Read the summary and the most important questions on Strategic Management | 1259913747 | Frank T. Rothaermel

• 1 What is Strategy?

  This is a preview. There are 1 more flashcards available for chapter 1
  Show more cards here

• 1.1 What Strategy Is: Gaining and Sustaining Competitive Advantage

  This is a preview. There are 7 more flashcards available for chapter 1.1
  Show more cards here

• What do companies do to achieve superior performance? (+Example)

  By competing for resources
  
  Example: universities compete for the best students

• What is a Good Strategy?

  1) Diagnosis of the competitive challenge. (A)
  2) Guiding Policy to address the competitive challenge.  (F) 
  3) Set of coherent actions to implement the firm's guiding policy. (I)

• What is a Competitive Disadvantage?

  A firm that underperforms its rivals or the industry average.

• What is a Competitive Parity?

  Two or more firms performing at the same level.
  
  It refers to the optimal expenditure needed on branding and advertising activities to stay on par with the competitors of a particular brand, product or company as a whole.

• What can be a reward of creating superior value?

  - Profitability
  - Market Share

• What is Strategic Positioning?

  Creating superior value while controlling the cost to create it.
  
  When firms are able to stake out a unique position within an industry that allows the firm to provide value to customers, while controlling costs.

• What are Industry Effects?

  They describe the underlying economic structure of the industry. The structure of an industry is determined by common elements of all industries. 
  
  Examples: barriers to entry/exit, size of firms, types of products offered
  
  (Only determines around 20% of firm performance)

• What are Firm Effects?

  The result of actions taken by managers to influence firm performance.
  
  (Very important, determines 55%  of performance)

• What Strengthens a Unique Strategic Position?

  - Marketing skills
  - Operational effectiveness
  - Other functional expertise

• 1.2 Stakeholders and Competitive Advantage

  This is a preview. There are 24 more flashcards available for chapter 1.2
  Show more cards here

• What is Value Creation?

  
  When firms are able to provide products and services at an affordable price point while making profit at the same time and both parties benefit from trading as they both capture a part of the value created.
  
  
  Affordable Price Point + Profit
  BOTH parties benefit