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Transcript of [STRATEGY]
COURSE BOOK
STRATEGY
(EBC1017)
Course coordinator: Dr. Boris Lokshin
Course period 1.4 International Business
Academic year 2012/2013
2
INTRODUCTION
The objective of this course is to introduce students to the core concepts, frameworks and techniques
of strategic management, allowing students to make better decisions in their professional lives.
Strategy is formulated based on the company’s mission and its assessment of the external and internal
environment. A systematic examination of the environment in which the firm operates enables
managers to recognize sources of possible competitive advantage by identifying unmet needs, broadly
defined, in the external environment and the firm’s abilities to meet those needs (internal analysis).
Strategic choice is the point in the process where managers choose how to organize and position the
resources of the firm. Strategic choices are made at two levels: the business level and the corporate
level. Managing a firm is somewhat like playing chess. The resources of the firm are like the pieces of
a chess set. This course will be about positioning the resources of a firm with a view toward gaining
competitive advantage and earning superior economic returns. The course will take students through
several models of analysis that will look at the positioning of competitors, suppliers, customers, etc.
Positioning of the focal firm’s own resources will be a central theme throughout the several models
presented during the course.
REQUIRED LITERATURE
Rothaermel, Frank T. 2013. Strategic Management: Concepts and Cases, 1st edition, McGraw-Hill.
COURSE REQUIREMENTS
Attendance and participation
Attendance and active participation are critical to students’ success in this course. Each tutorial
meeting will focus on one or more topics from the required readings and the corresponding tasks.
Students are required to prepare assignments before the meeting and be ready to discuss the tasks in
class. For the post-discussion students prepare answers to the learning objectives. During each meeting
each student’s individual participation will be evaluated by the tutor based on two aspects: (1)
preparation – the extent to which a student demonstrates that he/she studies and prepares for the
meetings and (2) contribution – the extent to which a student actively contributes during the tutorial
group discussions. Participation mark for each session depends on both aspects and will be either a
“plus”, or a “minus”. Lacking participation means missing more than three tutorial sessions or
obtaining fewer than eight ‘pluses’ and will entail a course assignment.
Individual Presentations
The skill training associated with this course is presentation skills. Each student must present once
during the course. This individual presentation is linked to the (post) discussion of a task and follows
the tutorial group discussion of the assigned chapter. Each student has a maximum of 15 minutes for a
presentation, followed by up to 5 minutes of discussion and feed-back. In the individual presentation
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students give their analysis of the task, which is related to one or more learning goals for the session,
and answer critical questions posted in the course book.
The evaluation of the presentation takes into account structure (25%), form (25%), and content
(50%). If a student has an insufficient grade for the presentation a resit is offered in the last tutorial of
the course. In case of a no show a student receives a zero mark. The final grade for the individual
presentation is an average of the marks received in the first sit and the resit presentation.
Students who failed are advised to improve their presentation on the basis of the feedback
received from the tutor and use the same topic as in the first presentation. MS Word documents
Presentation Evaluation and Basic Rules for Providing Feedback are posted on Eleum and contain
information on the grading of the presentations and suggestions on how to provide feedback. For more
information on how to prepare the presentation please consult the presentation guide, Steps in
Preparing and Giving a Presentation, available on Eleum under the course material. Scheduling of the
presentations will take place in the first tutorial of the course. Table 1 below summarizes available
slots and tasks associated with them.
Team Presentation
In addition to the individual presentations, there is a team case presentation. Students will form three
or four teams during the first session. Team diversity is promoted. Session 11 is reserved for the case
presentations. Each team has a maximum of 20 minutes for their presentation, followed by up to 5
minutes of discussion. Critical questions (details are given in the corresponding section of the block
book) have to be answered during the team presentation. The evaluation of the presentation takes into
account structure (25%), form (25%), and content (50%).
