strategy: Creating and Sustaining Competitive Advantages 146 6 Corporate-Level Strategy: Creating Value through Diversication 182 7 International Strategy: Creating Value in Global Markets 218 8 Digital Business Strategy: Leveraging Internet and E-Business Capabilities 250

Strategic Formulation

Strategic Implementation
9 Strategic Control and Corporate Governance 288 10 Creating Effective Organizational Designs 328 11 Strategic Leadership: Creating a Learning Organization and an Ethical Organization 360 12 Managing Innovation and Fostering Corporate Entrepreneurship 394 13 Recognizing Opportunities and Creating New Ventures 428

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Analyzing Strategic Management Cases 470 Cases 500 Indexes 919

Case Analysis

contents

Strategic Analysis
Chapter 1
Strategic Management: Creating Competitive Advantages
What Is Strategic Management?
Dening Strategic Management The Four Key Attributes of Strategic Management

The Competitive Environment


Porters Five-Forces Model of Industry Competition Strategic Groups within Industries

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54 61

4
8
9 10

Summary 64

Chapter 3
Assessing the Internal Environment of the Firm
Value-Chain Analysis
Primary Activities Support Activities Interrelationships among Value-Chain Activities within and across Organizations

The Strategic Management Process


Strategy Analysis Strategy Formulation Strategy Implementation

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12 14 15

68
71
73 76 81

The Role of Corporate Governance and Stakeholder Management


Zero Sum or Symbiosis? Two Alternate Perspectives of Stakeholder Management Social Responsibility: Moving Beyond the Immediate Stakeholders

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19 19

Resource-Based View of the Firm


Types of Firm Resources Firm Resources and Sustainable Competitive Advantages The Generation and Distribution of a Firms Prots: Extending the Resource-Based View of the Firm

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82 84

The Strategic Management Perspective: An Imperative Throughout the Organization

21

Some Key Driving Forces 21 Enhancing Employee Involvement in the Strategic Management Process 24

89

Ensuring Coherence in Strategic Direction


Organizational Vision Mission Statements Strategic Objectives
Summary 31

26
26 28 29

Evaluating Firm Performance: Two Approaches


Financial Ratio Analysis Integrating Financial Analysis and Stakeholder Perspectives: The Balanced Scorecard
Summary 97 Appendix to Chapter 3: Financial Ratio Analysis 102

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91 94

Chapter 2
Analyzing the External Environment of the Firm
Creating the Environmentally Aware Organization
The Role of Scanning, Monitoring, Competitive Intelligence, and Forecasting SWOT Analysis

Chapter 4
36
39
39 45

Recognizing a Firms Intellectual Assets


The Central Role of Knowledge in Todays Economy Human Capital: The Foundation of Intellectual Capital
Attracting Human Capital Developing Human Capital Retaining Human Capital

114
117 120
121 123 126

The General Environment


The Demographic Segment The Sociocultural Segment The Political/Legal Segment The Technological Segment The Economic Segment The Global Segment Relationships among Elements of the General Environment

45
45 48 48 49 51 52 52

The Vital Role of Social Capital


How Social Capital Helps Attract and Retain Talent The Potential Downside of Social Capital

129
130 132

Using Technology to Leverage Human Capital and Knowledge

133

Using Networks to Share Information and Develop Products and Services 133 Codifying Knowledge for Competitive Advantage 134 Retaining Knowledge When Employees Leave 135

Related Diversication: Market Power


Pooled Negotiating Power Vertical Integration

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190 192

The Central Role of Leveraging Human Capital in Strategy Formulation


Leveraging Human Capital and Business-Level Strategy Leveraging Human Capital and Corporate-Level Strategy Leveraging Human Capital and International-Level Strategy Leveraging Human Capital and Internet Strategies
Summary 139

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137 137 139 139

Unrelated Diversication: Financial Synergies and Parenting


Corporate Parenting and Restructuring Portfolio Management Caveat: Is Risk Reduction a Viable Goal of Diversication?

