|



 


 
|

 
  


|

 ÷
 



ë As the emphasis on bottom-
bottom-line performance has
increased due to external financial market
pressures and globalization, managers are
increasingly concerned with how to develop and
sustain competitive advantage ± the basis for
superior performance. Strategic management
goes to the heart of how managers add value to
the firm by focusing on how managers should
evaluate and assess their organizations and
competitive environments in order to develop a
competitive advantage in the marketplace.

 ÷

ë
lobal Competitive Strategy examines the opportunities,
challenges, and strategies of operating firms with an
international presence. Among other topics, we will be
examining:

ë the potential for companies to be competitive in the global

arena,
ë the nature of industry structure on a global basis, achieving
global strength, international risk,
ë various functional areas such as operations, marketing, and
human resources,
ë design and implementation of a global organization, and
development of global strategy.
  

ë ÷
 

 
Competitive intelligence is a combination of an ³art´ (CI
focused strategy), science (analytical techniques) and craft
(learning from experience of managing and doing CI). An
effective competitive intelligence program (CIP) is a core
foundation upon which competitive strategies and execution
tactics are developed, assessed and modified.
The heart of the course is developing a CIP. The CIP is a
continuous process that integrates both formal and informal
intelligence gathering processes by which managers in the
organization assess, disseminate and use key trends,
emerging discontinuities, the evolution of industry structure
and the capabilities and behaviors of current and potential
competitors to assist in formulating and implementing
strategy and tactics.
 |      


ë
rowth through mergers and acquisitions can provide an
attractive means to jump start a stagnant company,
leverage its core competencies or diversify into attractive
adjacent markets, but it is a strategic path fraught with
risks. When is it the best course versus alternative growth
strategies? What is the ³perfect ³fit´ test for evaluating
target companies? What antitrust considerations must the
acquirer bear in mind? Addressing those questions will
provide the strategic backdrop for a more detailed review of
the techniques and mechanics of growing through
acquisition: merger economics, deal structure, valuation,
negotiation tactics, legal considerations, due diligence,
closing the deal and post-
post-closing integration
 
 
 
ë
As global competition heats up at an ever-
ever-increasing pace,
the ability to innovate becomes a vital strategy for every
business. Yet it is not enough to focus on a single,
breakthrough innovation or a series of small incremental
changes. The business of tomorrow will only grow through
a sustainable approach and practice of innovation.
This Module incorporates three elements:

ë Organizing for Innovation

ë Vision and Leadership
ë Infrastructure, competition, cooperation
ë Policies
ë Strategies
ë Thinking styles
ë Processes
 G   
ë technical skills, research, and
innovation;
ë · entrepreneurship and management
skills;
ë · institutional depth and publicly
financed social protection;
ë · infrastructure modernization and
integration; and
ë · institutions of trade facilitation
 ÷


÷




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ë Cost leadership strategy:
becoming a low cost producer of
products and services in the
industry.

ë Differentiation strategy:
developing ways to differentiate a
firm¶s products and services from its
competitors.
 ÷



 
ë Innovation strategy:
Finding new ways of doing business.

ë
rowth strategies:
Significantly expanding a company¶s capacity to
produce goods and services.

ë Alliance strategies:
Establishing new business linkages and
alliances with customers, suppliers, competitors,
consultants, and other companies.
 6

 
 

 
 ÷
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 £÷

£ASIC STRATE
IES IN THE £ SINESS SE OF INFORMATION TECHNOLO
Y

Lower Costs
ë use IT to substantially reduce the cost of business processes.

ë use IT to lower the costs of customers or suppliers.

Differentiate
ë develop new IT features to differentiate products and services.

ë use IT features to reduce the differentiation advantages of competitors.

ë use IT features to focus products and services at selected market.

Innovate
ë create new products and services that include IT components.

ë develop unique new markets with the help of IT.

ë make radical changes to business processes with IT that dramatically cut costs, improve quality,

efficiency, customer services.