Strategy team project
The goal of this course-long project is to provide a tangible application of many of the concepts
discussed in this course. By the end of the project, students will not only have practice in using key
strategic management components and processes to increase understanding of the material, but also
will be able to conduct strategic management analysis of a company. Each assignment requires either
data collection or analysis relating the material discussed in the chapter to the firm students select. At
the end of each session, under the heading ‘Strategy Term Project’ you will find the tasks that you
need to do. In meeting 8 the teams will present their findings in class. Each team has a maximum of 20
minutes for their presentation. The project will be evaluated as a written piece of work as well as a
presentation. A total of 100 points can be earned for the strategy project, 70 for the written report and
30 for the oral presentation. It is specified per task how many points each of the 9 strategy project
tasks is worth. The evaluation of the report is based on: 1) How well are the questions answered? 2)
What is the quality of spelling and grammar? 3) What is the quality of referencing? The evaluation of
the presentation takes into account coherence (50%), and presentation style (50%). The total length of
the written report should not exceed 2100 words. In the description of the tasks a word limit per each
task is indicated. Reports longer than 2100 words will be penalized. The print-out of the project (Tasks
1 – 8) has to be submitted to your tutor during session 9 on March 14, and an electronic copy has to be
uploaded on Safe Assign. Individual report (Task 9) has to be submitted on March 26.
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International Classroom Skills
A new initiative by SBE board, Program Committee and Student Council has been launched aimed at
improving cooperation between Maastricht University students of different nationalities. Students are
required to spend 2 extra hours on developing skills that would ensure that student cooperation with
peers of different nationalities is more effective. The focus in EBC1017 is on improving the team
skills. During your university studies you will work repeatedly in small teams. Working in teams can
be both fun and challenging. Complexity of the team tasks tend to increase over time during your
studies and hence the challenges you will face. This is a good preparation for your career, where team
skills are an important asset. Similar to earlier International Classroom tasks, focus is on actually
practicing the skills involved. International Classroom Skills (ICS) training makes part of the strategy
team project. The detailed description of ICS Tasks 1 – 4 can be found under the sessions below.
Written Exam
The written exam is closed book and will consist of multiple-choice questions based on the required
readings. The use of dictionaries (except explanatory English-English) and a non-programmable
calculator is allowed. A total of 100 points can be earned for the exam and the exam grade is
determined by dividing the total number of points scored by 10.
GRADING
The final grade for the course is composed of the following parts:
15% Individual presentation
20% Strategy team project (report and presentation)
10% Team presentation (case analysis)
55% Exam
In order to receive full credits for the course a student must meet the following conditions:
1) receive a passing grade for the written exam of 5.5 or higher
2) receive ‘pass’ for the individual presentation
3) fulfill the participation requirement (see section Attendance and participation)
In case conditions 1) and/or 2) are not met a student can register for a re-sit of a written exam and the
individual presentation, which are both offered. In case condition 3) is not met, a student must
complete the block assignment. Further details on the course assignment will be posted on the course
page on Eleum.
THE SESSIONS
The first half of each tutorial is devoted to the (post) discussion of the assigned reading. The second
part of each tutorial session students will give individual presentations, which are based on a case. The
information on cases is given under each tutorial session heading below. The tutorial will end with a
pre-discussion of the follow up tasks. At the end of the pre-discussion students should be able to
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formulate learning goals for the following tutorial. The thirteen tutorial sessions are summarized in the
following table.
Table 1 Time schedule for the course
Session
number
Date Readings Problem Tasks (T)
Second (post) discussion/
individual presentation
First (pre) discussion
1 Feb 5 T0, T1, ICS1, ICS2
2 Feb 7 1 T1, ICS2 T2; SP1, SP2
3 Feb 19 2 T2 T3, T4; SP3
4 Feb 21 3 T3, T4 T5, T6; SP4
5 Feb 26 4 T5, T6 T7, T8; SP5
6 Feb 28 5 T7, T8 T9, T10; SP6, SP7
7 March 5 6 T9, T10 T11, T12; SP8
8 March 12 Strategy project presentation
9 March 14 8 T11, T12, Hand in Strategy
project report to the tutor and
upload in Safe Assign on
EleUM
T13, T14;
10 March 19 9 T13, T14 T15
11 March 21 Case presentation SP9
12 March 26 7 T15, Hand in ICS individual
report to the tutor and upload in
Safe Assign on EleUM
13 March 28 Recap
Note: each of the tasks T1 – T15 can be used for individual presentations.
In session 9 the teams have to indicate which of the cases they have chosen for the team presentation.
ELEUM
Course materials, such as presentation guide, description of the seven-jump method, and presentation
evaluation form, team report criteria mentioned in this course book, are posted on the course webpage
on Eleum (http://eleum.unimaas.nl). Minutes of the tutorial sessions, power-point slides of the
individual presentations and the lecture slides will also be posted on Eleum in due course. Students are
advised to check Eleum regularly to keep up to date and for announcements related to the course.
