In this chapter students will be able to: Define strategy, explain why the goal of strategy is to attain superior performance, describe what is meant by competitive advantage, explain how business-level strategy can lead to competitive advantage, explain how operations strategy can lead to competitive advantage, explain how corporate-level strategy can lead to competitive advantage. | chapter 6 Strategy McGraw-Hill/Irwin Principles of Management © 2008 The McGraw-Hill Companies, Inc., All Rights Reserved. Learning Objectives Define strategy. Explain why the goal of strategy is to attain superior performance. Describe what is meant by competitive advantage. Explain how business-level strategy can lead to competitive advantage. Explain how operations strategy can lead to competitive advantage. Explain how corporate-level strategy can lead to competitive advantage. See Text Page: 132 Strategy An action managers take to attain a goal of an organization. Learning Objective 1: Define strategy. See Text Page: 134 Superior Performance Superior performance requires High profitability Growth in profits over time Learning Objective 2: Explain why the goal of strategy is to attain superior performance. See Text Page: 135 Wal-Mart First year of operation – 1962 – Rogers, Arkansas 1960s – 15 Wal-Mart stores 1979-80 – 276 stores with $1 billion in sales 1989 – 1,400 stores . | chapter 6 Strategy McGraw-Hill/Irwin Principles of Management © 2008 The McGraw-Hill Companies, Inc., All Rights Reserved. Learning Objectives Define strategy. Explain why the goal of strategy is to attain superior performance. Describe what is meant by competitive advantage. Explain how business-level strategy can lead to competitive advantage. Explain how operations strategy can lead to competitive advantage. Explain how corporate-level strategy can lead to competitive advantage. See Text Page: 132 Strategy An action managers take to attain a goal of an organization. Learning Objective 1: Define strategy. See Text Page: 134 Superior Performance Superior performance requires High profitability Growth in profits over time Learning Objective 2: Explain why the goal of strategy is to attain superior performance. See Text Page: 135 Wal-Mart First year of operation – 1962 – Rogers, Arkansas 1960s – 15 Wal-Mart stores 1979-80 – 276 stores with $1 billion in sales 1989 – 1,400 stores with $26 billion in sales 1983 – SAM’s Club 1988 – Supercenters Today -- More than million associates worldwide, nearly 6,500 stores and wholesale clubs across 15 countries, and over $312 billion in sales. Source: Learning Objective 2: Explain why the goal of strategy is to attain superior performance. Wal-Mart This slide presents the Wal-Mart’s growth story. Ask the students – What would they attribute Wal-Mart’s success to? (Superior performance driven by low prices, growth, and profitability.) Ask the students – how does shopping at Wal-Mart compare to other stores such as K-Mart or Target? What would be the competitive advantage of each of these stores? Competitive Advantage Competitive advantage: Advantage obtained when a firm outperforms its rivals. Distinctive competency: A unique strength that rivals lack. Sustainable competitive advantage: A distinctive competency that rivals cannot easily match or imitate. Barrier to imitation: Factors that make it difficult
