Chapter 1

• Shareholder value - The returns that shareholders earn from

purchasing shares in a company.
• Return on invested capital (ROIC) - Net profit over the capital
invested in a firm.
• Competitive advantage
• Sustained competitive advantage – A company’s strategies that
enable it to maintain above-average profitability for a number of
years.
• Business Model - Conception of how strategies should work together
as a whole to enable the company to achieve competitive advantage
and make money.
• Mission and Vision
• SWOT Analysis
• Serendipity
• Characteristics of good strategic leaders - Vision, eloquence, and
consistency; Articulation of a business model; Commitment, Being well
informed; Willingness to delegate and empower; Astute use of power;
and Emotional intelligence
Chapter 2
• Competitive Forces
• Economies of Scale - Reductions in unit costs attributed to a larger output
• Stages in the Industry Lifecycle
• The role of Macroeconomic Forces - global and technology forces;
social, demographic, and political forces
Chapter 3
• Distinctive competencies
• Value Creation
• Building Blocks of Competitive Advantage
• Drivers of Profitability – ROIC
• The Icarus paradox - Companies become very specialized and myopic
• Steps to avoid failure
Chapter 4
• Functional level strategies
• Low cost & differentiation strategies
• Diseconomies of scale
• Experience Curve
• Just-in-time (JIT) inventory system
• Achieving superior innovation
Chapter 5
• The differentiation-low cost tradeoff
• Market segmentation
• Low cost companies vs. differentited companies