1、Strategic ManagementCompetitiveness and globalization:Concepts & CasesThird EditionHitt, Ireland, HoskissonChapter I Strategic Management and Strategic CompetitivenessChapter 2 The External Environment Opportunities, Threats, IndustryCompetition and Competitor AnalysisChapter 3 The internal Environm

2、ent: Resources, Capabilities and Core CompetenciesChapter 4 Business-Level StrategyChapter 5 Competitive DynamicsChapter 6 Corporate Level StrategyChapter 7 Acquisitions and RestructuringChapter 8 International StrategyChapter 9 Cooperative StrategiesChapter 10 Corporate GovernanceChapter 11 Organiz

3、ational Structure and ControlChapter 12 Strategic LeadershipChapter 13 Corporate Entrepreneurship and innovationCHAPTER 1STRATEGY & STRATEGIC COMPETITIVENESSLearning Objectives:1. Understand the l. Define strategic competitiveness, competitive advantage and above-average returns.2. Discuss the chall

4、enge of strategic management.3. Describe the new competitive landscape and how it is being shaped by global andtechnological changes.4. Use the industrial organization (I/O) model to explain bow firms can earn above-averagereturns.5. Use the resources based model to explain how firms can earn above

5、average-returns.6. Describe strategic intent and strategic mission and discuss their value to the strategicmanagement process.7. Define stakeholders and describe the three primary stakeholder groups ability to influenceorganizations.8. Describe the work of strategists.9. Explain the strategic manage

6、ment process.Chapter Outlines1. Strategy and Strategic ManagementThe Challenge of Strategic Management:The global economy and globalization, Technological change and diffusion, The information age and increasing knowledge intensity3. The I/O Model of Above-Average ReturnsThe Resource-based Model of

7、Above-Average ReturnsStrategic Intent and Strategic MissionStakeholdersOrganizational StrategistsReview QuestionsTeaching Focus: It may be very good to begin this lecture with a general comment thatChapter I provides an overview of the strategic management process. In this Chapter, theAuthors introd

8、uces a number of terms and models that students will study in more detail inChapters 2 through 13. Stress the importance of students paying careful attention to theconcepts introduced in this Chapter so that they are well grounded in the strategicmanagement concept before proceeding further.This Cha

9、pters Opening Case discusses the changes taking place in the telecommunicationsindustry and the effects of these changes on the industrys competitive landscape.Opening Case A New World Order in the Telecommunications industryThe Federal Communications Commission voted to allow foreign companies incr

10、eased access to the U.S. market. A World Trade Organization Agreement saw 69 countries agree to open theirTelecommunications markets.Countries of the European Union are deregulating their telecommunications markets andpreviously protected franchises are now open to foreign and domestic competition.E

11、merging markets such as China present significant opportunities to telecommunications firms from around the world.The ability of firms to compete successfully in this new competitive landscape, will bedetermined by their abilities to marshal (meaning: control and organize) vast amounts of resources.

12、 As an example, in 1996, the required investment in the global telecommunications infrastructure was $ 160 billion, an amount that seems small compared to the $ 1 trillion opportunity in China alone. And vast investments also will be required to maintain competitive technological parity throughout E

13、urope and Asia as well as in the U.S.As implied by the Chapter titlestrategic Management and Strategic Competitivenessandillustrated by the discussion of changes taking place in the telecommunications industry, theprimary purpose of the strategic management process is to enable firms to achieve stra

14、tegiccompetitiveness and earn above-average returns. An in-depth discussion of international (global)strategies will be found in Chapter 8.Definitions:strategyStrategic competitiveness is achieved when a firm successfully formulates and implements a value-creating strategy. By implementing a value-c

15、reating strategy that current and potential competitors are not simultaneously implementing and that competitors are unable to duplicate the benefits of, a firm achieves a sustained or sustainable competitive advantage.Above average returns represent returns that exceed returns that investors expect

16、 to earn from other investments with similar levels of risk (investor uncertainty about the economic gains or losses that will result from a particular investment). In other words, above average-returns exceed investors expected levels of return for given levels of risk. So long as a firm can sustai

17、n (or maintain) a competitive advantage, investors will earn above-average returns.Teaching suggestion: Point out that, in the long run, firms must earn at least average returnsand provide investors with average returns if they are to survive. If a firm earns below averagereturns and provides invest

18、ors with below-average returns, investors will withdraw their fundsand place them in investments that earn at least average returns.Strategic Management Process is a framework that can assist firms in their quest for strategic competitiveness, it is the full set of commitments, decisions and actions

19、 required for a firm to systematically achieve strategic competitiveness and earn above-average returns- This process is illustrated in Figure 1-1 .The dynamic nature of the strategic management process is indicated by feedback linkagesamong the three primary elements: strategic inputs, strategic ac

20、tions and strategic outcomes.Strategic inputs, in the form of information gained by scrutinizing the internal environmentand scanning the external environment are used to develop the firms strategic intent andstrategic mission.Strategic actions are guided by the firms strategic intent and strategic

