question
improving industry attractiveness
answer
reduce number of rivals
restricting entry
cooperation among rivals
restricting entry
cooperation among rivals
question
oligopoly
answer
a few large, influential rivals
high competitive interdependence
market power and complex pricing
high barriers to entry
both commodities and differentiated goods/services
high competitive interdependence
market power and complex pricing
high barriers to entry
both commodities and differentiated goods/services
question
economies of scale
answer
reduction of unit costs with quantity of output due to greater specialization of labor and management, greater bargaining power over suppliers, more efficient utilization of capital equipment, etc.
question
Rent Seeking
answer
incumbents seek to use the force of government to create a barrier to the entry of new firms, or to hobble new entrants before they can get established
question
the private trust or cartel
answer
a formal organization of sellers or buyers that agree to fix selling prices, purchase prices, reduce production, or exclude entry of a new competitor into their market
question
monopolistic trusts
answer
oligopolistic firms attempt to act like a "collective" pure monopoly, trusts involve small numbers of major players, mutually interdependent and prefer to avoid cutthroat rivalry, agree explicitly to refrain from competition
question
factors exacerbating cartel instability
answer
1. falling demand may create tension among market rivals
2. any entry into the oligopolistic industry puts downward pressure on price
3. disruptive technologies emerge to end cooperation
4. managers are paid for sustainable competitive
5. it's human nature to want to be number one
6. even rational people may face incentives to compete where cooperation would be more beneficial
2. any entry into the oligopolistic industry puts downward pressure on price
3. disruptive technologies emerge to end cooperation
4. managers are paid for sustainable competitive
5. it's human nature to want to be number one
6. even rational people may face incentives to compete where cooperation would be more beneficial
question
neoclassical school
answer
on oligopolistic rivalry: competition exists where there is a large number of buyers and sellers dealing in homogeneous goods and services and where entry and exit are easy and information flows freely
SCA = F(Position, Barriers to Entry)
SCA = F(Position, Barriers to Entry)
question
austrian school
answer
on oligopolistic rivalry: competition is a process by which two or more parties attempt to gain the more favorable terms
SCA = F(Core Competencies)
SCA = F(Core Competencies)
question
Austrian Rivalry Sisyphus problem
answer
firms competing in oligopolistic industries tend to experience times of above normal returns, and times of normal returns, or worse
like sisyphus, they roll their rock up the hill only to have it roll back down again and again
like sisyphus, they roll their rock up the hill only to have it roll back down again and again
question
The Waving Hand Equilibrium
answer
-top firms in oligopoly industries may continue to jockey for position through time
-the back-and-forth cycle of leadership and followership
-two firms in oligopolistic industry attempt over time to gain a competitive advantage over their rival
-neither firm is able to find a dominant strategy neither firm has unique, strategic resources to give them a sustainable competitive advantage
-the back-and-forth cycle of leadership and followership
-two firms in oligopolistic industry attempt over time to gain a competitive advantage over their rival
-neither firm is able to find a dominant strategy neither firm has unique, strategic resources to give them a sustainable competitive advantage
question
game theory
answer
the study of strategic or interactive decisions making which entails mathematical models of conflict and cooperation between intelligent rational decision-makes
question
dominant strategy
answer
in game theory, when one strategy is better than another strategy for one player, no matter how that player's opponents may play, that's the dominant strategy for that player
question
the resource-based view
answer
-internal focus on resources and capabilities rather than external focus on rivals
-sustainable competitive advantage derives from formulation and implementation of strategies supported by strategic resources and capabilities
-sustainable competitive advantage derives from formulation and implementation of strategies supported by strategic resources and capabilities
question
Value
answer
-in the VRIN/O framework, pertains to a resource or capability that enables the firm controlling it to implement a value-creating strategy to achieve a competitive advantage and above-normal returns
-value is a low bar for SCA: all existing firms have resources or capabilities that enable it to survive and, thus, have value
-value is a low bar for SCA: all existing firms have resources or capabilities that enable it to survive and, thus, have value
question
Rareness
answer
-resources that can only be acquired by one or very few companies are considered to be rare
-this characteristic of resources and capabilities impedes the ability of imitating firm to recognize, acknowledge, or respond to your resource-based success
-this characteristic of resources and capabilities impedes the ability of imitating firm to recognize, acknowledge, or respond to your resource-based success
question
differential scarcity and rents
answer
-assume resources are valuable but heterogeneous (research scientists)
-as demand rises, the valuable and differentially rare resources will become scarce
-now, less valuable resources will come online
-the rents earned by the superior resources are differential rents
-as demand rises, the valuable and differentially rare resources will become scarce
-now, less valuable resources will come online
-the rents earned by the superior resources are differential rents
question
product/service pioneers
answer
the first firm to develop a working model or sample in a new product category. what is rare is the ability and willingness to invest the time and capital and bear the risks of entrepreneurial discovery
question
market pioneers
answer
the first firm to sell goods and services in a new market setting. what is rare is the willingness to enter a new market, deal with language and culture difficulties, and the risks of exchange rate fluctuations
question
inimitability
answer
resources and capabilities that prevent potential new entrants form recognizing, acknowledging, or responding to your competitive advantage and success in real time
question
paths to inimitability
answer
-values, attitudes and beliefs
-historical conditions
-causal ambiguity
-social complexity
-historical conditions
-causal ambiguity
-social complexity
question
values, attitudes and beliefs
answer
psychological resources and capabilities possessed by key employees that others are unwilling or unable to adopt
question
historical conditions
answer
resources that were developed due to historical events or over a long period of time are usually costly to imitate
question
causal ambiguity
answer
companies can't identify the particular resources that are the cause of competitive advantage
question
social complexity
answer
the resources and capabilities that are based on company's culture or interpersonal relationships
question
distinctive, difficult to hold to values, attitudes, and beliefs
answer
the ability and willingness to do valuable things that others are unable and/or unwilling to do may be valuable, rare and inimitable, and a source of SCA
question
time on sustainable competitive advantage
answer
competitive advantage is most likely to result from the development and use of resources and capabilities that have been built up through on ongoing process of accumulation over historical time
question
entropy and on-going investment
answer
-human organizations have a tendency to run down over time
-their resources and capabilities can lose their original effect on sustainable competitive advantage
-they experience what physicists have identified in nature as entropy: lack of order or predictability; gradual decline into disorder
-their resources and capabilities can lose their original effect on sustainable competitive advantage
-they experience what physicists have identified in nature as entropy: lack of order or predictability; gradual decline into disorder
question
investment delays entropy
answer
-if your goal is just to maintain your business, you are actually liquidating it
-to avoid organizational entropy, there must be a continuing effort for improvement to even maintain the status quo ante
-to avoid organizational entropy, there must be a continuing effort for improvement to even maintain the status quo ante
question
causal ambiguity
answer
exists when a potential imitating firm does not and cannot understand how the resources or capabilities of an innovative firm help it achieve its competitive advantage in real time
question
factors contributing to ambiguity
answer
-taken-for-granted resources or capabilities
-complex sets of inter-related capabilities
-multiple non-testable hypotheses about why the firm has been success
-complex sets of inter-related capabilities
-multiple non-testable hypotheses about why the firm has been success
question
taken for granted resources and capabilities
answer
-resources and capabilities are often complex and interdependent. they can be implicit and take for granted by the firm's managers
-as such, there is no way to test any given resource to determine its effect on the firm's performance
-Ristorante Babbo, Koch Industries and Rational Combi Steamer Oven Co. provide three examples
-as such, there is no way to test any given resource to determine its effect on the firm's performance
-Ristorante Babbo, Koch Industries and Rational Combi Steamer Oven Co. provide three examples
question
unambiguous social complexity
answer
-socially complex systems are comprised of many elements that must be coordinated by management and/or which require spontaneous cooperation to produce sustainable competitive advantage
-imitating firms will eventually recognize, acknowledge, and respond to these resources and capabilities, but not in real time
-imitating firms will eventually recognize, acknowledge, and respond to these resources and capabilities, but not in real time
question
team production is socially complex
answer
-interdependencies among associates increase advantage beyond the sum of the parts (synergy)
-luck or foresight may endow firms with unique team production capabilities
-rivals may be unable to pinpoint source of advantage and unable to capture equivalent value
-luck or foresight may endow firms with unique team production capabilities
-rivals may be unable to pinpoint source of advantage and unable to capture equivalent value
question
strategic substitutes
answer
resources or capabilities that serve to neutralize a competitors previously effective barrier to imitation
question
distinctive values, attitudes, and beliefs
answer
the ability and willingness to do valuable things that others are unable and/or unwilling to do may be valuable, rare and inimitable, and a source of SCA
question
entropy
answer
lack of order or predictability; gradual decline into disorder
question
on-going investment
answer
-human organizations have a tendency to run down over time
-their resources and capabilities can lose their original effect on sustainable competitive advantage
-they experience what physicists have identified in nature as entropy
-their resources and capabilities can lose their original effect on sustainable competitive advantage
-they experience what physicists have identified in nature as entropy
question
Non-Substitution
answer
-resources or capabilities that serve to neutralize a rival's previously effective barrier to imitation
-substitutes allow customers to choose between the offerings of close rivals. sustainable competitive advantage depends on the absence of such substitutes
-substitutes allow customers to choose between the offerings of close rivals. sustainable competitive advantage depends on the absence of such substitutes
question
war made new takeaways
answer
-technology is tangible and tradable, can be imitated and is not a source of sustainable competitive advantage
-the ability to innovate is a source of temporary competitive advantage, but not sustainable competitive without effective organization
-sustainable competitive advantage requires core competencies and the proper organizational design to leverage those resources and capabilities
-in the information age, the key is to create decentralized organizations to delegate authority to the lowest level possible
-the ability to innovate is a source of temporary competitive advantage, but not sustainable competitive without effective organization
-sustainable competitive advantage requires core competencies and the proper organizational design to leverage those resources and capabilities
-in the information age, the key is to create decentralized organizations to delegate authority to the lowest level possible
question
organization
answer
-the elements of the value chain, management systems, processes, policies, organizational architecture that allows the firm's core competencies to be a source of sustainable competitive advantage
question
rules of the game
answer
the set of explicit and implicit expectations of behavior within the firm which shapes employee expectations
question
21st century management challenge
answer
design institutions and organizational architectures that maximize the likelihood that local decision makers have both the relevant information to make good decisions, and the incentives to use that information productively
question
21st century management response
answer
-judicious delegation of decision rights to those with tacit knowledge
-accurate measurement and evaluation of individual and unit contribution to the firm's success
-allocation of rewards based on assessment of both subjective and objective measures of performance
-decision rights
-performance measurement and evaluation process
-reward system
-accurate measurement and evaluation of individual and unit contribution to the firm's success
-allocation of rewards based on assessment of both subjective and objective measures of performance
-decision rights
-performance measurement and evaluation process
-reward system
question
the market system
answer
open markets are best viewed as experimental discovery processes that continuously track changing customers needs and changes in the availability and costs of resources required to meet those needs
question
private property right
answer
-a legally enforced right to select how an economic good is to be used.
-it includes the right to exclude non-owners or non-payers
-assigned to a specific entity
-alienable in that they can be transferred to another individual within limits
-individuals have use rights within limits
-it includes the right to exclude non-owners or non-payers
-assigned to a specific entity
-alienable in that they can be transferred to another individual within limits
-individuals have use rights within limits
question
market architecture controls
answer
-if managers fail to efficiently produce what consumers in their market desire, they suffer losses and are finally eliminated from their managerial positions
-other people who know better how to serve the consumers tend to replace them and takeover their property rights
-other people who know better how to serve the consumers tend to replace them and takeover their property rights
question
benefits of decentralization
answer
-effective use of local knowledge
*local tastes and preferences
*price sensitivities of particular customers
-conservation of management time
*senior management focus on strategy
-training opportunities for lower-level managers
-increased response time to local threat and opportunities
*local tastes and preferences
*price sensitivities of particular customers
-conservation of management time
*senior management focus on strategy
-training opportunities for lower-level managers
-increased response time to local threat and opportunities
question
costs and risks of deventralization
answer
-potential agency problems
*effective control systems may be expensive
-coordination costs and failures
*duplication may occur in market analysis
-less effective use of central information
-costs of training and monitoring
*effective control systems may be expensive
-coordination costs and failures
*duplication may occur in market analysis
-less effective use of central information
-costs of training and monitoring
question
subsidiarity
answer
-in latin derived from the latin word subsidiarius and has its origins in catholic social teaching
-idea that a central authority should be performing only those tasks which cannot be performed effectively at a more immediate or local level
-idea that a central authority should be performing only those tasks which cannot be performed effectively at a more immediate or local level
question
control system
answer
-effective executives take care to ensure that decision makers have relevant skills and information to make good decisions
-craft the appropriate control systems and incentives to motivate associates to use their information productively
-executives delegate authority based on the contingencies of any given situation
-craft the appropriate control systems and incentives to motivate associates to use their information productively
-executives delegate authority based on the contingencies of any given situation
question
decision management
answer
-employee initiative (seek charter)
-employee implementation (fulfill charter)
-employee implementation (fulfill charter)
question
decision control
answer
-management ratification (grant charter)
-management monitoring (complete charter)
-management monitoring (complete charter)
question
the genius of chartering
answer
-promotes formulation of well-understood, well-defined objectives before work begins
-forces clarification of vague or poorly defined initiatives early on
-breaks down problems/projects too large or costly for any given team
-combines market-based decision rights with management oversight
-forces clarification of vague or poorly defined initiatives early on
-breaks down problems/projects too large or costly for any given team
-combines market-based decision rights with management oversight
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
