Business Strategy and Sustainability Week 1-3
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Questions and Answers

Which of the following is NOT a strategic key element of cost leadership?

  • Control over overheads
  • Process innovation
  • Scale-efficient production units
  • Branding and advertising (correct)

What organization focus is critical to implement effective cost leadership?

  • Focus on access to capital (correct)
  • Focus on high-quality product development
  • Focus on competitive brand image
  • Focus on customer service excellence

Which of the following risks is NOT associated with a cost leadership strategy?

  • Changing customer preferences
  • Enhanced customer loyalty through branding (correct)
  • Technological changes impacting costs
  • Imitation by competitors

Which of the following elements is part of a differentiation strategy?

<p>Design and quality (C)</p> Signup and view all the answers

In which circumstance might customers prioritize differentiation over cost leadership?

<p>When there is a strong brand loyalty (B)</p> Signup and view all the answers

What potential outcome should companies analyze when considering whether not to collaborate?

<p>Potential loss of opportunities to competitors (A)</p> Signup and view all the answers

What should be evaluated to determine if cooperation will compromise competitive advantage?

<p>The risk of sharing proprietary information (A)</p> Signup and view all the answers

Which aspect is crucial when structuring a cooperation agreement?

<p>Control mechanisms and how to unwind the arrangement (B)</p> Signup and view all the answers

What emotional response can hinder the acceptance of co-opetition?

<p>Belief that only one party can win (A)</p> Signup and view all the answers

What is a recommended approach to foster cooperation among teams?

<p>Choose individuals open to the concept of co-opetition (D)</p> Signup and view all the answers

What is the primary reason Sergio Marchionne believes scale is essential for European carmakers?

<p>To achieve competitive margins (A)</p> Signup and view all the answers

What was the outcome for GM following the Opel-PSA deal?

<p>GM retained pension liabilities and realized minimal profit (D)</p> Signup and view all the answers

What caution does Carlos Ghosn provide regarding scale in the automotive industry?

<p>The effectiveness of scale depends on its utilization (B)</p> Signup and view all the answers

What trend is highlighted in the automotive industry regarding dealmaking?

<p>Carmakers are investing in technology and battery companies (C)</p> Signup and view all the answers

How do analysts view the Opel-PSA deal in terms of future mergers and acquisitions?

<p>As a potential trigger for more consolidation speculation (D)</p> Signup and view all the answers

In the conclusion, what dual approach is emphasized for shaping the future of the automotive industry?

<p>Through both consolidation and technological partnerships (A)</p> Signup and view all the answers

What is one source of synergy by aligning resources according to corporate-level strategy?

<p>Achieving resource allocation (C)</p> Signup and view all the answers

What does the integration of value chains aim to achieve?

<p>Sharing and linking value-adding activities (D)</p> Signup and view all the answers

What is a primary reason for companies to prioritize their impact on society?

<p>To align with sustainability, political, and innovation perspectives (B)</p> Signup and view all the answers

What does the 'mission' of a company primarily consist of?

<p>Organizational purpose, beliefs, and values (C)</p> Signup and view all the answers

Which element is NOT part of a company's vision?

<p>Organizational values (B)</p> Signup and view all the answers

How does a mission and vision contribute to an organization?

<p>They set boundaries for actions and inspire employees (B)</p> Signup and view all the answers

What distinguishes Starbucks in the competitive coffee market?

<p>Emphasizing digital innovation and diverse offerings (C)</p> Signup and view all the answers

Which approach best defines corporate social responsibility (CSR)?

<p>Balancing profit-making with ethical responsibilities towards people and the planet (A)</p> Signup and view all the answers

What type of activities are encompassed by diagnosing activities?

<p>External and internal assessments (D)</p> Signup and view all the answers

Which statement best describes the nature of strategy formation in small, entrepreneurial organizations?

<p>It emphasizes a non-linear approach based on available resources. (B)</p> Signup and view all the answers

What describes the competitive advantage in business-level strategy?

