Strategy- The Logic of Superior Performance- Presentation | Competition | Business Model

A presentation based on the Book “what management is” by Joan Magretta.

Rupesh Kumar
EPGDBM-4 NMIMS, Bangaluru

1) What Business Strategy is
Strategy and Competition The rise of Wall mart- What was the Strategy

2) The Aim of Business Strategy
3) How to make strategy 4) Thinking strategically- The Game Theory 5) Staying power of a Strategy

“Doing better

by being different”

A Successful Strategic Thinking
Begins with a good business model - that describes the economic relationships central to fulfilling an organizations purpose. And completes with a good Strategy - having a systematic approach to achieve and sustain a competitive edge.

The Fundamental premise of doing better by being different is that you are playing in the world of alternatives- and you need to make choices.
The business choices you make - positions and configures your business in relation to other alternatives your competitors have. The choices are about –which customers and markets to serve, what products and services to offer and what kind of value to create.

“Discount retailing” was the Business Model, but what was the strategy?

Walton chose to serve a different group of customers in a different set of markets- putting good sized stores in small towns- and being First there. (First mover Advantage) Different Approach to Merchandising and Pricing- Selling Best brands at low prices. Cutting costs on Supply Chain, logistics and Advertising. Using advance Information Technology

  

“To move an Enterprise away from Perfect competition and in the direction of Pure Monopoly.”

Revenue

costs

Profit

 1) 2)

There are only 2 ways a company can outperform another: Increase Revenue Reduce costs.

The essence of strategy is cho0sing what not to do - Micheal E. Porter

A ) CREATING ROADBLOCKS TO PURE COMPETITION: 1. Patents – To prevent competitors from copying

2. Creating Brand Identity- To prevent customers switching brand
3. Intellectuals property rights- protecting the know-how about company’s core competency- Either in form of product development or Customer Service. 4. Unique positioning- Unique positioning with strategic tradeoff has real staying power in the market

(B) THINKING STRATEGICALLY

No organization acts in vacuum- World is filled with potential rivals and allies. Thinking strategically means recognizing others whose aims may constrain or challenge yours.

Three Important lessons from game Theory
1.

Look Forward - Every Move will Evoke a response – factor in all possible responses from all possible players before you decide your move. Keep eye on whole value Chain- and on value that each player adds to the whole. Think from Competitor’s perspectives

2.

3.

Others can copy your strategy and spoil your game plan Others can come out with counter-strategy and again spoil your game plan.

Only that strategy which not only creates a difference but also prevents competitors from countering that strategy will stay . Its not the strategy , but the staying power of the strategy which will decide whether it helps the business retain its competitive edge.

The Most Important part of a Strategy
Keep Looking Forward in the Game.

A Successful Strategy is always Dynamic

It must keep changing to maintain the competitive advantage.

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