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197 198 201

The Means to Achieve Diversication


Mergers and Acquisitions Strategic Alliances and Joint Ventures Internal Development

201
202 203 206

Strategic Formulation
Chapter 5
Business-Level Strategy: Creating and Sustaining Competitive Advantages 146
Types of Competitive Advantage and Sustainability
Overall Cost Leadership Differentiation Focus Combination Strategies: Integrating Overall Low Cost and Differentiation

Real Options Analysis: A Useful Tool How Managerial Motives Can Erode Value Creation
Growth for Growths Sake Egotism Antitakeover Tactics
Summary 212

207 208
209 210 212

Chapter 7
International Strategy: Creating Value in Global Markets 218

150
151 157 162 164

The Global Economy: A Brief Overview 220 Factors Affecting a Nations Competitiveness 221
Factor Conditions Demand Conditions Related and Supporting Industries Firm Strategy, Structure, and Rivalry Concluding Comment on Factors Affecting a Nations Competitiveness 222 223 223 224 226

Industry Life Cycle Stages: Strategic Implications


Strategies in the Introduction Stage Strategies in the Growth Stage Strategies in the Maturity Stage Strategies in the Decline Stage Relating Generic Strategies to Stages of the Industry Life Cycle: The Personal Computer Industry Turnaround Strategies
Summary 177

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170 171 172 173

International Expansion: A Companys Motivations and Risks


Motivations for International Expansion Potential Risks of International Expansion

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226 228

175 175

Achieving Competitive Advantage in Global Markets


Two Opposing Pressures: Reducing Costs and Adapting to Local Markets International Strategy Global Strategy Multidomestic Strategy Transnational Strategy

232
232 234 235 236 238

Chapter 6
Corporate-Level Strategy: Creating Value through Diversication 182
Making Diversication Work: An Overview Related Diversication: Economies of Scope and Revenue Enhancement
Leveraging Core Competencies Sharing Activities

186 187
188 189

Entry Modes of International Expansion


Exporting Licensing and Franchising Strategic Alliances and Joint Ventures Wholly Owned Subsidiaries
Summary 246

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240 242 242 244

Chapter 8
Digital Business Strategy: Leveraging Internet and E-Business Capabilities 250
How the Internet Is Affecting the Five Competitive Forces
The Threat of New Entrants The Bargaining Power of Buyers The Bargaining Power of Suppliers The Threat of Substitutes The Intensity of Competitive Rivalry

Linking Strategic Control to Business-Level and Corporate-Level Strategies


Business-Level Strategy and Strategic Control Corporate-Level Strategy and Strategic Control

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305 306

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257 258 259 260 262

The Role of Corporate Governance


The Modern Corporation: The Separation of Owners (Shareholders) and Management Governance Mechanisms: Aligning the Interests of Owners and Managers External Governance Control Mechanisms
Summary 321

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309 311 317

How the Internet Adds Value


Search Activities Evaluation Activities Problem-Solving Activities Transaction Activities Other Sources of Competitive Advantage Business Models

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263 265 265 266 267 268

Chapter 10
Creating Effective Organizational Designs
Traditional Forms of Organizational Structure
Patterns of Growth of Large Corporations Simple Structure Functional Structure Divisional Structure Matrix Structure International Operations: Implications for Organizational Structure How an Organizations Structure Can Inuence Strategy Formulation

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330
331 332 333 334 338 339 341

How the Internet Is Affecting the Competitive Strategies


Overall Cost Leadership Differentiation Focus Are Combination Strategies the Key to E-Business Success?

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272 273 275

Are Internet-Based Advantages Sustainable? 278


278

Leveraging Internet Capabilities


Summary 281

280

Boundaryless Organizational Designs


The Barrier-Free Organization The Modular Organization The Virtual Organization Boundaryless Organizations: Making Them Work
Summary 355

341
343 347 348 352

Strategic Implementation
Chapter 9
Strategic Control and Corporate Governance 288

Chapter 11
Strategic Leadership: Creating a Learning Organization and an Ethical Organization
Leadership: Three Interdependent Activities
Setting a Direction Designing the Organization Nurturing a Culture Dedicated to Excellence and Ethical Behavior Overcoming Barriers to Change and the Effective Use of Power

Ensuring Informational Control: Responding Effectively to Environmental Change 291


A Traditional Approach to Strategic Control A Contemporary Approach to Strategic Control 291 292

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363
365 365 367 367

Attaining Behavioral Control: Balancing Culture, Rewards, and Boundaries


Building a Strong and Effective Culture Motivating with Rewards and Incentives Setting Boundaries and Constraints Behavioral Control in Organizations: Situational Factors Evolving from Boundaries to Rewards and Culture

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296 297 299 302 303

Emotional Intelligence: A Key Leadership Trait Developing a Learning Organization


