Chapter 1: What Is Strategy? PDF
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Oregon State University
Sam Yul Cho
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Summary
This chapter introduces the concept of strategy and competitive advantage. It outlines the key elements of a good strategy, including a critical diagnosis of the competitive challenge and an effective guiding policy, along with the implementation of coherent actions. The document also discusses benchmarking for assessing competitive advantage, and provides a framework for analyzing, formulating, and implementing strategy.
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CHAPTER 1 What Is Strategy? Professor Sam Yul Cho, PhD LEARNING OBJECTIVES Define strategy and competitive advantage. DQ Strategy A set of goal-directed actions a firm takes to gain and sustain superior performance relative to compe...
CHAPTER 1 What Is Strategy? Professor Sam Yul Cho, PhD LEARNING OBJECTIVES Define strategy and competitive advantage. DQ Strategy A set of goal-directed actions a firm takes to gain and sustain superior performance relative to competitors. To achieve superior performance, companies compete for resources: Tesla, a new entrant in the automotive industry, is competing for customers with established U.S. companies and also with foreign automakers. A Good Strategy Is Based on Three Elements A critical diagnosis of the competitive challenge. The firm needs to critically analyze its internal and external environments. An effective guiding policy to address the competitive challenge. The firm needs to formulate an effective guiding policy (e.g., corporate, business and functional strategy). A set of coherent actions to implement the firm’s guiding policy. The firm needs to implement a set of coherent actions. DQ Competitive Advantage A firm achieves superior performance relative to other competitors in the same industry or the industry average. Competitive advantage is relative, not absolute. Benchmark to assess competitive advantage Compare the firm to competitors in the same industry. Compare the firm to the industry average. The Analysis Formulation Implementation Strategy Framework Exhibit 1.4 LEARNING OBJECTIVES Define strategy and competitive advantage. Thank You
