Key Terms (listed in order of appearance) environmental scanning 31 natural environment 31 societal environment 31 task environment 31 industry analysis 31 STEEP analysis 32 multinational corporation (MNC) 34 issues priority matrix 36 industry 37 new entrants 38 entry barrier 38 rivalry 38 substitute products 39 bargaining power of buyers 39 bargaining power of suppliers 40 relative power of other stakeholders 40 fragmented industry 41 consolidated industry 41 multidomestic industry 41 global industry 42 strategic group 42 strategic type 43 hypercompetition 44 key success factors 45 industry matrix 45 competitive intelligence 46 extrapolation 47 scenarios 48 EFAS Table 48 Notes 1. C. Edwards and P. Burrows, “Intel Tries to Invest Its Way Out of a Rut,” Business Week (April 27, 2009), pp. 44–46. 2. W. E. Stead and J. G. Stead, Sustainable Strategic Management (Armonk, N.Y.: M.E. Sharp, 2004), p. 6. 3. J. Wyatt, “Playing the Woofie Card,” Fortune (February 6, 1995), pp. 130–132. 4. M. E. Porter, Competitive Strategy (New York: The Free Press, 1980), p. 3. 5. This summary of the forces driving competitive strategy is taken from Porter, Competitive Strategy, pp. 7–29. 6. Ibid., p. 23. 7. M. E. Porter, “Changing Patterns of International Competition,” California Management Review (Winter 1986), pp. 9–40. 8. K. J. Hatten and M. L. Hatten, “Strategic Groups, Asymmetrical Mobility Barriers, and Contestability,” Strategic Management Journal (July–August 1987), p. 329. 9. R. E. Miles and C. C. Snow, Organizational Strategy, Structure, and Process (New York: McGraw-Hill, 1978). 10. R. A. D’Aveni, Hypercompetition (New York: The Free Press, 1994), pp. xii-xiv. 11. E. Von Hipple, Sources of Innovation (New York: Oxford University Press, 1988), p. 4. 12. “Competitive Intelligence Spending ‘to Rise Tenfold’ in 5 Years,” Daily Research News (June 19, 2007). 13. E. Iwata, “More U.S. Trade Secrets Walk Out Door with Foreign Spies,” USA Today (February 13, 2003), pp. B1, B2. 14. This process of scenario development is adapted from M. E. Porter, Competitive Advantage (New York: The Free Press, 1985), pp. 448–470. [...]... customized batches Economies of scope (in which the manufacturing activities of the common parts of various products are combined to gain economies even though small numbers of each product are made) replace economies of scale (in which unit costs are reduced by making large numbers of the same product) in flexible manufacturing Flexible manufacturing permits the low-volume output of custom-tailored products... score for an average firm in an industry is always 3.0 As an example of this procedure, Table 4.2 includes a number of internal factors for Maytag Corporation as of 1995 with corresponding weights, ratings, and weighted scores provided Discussion Questions 1 What is the relevance of the resource-based view of a firm to strategic management in a global environment? 2 How can value-chain analysis help... low-volume output of custom-tailored products at relatively low unit costs through economies of scope It is thus possible to have the cost advantages of continuous systems with the customer-oriented advantages of intermittent systems What are the Strategic Human Resource Issues? The primary task of the manager of human resources is to improve the match between individuals and jobs A good HRM department... task of the manager of information technology is to design and manage the flow of information in an organization in ways that improve productivity and decision making Information must be collected, stored, and synthesized in such a manner that it can answer important operating and strategic questions A corporation’s information technology can be a strength or a weakness in all three elements of strategic. .. factor’s probable impact on a particular company’s current strategic position The higher the weight, the more important this factor is to the current and future success of the company (All weights must sum to 1.0 regardless of the number of strategic factors.) • In Column 3 (Rating), assign a rating to each factor from 5 (Outstanding) to 1 (Poor) based on management s current response to that particular factor... be more expensive to develop, it offers performance improvements in areas that are attractive to this small niche, but of no consequence to the customers of the established competitors.9 What are the Strategic Operations Issues? The primary task of the operations (manufacturing or service) manager is to develop and operate a system that will produce the required number of products or services, with a... the Concept of Virtuality: The Effects of Geographic Dispersion, Electronic Dependence, Dynamic Structure, and National Diversity on Team Innovation,” Administrative Science Quarterly (September 2006), pp 451–495 11 O C Richard, B P S Murthi, and K Ismail, “The Impact of Racial Diversity on Intermediate and Long-Term Performance: The Moderating Role of Environmental Context,” Strategic Management Journal... airframe industry or 70% for integrated circuits) is risky The experience curve of the industry as a whole might not hold true for a particular company for a variety of reasons WHAT IS FLEXIBLE MANUFACTURING? The use of large mass-production facilities to take advantage of experience-curve economies has been criticized The use of computer-assisted design and computerassisted manufacturing (CAD/CAM) and... increasingly willing to support new strategic initiatives and employee involvement programs Outside the United States, however, the average proportion of unionized workers among major industrialized nations is around 50 percent A significant issue for unions is the increasing use of temporary workers, often part-time employees who earn low wages and few benefits Over 90 percent of U.S and European firms use... build capacity ahead of demand in order to achieve the lower unit costs that develop from the experience curve On the basis of some future point on the experience curve, the product or service should be priced very low to preempt competition and increase market demand The resulting high number of units sold and high market share should result in high profits, based on the low unit costs Management commonly . power of other stakeholders 40 fragmented industry 41 consolidated industry 41 multidomestic industry 41 global industry 42 strategic group 42 strategic type 43 hypercompetition 44 . factors 45 industry matrix 45 competitive intelligence 46 extrapolation 47 scenarios 48 EFAS Table 48 Notes 1. C. Edwards and P. Burrows, “Intel Tries to Invest Its Way Out of a Rut,”. Week (April 27, 2009), pp. 44 46 . 2. W. E. Stead and J. G. Stead, Sustainable Strategic Management (Armonk, N.Y.: M.E. Sharp, 20 04) , p. 6. 3. J. Wyatt, “Playing the Woofie Card,” Fortune (February