SBM

• Vision


  What the organization would like to become
• Mission statement defines the fundamental, unique purpose that sets a company apart from other firms of its type and identifies the scope or domain of the company's operations in terms of products (including services) offered and markets served
• Mission statement may also include the firm's values and philosophy about how it does business and treats its employees
• Business strategy


  Focuses on improving the competitive position of a company's or business unit's products or services within the specific industry or market segment that the company or business unit serves
• Business unit effects have double the impact on overall company performance than do either corporate or industry effects
• Competitive strategy


  Focuses on whether to compete on the basis of lower cost (and thus price), or to differentiate products/services on some basis other than cost, such as quality or service
• Cost leadership strategy


  Lower-cost competitive strategy that aims at the broad mass market
• Differentiation strategy


  Ability of a company to provide unique and superior value to the buyer in terms of product quality, special features, or after-sale service
• Cost focus strategy


  Low-cost competitive strategy that focuses on a particular buyer group or geographic market
• Differentiation focus strategy


  Concentrates on differentiating in a targeted market segment
• Corporate strategy


  Primarily about the choice of direction for a firm as a whole and the management of its business or product portfolio

  
• Directional strategies


  • Growth
  • Stability
  • Retrenchment
• Vertical growth


  Taking over a function previously provided by a supplier or by a distributor
• Backward integration


  Assuming a function previously provided by a supplier
• Vertical integration continuum


  • Full integration
  • Taper integration
  • Quasi-integration
  • Long-term contracts
• International entry options for horizontal growth

  • Exporting
  • Licensing
  • Franchising
  • Joint ventures
  • Acquisitions
• Green-field development


  Building its own manufacturing plant and distribution system
• Production Sharing


  The process of combining the higher labor skills and technology available in developed countries with the lower-cost labor available in developing countries. Often called outsourcing.
• Turnkey Operations


  Contracts for the construction of operating facilities in exchange for a fee. The facilities are transferred to the host country or firm when they are complete.
• BOT (Build, Operate, Transfer) concept


  A variation of the turnkey operation where the company operates the facility for a fixed period of time during which it earns back its investment plus a profit.
• Management Contracts


  A large corporation uses some of its personnel to assist a firm in a host country for a specified fee and period of time.
• Concentric (Related) Diversification


  Growth through diversification into a related industry when a firm has a strong competitive position but industry attractiveness is low. The search is for synergy.
• Conglomerate (Unrelated) Diversification


  Diversifying into an industry unrelated to its current one when the current industry is unattractive and the firm lacks outstanding abilities or skills that it could easily transfer to related products or services.
• Pause/Proceed with Caution Strategy

  A timeout - an opportunity to rest before continuing a growth or retrenchment strategy. It is a very deliberate attempt to make only incremental improvements until a particular environmental situation changes.
• No-Change Strategy


  A decision to do nothing new - a choice to continue current operations and policies for the foreseeable future. It depends on a lack of significant change in a corporation's situation.
• Profit Strategy


  A decision to do nothing new in a worsening situation but instead to act as though the company's problems are only temporary by reducing investment and short term discretionary expenditures.
• Turnaround Strategy


  Emphasizes the improvement of operational efficiency. It has two phases: contraction (quickly "stop the bleeding" with a general, across-the board cutback) and consolidation (stabilize the now leaner corporation).
• Sell-Out/Divestment Strategy


  Selling the entire company or a division with low growth potential to another firm when a corporation with a weak competitive position is unable to pull itself up or find a customer to become a captive company.
• Bankruptcy/Liquidation Strategy


  When a company finds itself in the worst possible situation with a poor competitive position in an unattractive industry, it must pursue bankruptcy (giving up management to the courts) or liquidation (terminating the firm and converting assets to cash).
• BCG Growth-Share Matrix


  A portfolio analysis technique that plots each of a corporation's product lines or business units according to industry growth rate and relative market share.
• GE Business Screen


  A more complicated portfolio analysis matrix that includes nine cells based on long-term industry attractiveness and business strength competitive position.
• Corporate Parenting Strategy


  Views a corporation in terms of resources and capabilities that can be used to build business unit value as well as generate synergies across business units.
• Balanced Scorecard


  Combines financial measures with operational measures on customer satisfaction, internal processes, and the corporation's innovation and improvement activities to provide a more comprehensive view of performance.
• Balanced Scorecard Perspectives


  • Financial
  • Customer
  • Internal business
  • Innovation and learning