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Theory of your firm (Focuse on growth Corporate Therory (Blur uniqness…
Theory of your firm
Focuse on growth Corporate Therory
Discoverint and targeting attractive markets
Craft positions to deliver sustained competitive advantage
Valuable positions protected from imitation and appropriatnion
Prior financial returns does not significantly increase share price
Blur uniqness
create compromises
reduce fit
undermine competitive advantafe
hazardous to strategy
How to keep finding new unexpected ways to create value
Draw from available Knowledge and prior experience
Develop cognitive theoretical model
make guess about where to find value
a well crafted theory becomes evident
comes down to prices paid
enables acquirer to spot bargains
provide the vision to step into uncharted terrain
what are necessarily incertain strategic experiments
a better theory yields better choices
search for valuable more tha an random walk
Sights of strategy
Foresight
Articulates beliefs and expectations
Predicts future customer tastes
customer demands
foresees develompent of technolofies
forecasts competitive actions of rivals
asset acuisitions, investements, or strategic actions
Insight
reflecting a deep understanding of the organization activities
identivies rare, distinctive and valuable
required no agents
Cross sight
identifies complementarity
assemble pursue by acquiring assetns
combined with existing ones to create value
Sustained advantage comes from targeting and crafting positions
Managers need a corprate theory to explain how they create value
Forsight about an industry's future
companies valuies and unique resourses
Lack of a theory
not all companies discover a valuable one