Promote growth
ë use IT to manage regional and global business expansion.

ë use IT to diversity and integrate into other products and services.

Develop alliance
ë use IT to create virtual organizations of business partners.
£  
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ë Demands for organizational innovation and

technological advantage are increasingly crucial
components of competitive strategy for many
firms. Most firms face serious competitive
challenges due to the rapid pace and
unpredictability of technology change.
ë Industries dependent on highly sophisticated
technologies and firms engaged in multinational
competition are particularly vulnerable to the
need for continuous and rapid modification of
their product features and the ways in which they
conduct business
 ½ !½"½!½
ë Market orientation strategy leads to the
development of merely incremental innovations
and to inferior products in the long term, given
that innovation risks tend to be avoided. Thus,
customer emphasis promoted by market
orientation is seen to lead solely to the creation
of possible or feasible products within the
customers¶ own reference system.
ë Therefore, radical innovations would never be
generated as customers would not suggest them
and evaluation of their potential acceptance by
the target market would be even less feasible.
This idea has prevailed in the management of
many industrial Firms, particularly in those in
which technology plays a predominant role.
 ½ !½"½!½

ë Authentic market orientation requires a continual innovative

effort that need not be limited to incremental innovations,
provided that latent radical necessities are detected.
ë There is a positive relationship between the magnitude of
market orientation and an organization¶ s relative emphasis
on developing more innovative products.
ë Market orientation, together with other characteristics and
organizational culture, is an antecedent of a ® rm¶s
receptivity or willingness towards new idea development.
 ½!½G##$%½!#

ë Market orientation is positively associated with a

Firm¶ s innovativeness or its cultural
predisposition to innovate.
ë A Firm¶ s innovativeness is positively associated
with the Firm¶ s innovation rate and new product
innovativeness.
ë A Firm¶ s innovation rate and new product
innovativeness lead to superior company
ë performance.
ë Market orientation has a direct, positive impact
on a Firm¶ s innovation rate, new product
ë innovativeness and company performance.
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ë r
¶s: corporate restructuring
identified with leveraged buyouts,
L£O¶s, LCO¶s
‡ More generally, however, divestitures,
carve out IPO¶s, spin offs, etc.
ë Early r ¶s: corporate
restructuring identified with troubled
debt restructuring: workouts and
reorganization
 
    

ë Stock market
‡ Activist shareholders
‡ Pension funds
ë Increasing competition
‡
lobal
‡ Technological
ë Change in regulation
 i
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ë Asset restructuring
‡ Acquisitions
‡ Divestitures
‡ Spin offs
‡ Corporate downsizing
‡ Outsourcing
 


   


ë Restructuring ownership structure,

leverage
‡ Exchange offers
‡ Share repurchases
‡ L£O¶s, LCO¶s
ë Restructuring equity claims (next
slide)
 


   

ë Ownership vs. control
‡ Limited partnerships
‡ Leasing
‡ Joint ventures
‡ Securitization
‡ Project finance
ë Incentive restructuring
‡ Value based management programs (EVA,
etc.)
 


   

ë Corporate control
‡ Anti
Anti--takeover amendments
‡ Dual
Dual--class recapitalizations
‡
reenmail/Standstill agreements
‡ Poison pills/Charter amendments
‡ Defensive asset/ownership
restructurings
 6
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Information about industries, markets, and products is needed for investment

decisions, business planning, and product development. Researchers typically
seek information such as:

the current environment of an industry or sector

news, developments and trends for an industry or product

market analyses, strategies and forecasts for products or technologies

The following slides show databases commonly used to find this information.

New, innovative products may pose special challenges precisely because they
are new. Niche products may also be hard to research.

If you are researching an innovation or a niche product, use the databases as

starting points. You may also find the MIT Libraries subject guide G


 
   helpful. The guide is at
http://libraries.mit.edu/guides/subjects/market-res-diy/
 i
   
'
(

()
*


.

