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LN7-Business Strategy & Competitive Advantages, SMMC G5, to stop the…
LN7-Business Strategy & Competitive Advantages
differentiation v.s. cost leadership
Differentiation Potential by Value Chain
tsmc
human resource mangement
there are 19 differents kinds of job they need
technology development
the biggest foundary market in the world 77.2%
Disadvantages
Foundry include memory, logic and so on
if we count it into foundary tsmc only offer 5% of the foundry to the world
firm infrastructure
chemical mechanical polishing(CMP)
CMP pad
Ryan Air: Lower cost than the Cost Leader!
Ryanair
no meal offer on plane
no entertainment
no lounge access
Internet-enabled Strategies
Focus
lower the cost for search beneficial to economic development
get immediate information
Differentiation
the information can be discussed or correct immediately on the internet
being more convenience to do searching
cost
for enternet fee it will be around 290 to 677 a month
doesn' t need to pay extra fee for serach engine
search every without any traffic demand
for tratitional search an encyclopedia around 450
need to buy or borrow other books or information
need extra fee for traffic demand
Combined
traditional are well to prevent data leakage
well to do compare with the price while shopping
Industry Lifecycle
Stages of Industry Lifecycle
strage
Introduction
Growth
Maturity
Decline
factor
Generatic strategies
Differentiation
Differentiation
Differentiation
Overall cost Leadership
Overall cost Leadership
maximizing efficiency and minimizing costs
1 more item...
maintaining their market position and customer reduce costs and improve efficiency
differentiating their offerings from the competitors to attract more specific consumers and address their preferences
company find their new products or services which have differentiation from those of competitors
Market growth rate
Number of competition
very few
some
many
1 more item...
Intesity of competition
Major functional area of concern
Overall object
1 more item...
research
and development
1 more item...
low
increasing
1 more item...
low
very large
low to mederate
negative
How to Protect Competitive Advantages
Path Dependence
present options constrained by past decisions
Examples
Honda’s core competencies in the gas engine field
Expertise and technology base built over decades
Unique Metric System in the U.S
It adopts the imperial system
Difficult to change
Causal Ambiguity
Reasons for success or failure are not apparent
Consider Apple's range of products as successful
Creative Talents of Apple's Design Team
It's hard to say which factor is the main reason for Apple's success
Strategic Timing of Product Launches
Steve Jobs' Visionary Leadership
Social Complexity
Interaction of multiple systems produces numerous outcomes
Examples
5 people → 10 potential interactions
As the number of participants increases, so does the complexity of the interactions
3 people → 3 different relationships
Better Expectations of Future Values
Buy resources economically
Take real estate development for example
Highway expansion increases transportation convenience
Buy land at a lower price
⭣
The value of land may rise significantly
Porter’s Three Generic Strategies
cost leadership
Low cost position & Industrywide
focus
Differentiation Focus
Uniqueness perceived by the customer & Particular segment only
Cost Focus
Low cost position & Particular segment only
differentiation
Uniqueness perceived by the customer & Industrywide
Cost Down vs. Value Up
Value Up
Target Customer Group
customization of products or services, targeted marketing campaigns
Differentiation
innovative technology
distinctive branding
superior quality
Product/Service Attributes
intangible
exceptional customer service,a strong brand reputation
tangible
quality materials, innovative design
Cost Down
Design for Manufacture (DFM)
by standardizing components, modularizing designs to allow for easier assembly, and streamlining production processes
faster production times, lower material costs and reduced labor requirements
Input Factors
Negotiating favorable terms with suppliers and taking advantage of location advantages
diversifying suppliers to reduce dependency
leveraging economies of scale to negotiate lower prices
locating production facilities in regions with favorable economic conditions
Economies of Scope
the cost of producing multiple products or services together < the cost of producing them separately
cost sharing
spillover effects
Capacity Utilization
Optimizing capacity utilization involves managing production resources efficiently
designing flexible production systems that can adapt to changing demand
optimizing the cost structure of production facilities
controlling inventory levels to avoid excess or shortages
Economies of Learning (EOL)
the cost reductions that come from gaining experience and expertise over time
improving individual skills through training and development
optimizing organizational routines and processes
Residual Efficiency
optimizing organizational culture, business processes, and management practices
fostering a culture of continuous improvement
streamlining workflows and decision-making processes
investing in training and development to enhance employee skills and productivity
Economies of Scale (EOS)
reducing per-unit costs by increasing the volume of production
can be achieved through
specialization
SMMC G5
IBS3 Chloe
IBS3 Ken
IBS3 Hailey
DFLL3 Ruby
DFLL3 Emily
IBS3 Yvonne
IBS3 Ruby
DFLL3 Allen
to stop the monopoly of the air line between London and Ireland from British Airways and Aer Lingus
LN8-Management of Technology,
Innovation and Entrepreneurship
Innovation
Meaning
A recombination process :check:
Discovery :green_cross:
Making a change/difference
Strategic Innovation
Involve
Initiate a new business model
How to compete
Beyond
Product Innovation
Process Innovation
The profit
Value of innovation
maintain a competitive edge
meet the evolving needs of customers
explore new market opportunities
two elements
Legal Protection
ensure their unique position in the market
gain lawful profits
Complementary Resources
collaborate with other enterprises or institutions
jointly develop and promote innovative products or technologies
Ability to appropriate innovation value
Limitability of the technology
Ability to appropriate innovation value
Strategies for limiting availability
patents protection
restrict the availability of technology to competitors
enhance the innovator's proprietary value
Lead time
Time for competitors to develop similar innovations
Complexity of the technology
Regulatory barriers
Multiple Dimensions of Value
A Technology's Stand-alone Value
:two: aesthetic qualities
:three: Its ease of use
:one: The functions for customers
Buyer Utility Map
Network Externality value
include
:diamond_shape_with_a_dot_inside: The size of the technology's installed base
smaller
more standalone functionality & less overall value
:heavy_check_mark: The availability of complementary goods
poor
must offer
dramatic technological improvement
compatibility with existing installed base and complements
each dimension may be
Disproportional
Standards
Three ways standards emerge
:one: Firms ask for
industry standard- public domain
A set of guidelines or criteria being used for public, openly accessible within the industry
:two: Set by cooperation among firms
:three: Selected by
market demand
They reflect the preferences, needs, and requirements of consumers and businesses
Benefits of Standards
Guarantee
compatibility
between products
The USB standardize connection interface for various devices such as computers, printers
Reduce risks with supplying complementary products
Reduce consumers' confusion
It offers convenience and
interoperability
across different devices and brands.
Reduce production cost
Efficiency
Economies of Scale
Interchangeability
technology
Ex: new technology
horizontal axis:competitive advantages
vertical axis:strategy target
Why
ex:
ex:
result from
result in
