Chap1
1. What are strategic competitiveness, strategy, competitive advantage, above-average returns, and the strategic management process?
Strategic competitiveness is achieved when a firm successfully formulates and implements a value-creatingstrategy.
A strategy is an integrated and coordinated set ofcommitments and actions designed to exploit or competencies and gain acompetitive advantage.
A firm has a competitive advantage when it implements a strategy competitors are unable to duplicate or find too costly totry to imitate.
Above-average returns are returns in excess of what an investor expects to earn from other investments with a similar amount of risk
The strategic management process is the full set of commitments, decisions, and actions required fora firm to achieve strategic competitiveness and earn above-average returns.
2. What are thecharacteristers of the current competitive landscape? What two factors are theprimary drivers of this landscape?
(1) Challenging to determine boundaries of an industry
Coventional sources of competitive advantage such aseconomies of scale and huge advertising budgets are not as effective as theyonce were
Managers must adopt a new mind-set that values flexibility,speed, innovation, integration, and the challenges that evolve from constantly changing conditions.
Developing and implementing strategy remains an important element of success in this environment.
(2)The global economy andtechnology and technological changes
3. According to the I/Omodel, what should a firm do to earn above-average returns?
The I/O model stress on external environment.
4. What does theresource-based model suggest a firm should do to earn above-average returns?
The resource-based model focus on internal environment.
5. What are vision andmission? What is their value for the strategic management process?
(1) Vision is a picture of what the firm wants to beand, in broad terms, what it wants to ultimately achieve.
A mission specifies the business or businesses inwhich the firm intends to compete and the customers it intends to serve
(2)Having aneffectively formed vision and mission has a positive effect on performance asmeasured by growth in scales, profits, employment, and net worth. In turn,positive firm performance increases the firm’s ability to satisfy the interestsof its stakeholders.
6. What are stakeholders?How do the three primary stakeholder groups influence or ganizations?
(1) Stakeholders are the individuals and groups who can affevt, and are affected by, the strategic outcomes achieved and who have enforceable claims on a firm’s performance.
(2) Capital Market Stakeholders:
Dissatisfied lenders may impose stricter covenants onsubsequent borrowing of capital. Dissatisfied share holders may reflect their concerns through several means, including selling their stock.
Product Market Stakeholders
Product market shareholders are generally satisfied when afim’s profit margin reflects at least as balance between the returns to capital market stakeholders and the returns in which they share
Organizational stakeholders
Employees-the firm’s organizational stakeholders-expect the firm to provide a dynamic, stimulating, and rewarding work environment.
7. How would you describethe work of strategic leaders?
Stategic leaders are people who are involved in choosing a firm’s strategy, implementing actions and deciding a firm’s organizational culture. They need to be both a good dreamer and a good doer.
8. What are the elements ofthe strategic management process?How are theyinterrelated?
(1) Analyze external environmentand internal organization
(2) Use different strategies(business-level strategies, corporate-level strategies, portfolio ofbusinesses, international strategy, cooperative strategies, taking actions and reactions)according to the analyzation
(3) Take specific actions(governfirms, control a firm’s operations, strategic leadership, strategic enterpreneurship）
