Expert answer:write a blog
Expert answer:Find a news( not an article) and write a blog related subject about chapter 12,post the link of news also.
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STRATEGIC MANAGEMENT
Competitiveness & Globalization
Concepts
12e
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
STRATEGIC MANAGEMENT
Competitiveness & Globalization
Concepts
12e
Michael A. Hitt
Texas A&M University
and
Texas Christian University
R. Duane Ireland
Texas A&M University
Robert E. Hoskisson
Rice University
Australia • Brazil • Japan • Korea • Mexico • Singapore • Spain • United Kingdom • United States
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. WCN 02-200-203
Strategic Management: Competitiveness &
Globalization: Concepts, 12e
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Michael A. Hitt, R. Duane Ireland, and
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To My Family:
I love each and every one of you. Thank you for all of your love and
support.
— MICHAEL, DAD , PAP A
To Mary Ann:
“Now everyone dreams of a love lasting and true.” This was my dream
that you have completely fulfilled. Thank you for all of the love, support,
and encouragement throughout our life together.
— R. DUANE IRRELAN D
To Kathy:
My love for you is eternal, and I hope that we can be eternally together.
Thanks for all the support and love you’ve given me throughout my life.
— BOB
O
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Brief Contents
Preface, xv
About the Authors, xxii
Part 1: Strategic Management Inputs
1.
Strategic Management and Strategic Competitiveness, 2
2.
The External Environment: Opportunities, Threats, Industry Competition,
and Competitor Analysis, 38
3.
The Internal Organization: Resources, Capabilities, Core Competencies,
and Competitive Advantages, 76
Part 2: Strategic Actions: Strategy Formulation
4.
Business-Level Strategy, 108
5.
Competitive Rivalry and Competitive Dynamics, 142
6.
Corporate-Level Strategy, 172
7.
Merger and Acquisition Strategies, 204
8.
International Strategy, 236
9.
Cooperative Strategy, 276
Part 3: Strategic Actions: Strategy Implementation
2
108
308
10. Corporate Governance, 308
11. Organizational Structure and Controls, 344
12. Strategic Leadership, 382
13. Strategic Entrepreneurship, 416
Part 4: Preparing an Effective Case Analysis
C-1
Name Index, I-1
Company Index, I-20
Subject Index, I-23
vi
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Contents
Preface xv
About the Authors xxii
Part 1: Strategic Management Inputs 2
1: Strategic Management and Strategic Competitiveness 2
Opening Case: Alibaba: An Online Colossus in China Goes Global 3
1-1 The Competitive Landscape 7
1-1a The Global Economy 8
1-1b Technology and Technological Changes 10
Strategic Focus: Starbucks Is “Juicing” Its Earnings per Store through Technological Innovations 11
1-2 The I/O Model of Above-Average Returns 14
1-3 The Resource-Based Model of Above-Average Returns 16
1-4 Vision and Mission 18
1-4a Vision 18
1-4b Mission 19
1-5 Stakeholders 19
Strategic Focus: The Failure of BlackBerry to Develop an Ecosystem of Stakeholders 20
1-5a Classifications of Stakeholders 21
1-6 Strategic Leaders 25
1-6a The Work of Effective Strategic Leaders 25
1-7 The Strategic Management Process 26
Summary 28 • Key Terms 28 • Review Questions 29 • Mini-Case 29 • Notes 30
2: The External Environment: Opportunities, Threats, Industry
Competition, and Competitor Analysis 38
Opening Case: Are There Cracks in the Golden Arches? 39
2-1 The General, Industry, and Competitor Environments 41
2-2 External Environmental Analysis 43
2-2a Scanning 43
2-2b Monitoring 44
2-2c Forecasting 44
2-2d Assessing 45
2-3 Segments of the General Environment 45
