D uses quantitative measures of industry attractiveness and competitive strength to plot each business's location on the matrix—the thesis underlying the matrix is that there are good reasons to concentrate the company's resources on those businesses having relatively strong competitive positions in industries with relatively high attractiveness and to invest minimally or even divest those businesses with relatively weak competitive positions in industries with relatively low attractiveness. It forces you to consider every aspect of a process in the context of how it serves the customer, which could be a consumer or another business. Lastly, businesses should identify differentiation that can be maintained and adds the most value. Diversification merits strong consideration whenever a single-business company A has integrated backward and forward as far as it can. E generally offers more competitive advantage potential than related diversification. The questions I asked professor Bayless were: do you value a University education, why did you decide to become a biology professor, how long have you been at Washburn and what made you want to come here, do you believe students should get involved in campus activities and clubs, do you think living on campus your first year is beneficial, and what do you think is important to help make you successful in college? The best combination of them should be used to pursue sustainable differentiation advantage.
C provide a basis for drawing analysis-based conclusions about the attractiveness of the industries a company has diversified into, both individually and as a group, and further to provide an indication of which industries offer the best and worst long-term prospects. B When a company is only earning a low profit margin in its principal business C When a company has a powerful and well-known brand name that can be transferred to the products of other businesses and thereby used as a lever for driving up the sales and profits of such businesses. C ranking the performance prospects of the various businesses from best to worst and determining the priorities for resource allocation. C rank the each business unit's strategic fits from highest to lowest. B capitalize on opportunities for both cross-business and cross-country collaboration and coordination. The idea is that by adding value efficiently and affordably throughout the value chain, you can increase your ability to earn profit as a result of your business operations. The firm that competes through differentiation advantage will try to perform its activities better than competitors would do.
The task of crafting corporate strategy for a diversified company encompasses A picking the new industries to enter and deciding on the means of entry. The majors generally preferred to compare themselves only with other majors; they saw no reason to compare their integrated downstream structure with that of a distributor. Use a value chain example to improve your business and to build a value chain model. E All of the above. E Related diversification is typically more profitable than unrelated diversification, which is a major factor in helping related diversification pass the attractiveness test.
End Goal The ultimate purpose of the value chain is the same as the general objective of a for profit business, to make money. E All of the above. C the potential for improving the stability of the company's financial performance. While the development of a deep spot market for gasoline at major trading centers was important, by no means was it the only decoupling of the downstream value chain. D Determining whether the company has enough cash hog businesses to supply capital to its cash cow businesses. You can use it to your advantage as well. The remainder of this article focuses on the downstream, the restructuring of which was, as discussed in the example on the paper industry, largely caused by an event elsewhere in the value chain.
Scholarly references word counts no more one page. E the shareholder value test, the cost-of-entry test, and the profitability test. B diversify into those industries where the same kinds of driving forces and competitive forces prevail, thus allowing use of much the same competitive strategy in all of the business a company is in. The industry wide synchronized interactions of those local value chains create an extended value chain, sometimes global in extent. A Strategic fit between two businesses exists when the management know-how accumulated in one business is transferable to the other. By the late 1980's and early 1990's, however, the U.
C opportunities to leverage existing competencies and capabilities by expanding into businesses where these same resource strengths are key success factors and valuable competitive assets attractive. The company has strategically created segments that would complement their efforts to reduce costs through efficient value supplier chain that is interconnected with each segment of the incorporation… 882 Words 4 Pages Module 3 Case Study What do you see as the root or underlying cause that accounts for the citizen participation component not being a success? D whether to build shareholder value via paying higher dividends or via actions aimed at increasing the company's stock price. C revamping the strategies of its different businesses, especially those that are performing poorly. B indicates which businesses are cash hogs and which are cash cows. The integrated majors reacted to this restructuring at different rates, but most have now made strides to decouple their operations.
C stem from cost-saving strategic fits along the value chains of related multiple businesses. C consider the appeal of the whole group of industries in which the company has invested. Only by understanding what factors drive the costs, managers can focus on improving them. And, as noted previously, the majors have consistently reduced their direct ownership in the retailing business. Attractiveness: media networks, park and resorts, studio entertainment, interactive media, consumer products. Starbucks coffee shops are in over 21,000 stores worldwide. B insufficient cash flows to finance so many different lines of business and a lack of uniformity among the strategies of the businesses it has diversified into.
Cambridge University: Institute for Manufacturing IfM. About the Author Tom Gresham is a freelance writer and public relations specialist who has been writing professionally since 1999. D forming a strategic alliance with another company to enter the target industry. NationsBank has divested origination and servicing operations while Fleet is expanding there. Value chain represents all the internal activities a firm engages in to produce goods and services.
G20 Trade and Investment Promotion Summit. This reputation is built on premium quality beans and service. For companies that produce goods, the value chain starts with the raw materials used to make their products, and consists of everything added before the product is sold to consumers. D its ability to pinpoint what kind of competitive advantage or disadvantage each business has. Secondary activities include Procurement, Human Resource management, Technological Development and Infrastructure , pp.
As a result, downstream returns for the U. A It can offer opportunities for transferring expertise, technology, and other capabilities from one business to another. B calculate industry attractiveness scores for each industry into which the company has diversified. After all, how many children really know what they want to do with the rest of their lives? Children have… 1235 Words 5 Pages meals through innovation and by providing the consumers with what they want. D determining whether the cost to enter the target industry will raise or lower the company's total profits. What is a value chain? E Strategic fit exists when a company can transfer its brand name reputation to the products of a newly acquired business and add to the competitive power of the new business. C the industry is growing slowly and adding too much capacity too soon could create oversupply conditions.