<p>Performance superiority compared to competitors (B)</p> Signup and view all the answers

What misconception might someone have regarding Starbucks' product development?

<p>Starbucks only offers traditional coffee drinks (D)</p> Signup and view all the answers

What is a significant disadvantage of a highly informal strategy formation approach?

<p>Higher levels of subjectivity and risk of hasty conclusions. (C)</p> Signup and view all the answers

Which of the following best represents the impact of the third wave coffee movement?

<p>A shift towards experiential and ethically sourced coffee (B)</p> Signup and view all the answers

Which of the following is NOT a phase in the strategic activity model?

<p>Implementing activities (A)</p> Signup and view all the answers

What problem is associated with greenwashing?

<p>Portraying a company as more socially responsible than it actually is (B)</p> Signup and view all the answers

What is a primary characteristic of causation logic in strategy formation?

<p>It emphasizes defining objectives and planning to achieve them. (B)</p> Signup and view all the answers

Which of the following best describes the core idea of population ecology theory?

<p>Changes in business primarily occur at the population level rather than the individual level. (A)</p> Signup and view all the answers

What commonly inhibits organizations from making significant changes?

<p>Political resistance to change (B)</p> Signup and view all the answers

In the context of organizational change, which factor is NOT part of the areas of change?

<p>Market share (C)</p> Signup and view all the answers

What does ambidexterity in organizations primarily refer to?

<p>The simultaneous exploitation of existing resources and exploration of new opportunities. (B)</p> Signup and view all the answers

Which aspect does NOT contribute to the concept of organizational inertia?

<p>Market demand fluctuations (D)</p> Signup and view all the answers

Which of the following describes the process of selection in the context of environmental change?

<p>Identifying features that provide competitive advantage. (D)</p> Signup and view all the answers

Which of these describes how organizations may retain advantageous features?

<p>By maintaining necessary organizational features. (A)</p> Signup and view all the answers

Which of the following is NOT an element that defines how organizations deliver value to customers?

<p>Market segmentation (A)</p> Signup and view all the answers

Flashcards

Profit

The financial gain from a business endeavor, exceeding its costs.

Corporate Social Responsibility (CSR)

A business approach that considers the impact of its actions on the environment, society, and its own stakeholders.

Mission

Fundamental principles guiding a company's actions and direction.

Vision

The desired future state and position of a company in the market.

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Competitive Advantage

Superior performance compared to competitors in the same industry.

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Greenwashing

Misrepresenting a company's environmental or social practices as more positive than true.

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Business Model

A plan for how a company creates, delivers, and captures value.

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Product Offering

The range of products and services a business provides.

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Coffee Industry Paradigm Shift

Change in the coffee industry, from a basic commodity to a specialty market.

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Value Chain

The series of activities involved in creating and delivering a product or service, from sourcing raw materials to selling to customers.

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Cost Leadership Strategy

A business strategy focused on offering products or services at the lowest cost in the industry while maintaining acceptable profit margins.

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Differentiation Strategy

A business strategy that seeks to provide unique products or services with features that stand out from the competition.

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Cost Leadership Key Elements

Scale-efficient production, simple designs, overhead control, process innovation, and outsourcing are essential for a cost leadership strategy.

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Differentiation Key Elements

Branding, design, service, quality, and product development are critical aspects in differentiation.

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Competitive Advantage

Any aspect of a business that allows it to perform better than its competitors, this can be achieved in many ways (price, features, quality and so on),

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Co-opetition

A strategy combining collaboration and competition among companies for mutual benefit.

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Analyze Alternatives

Assessing potential actions if collaboration is not fruitful, considering other options and competitors.

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Proprietary Information

Confidential information or "special sauce" that gives a company a competitive edge.

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Scope of Cooperation

The extent or limits of the collaboration agreement.

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Emotional Resistance

The reluctance to embrace collaboration, often due to feelings about competition or fear of losing control.

