CHAPTER 6
STRENGTHENING A COMPANY'S TS CMAPTER WiLL HELP YOU UNDERSTAND:
COMPETITIVE POSITIO 101 er enn pre i ot ten
‘STRATEGIC MOVES, TIMING, eerste lero
AND SCOPE OF OPERATIONS. Panos
Res age a rd me ieming scoot
: Tela eee rego es aout
Crafting & Executing Lode Rader tao con Gea elite
aise naemecs Scan,
> ACB STRATEGY Sizemore
‘iweoues For cower saves {LO Whon an¢ how stategcalances can substtue for
a Devote Goes horizontal mergers and aequlitors or vertical inogration
ep ra S {nd how tney ean facts outsourcin,
ll MAXIMIZING THE POWER OF A STRATEGY
ent u a
Core een
SL ieee)
‘+ Whether and when o go on the offensive sratesically
‘+ Whether and when to employ defensive erategies.
‘+ Wen to undertake strategic moves —frst mover,
| ‘afastfolower, or a late mover
‘+ Whether to merge with or acauire another frm
| ‘+ Whatherto integrate backward or forward into more
eee Seop0 of stages of the industry's activity chain,
ea + Which value chain activites, itany, should be outsourced.
pon “ale asin
| + Whether lo enter into stategic alliances oF
partnership arrangements,
sgupeammaretameetennemenin CnRrra section
+ Strategic Offensive Principles:
«+ Focusing relentlessly on aulsing compotitve
‘advantage and then siving to conver it into
sustainable advantage,
+ Applying resources where rivals are least able to
defend themselves.
+ Employing the element of surrise as cpsosed to
doing what rivals expect and are prepared fer
+ Displaying a capacity for swift, decisive, and
overwhelming actions to overpowerrivas,
Nem asceiaentoe este
+ Avoid directly challenging a targeted competitor
‘where itis strongest,
+ Use the fim's strongest strategic assets to
attack a competitor's weaknesses.
+ The offensive may not yield immediate results
if market rivals are strong competitors
‘¢ Be prepared for the threatened competitor's
counter-response,
STRATEGIC MANAGEMENT PRINCIPLE
+ Sometimes a company’s best strategic option
is to seize the initiative, go on the attack, and
launch a strategic offensive to improve its
market position
‘¢ The best offensives use a company's most
powerful resources and capabilities to attack
rivals in the areas where they are weakest.OPTION
}| PRINCIPAL OFFENSIVE STRATES
1. Offer an equly good or better product lover pce
2. Leapteg compebtrs by boing Histo market wih next gorwation
Produ,
3. Pursue contnuous product imation tera als and market
shore sway Femteas nova ais
| 4. Pursue dsrupte pros movatos 0 creat naw markets
6. Acopt an improve on the good ieas of alhar companies (vals er
‘thw
6. Use Ntent-un orguerta martin tacts to grb maka share
from complacent or races rvs
7 Launch a preemptive sake to secure on indus’ ited
resoues or capture arare opportunity
+ Given the rapiaty with which most frst mover,
advantages based on Ineinet technologies can be
lvercome, what would have led Git Groupe to
expect io bulc a sustainable compettive
¢ The business universe is divided into:
may
Recon aaa
«An existing market with boundaries and rules,
‘in which rival firms compete for advantage. es flartace Cees tones heal snes noted
+ A*blue ocean” market space, where the + Is Gilt Groupe a “one-tick pony” businass that the
industry has not yet taken shape, with no ephemeral nature of a fret-mover advantage
rivals and wide-open long-term growth and | strategy tends to favor?
profit potential for a firm that can create + How critical ming ofirst-mover advantage?
demand for new types of products,
saute aeermcamnemeete: