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COLLEGE NOTES BMO21306 (EVERYTHING YOU NEED TO KNOW)
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Advanced Management & MarketingLecture 1 Introducing Strategy
Good strategy: compromise, competitive success vs corporate strategy
Strategy decisions are likely to be complex, uncertain, affect daily decisions, integrated
approach, considerable change
Strategy: long term direction of the organization
Three horizons for strategy: 1. Extend and defend core business (short) 2. Build emerging
businesses (mid) 3. Create viable options (long)
Strategy is to define & express the motivating purpose of an organization to stakeholders
Motivating purpose: mission statement (why is the company existing) + vision statement
(what do you want to achieve in future) + statements of corporate values (principles, do not
change) + statement of objectives (outcomes that are to be achieved)
Goals (vision, mission, objectives) + scope (domain of the organization’s activities -> who,
where, how much ourselves) + advantage (competitive advantage)
Levels of strategy: corporate level (overall scope of an organization + how value is added to
business units) + business-level (competitive strategy, particular market) + functional
strategy (managing resources, processes, and people)
Exploring strategy: strategic position (environment + stakeholder + capability) + strategic
choices (directions and methods) + strategy in action (put into practice, leadership etc.)
Lecture 2 Marketing 1
Strategic marketing -> choose the value
Tactical marketing -> provide the value + communicate the value
Differentiation: creating differences between focal offering and its main competitors
Positioning: differentiating in the minds of target customers
Levels of competition: product form (brand is better than other) + product category
(product form is best in category) + generic (satisfy needs the best) + budget (most
appropriate way to spend money)
Brand switching analysis -> switching matrix (from current to future)
Standardized residual: (O-E)/ squared root E
Standardized residual > 1.96 in absolute value is significant. Positive = loyal customers
Lecture 4 The Business Environment & Industry and sector analysis
Societal influences macro -> PESTEL: Political Economic Social Technological
Ecological/Environmental Legal -> future impact + different impact
Political factors: role of state, exposure to civil society organizations, governmental political
development
Economic factors: business cycles, interest rates, personal disposable income, exchange
rates. Vulnerable to economic cycles -> discretionary spend industries (about savings ->
housing, cars) + high fixed cost industries (airlines + hotels sector)
Social factors: demographics, wealth distribution, geography, culture, social networks
Technological factors: new discoveries and technology developments
Legal factors: labor & consumer regulations, taxation & reporting requirements, rules on
ownership, foreign trade regulations, competition regulations
, Forecasting in conditions of uncertainty: PESTEL factors help, accurate forecasting is very
difficult -> single-point forecast (one outcome) + range forecast (likeliness of certain
outcomes) + alternative futures (multiple exclusive outcomes)
Scenario process: define scope -> identify key drivers (PESTEL factors)-> develop instinct
scenario stories (plausible, alternative views of future) -> identify impacts -> monitor
progress
An industry is a group of firms producing products and services that are essentially the same
(supply side, automobiles, or airlines)
A market is a group of customers for specific products or services that are essentially the
same (demand side, market for luxury cars in Germany)
Industry analysis: define industry -> identify actors of each of the five forces -> determine
underlying factors -> asses overall industry structure & attractiveness -> determine how to
position
Porter’s 5-forces frameworks: threat of entry + threat of substitutes + bargaining power of
buyers + bargaining power of suppliers + extent of rivalry between competitions
5 forces are high -> less attractive for lacking profit potential
Bargaining power of buyers high: buyers are concentrated, have low switching costs, can
supply their own inputs, lower buyer profits & low impact on their quality
Bargaining power of suppliers high: suppliers are concentrated, switching costs are high for
focal firm, suppliers can integrate forward, provide a specialist or rare input
Backed integration: replacing the supplier by doing it on your own
Threat of substitutes: similar benefit but have a different nature from outside the industry.
High when price/performance ratio is better, substitute benefits from an innovation, extra-
industry effects
Threat of entry: factors that need to be overcome by new entrants if they are to compete ->
economies of scale, access to supply channels, differentiation, government restrictions
Threat of potential entrants (low) is inverse to barriers against entrants (high)
Rivalry between existing competition: similar products, same customer, same
industry/market -> depends on competitor concentration & balance, industry growth rate
Product life cycle: introduction (low sales, high costs) -> growth (increasing sales, reducing
costs) -> maturity (constant sales, reducing costs) -> decline (reducing sales, constant costs)
Company life cycle: concept creation -> concept development -> market development ->
business optimization -> re-inventing business / harvesting
Industry life cycle: development (low rivalry) -> growth (low rivalry) -> shake out (increasing
rivalry) -> maturing (strong buyers) -> decline (extreme rivalry)
Technology/marketing adoption cycle: innovators -> early adopters (chasm in between) ->
early majority -> late majority -> laggards
Strategic groups: organization within an industry with similar strategic characteristics,
following similar strategies of competing on similar bases (you want to know everything of
them)
Understanding competition (rather than whole industry) -> analyze strategic opportunities
(strategic spaces) -> analysis of mobility barriers (can be overcome or can be build)
Lecture 5 Marketing 2
Market segmentation: the subdividing of a market into distinct subsets of customers
Segments: members are different between segments but similar within
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