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SESSION 1, February 5
The suggested plan for the first session is as follows:
Clarify the role of tutor, group members, person to take minutes, and discussion leader(s)
International Classroom Skills (ICS) Task 1 Getting to know each other
Assigning discussion leaders, secretaries (responsible for minutes) and presenters
Making up teams
International classroom skills (ICS) Task 2
Tutorial task 0 and Tutorial task 1
The role of the discussion leader(s), scheduled for each session, is to lead the discussion. Another
student is scheduled to keep minutes. The minutes should be posted on Eleum in order to be available
for other students the day after the meeting. The students have to choose a session when they are going
to make their individual presentation. There are slots for presentations during sessions 2 – 9. The
sessions are structured in such a way to give one or two students an opportunity to present. Each
individual presentation has to deal with a corresponding task indicated in Table 1. The students are
also to form teams consisting of three or four students. Sessions 8 and 12 are reserved for team
presentations which are separately graded.
A possible agenda for each of the following meetings could be:
opening round
agenda setting
o any remarks on the minutes
o any questions
post discussion of the chapter and the learning goals (first half of the session)
individual presentation, followed by the group discussion (second half of the session)
short evaluation of the presentations
pre discussion of the topic of the following tutorial, setting of the learning goals
closing round
International Classroom Skills (ICS) Task 1 Getting to know each other
Why this series of tasks? Students of earlier years have been in favor of more explicit attention to
international cooperation in and around the classroom. One of the problems noted by internationally
oriented students was the preference of quite a number of students to work in teams with fellow
nationals only, including a sometimes reluctance to work with students from other nationalities. One
of the reasons for this was that teamwork was perceived as pretty challenging by quite a number
groups of students. That’s why CICD has thought of series of ICS tasks to deal with these challenges
in teamwork. While it would be an illusion to think that problems can be prevented completely,
following some basic principles can certainly help to reduce problems in the first place. This task is
about getting to know each other. We begin with students breaking up in pairs. Students interview
each other for a couple of minutes. Please make notes because afterwards you will introduce each
other to the entire group:
a. What is your name? What country do you come from? In which countries did you live or
visited?
b. Are you regular or exchange student?
c. Do you have work experience (real job, holiday job etc.) and what is the most interesting thing
you’ve learned from this experience?
Group members introduce each other to the group by briefly summarizing the points listed above
After the break the teams will be formed
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International Classroom Skills, ICS Task 2 ‘Mapping the Ground’
In this course you will do a number of tasks as a team: a strategy project (presentation and report) and
a case (presentation). The strategy project consists of various tasks specified in the course book.
Team work starts with exploration or ‘Mapping the Ground’. In the course Management of
Organisations and Marketing in course period 1.1 you already became acquainted with the model of
‘Forming, Storming, Norming, Performing and Adjourning’, Gallagher (2010, p.204). While the
importance of mapping the ground may seem (all too) obvious, experience shows that in practice
many teams omit this stage or go through it too quickly, implying that they run into problems later on.
Get together as a team and discuss the following
1. Explore similarities and differences between the team members. As many as possible in a
short time, e.g. nationality, eye color, age, sports, music preferences hobbies etc. Make sure to
find a good balance between similarities and differences. Count similarities and differences.
Which team has most?
2. What are your aspirations for the team project, both intrinsic (what do you want to learn) and
extrinsic (grades you hope to achieve)? How important is this task to you, compared to other
obligations? What other obligations do you have during this period and how much time do
they require? Think of the other course you are following, job(s) you have, membership and
activities in student associations, sports training, other hobbies, weekend trips to parents /
boyfriend /girlfriend, etc. Also share specific time commitments during the week. Apart from
getting to know each other better, it is also practical to know this when making agreements.
3. In student teams (just like in business teams) there are sometimes big differences in (grade)
aspirations and willingness to spend time and energy on a team task. While this is challenging
in itself, things get even worse if team members don’t discuss these things with each other.
Gallagher (2010, p.207-8, figure 10.2 and 10.3) suggests to agree as a team on the following
things:
a. How do you communicate with each other?
b. When do you have meetings? E.g.
Fixed time every week (as in the example of Gallagher, 2010, p. 208)
Going with the flow, dependent on the tasks at hand
c. How do you make decisions? E.g.
One leader or coordinator for the entire project
Different coordinators for different sub-tasks
Joint decision making as in Gallagher’s example
d. How do you divide roles and responsibilities within the team?