21、mission, and are represented by strategies that are formulated or developed and subsequently implemented or put into action. Strategic outcome is the result of a firms strategy implemented. A desired strategic outcomestrategic competitiveness and above-average returnsresult when a firm is able to su

22、ccessfully formulate and implement value-creating strategies that others are unable to duplicate. Feedback links the elements of the strategic management process together and helps firmscontinuously adjust or revise strategic inputs and strategic actions in order to achieve desiredstrategic outcomes

23、.This Chapter also will discuss two approaches to the strategic management process. The first,the industrial organization model, suggests that the external environment should be considered as the primary determinant of a firms strategic actions. The second is the resource-based model,which perceives

24、 the firms resources and capabilities (the internal environment) as critical linksto strategic competitiveness. Following the discussion in this Chapter, as well as in Chapters 2and 3, students should see that these models must be integrated to achieve strategic Competitiveness.THE CHALLENGE OF STRA

25、TEGIC MANAGEMENTAs noted in earlier comments, all firms-and managers-are challenged to achieve strategiccompetitiveness and earn above-average returns. And, the challenge can be formidable. Aprimary challenge facing managers today is the need to recognize-as illustrated by the commentson such firms

26、as IBM, Union Pacific, Honda and The Limited-that the strategic managementprocess and the striving for strategic competitiveness takes place in a dynamic global economy.As a result of this ongoing struggle, success today does not necessarily equate with successtomorrow.Honda has had to make major ch

27、anges to survive in the global automobile market. In itsattempt to make its flagship Accord more sporty, it found that the car was too small to satisfy theexpectations and not sporty enough to satisfy Japanese buyers. As a result, it has designed theAccord around a world car design with alterations

28、to meet different market expectations. ItsU.S. Accord is now larger, the Japanese model is smaller and contains more of the high-technology features desired by Japanese buyers and a smaller European version has beenintroduced.TABLE I-1 Top Ten Wealth CreatorsAs shown in Table 1-1, Coca-Cola and Gene

29、ral Electric continue to lead the least of wealthcreators for the second consecutive years they have created more wealth (measured by market value added) than other U.S. firms. However, The balance of the listing indicates the shiftingnature of success for the other firms.Since 1992, Microsoft has i

30、mproved from number 14 to number three on the list.Intel has leaped from number 74 in 1992 to the number four position in 1997.While the other changes in the list have not been as dramatic as those reported for Microsoftand Intel, students should recognize that the dynamics of the new competitive la

31、ndscape haveresulted in a shuffling of positions for the other firms on the list.The transient nature of strategic competitiveness is pointed out even more clearly when oneRealize that only 2 of the 25 largest U.S. industrial corporations in 1900 remain competitive inthe 1990s and that four members

32、of 1997s top ten were not among the top ten in 1992.It also should be noted that firms in the global telecommunications industry-including AT&T,Nippon Telephone & Telegraph and WorldCom must be prepared to compete differently thanthey have in the past if they hope to achieve long-term strategic comp

33、etitiveness. One key tosuccess will be which firms strategies will represent the best fit between the demands of theexternal environment and the resources and capabilities in their respective internal environments.THE NEW COMPETITIVE LANDSCAPEThis new competitive landscape can be described as one in

34、 which the fundamental nature ofcompetition is changing in a number of the worlds industries. And, the boundaries of industriesare becoming blurred and more difficult to define.Consider changes that have taken place in the entertainment and communications industries:Traditional broadcast networks-AB

35、C, NBC and CBS-now must compete with cable networks such as ESPN, A&E, HBO and Showtime as well as with cable systems.Rupert Murdochs News Corp. (owner of the Fox Network) formed a strategic alliance withTele-Communications Inc (the largest U.S. cable system) to develop a venture that is intended to

36、 control a global web of sports TV networks.Disneys 1996 purchase of Cap Cities/ABC has resulted in a media network that includes abroadcast network (ABC), a cable station (The Disney Channel) as well as motion pictureproduction and distribution, newspapers, magazines and theme parks.Innovative comp

37、anies such as AT&T, Sony and Microsoft have indicated that they areinterested in participating in this new entertainment-communications industry.The new competitive landscape thus implies that traditional sources of competitive advantageeconomies of scale and large advertising budgetsmay not as impo

38、rtant in the future as theywere in the past. The rapid and unpredictable technological change that characterizes this newcompetitive landscape implies that managers must adopt new ways of thinking. The newcompetitive mind set must value flexibility, speed, innovation and integration.A term often use

39、d to describe the new realities of competition is hypercompetition, a conditionthat results from the dynamics of strategic moves and countermoves among innovative, globalfirms: a condition of rapidly escalating competition that is based on price-quality positioning.battles to achieve first-mover adv

40、antage and battles to protect or to invade established product orgeographic markets (that will be discussed in more detail in Chapter 5).Teaching suggestion; Two primary drivers of the new competitive landscape are illustrated inFigure 1-2The New Competitive Landscape1. Technology and technological

