SI 422

Introduction to Strategy Porterian view What is strategy?  Operational effectiveness: refers to the extent to which a firm performs similar activities better than rivals  Strategy: refers to performing different activities from rivals or performing them in a different way o Choose the right configuration & make the right trade-offs o Rests on unique activities Who wins & why?  Porter believes that firms can achieve competitive advantage only if they have both operational effecti...

Module 1:What is Strategy? What is Strategy according to Porter and to Grant? ● Strategy is the creation of a unique and valuable position, involving a different set of activities. ○ Grant’s View: Strategy is not a detailed plan or program of instructions; it is a unifying theme that gives a coherence and direction to the actions and decisions of an individual or an organization.” ■ Designed to help the firm use its internal resources and characteristics to deal with its indust...

Lecture 1:  Focus on strategy rather than management or tactics  Lesson from Taxi/Coffee Case o No mater how “hard working” some employees are, they will find it hard to make profits because their industries are extremely competitive o Industry affiliation has a substantial impact on firm profitability  Supermarkets have historically low profits  Pharmaceutical companies have high profits  result of economies of those industries  Lesson from Soccer/Zappos Case o D...

Sessions: Session 1 - WHAT IS STRATEGY - Reading #1 -- ‘What is Strategy’ - Michael Porter Session 2 - WHAT IS STRATEGY? A HISTORICAL + CONCEPTUAL OVERVIEW - Reading #1 -- ‘Foundations of Strategy’ - Robert Grant + Judith Jordan Session 3 - THE ECONOMICS OF A LOW PROFIT INDUSTRY - Reading #1 -- ‘An economic analysis of a drug selling gang’s finances’ - Reading #2 -- ‘When cartels are cartels, public safety wins’ - Reading #3 -- ‘Why do drug dealers live with their mom...

Cases  Z o Culture and customer service make them different o Hard to imitate their culture and success o Shows impact of strategy on the FIRM level within a difficult competitive environment  Within a particular competitive environment or industry, strategy can affect a firm’s performance relative to its rivals  An effective strategy requires tradeoffs  Such as kinds Freiburg made  Is zappos doing enough to make itself truly different?  German Soccer o Formed a t...