Don’t divide tasks too early, make sure to explore them first (Gallagher 2010,
p.207, fig. 10.2. steps 1-5)
Reserve time to bring the various subtasks together before the final deadline
(Gallagher 2010, p.207, fig. 10.2. steps 5-8)
e. What do you do when agreements are not met?
As a first step, before making decisions on this, explore what preferences team members have. Don’t
enforce a decision too early, but first explore all the options and allow team members to propose
different solutions. Agree on a time (and place) when you continue.
8
Tutorial Task 0: What makes a good presentation?
Some of you have already had the experience of giving a presentation. You have also attended a lot of
presentations or lectures. Some of them you will never forget some you will hardly remember. The
main question is ‘What makes a good presentation?’ Discuss the elements of a good presentation and
make together a checklist. Give also for each element an indication how to reach the criterion.
Tutorial Task 1. What is Strategy? (Chapter 1)
For this task read the opening case to Chapter one. In addition, it is fine if you surf the internet prior
when preparing the task, to further your understanding of the case. For instance, you can research
Google’s unfolding relationship with China or Google’s changing position on Net Neutrality or
Google’s entry into e-books. Does Google have a good strategy according to you (think of overall
strategy of a company, not just the attractiveness of its products or services)?
In your individual presentation address two, maximum three, learning goals formulated for this
session (the suggested ones are listed in brackets). Use Google as an example. In the course of your
presentation answer the following questions:
1. Google was not the first search engine on the Internet, but it has been the most successful.
What is Google’s competitive advantage? Hint: their theory of how to gain competitive
advantage can be broken down as follows: What is their business model (that is, what serves
as their profit engine) and how do they differentiate themselves? (LO 1-1)
2. What strategy and business model is Microsoft using today with Bing to try to succeed in the
Internet-search business? (LO 1-2)
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SESSION 2, February 7
Tutorial Task 2. Strategic management process (Chapter 2)
Google founders started out with the idea of organizing the world’s information and making it
accessible and useful. However, since IPO in summer of 2004 Google launched a host of products that
expanded company’s operations beyond web search. Some of the most well-known ones are Gmail,
Google Maps, Google Docs, and Google Finance. In a rampant series of acquisitions Google acquired
among others YouTube and DoubleClick which allowed the company to establish presence in online
video and display advertising. Analysts speculate as to what objectives Google has in mind? Some of
Google’s initiatives moved it towards companies like Yaaho! and Microsoft MSN. With other
initiatives, like Maps, books Google engaged in competition with e-commerce incumbents such as
eBay and Amazon. With yet other offerings, like Google Docs the company challenges traditional
Office hegemony of Microsoft. In January 2010 Google even launched the Nexus One – a touch-
screen smartphone. This raises the question: are these developments the outcome of deliberate and
rational strategic plan by the company’s top management or these strategic initiatives popped up in
some unplanned way?
In your individual presentation address two (maximum three) learning goals formulated for this
session. Use Google as an example. In the course of your presentation answer the following questions:
1. What is Google’s mission? Is it customer- or product-oriented? What relationship do you see
between Google’s mission statement and its competitive advantage? (LO 2-1, LO 2-3)
2. Has Google’s strategy been intended versus emergent? Why do you think so? (LO 2-6)
3. Is pursuit of opportunities in the portal, e-commerce intermediary, and desktop operating system
businesses consistent with Google's mission and culture? (LO 2-6)
Strategy project Task 1: Initial firm selection
This first task is to identify a company to study. The easiest and most consistent method will be to
select a medium- or large-sized public company to study. One important requirement is that you have
the company most recent annual reports (2011 and 2012) . The secondary approach of selecting a local
firm can provide challenges regarding the appropriate collection of data. Even if a student works at the
firm, there are quite often proprietary limits on the data (especially financial and competitive data) that
these firms will allow to be used for such a project. Be sure to check with the local firm on data
availability. There is a lot of information available on the Internet. Unfortunately, a lot of it is heavily
flawed or biased. Students should use a variety of sources, because even sources like The Wall Street
Journal and Financial Times can be biased in choosing their reporting topics and tone. Once the firm is
selected, it’s time for the students to start gathering information on the history of the firm, its current
top management team, and the primary business model for the firm. The goal of this first assignment
is basic familiarization with the firm and a check to be sure data sources are forthcoming and
reputable. Your chosen company must be approved by your tutor.
