MG800: Strategic Management

Member of Team B
Ayoub Bokhabrine
Hyungnam Kim
Shail Thakkar
Adit Pandya

Chapter 10
Question 1 page 312:
The heart of Toyota's strategy in motor vehicles is to out-compete rivals by manufacturing worldclass, quality vehicles at lower costs and selling them at competitive price levels. Executing this
strategy requires top-notch manufacturing capability and super-efficient management of people,
equipment, and materials. Illustration Capsule 10.2 discusses the principles, practices, and
techniques grounded in Toyota's famed Toyota Production System. How does Toyota's
philosophy of dealing with defects, empowering employees, and developing capabilities impact
strategy execution? Why are its slogans such as "Never be satisfied" and 'Ask yourself 'Why?'
five times" important?
Answer:
Toyota is one of the largest car manufacturers all over the world, their Operational strategy is to
achieve a competitive advantage in the marketplace by providing high-quality vehicles at
competitive prices. Toyota has a unique philosophy of its kind to treat defects, and empower
employees and develop their capabilities. All of these factors in society contribute to the effective
implementation of the strategy, as shown below:

The company focuses on addressing the defects only when they occur. It allows the
company to save time, resources and effort by using control techniques only at the time
of the problems. Therefore, it saves the unnecessary use of technology staff and control
used in the operations smoothly.

In addition, the company also emphasize on identifying the root cause of the errors that helps to
avoid them in future. Thus, the company could reduce the defects in its products.

Toyota confirms the company has enabled workers by giving them the power to stop the
assembly line at a time to identify defects. It allows the company to track faulty items in
the initial stages and safe. If the items will go further in the assembly line, the company
must make an extra effort to identify the problem in the product. It can lead to the

manufacture of poor quality products also. Thus, to enable staff to help in the

manufacture of high quality products.

Capacity building: In order to achieve this goal, and focus on the company's continuous
development. In addition to this, also focus on developing staff that can offer innovative
ideas to improve the production process. These steps will help in the development of the
company's capabilities, which further help in the production of high quality products at
reasonable prices.

The company used many slogans such as "Ask yourself:" Why? "Five times" and "never be
satisfied", etc. To keep employees motivated. These logos help to create a positive and
competitive work environment. In addition, it also helps to remind staff on the principle of
continuous development and production of high quality products for the company.
Staff and encourages the exchange of ideas and value assessments and information with the
company, which is crucial to improve the efficiency and effectiveness of production processes.

Chapter 8:
Question 1:
See if you can identify the value chain relationships which make the businesses of the following
companies related in competitively relevant ways. In particular, you should consider whether
there are cross-business opportunities for (1) skills/technology transfer, (2) combining related
value chain activities to achieve lower costs, and/or (3) leveraging use of a well-respected brand
name.
Outback Steakhouse
Outback Steakhouse
Carrabbas Italian Grill
Roys Restaurant (Hawaiian fusion cuisine)
Bonefi sh Grill (Market-fresh fi ne seafood)

 Flemings Prime Steakhouse & Wine Bar

Lee Roy Selmons (Southern comfort food)
Cheeseburger in Paradise
Blue Coral Seafood & Spirits (Fine seafood)
LOral
Maybelline, Lancme, Helena Rubenstein, Kiehls, Garner, and Shu Uemura cosmetics
LOral and Soft Sheen/Carson hair care products
Redken, Matrix, LOral Professional, and Kerastase Paris professional hair care and skin care
products Ralph Lauren and Giorgio Armani fragrances
Biotherm skincare products
La RochePosay and Vichy Laboratories dermocosmetics
Johnson & Johnson
Baby products (powder, shampoo, oil, lotion)
Band-Aids and other fi rst-aid products
Womens health and personal care products (Stayfree, Carefree, Sure &Natural)
Neutrogena and Aveeno skin care products
Nonprescription drugs (Tylenol, Motrin, Pepcid AC, Mylanta, Monistat)
Prescription drugs
Prosthetic and other medical devices
Surgical and hospital products
Accuvue contact lenses
Answer:
Outback Steakhouse:The general strategy of the company is to differentiate its restaurants by
emphasizing consistently high quality food and service, generous portions at moderate prices and
a casual atmosphere. This is a good example of two strategic fit opportunities: transferring skills

and combining the related value chain activities to achieve lower costs, especially in the
administrative functions.
.

LOral: Opportunity fit strategy is to transfer skills which involves cross business cooperation
to focus on new beauty-products, creation of new strengths and capabilities. In some companies,
it is possible to combine the relevant value chain activities, including manufacturing, research
and development.
Johnson & Johnson: This a great example of leveraging a well-respected brand name. Another
potential strategic fit opportunity is combining related value chain activities, including
distribution and manufacturing.

