Business Level Strategy

In: Business and Management

Lecture Week 7!
Business Level Strategy!

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Learning Outcomes – Week 7!
Be able to! •  Identify Strategic Business units in Organisations! •  Explain the different bases of achieving competitive advantage! •  Explain the factors influencing the sustainability of competitive advantage! •  Explain the relationship between competition and collaboration !
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Strategic Choices !

Exhibit III.1!
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Business Level Strategy - Outline!
•  Strategic business units! •  Competitive advantage (strategy clock)!
–  Price-based! –  Differentiation! –  Hybrid and focus!

•  Sustainability of competitive advantage! •  Co-operation and competition! •  Game theory in competitive strategy!
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Business Level Strategies!

Exhibit 5.1!
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Strategic Business Units!
A strategic business unit is a part of an organisation! for which there is a distinct external market for
 goods or services that is different from another SBU!

•  Opposing pitfalls in identifying SBUs!
–  Too many different products/markets means lack of focus! –  Too few means not reflecting diversity of products/markets!

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Criteria for Identifying SBUs!
External! Same customer types! Same channels! Similar competitors! Internal! Similar products/ services! Similar technologies! Similar resources and competences!

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Bases of Competitive Advantage!
•  Competitive strategy!
–  The bases for achieving competitive advantage ! –  The bases for providing best value!

•  Porterʼs generic strategies!
–  Cost leadership! –  Differentiation ! –  Focus!

•  Bowman and DʼAveniʼs market facing strategies!
–  Provide customer needs better or more effectively than competitors! –  The strategy clock!
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The Strategy Clock!

Note: The strategy clock is adapted from the work of Cliff Bowman (see D. Faulkner and C. Bowman, The Essence of...

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