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Strategy#6
| Question | Answer |
|---|---|
| What does have a dominant design gives us | mostly lead time to become technical design where we can apply intellectual property right |
| What are 3 question while entering a new market for diversification | 1,The attractiveness test (attractive for diversification) 2,The cost-of-entry test (cost must be smaller as profits) 3,The better-off test (synergies from diversification) |
| What are 3 motives for diversification | 1,Growth of the industry (better be in more industries while any may decline) 2,Risk reduction (cashflow from uncorrelated industries secure profitability) 3,Value creation increase value of the whole company |
| What are 5 types of synergie | 1,Economies of scope lower cost of increasing output from different products 2,Economies from internalizing transaction 3,Parenting advantage 4,Diversified firm as an internal market 5,Economies of scale Lower cost from single product |
| What are 4 examples of Economies of scope | 1,Tangible resources (Magenta-research labs, sales forces,..) 2,Intangible resources (Starbucks-reputation, brand,..) 3,Organizational capabilities (market analysis, PR,..) 4,Demand-sides EOS (when customer can buy on product at one provider) |
| What is Parenting advantage (2) | 1,can parenting company deploy its resources & management skills to parent company 2,if some parenting company may add more value added, than it should be selled |
| What is the relation between diversification & proftability (2) | 1,reverse U curve 2,balanced diversification is optimal .. too low diversification & too much are both bad |
| What is better related diversification or unrelated diversification (2) | 1, no clear empirical correlation what is better 2, the shared management has low EOS |
| What is the name of "attractiviness test, cost-of-entry-test, better-off test" | Three essential tests |
| What are four main activities of corporate management adds value | 1,Managing the corporate protfolio 2,Managing linkages across businesses 3,Managing individual businesses 4,Managing change |
| What are two main question when managing the corporate portfolio | 1,What business should we be in 2,How should we manage those businesses in order ro generate as much value from them as possible |
| What 3 instrument we may use for managing the corporate portfolio | 1, THe GE/McKinsey Matrix (Industry Atractiviness x Competitive Strengh of Business unit) 2,BSG´s rowth-Share Matrix 3,The Ashridge Portfolio Display (parenting effects) |
| What are strategies of GE/McKinsey Matrix (3) | 1,low Attractiviness / low BU Competitive Advantage..Harvest 2,Medium/Medium .. Hold 3,High / High .. Build |
| What is a Ashridge Portfolio Display (2) | 1,Dimesion (high x low) .. Potential for the parent to add value to the business 2,Potential for value destriction, while misfit of the business |
| What are 3 forms to manage linkages & determine their potential to create value (centralization of common services) | 1,Common corporate service 2,Transferring & sharing resources and capabilities 3,Coordination throught the corporate HQ |
| What is 1,theory 2,reality of common corporate services | 1,Theory= because of learning curve or economy of scale we save money 2,Reality=there are no benefits, cause HQ have week incentives for corporate stuff to meet the needs of the business |
| What is problem of common corporate service & its solution | Problem= HQs serve two different purpose leadership & cont-rolling, as well as providing support & service Solution=Seperating HQ intro a corporate management unit & a shared service organization |
Created by:
semester1.IBWL
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