Chapter Four

1. 4-1 Chapter Four Building Competitive Advantage Through Functional-Level Strategy

2. 4-2 Building Blocks of Competitive Advantage ???????????: ??: ??=??/?? ?????:?????????????,???????????????????????? ??:?????? ??:????(3M,Intel)?????(????????JIT) ???????????????: ??: ??=??/?? ?????:?????????????,???????????????????????? ??:?????? ??:????(3M,Intel)?????(????????JIT) ????

3. 4-3 Functional-Level Strategies Aim to give a firm superior: Efficiency Quality Innovation Customer responsiveness

4. 4-4 The Roots of Competitive Advantage

5. 4-5 Building Blocks of Competitive Advantage ???????????: ??: ??=??/?? ?????:?????????????,???????????????????????? ??:?????? ??:????(3M,Intel)?????(????????JIT) ???????????????: ??: ??=??/?? ?????:?????????????,???????????????????????? ??:?????? ??:????(3M,Intel)?????(????????JIT) ????

6. 4-6 How to Achieve Superior Efficiency

7. 4-7 Achieving Superior Efficiency Economies of scale Unit cost reductions associated with a large scale of output Spread fixed costs over a large production volume Producing in large volumes to achieve a greater division of labor and specialization Employees to become very skilled at performing a particular task Economies of scale Unit cost reductions associated with a large scale of output Ability to spread fixed costs over a large production volume Ability of companies producing in large volumes to achieve a greater division of labor and specialization Specialization has favorable impact on productivity by enabling employees to become very skilled at performing a particular task Diseconomies of scale Unit cost increases associated with a large scale of output Increased bureaucracy associated with large-scale enterprises Resulting managerial inefficiencies Economies of scale Unit cost reductions associated with a large scale of output Ability to spread fixed costs over a large production volume Ability of companies producing in large volumes to achieve a greater division of labor and specialization Specialization has favorable impact on productivity by enabling employees to become very skilled at performing a particular task Diseconomies of scale Unit cost increases associated with a large scale of output Increased bureaucracy associated with large-scale enterprises Resulting managerial inefficiencies

8. 4-8 Economies and Diseconomies of Scale

9. 4-9 How to Achieve Superior Efficiency

10. 4-10 Learning Effects Learning Effects are cost savings that come from learning by doing. Labor productivity Management efficiency A downward shift of the entire unit cost curve

11. 4-11 The Impact of Learning and Scale Economies on Unit Costs

12. 4-12 How to Achieve Superior Efficiency

13. 4-13 The Experience Curve The Experience Curve is the systematic lowering of the cost structure and consequent unit cost reductions that occur over the life of a product

14. 4-14 The Experience Curve

15. 4-15 Unit Production Costs in an Integrated Steel Mill and a Mini-mill


17. 4-17 Flexible Manufacturing and Mass Customization Flexible Manufacturing Technology Reduces setup times for complex equipment Improves scheduling to increase use of individual machines Improves quality control Increases efficiency and lowers unit costs

18. 4-18 Flexible Manufacturing and Mass Customization Mass Customization Ability to use flexible manufacturing technology to reconcile two goals that were once thought incompatible: Low cost Differentiation through product customization

19. 4-19 Tradeoff Between Costs and Product Variety


21. 4-21 Marketing The position that a company takes regarding: Pricing Promotion Advertising Product Design Distribution Marketing strategy can reduce costs by lowering customer defection rates and increasing loyalty

22. 4-22 Customer Loyalty and Profit per Customer


24. 4-24 Activities necessary to get inputs and components to a production facility, through the production process and the distribution system to the end-user Many sources of cost in this process Significant opportunities for cost reduction Just-in-Time (JIT) Inventory System Supply Chain Management is the task of managing the flow of inputs to a company�s processes to minimize inventory holding and maximize inventory turnover Materials Management and Supply Chain


26. 4-26 Boost efficiency Reduce the number of parts that make up a product Design for manufacturing Lower cost structure by pioneering process innovations Reduce process setup times Flexible manufacturing An important source of competitive advantage R&D Strategy