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European Carmaker Consolidation

Merging or combining European automobile companies to achieve economies of scale and compete globally.

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Synergy through Resource Alignment

Achieving efficiency by coordinating resources among different business units or companies, increasing the combined value.

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Synergy via Value Chain Integration

Increasing value by sharing value-adding activities or linking them across departments or companies.

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Opel-PSA Deal

GM selling Opel to PSA (now part of Stellantis), illustrating a strategy of exiting the European market.

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M&A in Auto Industry

Mergers and Acquisitions in the automobile sector, focused on consolidation or strategic investments in technologies.

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Technological Innovation in Auto

Shifting focus from manufacturing scale to technological innovations like batteries and autonomous driving.

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Importance of Scale in Auto Industry

While scale is important for investments, it's not a guarantee of success or profitability – effectiveness depends on strategy.

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Global Competition in Autos

The requirement for European car manufacturers to adapt and achieve economies of scale to compete with established US companies.

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Strategy Formation Activities

The structured steps taken to develop a plan of action for a business or organization, involving identifying problems, analyzing options, and implementing solutions.

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Formal Strategy Formation

A structured approach to strategy creation with defined processes, timings, roles, and responsibilities, ensuring clarity and reducing subjectivity.

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Informal Strategy Formation

A more flexible approach to strategy creation, with less structure, possibly leading to more subjectivity and quicker decisions.

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Causation Strategy

A linear strategy approach, focusing on leveraging existing competitive advantages to achieve desired outcomes.

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Effectuation Logic

A non-linear strategy approach, where strategic decisions are made based on available resources and their potential for achievement.

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Task Environment

The immediate environment surrounding an organization, consisting of competitors, suppliers, customers, and regulators.

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General Environment (Macroenviornment)

Broader forces impacting the organization, beyond its immediate environment, such as economic conditions, social trends, and political issues.

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Population Ecology Theory

A theory stating that organizations are often inert and changes occur at a population level, driven by environmental selection.

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Organizational Inertia

The resistance to change within an established organization.

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Areas of Change (Business Model)

Modifications in how an organization delivers value to customers, encompassing product offerings, activity systems, and resource base.

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Organizational Inertia Reasons

Causes of resistance to change include political, cultural, psychological resistance, and investment, competence, system, or shareholder lock-in.

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Ambidexterity

The ability to simultaneously exploit existing resources and explore new opportunities.

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Magnitude of Change

The amount of change experienced by an organization.

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Study Notes

Week 1 Lecture Notes

  • Strategy is a plan of action to achieve a long-term or overall aim.
  • Strategy is distinct from planning, as it has a clear logic behind it.
  • Key components of strategy include What, How, and Where.

Week 2 Pre-readings

  • Patagonia, a well-known outdoor clothing company, has transitioned its ownership to a trust and a non-profit organization.
  • The aim is to combat climate change and protect undeveloped land.
  • The company will continue to operate in the environmentally responsible way it has historically done.
  • The transition raises concerns that the lack of family financial stake might lead to losing focus on sustainability.

Week 3 Pre-readings

  • Starbucks' business model case study is provided
  • The coffee industry has evolved from simple commodity to a specialty, experiential market.
  • Key factors include consumer demand, ethical sourcing, and the embrace of digital innovation.
  • The company's product portfolio includes espresso beverages, seasonal items, and food items.

Week 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, assignments

  • Participation: 20%
  • Group Work: 40% (20% strategy simulation, 10% group reflection, 10% peer evaluation)
  • Weeks 6-9 are relevant to group evaluation
  • All the information is relevant to the subject matter being presented

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SIEN2210 Assignments and Lecture Notes PDF

Description

This quiz covers key concepts from the first three weeks of discussions on business strategy, sustainability, and industry evolution. It examines strategic planning distinctions, Patagonia's innovative ownership transition, and Starbucks' approach to the specialty coffee market. Test your understanding of these essential topics.

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