Question 2:
Peruse the business group listings for United Technologies shown below and listed at its website
(www.utc.com). How would you characterize the companys corporate strategy? Related
diversification, unrelated diversification, or a combination related-unrelated diversification
strategy? Explain your answer.
Answer:
The corporate level strategy of unrelated diversification has been pursued by UTC Corporation
in which it has been successful in pursuing such strategy. United Technologies Corporation
(UTC) is Hartford based company, which has owned a wide variety of companies that operate in
different lines of business and industry. With UTC operating differed lines this will help them
grow very quickly.
Otis: the worlds leading manufacturer, installer and maintainer of elevators, escalators and
moving walkways
Carrier: the worlds largest provider of air-conditioning, heating, and refrigeration solutions.
Sikorsky: a world leader in helicopter design, manufacture and service.

UTC Fire& Security: fire and security systems developed for commercial, industrial, and
residential customers.
UTC Power: a full-service provider of environmentally advanced power solutions.
Hamilton Sundstrand: technologically advanced aerospace and industrial products.
Pratt Whitney: designs, manufactures, services and supports aircraft engines, industrial gas
turbines and space propulsion systems.
Question 3:
The Walt Disney Company is in the following businesses:
Theme parks
Disney Cruise Line
Resort properties
Movie, video, and theatrical productions (for both children and adults)
Television broadcasting (ABC, Disney Channel, Toon Disney, Classic Sports Network, ESPN
and ESPN2, E!, Lifetime, and A&E networks)
Radio broadcasting (Disney Radio)
Musical recordings and sales of animation art
Anaheim Mighty Ducks NHL franchise
Anaheim Angels major-league baseball franchise (25 percent ownership)
Books and magazine publishing
Interactive software and Internet sites
The Disney Store retail shops
Based on the above listing, would you say that Walt Disney's business lineup reflects a strategy
of related diversification, unrelated diversification, or a combination of related and unrelated
diversification? Be prepared to justify and explain your answer in terms of the nature of Disney's
shared or transferred resources and capabilities and the extent to which the value chains of
Disney's different businesses seem to have competitively valuable cross business relationships.

Answer:
A related diversification strategy is when the firms value chain exhibits competitively important
cross business relationships. An unrelated diversification strategy occurs when a business tries to
enter a new market. Disney uses a related diversification strategy. Disney started out making
cartoon films and soon moved into feature length films. After the success the sold merchandise
and began to open theme parks. The theme parks were a way to incorporate the characters they
featured in the films as real beings that the visitors could visit with and see in person. Disney
kept the cross business relationship going as they bought shares in the Anaheim Mighty Ducks
and Angels and made the films The Mighty Ducks and Angels in the Outfield. Every
operation Disney embarks on is a cross business relationship.
They began to become more diversified and offered The Disney Channel and eventually began
filming their own television shows. They made the shows into full feature movies, dolls; and
released numerous successful music artist albums. Disney went on to purchase Pixai, Marvel
Entertainment, and the latest venture, the purchase of Lucas film and the Star Wars Brand. With
the purchase of Pixar, Disney was able to release numerous popular films like Finding Nemo,
Toy Story, Cars, and Monsters mc. The acquisition of Marvel Disney released Iron Man
and The Avengers. Disney had already had huge successes with The Pirates of the
Caribbean. They even started the High School Musical series which has been successful as a
TV show, movie, and had their own top selling album. If Disney was using an unrelated
diversification strategy they would try to enter a new market. But Disney sticks with what they
know, entertainment. They keep churning out new movies, music, television shows, and theme
parks. They have built a huge group of loyal customers and are a globally recognized brand.

Chapter 7:
Question 3:
Assume you are in charge of developing the strategy for a multinational company selling
products in some 50 countries around the world one of the issues you face is whether to employ a
multi-domestic, a transnational, or a global strategy.
a. If your companys product is mobile phones, do you think t would make better strategic sense
to employ a multi-domestic strategy? A transnational strategy. Or a global strategy? Why?

Answer:
A) A mobile phone is an electronic device components programmable and each one expects
something new from t. It is not worthwhile to include each person's preferences. In
addition, the basic requirements for the mobile phone is the customer need to
communicate the use of mobile phone technology.
Thus, there is no need to customize mobile phones to meet local preferences. Thus, the
company should use cell phones produce a comprehensive strategy to take advantage of
unified products and economies of scale.
B) Culture, society and demographics determine the strength of the company's preference.
Most Indians prefer to eat vegetarian food, while the vast majority of the Danish People
prefer to eat non-vegetarian. The point is that food tastes fit according to buyers and
preferences of society change.
Therefore, the entity must use a multi-local strategy to customize the soup to meet the
preference of different buyers and local eating habits.
C)

A company producing consumer appliances must use transnational strategy to standardize

its product quality and technology and then customize t to meet the local preferences
such as environmental considerations, buying behaviors, purchasing capacity its.
For example. The expectations from a heater in semi humid region are quite different
than that of very cold region.