2-3a The Demographic Segment 45
2-3b The Economic Segment 48
2-3c The Political/Legal Segment 49
2-3d The Sociocultural Segment 50
2-3e The Technological Segment 51
2-3f The Global Segment 52
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vii
viii
Contents
2-3g The Sustainable Physical Environment Segment 53
Strategic Focus: Target Lost Its Sway Because Tar-zhey No Longer Drew the Customers 54
2-4 Industry Environment Analysis 55
2-4a Threat of New Entrants 56
2-4b Bargaining Power of Suppliers 59
2-4c Bargaining Power of Buyers 60
2-4d Threat of Substitute Products 60
2-4e Intensity of Rivalry among Competitors 60
2-5 Interpreting Industry Analyses 63
2-6 Strategic Groups 63
Strategic Focus: Watch Out All Retailers, Here Comes Amazon; Watch Out Amazon, Here Comes
Jet.com 64
2-7 Competitor Analysis 65
2-8 Ethical Considerations 67
Summary 68 • Key Terms 68 • Review Questions 68 • Mini-Case 69 • Notes 70
3: The Internal Organization: Resources, Capabilities, Core
Competencies, and Competitive Advantages 76
Opening Case: Data Analytics, Large Pharmaceutical Companies, and
Core Competencies: A Brave New World 77
3-1 Analyzing the Internal Organization 79
3-1a The Context of Internal Analysis 79
3-1b Creating Value 81
3-1c The Challenge of Analyzing the Internal Organization 81
3-2 Resources, Capabilities, and Core Competencies 84
3-2a Resources 84
Strategic Focus: Strengthening the Superdry Brand as a Foundation to Strategic Success 85
3-2b Capabilities 88
3-2c Core Competencies 89
3-3 Building Core Competencies 89
3-3a The Four Criteria of Sustainable Competitive Advantage 89
3-3b Value Chain Analysis 93
3-4 Outsourcing 96
3-5 Competencies, Strengths, Weaknesses, and Strategic Decisions 96
Strategic Focus: “We’re Outsourcing that Activity but Not That One? I’m Surprised!” 97
Summary 98 • Key Terms 99 • Review Questions 99 • Mini-Case 100 • Notes 101
Part 2: Strategic Actions: Strategy Formulation 108
4: Business-Level Strategy 108
Opening Case: Hain Celestial Group: A Firm Focused on “Organic” Differentiation 109
4-1 Customers: Their Relationship with Business-Level Strategies 112
4-1a Effectively Managing Relationships with Customers 112
4-1b Reach, Richness, and Affiliation 113
4-1c Who: Determining the Customers to Serve 114
4-1d What: Determining Which Customer Needs to Satisfy 114
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Contents
4-1e How: Determining Core Competencies Necessary to Satisfy Customer Needs 115
4-2 The Purpose of a Business-Level Strategy 116
4-3 Types of Business-Level Strategies 117
4-3a Cost Leadership Strategy 118
4-3b Differentiation Strategy 122
Strategic Focus: Apple vs. Samsung: Apple Differentiates and Samsung Imperfectly Imitates 126
4-3c Focus Strategies 127
4-3d Integrated Cost Leadership/Differentiation Strategy 129
Strategic Focus: RadioShack’s Failed Focus Strategy: Strategic Flip-Flopping 130
Summary 134 • Key Terms 135 • Review Questions 135 • Mini-Case 135 • Notes 136
5: Competitive Rivalry and Competitive Dynamics 142
Opening Case: Does Google Have Competition? Dynamics of the High Technology
Markets 143
5-1 A Model of Competitive Rivalry 146
5-2 Competitor Analysis 147
5-2a Market Commonality 147
5-2b Resource Similarity 148
Strategic Focus: Does Kellogg Have the Tiger by the Tail or Is It the Reverse? 150
5-3 Drivers of Competitive Behavior 150
5-4 Competitive Rivalry 152
5-4a Strategic and Tactical Actions 152
5-5 Likelihood of Attack 153
5-5a First-Mover Benefits 153
5-5b Organizational Size 155
5-5c Quality 156
5-6 Likelihood of Response 157
5-6a Type of Competitive Action 157
5-6b Actor’s Reputation 158
5-6c Market Dependence 158
5-7 Competitive Dynamics 159
5-7a Slow-Cycle Markets 159
