Chapter 6 - Strengthening a company’s competitive position: Strategic moves, timing, and scope of operations. After studying this chapter, you should be able to: Learn whether and when to pursue offensive or defensive strategic moves to improve a company's market position, recognize when being a first mover or a fast follower or a late mover is most advantageous, become aware of the strategic benefits and risks of expanding a company's horizontal scope through mergers and acquisitions,. | Student Version 1 Choosing Strategy Actions that Complement a Firm’s Competitive Approach Decisions regarding the firm’s operating scope and how to best strengthen its market standing must be made: Whether and when to go on the offensive and initiate aggressive strategic moves to improve the firm’s market position. Whether and when to employ defensive strategies to protect the firm’s market position. When to undertake strategic moves based upon whether it is advantageous to be a first mover or a fast follower or a late mover. 2 Choosing Strategy Actions that Complement a Firm’s Competitive Approach (cont’d) Decisions regarding the firm’s operating scope and how to best strengthen its market standing must be made: Whether to integrate backward or forward into more stages of the industry value chain. Which value chain activities, if any, should be outsourced. Whether to enter into strategic alliances or partnership arrangements with other enterprises. Whether to bolster the firm’s market position by merging with or acquiring another company in the same industry. Launching Strategic Offensives to Improve a Company’s Market Position Aggressive strategic offensives are called for when a firm: Spots opportunities to gain profitable market share at the expense of rivals Has no choice but to try to whittle away at a strong rival’s competitive advantage Can reap benefits of a competitive edge offers—a leading market share, excellent profit margins, and rapid growth. The best offensives use a firm’s resource strengths to attack its rivals’ weaknesses. Choosing the Basis for Competitive Attack Principal Offensive Strategy Options Adopt and improving on good ideas of other firms Attack profitable market segments of key rivals Capture unoccupied or less contested markets Attack the competitive weaknesses of rivals Offer an equal or better product at a lower price Pursue continuous product innovation Leapfrog competitors to be the first to market Use hit-and-run or . | Student Version 1 Choosing Strategy Actions that Complement a Firm’s Competitive Approach Decisions regarding the firm’s operating scope and how to best strengthen its market standing must be made: Whether and when to go on the offensive and initiate aggressive strategic moves to improve the firm’s market position. Whether and when to employ defensive strategies to protect the firm’s market position. When to undertake strategic moves based upon whether it is advantageous to be a first mover or a fast follower or a late mover. 2 Choosing Strategy Actions that Complement a Firm’s Competitive Approach (cont’d) Decisions regarding the firm’s operating scope and how to best strengthen its market standing must be made: Whether to integrate backward or forward into more stages of the industry value chain. Which value chain activities, if any, should be outsourced. Whether to enter into strategic alliances or partnership arrangements with other enterprises. Whether to bolster the firm’s .