Empowering Employees at All Levels Accumulating and Sharing Internal Knowledge

370 374
375 376

Gathering and Integrating External Information Challenging the Status Quo and Enabling Creativity

378 380

Dedication and Drive Commitment to Excellence

451 453

Creating an Ethical Organization


Individual Ethics versus Organizational Ethics Integrity-Based versus Compliance-Based Approaches to Organizational Ethics Role Models Corporate Credos and Codes of Conduct Reward and Evaluation Systems
Summary 390

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381 383 387 387 388

Entrepreneurial Strategy
Entry Strategies Generic Strategies Combination Strategies
Summary 463

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455 459 462

Chapter 12
Managing Innovation and Fostering Corporate Entrepreneurship
Managing Innovation
Types of Innovation Challenges of Innovation Dening the Scope of Innovation Managing the Pace of Innovation Collaborating with Innovation Partners

Case Analysis
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398 400 401 402 402

Chapter 14
Analyzing Strategic Management Cases

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472 473
475 477 477 478 480

Why Analyze Strategic Management Cases? How to Conduct a Case Analysis


Become Familiar with the Material Identify Problems Conduct Strategic Analyses Propose Alternative Solutions Make Recommendations

Corporate Entrepreneurship
Focused Approaches to Corporate Entrepreneurship Dispersed Approaches to Corporate Entrepreneurship Measuring the Success of Corporate Entrepreneurship Activities

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405 408 410

How to Get the Most from Case Analysis Using Conict-Inducing Decision-Making Techniques in Case Analysis
Symptoms of Groupthink and How to Prevent It Using Conict to Improve Decision Making

480 483
485 485

Entrepreneurial Orientation
Autonomy Innovativeness Proactiveness Competitive Aggressiveness Risk Taking
Summary 423

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414 416 418 419 421

Following the Analysis-Decision-Action Cycle in Case Analysis 487


Summary 491 Appendix to Chapter 14: Sources of Company and Industry Information 493

Chapter 13
Recognizing Opportunities and Creating New Ventures
New Ventures and Small Businesses
Categories of Entrepreneurial Ventures

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431
431

Cases
1. 2. 3. 4. 5. Adolph Coors in the Brewing Industry American Red Cross to 2002 (A) American Red Cross, 20022004 (B) Atari and InfoGrames Entertainment SA Ben & Jerrys Homemade, Inc.: Passing the Torch 6. The Best-Laid Incentive Plans 7. Carly Fiorina: The Reinvention of Hewlett-Packard 500 514 525 530 540 555 559

Opportunity Recognition: Identifying and Developing Market Opportunities


The Opportunity Recognition Process Characteristics of Good Opportunities

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438 440

Entrepreneurial Resources
New-Venture Financing Other Entrepreneurial Resources

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443 447

Entrepreneurial Leadership
Vision

450
450

8. Challenges Brewing at Breckenridge Brewery 9. Chiquitas Global Turnaround 10. Crown Cork and Seal in 1989 11. Dippin Dots Ice Cream 12. eBay: King of the Online Auction Industry 13. Edward Marshall Boehm, Inc. 14. Ford Motor Company in 2004: Entering a Second Century of Existence 15. FreshDirect 16. General Motors 17. Go Globalor No? 18. Green Mountain Coffee Roasters 19. Growing for Broke 20. Heineken 21. Jays Foods, LLC 22. JetBlue Airways 23. Johnson & Johnson 24. The Lincoln Electric Company, 1989 25. McDonalds 26. Microsofts Battle for the Living Room: The Trojan HorseThe Xbox 27. Nokias Strategic Intent for the 21st Century 28. Outback Steakhouse Goes International

576 589 597 615 621 640 641 650 660 666 670 679 683 689 700 710 716 730 736 751 764

29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44.

Panera Bread Company Pixar Animation Studios Procter & Gamble Robin Hood Samsung Electronics Schoolhouse Lane Estates Segway: A New Dimension in Human Transportation The Skeleton in the Corporate Closet Southwest Airlines: How Much Can LUV Do? Starbucks Corporation: Competing in a Global Market Toys R Us Moving into 2004 Trouble in Paradise Wal-Marts Strategy for the 21st Century: Sustaining Dominance World Wrestling Entertainment Yahoo! Yum! Brands, Pizza Hut, and KFC

783 793 799 805 806 811 825 834 837 846 866 872 876 895 901 907

Indexes
Company Name Subject 919 926 936