5-7b Fast-Cycle Markets 161
5-7c Standard-Cycle Markets 162
Strategic Focus: The Ripple Effect of Supermarket Wars: Aldi Is Changing the Markets in Many
Countries 163
Summary 164 • Key Terms 166 • Review Questions 166 • Mini-Case 166 • Notes 167
6: Corporate-Level Strategy 172
Opening Case: Disney Adds Value Using a Related Diversification Strategy 173
6-1 Levels of Diversification 175
6-1a Low Levels of Diversification 176
6-1b Moderate and High Levels of Diversification 177
6-2 Reasons for Diversification 178
6-3 Value-Creating Diversification: Related Constrained and Related
Linked Diversification 179
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ix
x
Contents
6-3a Operational Relatedness: Sharing Activities 180
6-3b Corporate Relatedness: Transferring of Core Competencies 181
6-3c Market Power 182
6-3d Simultaneous Operational Relatedness and Corporate Relatedness 184
6-4 Unrelated Diversification 185
6-4a Efficient Internal Capital Market Allocation 185
Strategic Focus: GE and United Technology Are Firms that Have Pursued Internal Capital Allocation
and Restructuring Strategies 186
6-4b Restructuring of Assets 187
6-5 Value-Neutral Diversification: Incentives and Resources 188
6-5a Incentives to Diversify 188
Strategic Focus: Coca-Cola’s Diversification to Deal with Its Reduced Growth in Soft Drinks 190
6-5b Resources and Diversification 192
6-6 Value-Reducing Diversification: Managerial Motives to Diversify 193
Summary 196 • Key Terms 196 • Review Questions 196 • Mini-Case 197 • Notes 198
7: Merger and Acquisition Strategies 204
Opening Case: Mergers and Acquisitions: Prominent Strategies for Firms Seeking to
Enhance Their Performance 205
7-1 The Popularity of Merger and Acquisition Strategies 206
7-1a Mergers, Acquisitions, and Takeovers: What Are the Differences? 207
7-2 Reasons for Acquisitions 208
Strategic Focus: A Merger of Equals: Making It Happen Isn’t Easy! 209
7-2a Increased Market Power 210
7-2b Overcoming Entry Barriers 211
Strategic Focus: Different Strategic Rationales Driving Cross-Border Acquisitions 212
7-2c Cost of New Product Development and Increased Speed to Market 213
7-2d Lower Risk Compared to Developing New Products 214
7-2e Increased Diversification 214
7-2f Reshaping the Firm’s Competitive Scope 215
7-2g Learning and Developing New Capabilities 215
7-3 Problems in Achieving Acquisition Success 216
7-3a Integration Difficulties 217
7-3b Inadequate Evaluation of Target 218
7-3c Large or Extraordinary Debt 219
7-3d Inability to Achieve Synergy 220
7-3e Too Much Diversification 221
7-3f Managers Overly Focused on Acquisitions 221
7-3g Too Large 222
7-4 Effective Acquisitions 222
7-5 Restructuring 224
7-5a Downsizing 224
7-5b Downscoping 224
7-5c Leveraged Buyouts 225
7-5d Restructuring Outcomes 225
Summary 227 • Key Terms 228 • Review Questions 228 • Mini-Case 228 • Notes 230
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Contents
8: International Strategy 236
Opening Case: Netflix Ignites Growth Through International Expansion, But Such
Growth Also Fires Up the Competition 237
8-1 Identifying International Opportunities 239
8-1a Incentives to Use International Strategy 239
8-1b Three Basic Benefits of International Strategy 241
8-2 International Strategies 243
8-2a International Business-Level Strategy 243
8-2b International Corporate-Level Strategy 246
Strategic Focus: Furniture Giant IKEA’s Global Strategy 248
8-3 Environmental Trends 250
8-3a Liability of Foreignness 250
8-3b Regionalization 251
8-4 Choice of International Entry Mode 252
8-4a Exporting 253
8-4b Licensing 253
8-4c Strategic Alliances 254
8-4d Acquisitions 255
8-4e New Wholly Owned Subsidiary 256
8-4f Dynamics of Mode of Entry 257
8-5 Risks in an International Environment 258