Strategy project Task 2: Agreement on working procedures (ISC Task 3) (200 words, 5 points)
Have a meeting with your team to finalize the initial discussion of ISC Task 2. Put the agreement that
your ream has reached on paper. Answer the following questions in the report:
a. How and when do you communicate with each other?
b. How do you maintain a good atmosphere in the team (informal gatherings? other ideas?)
c. When do you have meetings?
d. How do you make decisions?
e. How have you divided roles and responsibilities within the team?
f. When will you start preparing the case presentation?
g. What do you do when agreements are not met?
10
SESSION 3, February 19
Task 3. External Analysis (Chapter 3)
For this task read the opening case to Chapter 3. You may also find useful to read the first part of Case
5 on p. c32 as a background reading.
In your individual presentation address two (maximum three) learning goals formulated for this
session. In the course of your presentation answer the following questions:
1. Think about the automotive industry in your home country. Is it structured more like an
oligopoly or monopolistic competition? (LO 3-2)
2. Do you think the structure would change for an electric vehicle strategic group within the
overall automotive industry? (LO 3-2)
3. Which PESTEL factors are the most salient for the electric automotive industry of the 21st
century? (LO 3-1)
Task 4. External Analysis (Chapter 3)
For this task read the opening case to Chapter 3. You may also find useful to read the first part of Case
5 on p. c32 as a background reading.
In the individual presentation answer the following questions:
1. Using the industry attractiveness framework (see Exhibit 3.5), explain the overall automotive
industry. (LO 3-3)
2. How would your analysis change for the electric automotive industry? (LO 3-3)
3. Identify any strategic groups that might exist in the auto industry. How does intensity of
competition differ across the strategic groups you have identified? (LO 3-6)
Strategy project task 3 Mission and Goals (300 words, 5 points)
Search for the firms’ mission statement. Often companies announce it on their websites. Remember
some firms use the term mission and vision interchangeably, so you may need to adapt a vision
statement as the mission if it is appropriate. Major company goals are quite often also available
through the annual reports that each public firm must file with the SEC
http://www.sec.gov/edgar.shtml or http://www.morningstar.com or https://company.info through UM
library database. Longer-term goals are usually in the annual reports. You may go back a few years in
the annual reports and compare what the firm said three or five years ago to what they said most
recently. Pulling a couple of older annual reports will also help in the formation of a timeline for
major changes in the organization. Also, check the firm’s website. Often, firms will include a history
or “timeline” section from their home page under “About Us” or the “Investors” tab. In the report
answer the following questions:
1. What is the mission statement of the firm?
2. What are the major goals of the company?
3. Has the mission statement and company’s goals changed in the last few years?
11
SESSION 4, February 21
Task 5. Internal Analysis (Chapter 4)
For this task read the mini-case 4 “Starbucks: re-creating its uniqueness”, p. 371. In your presentation
answer the following questions:
1. What are Starbucks’ key tangible and intangible resources? How did Starbucks create its
uniqueness in the first place? (LO 4-1)
2. Was Starbucks’s uniqueness a VRIO resource? Did it help Starbucks gain and sustain a
competitive advantage? Why or why not? (LO 4-4)
3. Why and how did Starbucks lose its uniqueness?
4. How is Starbucks attempting to re-create its uniqueness? Do you think it will be successful?
Why or why not?
Task 6. Internal Analysis (Chapter 4)
For this task read the mini-case 4 “Starbucks: re-creating its uniqueness”, p. 371. In addition, it is fine
if you surf the internet prior when preparing the task, to further your understanding of the case. In your
presentation answer the following questions:
1. Explain Starbucks’s ups and downs using (a) strategic activity systems and (b) the dynamic
capabilities perspective. What implications can you draw? (LO 4-6)
2. Conduct a SWOT analysis (internal Strengths and Weaknesses and external Opportunities and
Threats) for Starbucks. (LO 4-8)
3. What recommendations would you give Howard Schultz? Support your arguments.
Strategy Project Task 4 External analysis (300 words, 5 points)
In this section, you will study the external environment of the firm you have previously selected for
this project. Look over annual reports and press clippings (or websites) for insights on the industry for
the firm they have selected. It is important at this stage for the student to clearly define what industry
they are going to use for the analysis. In the report answer the following questions:
1. What is the standard industry classification (report the 4-digit SIC code) and the definition of
the industry in which your company operates?