41、changeTechnology is changing rapidlyTechnology diffuses rapidly, not only across company boundaries but also across national borders.Information technology is changing both rapidly and dramatically. Knowledge is becoming increasingly important2. The global economyPeople, goods, services and ideas mo

42、ve freely across geographic bordersSignificant opportunities emerge in multiple global marketsMarkets and industries are becoming more internalizedThe Global EconomyA global economy is one in which goods, services, people, skills and ideas move freely acrossgeographic borders.Also, globalization is

43、referred to as the shift toward a more integrated and interdependent world economy. Globalization has two main components: the globalization of markets and the globalization of production.The Globalization of MarketsThe globalization of markets refers to the merging of historically distinct and sepa

44、rate national markets into one huge global marketplace. The tastes and preferences of consumers in different nations are beginning to converge on some global norm, thereby helping to create a global market. The global acceptance of consumer products such as Citicorp credit cards, Coca-Cola, Levis je

45、ans, Sony Walkmans, Nintendo game players, and McDonalds hamburgers are all frequently held up as prototypical examples of this trend. The expansion of some huge firms creates a global market. Firms such as Citicorp, Coca-Cola, McDonalds, and Levi Strauss are more than just benefactors of this trend

46、; they are also instrumental in facilitating it. By offering a standardized product worldwide, they are helping to create a global market. Markets for industrial goods and materials that serve a universal need the world over such as aluminum, oil, and wheat, the markets for industrial products such

47、as microprocessors, DRAMs (computer memory chips), and commercial jet aircraft; and the markets for financial assets from US Treasury Bills to eurobonds and futures have become global markets. Markets for consumer products are still often to act as a brake on globalization because of the national di

48、fferences in tastes and preferences. diversity is replaced by greater uniformity, because some firms, especially some multinational companies bring with them many of the assets that have served them well in other national markets-including their products, operating strategies, marketing strategies,

49、and brand names-creating a certain degree of homogeneity across markets. Thus, diversity is replaced by greater uniformity. As rivals follow rivals around the world, these multinational enterprises emerge as an important driver of the convergence of different national markets into a single, and incr

50、easingly homogenous, global marketplace. Due to such developments, in an increasing number of industries it is no longer meaningful to talk about the German market, the American market, the Brazilian market, or the Japanese market; for many firms there is only the global market.The emergence of this

51、 global economy results in a number of challenges and opportunities.For instance, many now consider Europe to be the worlds largest single market (despite thedifficulties of adapting to multiple national cultures and the lack of a single currency).Including the nations that make up the former Soviet

52、 Union and the rest of the Eastem bloc, theEuropean economy has a gross domestic product (GDP) of $ 5 trillion with 700 millionpotential customer. In addition, China is seen as an emerging giant that is expected to have ahigher GDP (but a lower per capita output) than Japan by 2015 or sooner.In the

53、eyes of many observers, the U.S., Europe and Japan are relatively equal contenders in the race to be the most competitive nation or economic bloc in the 21st century. And, exports arebecoming an even more important segment of the economy, especially in the U.S., as indicatedby the following: 42% of

54、U.S. economic growth was based on exportsExports and imports accounted for approximately 28% of U.S. gross domestic product in1997, up from 21% in 1991The competitive advantage in global technology is expected to drive continued export growthfor U.S firms into the 21st centuryWhile large firms may c

55、ommit resources to global markets more quickly than small and mid-size firms, in 1995, over one-half (50%) of U.S. midsize companies were competing inmarkets outside of the U.S.U.S. firms are successfully penetrating Japans high-tech, automobile, consumer goods andretailing marketsIn 1995, U.S. expo

56、rts increased 12 % over 1994, exceeding $800 billionExports are expected to reach the $1trillion level by 1998The largest share of U.S. exports currently go to Europe, Canada and JapanThe fastest growth in demand for U.S. goods and services is projected to be in Asian markets(excluding Japan); from

57、1996 to 2000, expected annual growth is 12 %. The March of GlobalizationGlobalization is the spread (or diffusion) of economic innovations around the world and thepolitical and cultural adjustments that accompany this diffusion.In essence, globalization seems to have gathered a momentum of its own b

58、ecause ofincreased levels of interdependence among industrialized nationsthe needs of developing countriesthe continuing disintegration or dropping of trade barriersintensified international integration of multiple national opportunitiesfinancial capital may be exported between national marketsmanuf

59、acturing equipment purchased in a third nation may be installed in plants around the world raw materials may be sourced from a variety of national markets, imported into stillother national markets for production and then finished products exported all over theglobe.The internationalization or globa

60、lization of markets and industries often makes itimpractical to classify many firms as purely domestic or foreign. Consider Honda, a majorplayer in the global automobile industry, which recently.employed some 14,300 people in the U.S,sold 660,000 units in the U.S. (73% were produced in the U.S.)used