“Analysis is the critical starting point of strategic thinking.pptVIP

“Analysis is the critical starting point of strategic thinking.” “Things are always different--the art is figuring out which differences matter.” Industry and Competitive Analysis Chapter 3 Chapter Outline Role of Situation Analysis in Strategy-Making Methods of Industry and Competitive Analysis Industry’s Dominant Economic Traits Industry’s Competitive Forces Drivers of Industry Change Competitive Positions of Rivals Competitive Moves of Rivals Key Success Factors Conclusions: Overall Industry Attractiveness Conducting an Industry and Competitive Analysis What Is Situation Analysis? Two considerations Company’s external or macro-environment Industry and competitive conditions Company’s internal or micro-environment Competencies, capabilities, resource strengths and weaknesses, and competitiveness Figure 3.1: The Components of a Company’s Macro-Environment Key Considerations Regarding the Industry and Competitive Environment Industry’s Dominant Economic Traits What is the definition of an industry? What are the Industry’s dominant economic traits? High capital requirements TRUE FALSE do not create exit barriers Industries characterized by TRUE FALSE the need for economies of scale do not require that firms have high market share. Industry’s Dominant Economic Traits How does vertical integration affect an industry? Capacity surpluses pull TRUE FALSE industry prices up. Consolidation is typical in TRUE FALSE slow growth industries. What are some possible industry exit barriers? What is the Experience Curve? Figure 3-3: Cost Advantages ofDifferent Experience Curve Effects Figure 3-4: Five ForcesModel of Competition Intensity of Rivalry What factors cause a strong rivalry in the industry? Competition in an industry is typically based upon what two things? Competitive Force of Potential Entry What is the potential impact of new entrants to existing firms? What are some ty