: Find information on the current environment of an industry.

 Try databases of analyses and overview reports by
investment analysts and advisory services.

+    

  
  


 

*,

Challenges and opportunities for the industry

Key players and companies
Impact of technology, innovations and new products
Statistics on supplies, production, distribution
Regulatory and environmental issues

- *  

  
,

Through research by industry specialists in investment houses

or consulting firms.
The research is used to guide investment decisions but can
be useful for other purposes.
i
   
'
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.

: Track new developments and trends for an industry,
market or product.

 se databases of news and publications from trade
and industry associations.
+    

 

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.
  ,

Current information on product lines

Reports on new technologies and applications
Coverage of new developments in an industry
Statistics and data on production, sales, revenues

- *  

  
,

£y trade and industry associations, who work to

collect information from their members

conduct research on behalf of members
keep people in an industry informed via newsletters,
journals, and trade fairs
  ÷  
  

 
 (
 
 
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÷

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ë The services sector in the Philippine

economy: Trends and Prospects
ë IT--Enabled Services: £road
IT
Perspectives
‡ Driving Forces
‡ Opportunities and Threats
‡ Strengths and Weaknesses
‡ Policy Framework
 

  
 



 
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ë £ackroom operations
‡ Contact centers ± Customer Relations
Management
‡ Medical transcription
‡ Human Resource Management
‡ Financial Management
‡ Animation
‡ Architectural and engineering design
‡ IT
IT--support systems
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The Ethics/£rand Dilemma of outsourcing

and
³The Consumer Society´:

³Products are manufactured in China at a

fraction of the cost of making them here,
and Americans get great deals «The
problem is,   
  
 
   
  

² Robert Reich, .S. Secretary of Labor, r -- 


   #

As an Integrated Element ±

Case history: Whirlpool

ë Market research: customer surveys documented
value of CSR attributes in energy and
environment.

ë CSR data generated adaptation of regional

emphases ( .S., £razil, Europe)

›


 
 




÷

   


£enefit from shared experience:

ë .N.
lobal Compact
ë £usiness for Social Responsibility
ë Center for Corporate Citizenship
ë World £usiness Council for Sustainable
Development
ë And, of course, academic centers/applied
ethics
 ³ CSR is no longer an option. It is an
integral prerequisite to our long-
long-term
success «

³Increasingly CSR means

quality management.´

² From: ³³
      
 
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ë £usiness Ethics essentially are rules of conduct
that guide actions in the market place-
place-the
standards against which people in a culture judge
what is right and what is wrong, good or bad.
ë European consumer protection laws/codes
laws/codes of
ethics include
‡ avoidance of false or deliberately mislead
advertising (Danish supermarket).
‡ rejection of high
high--pressure or misleading sales
tactics (£enetton)
‡ disclosure of all substantial risks associated
with a product or service.
 º& 62 
 # 

   -5
Ji 
÷ * ÷  
#  ÑÑ
  

  
0 1 
.'  Î
ë The potential for ethical products and
services in the K could be as high as
 of consumer markets.

ë 52 of consumers had recommended

companies because of the companies(
companies(
responsible reputation.

ë ** of consumers had avoided a

product or service because of a
company((s behaviour.
company


 
  

 
ë Internalisation of costs (making the
polluters pay).
ë
reen taxes.
ë Legislation.
ë Support for cleaner technology.
ë Redesigned products for recycling.
ë Reverse distribution channels to receive
products for recycling.
ë Consumer education on sustainability.
  


  




The establishment, maintenance and

enhancement of  
  # so that the objectives
of the parties involved are met
without compromising the ability of
future generations to achieve their
own objectives.

$ " %&'())(

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%
ë resources available
ë   ability to access market information

ë   size of customer base

ë   closeness to individual customers

ë   breadth and depth of managerial

expertise.
Overall conclusion: Although the actual
implementation of the marketing concept
may be different the core philosophy and
culture of it remains exactly the same.