8-5a Political Risks 258
8-5b Economic Risks 259
Strategic Focus: The Global Soccer Industry and the Effect of the FIFA Scandal 260
8-6 Strategic Competitiveness Outcomes 262
8-6a International Diversification and Returns 262
8-6b Enhanced Innovation 263
8-7 The Challenge of International Strategies 264
8-7a Complexity of Managing International Strategies 264
8-7b Limits to International Expansion 264
Summary 265 • Key Terms 266 • Review Questions 266 • Mini-Case 266 • Notes 268
9: Cooperative Strategy 276
Opening Case: Google, Intel, and Tag Heuer: Collaborating to
Produce a Smartwatch 277
9-1 Strategic Alliances as a Primary Type of Cooperative Strategy 279
9-1a Types of Major Strategic Alliances 279
9-1b Reasons Firms Develop Strategic Alliances 281
9-2 Business-Level Cooperative Strategy 284
9-2a Complementary Strategic Alliances 284
9-2b Competition Response Strategy 286
9-2c Uncertainty-Reducing Strategy 287
9-2d Competition-Reducing Strategy 287
Strategic Focus: Strategic Alliances as the Foundation for Tesla Motors’ Operations 288
9-2e Assessing Business-Level Cooperative Strategies 290
9-3 Corporate-Level Cooperative Strategy 290
9-3a Diversifying Strategic Alliance 291
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xi
xii
Contents
9-3b Synergistic Strategic Alliance 291
9-3c Franchising 291
9-3d Assessing Corporate-Level Cooperative Strategies 292
9-4 International Cooperative Strategy 292
9-5 Network Cooperative Strategy 293
9-5a Alliance Network Types 294
9-6 Competitive Risks with Cooperative Strategies 295
Strategic Focus: Failing to Obtain Desired Levels of Success with Cooperative Strategies 296
9-7 Managing Cooperative Strategies 297
Summary 299 • Key Terms 300 • Review Questions 300 • Mini-Case 300 • Notes 302
Part 3: Strategic Actions: Strategy Implementation 308
10: Corporate Governance 308
Opening Case: The Corporate Raiders of the 1980s Have Become the Activist
Shareholders of Today 309
10-1 Separation of Ownership and Managerial Control 312
10-1a Agency Relationships 313
10-1b Product Diversification as an Example of an Agency Problem 314
10-1c Agency Costs and Governance Mechanisms 316
10-2 Ownership Concentration 317
10-2a The Increasing Influence of Institutional Owners 318
10-3 Board of Directors 319
10-3a Enhancing the Effectiveness of the Board of Directors 321
10-3b Executive Compensation 322
10-3c The Effectiveness of Executive Compensation 323
Strategic Focus: Do CEOs Deserve the Large Compensation Packages They Receive? 324
10-4 Market for Corporate Control 325
10-4a Managerial Defense Tactics 326
10-5 International Corporate Governance 328
10-5a Corporate Governance in Germany and Japan 328
Strategic Focus: “Engagement” versus “Activist” Shareholders in Japan, Germany, and China 330
10-5b Corporate Governance in China 331
10-6 Governance Mechanisms and Ethical Behavior 332
Summary 333 • Key Terms 334 • Review Questions 334 • Mini-Case 335 • Notes 336
11: Organizational Structure and Controls 344
Opening Case: Luxottica’s Dual CEO Structure: A Key to Long-Term Success or a Cause
for Concern? 345
11-1 Organizational Structure and Controls 347
11-1a Organizational Structure 347
Strategic Focus: Changing McDonald’s Organizational Structure: A Path to Improved Performance? 348
11-1b Organizational Controls 350
11-2 Relationships between Strategy and Structure 351
11-3 Evolutionary Patterns of Strategy and Organizational Structure 351
11-3a Simple Structure 352
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Contents
11-3b Functional Structure 353
11-3c Multidivisional Structure 353
11-3d Matches between Business-Level Strategies and the Func …
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