Professional Documents
Culture Documents
STRENGTHENING A COMPANYS
COMPETITIVE POSITION
Strategic Moves, Timing, and Scope of
Operations
Student Version
Copyright 2012 The McGraw-Hill Companies, Inc. McGraw-Hill/Irwin
Maximizing the Power of a Strategy
62
GOING ON THE OFFENSIVE
STRATEGIC OPTIONS TO IMPROVE A
FIRMS MARKET POSITION
63
Choosing Which Rivals to Attack
Runner-up firms
Struggling Small local
Market leaders with weaknesses
enterprises on and regional
that are in areas where
the verge of firms with limited
vulnerable the challenger
going under capabilities
is strong
64
DEFENSIVE STRATEGIES
PROTECTING MARKET POSITION
AND COMPETITIVE ADVANTAGE
65
TIMING A FIRMS OFFENSIVE AND
DEFENSIVE STRATEGIC MOVES
Timings Importance:
Knowing when to make a strategic move is
as crucial as knowing what move to make.
Moving first is no guarantee of success or
competitive advantage.
The risks of moving first to stake out a
monopoly position must be carefully
weighted.
66
STRENGTHENING A COMPANYS
MARKET POSITION VIA ITS SCOPE
OF OPERATIONS
Extent of its
Size of its
Range of its geographic
Breadth of its competitive
activities market
product and footprint on
performed presence and
service offerings its market
internally mix of
or industry
businesses
67
HORIZONTAL MERGER AND
ACQUISITION STRATEGIES
Merger
Is the combining of two or more firms
into a single corporate entity that often
takes on a new name.
Acquisition
Is a combination in which one firm, the
acquirer, purchases and absorbs the
operations of another firm, the acquired.
68
VERTICAL INTEGRATION STRATEGIES
69
Types of Vertical Integration Strategies
Vertical Integration
Choices
610
Backwards Integration Towards Suppliers
611
Integrating Forward to Enhance
Competitiveness
612
STRATEGIC ALLIANCES AND
PARTNERSHIPS
Strategic Alliance
Is a formal agreement between two or more
separate firms in which they agree to work
cooperatively toward common objectives.
Joint Venture
Is a type of strategic alliance in which the
partners set up an independent corporate
entity that they own and control jointly,
sharing in its revenues and expenses.
613
Capturing the Benefits of Strategic Alliances
Being sensitive
to cultural
differences
Recognizing that
Picking a good the alliance must
partner benefit both sides
Strategic
Alliance Factors
614
The Drawbacks of Strategic Alliances
and Partnerships
615
Principle Advantages of Strategic Alliances
616