2. Which PESTEL factors are most important in your industry?
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SESSION 5, February 26
Task 7. Competitive advantage and firm performance (Chapter 5)
For this task read the opening case to Chapter 5. In your presentation answer the following questions
1. Analyze the data in the exhibits. To what degree has Google been able to capture the value
that they have created? (LO 5-1)
2. Assess Google’s performance. Look for evidence in the financial data in terms of how
Google’s strategy has contributed to performance—either in a positive way or in a negative
way. (LO 5-2)
3. In 2009, how is Google doing relative to its competitors? Chapter five discusses three
perspectives of competitive advantage. If Microsoft is successful in claiming a significant
share of the burgeoning smartphone market, will the economic, accounting, or stakeholder
perspective be impacted first? Which firm’s competitive advantage would be the most
impacted by this type of market shift? (LO 5-6)
Task 8. Competitive advantage and firm performance (Chapter 5)
For this task read the mini-case 5 “GE under jack Welsch vs. Jeffrey Immelt”, p. 372. In your
presentation answer the following questions
1. Do you agree with the claim that “GE experienced a sustained competitive advantage under
Jack Welch, while it experienced a sustained competitive disadvantage under Jeffrey Immelt”?
Why or why not?
2. Shareholder value creation is one of the metrics discussed in Chapter 5 to assess firm
performance. Do you consider this metric to be the most important one? Why or why not?
(LO 5-3)
3. As discussed in Chapter 5, what other ways could you use to assess firm performance and
competitive advantage? Would that answer change your assessment of the two different time
periods presented? (LO 5-1, 5-2)
Strategy Project Task 5 Internal analysis (400 words, 10 points)
In this task, you will study the internal resources, capabilities, core competencies, and value chain of
your selected firm. A good place to start with an internal firm analysis is to catalog the assets a firm
has. Answer the following questions:
1. Make a list of the firm’s tangible assets. Then, make a separate list of the intangible assets you
can identify.
2. Which, if any, of these resources are helpful in sustaining the firm’s competitive advantage?
Why?
3. Identify the core competencies that are at the heart of the firm’s competitive advantage.
(Remember, a firm will have only one, or at most a few, core competencies, by definition.)
13
SESSION 6, February 28
Task 9. Business strategy: Differentiation, cost leadership and integration (Chapter 6)
Cost leadership: Ryanair (see Strategy Highlight 6.2) is noted as a firm that can make a profit on an $8
ticket. For this task look up information on low-cost providers such as Ryanair and in your
presentation answer the following questions:
1. On which cost drivers Ryanair business-level strategy is based? (LO 6-3)
2. Are these drivers valuable and rare? (Looking back at Exhibit 6.7 may be useful) (LO 6-3)
3. If you were a competitor in the European market, such as Aer Lingus or Lufthansa, how
would you compete against Ryanair, knowing your cost structure would not allow price
parity? (LO 6-6)
Task 10. Business strategy: Differentiation, cost leadership and integration (Chapter 6)
Differentiation: For this task read the opening case to Chapter 6. In your presentation answer the
following questions:
1. Which value drivers is Whole Foods using to remain differentiated in the face of Walmart and
other competitors that are now selling organic foods? (Looking back at Exhibit 6.9 may be
useful.) (LO 6-2)
2. Given the discussion in the Chapter Case about Whole Foods trimming its cost structure, does
the firm risk being “stuck in the middle”? Why or why not? (LO 6-5)
3. What other methods could Whole Foods use to successfully drive its business strategy?
Strategy Project Task 6 Competitive advantage (300 words, 10 points)
Based on information in the annual reports or that published on the firm’s website, do the following:
1. Summarize what the firm views as the reasons for its successes (either past or expected in the
future). Search for both quantitative and qualitative success factors. Has your company
become more/less profitable in the recent years? (Hint: calculate profitability ratios and
compare them in the last few years). How is your company doing in terms of liquidity? How
does the company compare to its competitors or the industry average? Provide answers in the
report.
2. Many firms are now including annual corporate social responsibility (CSR) reports on their
websites. See whether your firm does so. If not, are there other indications of a triple-bottom-
line approach, including social and ecological elements in the firm’s strategies?
14
SESSION 7, March 5
Task 11. Corporate strategy: Vertical integration and diversification (Chapter 8)
Vertical integration. For this task read the opening case to Chapter 6. You may also find useful to read
parts of Case 19 on p. c261 as a background reading. In your individual presentation answer the
following questions:
1. Take either the energy or health care industry in which GE is active and draw the industry
vertical value chain. Is GE highly vertically integrated? If yes, does it employ taper
integration? (LO 8-3)
2. Are any of the vertical value chain operations outsourced or off-shored? If so, list some of the
pros and cons of having this part of the value chain outsourced/off-shored (LO 8-4).
