Chapter 5 Strategies in Action

Report
Chapter 5
Strategies in Action
Strategic Management:
Concepts & Cases
13th Edition
Fred David
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Publishing as Prentice Hall
Ch 5 -1
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Ch 5 -2
Long Term Objectives

Quantitative

Challenging

Measurable

Hierarchical

Realistic

Obtainable

Understandable

Congruent
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Ch 5 -3
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Ch 5 -4
Financial vs. Strategic Objectives
Financial Objectives
Growth
in revenues
Growth
in earnings
Higher
dividends
Larger
profit margins
Greater
ROI
Higher
earnings per share
Rising
stock price
Improved
cash flow
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Ch 5 -5
The Balanced Scorecard
Robert Kaplan & David Norton –
Strategy
evaluation & control technique
Balance
financial measures with
nonfinancial measures
Balance
shareholder objectives with
customer & operational objectives
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Ch 5 -6
Levels of Strategies –
Large Company
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Ch 5 -7
Levels of Strategies –
Small Company
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Ch 5 -8
Types of Strategies
Forward
Integration
Vertical
Integration
Strategies
Backward
Integration
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Ch 5 -9
Vertical Integration Strategies
Forward
Integration
Gaining ownership or increased
control over distributors or retailers
Backward
Integration
Seeking ownership or increased
control of a firm’s suppliers
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Ch 5 -10
Types of Strategies
Market
Penetration
Intensive
Strategies
Market
Development
Product
Development
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Ch 5 -11
Intensive Strategies
Market
Penetration
Seeking increased market share for
present products or services in
present markets through greater
marketing efforts
Market
Development
Introducing present products or
services into new geographic areas
Product
Development
Seeking increased sales by
improving present products or
services or developing new ones
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Ch 5 -12
Types of Strategies
Related
Diversification
Diversification
Strategies
Unrelated
Diversification
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Ch 5 -13
Diversification Strategies
Related
Diversification
Unrelated
Diversification
Adding new but related products or
services
Adding new, unrelated products or
services
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Ch 5 -14
Types of Strategies
Retrenchment
Defensive
Strategies
Divestiture
Liquidation
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Ch 5 -15
Defensive Strategies
Retrenchment
Divestiture
Liquidation
Regrouping through cost and asset
reduction to reverse declining sales
and profit
Selling a division or part of an
organization
Selling all of a company’s assets, in
parts, for their tangible worth
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Ch 5 -16
Porter’s Five Generic Strategies
Type 1 Cost Leadership – Low cost
 Type 2 Cost Leadership – Best value
 Type 3 Differentiation
 Type 4 Focus – Low cost
 Type 5 Focus – Best value

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Publishing as Prentice Hall
Ch 5 -17

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