3. How do GE’s corporate-level strategic initiatives of energy, health care, and globalization
reinforce each other? How might they generate conflicts in the company? (LO 8-8)
Task 12. Corporate strategy: Vertical integration and diversification (Chapter 8)
Diversification. For this task read the opening case to Chapter 6. You may also find useful to read
parts of Case 19 on p. c261 as a background reading. In your individual presentation answer the
following questions:
1. What is GE’s current level of diversification?
2. Historically, has GE become more or less diversified? Why has GE been moving in this
direction? (LO 8-6)
3. How well does the healthymagination initiative fit with GE’s resources, capabilities, and core
competencies? Where do ecomagination and healthymagination fit on the core competence–
market matrix for GE? (See Exhibit 8.8.) (LO 8-7)
Strategy Project Task 7 Business strategy (500 words, 20 points)
In this task, you will study the business strategy of the firm you have previously selected for this
project. Be sure to focus only on ONE business unit if your firm has several operations. Differentiation
or cost focus can often be determined from a close examination of the annual report. All firms will talk
about costs, but a differentiated firm will also highlight how it views its products (service) to be
different from the competition. The students can review the Value Drivers section of the text for some
thoughts on the basis of the differentiation. Financial analysis of the focal firm and key competitors is
the clearest way to determine if the firm has cost leadership. Market scope (q3) should be taken
relative to the competitors in the industry. For example, in the furniture industry IKEA is primarily
appealing to college-aged consumers and young families. In the report answer the following questions:
1. Does your firm have differentiated products/services? If so, what is the basis of differentiation?
2. Does your firm have a cost-leadership position? If so, which cost drivers it uses?
3. What is your firm’s approach to the market? If it segments the market, identify the scope of
competition it is using.
4. Using the answers to the preceding questions, identify which generic business strategies your
firm is employing. Explain.
5. As noted in chapter 6, each strategy is context-dependent. What do you see as positives and
negatives with the selected business strategy of your firm in its competitive situation?
Strategy Project Task 8 Corporate strategy (100 words, 5 points)
Report on recent merger or acquisition or announcement of alliance by your focal firm. What do you
think is the reason behind this strategic move?
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SESSION 8, March 12
STRATEGY PROJECT PRESENTATION
This session is devoted to the presentation of strategy projects you’ve been working on. Each of the
three or four teams will present answers to the strategy project tasks 1 – 8. The groups each get 20
minutes for presentation. Each of the group members needs to participate in the presentation of the
findings. Team presentations will be evaluated on the following elements: structure, appearance, and
delivery. A maximum of 30 points can be earned for the presentation.
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SESSION 9, March 14
Strategy project report covering strategy project task 1 – 8 is due. Reports have to be printed out
double spaced, font size 12 and should not exceed 7 pages excluding references and the title page (9
pages including references and the title page) and handed in to your tutor. Please simply staple the
report and do not use binders. It is not necessary to include the table of contents, but where the answer
to each task begins and ends has to be clearly indicated with an appropriate heading. The digital copy
of the report has to be uploaded on Safe Assign in EleUM.
Task 13. Corporate strategy: Acquisitions, Alliances, and Networks (Chapter 9)
Acquisitions. For this task read the case Case 19 on p. c261. In addition, it is fine if you surf the
internet prior when preparing the task, to further your understanding of the case. In your presentation
answer the following questions:
1. Describe the M&A strategy used by GE. (LO 9-1, 9-2)
2. Describe the divestiture strategy used by GE. (LO 9-1, 9-2)
3. Evaluate whether M&A/divestiture strategy of GE leads to competitive advantage (LO 9-3)
Task 14. Corporate strategy: Acquisitions, Alliances, and Networks (Chapter 9)
Alliances, and Networks. For this task read the opening case to Chapter 6. In your presentation discuss
the following:
1. Describe the strategic alliances strategy of Facebook. (LO 9-4)
2. How strategic alliances can lead Facebook to a competitive advantage? (LO 9-6)
3. Given Zynga’s recent activities in network building, what do you see as advantages and
disadvantages of Zynga’s network strategy? (LO 9-7)
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SESSION 10, March 19
Task 15. Innovation and Strategic Entrepreneurship (Chapter 7)
For this task read the mini-case 7 “Which automotive technology will win?”, p. 375. You may also
find useful to read the first part of Case 5 “Tesla Motors” on p. c32 as a background reading. In your
presentation discuss the following:
1. Evaluate different types of innovations and their role in the auto industry. (LO 7-4)
2. Do you believe that the internal combustion engine will lose its dominant position in the
future? Why or why not? What time horizon are you looking at? (LO 7-6)
3. What is the role of standard in the auto industry? Which factors do you think will be most
critical in setting the next industry standard for technology in car propulsion? (LO 7-6)
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Strategy Project Task 9 ISC individual report (400 words, 10 points)
In this course you worked together as a team. You did a strategy project together and you delivered a
case presentation. After the case presentation you meet as a team and discuss how the cooperation in
your team went throughout the course. Based on this discussion and your previous experiences in this
course each student writes an individual report. In this report you reflect on the team work and the
working procedure and you describe your own role in the team during this course. Answer the
following questions in this individual report:
a. Functioning of the team: decision making and communication
What went well and what was your contribution to this?
What was weak and what was your role in this?
b. Division of tasks and coordination
What were your roles and responsibilities? How did you perform these roles?
How effective was the coordination of the different subtasks?
c. Time management and planning
How was the time management and planning of the team and what was your role in
this?
To what extent was the initial working procedure effective and to what extent did the
team adapt the working procedure effectively? Your role in this?
d. Evaluation and look into the future
What would you do differently if you had the opportunity to do so again?
If you would have the opportunity to cooperate again in the same team would you opt
for this? If yes, give your arguments why. And if no, give your arguments why not.
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SESSION 11, March 21
These sessions are devoted to the presentation of cases. Each of the teams will present one case. These
cases are given at the end of the textbook. The teams can choose from of the following cases listed
below. Each team has 20 minutes for presentation followed by ten minutes of questions and
discussion. Each of the group members needs to participate in the presentation of the case. Team
presentations will be evaluated on the following elements: structure, appearance, delivery, and content.
Besides these elements, it is crucial to interact with the group by posing questions/organizing
discussion. In the course of their presentations teams have to answer critical study questions. These
study questions are as follows:
Case 7 Roger’s Chocolates
1. Using Porter’s characteristics, describe the inter-firm rivalry in the chocolate industry. What are
the strengths/weaknesses of Rogers’ Chocolates’ major competitors?
2. Apply the VRIO framework to assess the competitive implications of Rogers’ Chocolates
resources and capabilities. What are the firm’s core competencies? How might Rogers’ Chocolates
convert some of its existing resources and capabilities into core competencies?
Case 9 GEOX: Breathing innovation into shoes
1. Which stage of the industry life cycle is the footwear industry in? How has that affected Geox’s
ability to enter the market and gain market share?
2. What type of innovation is Geox’s technology? What are its implications for the global footwear
industry?
3. Describe Geox’s innovation strategy. What is its current market position? How did it get here?
Case 17 Merck: Open for Innovation?
1. What does the structure of the pharmaceutical industry look like (the SCP model/Porter’s five
forces)? Is it an attractive industry?
2. Looking at Merck’s SWOT, can Merck gain and sustain a competitive advantage in the
pharmaceutical industry? Why or why not?
3. Analyze Merck’s innovation strategy Can open innovation help Merck meet the needs of its
customers in creative and cost-effective ways that also bring value to its shareholders?
Case 20 Siemens Energy: How to Engineer a Green Future?
1. The case identifies a number of renewable energy sources. Which ones do you think will be viable
future businesses? Why?
2. Apply the Structure-Conduct-Performance (SCP) Model to determine the (U.S.) industry structure
for each of the renewable energy sources identified in your response to Question 1.
3. What are some potential entry barriers for developing new energy-related products, services?
4. How aggressive should Siemens be in pursuing these new technologies? Is it better to be a first
mover and set the standard, or let other firms take the initial risk and then capitalize on their
discoveries?
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SESSION 12, March 26
Post-discussion of task 15. Individual reports are due. Individual reports (ISC task 9) have to be
printed out on one page with 1.5 interval spacing, and font size 12 and handed in to your tutor. The
digital copy has to be uploaded on Safe Assign in EleUM.
SESSION 13, March 28
Recap, resit of individual presentations and feedback on the reports.