28. 4-28 Human Resource Strategy Hiring strategy Employee training Self-managing teams Pay for performance Hiring strategy Assures that the people a company hires have the attributes that match the strategic objectives of the company Employee training Upgrades employee skills to perform tasks faster and more accurately Self-managing teams Members coordinate their own activities and make their own hiring, training, work, and reward decisions Pay for performance Linking pay to individual and team performance can help to increase employee productivity Hiring strategy Assures that the people a company hires have the attributes that match the strategic objectives of the company Employee training Upgrades employee skills to perform tasks faster and more accurately Self-managing teams Members coordinate their own activities and make their own hiring, training, work, and reward decisions Pay for performance Linking pay to individual and team performance can help to increase employee productivity Hiring strategy Assures that the people a company hires have the attributes that match the strategic objectives of the company Employee training Upgrades employee skills to perform tasks faster and more accurately Self-managing teams Members coordinate their own activities and make their own hiring, training, work, and reward decisions Pay for performance Linking pay to individual and team performance can help to increase employee productivity Hiring strategy Assures that the people a company hires have the attributes that match the strategic objectives of the company Employee training Upgrades employee skills to perform tasks faster and more accurately Self-managing teams Members coordinate their own activities and make their own hiring, training, work, and reward decisions Pay for performance Linking pay to individual and team performance can help to increase employee productivity


30. 4-30 Information Systems Web-based information systems can automate many activities Cisco online support Automate interactions between Company and customers Google�s blog Company and suppliers


32. 4-32 A company�s structure, culture, style of strategic leadership, and control system: Determines the context within which all other value creation activities take place Is especially important in building a companywide commitment to efficiency Articulates a vision for all functions and coordinate across functions Infrastructure

33. 4-33 Primary Roles of Value Creation Functions

34. 4-34 Building Blocks of Competitive Advantage ???????????: ??: ??=??/?? ?????:?????????????,???????????????????????? ??:?????? ??:????(3M,Intel)?????(????????JIT) ???????????????: ??: ??=??/?? ?????:?????????????,???????????????????????? ??:?????? ??:????(3M,Intel)?????(????????JIT) ????

35. 4-35 Achieving Superior Quality A strong reputation for quality allows a company to differentiate its products. Eliminating defects or errors reduces waste, increases efficiency, and lowers the cost structure � increasing profitability.

36. 4-36 Improving Quality as Reliability

37. 4-37 Deming�s Steps in a Quality Improvement Program A clear business mode. Philosophy that mistakes, defects, and poor quality are not acceptable Quality of supervision An environment in which employees will not be fearful of reporting problems or making suggestions. Work standards Employees training Commitment of everyone

38. 4-38 Roles in Implementing Reliability Improvement Methodologies

39. 4-39 Implementing Reliability Improvement Methodologies Build organizational commitment to quality Create quality leaders Focus on the customer Identify processes and the source of defects Find ways to measure quality Set goals and create incentives Solicit input from employees Build long-term relationships with suppliers Design for ease of manufacture Break down barriers among functions

40. 4-40 Improving Quality as Excellence Developing Superior Attributes: Learn which attributes are most important to customers Design products and associate services to embody the important attributes Decide which attributes to promote and how best to position them in consumers� minds Continual improvement in attributes and development of new-product attributes

41. 4-41 Attributes Associated with a Product Offering


43. 4-43 Achieving Superior Innovation Innovation can: Result in new products that better satisfy customer needs Improve the quality of existing products Reduce costs Innovation can be imitated - So it must be continuous

44. 4-44 The High Failure Rate of Innovation Most common explanations for failure: Uncertainty Poor commercialization Poor positioning strategy Technological myopia Being slow to market Uncertainty Quantum innovation � radical departure with higher risk Incremental innovation � extension of existing technology Poor commercialization Definite demand for product Product not well adapted to customer needs Poor positioning strategy Good product but poorly positioned in the marketplace Technological myopia Technological �wizardry� vs. meeting market requirements Being slow to market Uncertainty Quantum innovation � radical departure with higher risk Incremental innovation � extension of existing technology Poor commercialization Definite demand for product Product not well adapted to customer needs Poor positioning strategy Good product but poorly positioned in the marketplace Technological myopia Technological �wizardry� vs. meeting market requirements Being slow to market

45. 4-45 Steps to Build Competencies in Innovation Achieving cross-functional integration Driven by customer needs Design for manufacturing Track development costs Minimize time-to-market Close integration between R&D and marketing Achieving cross-functional integration Driven by customer needs Design for manufacturing Track development costs Minimize time-to-market Close integration between R&D and marketing

46. 4-46 The Development Funnel

47. 4-47 Sequential and Partly Parallel Development Processes

48. 4-48 Functional Roles for Achieving Superior Innovation


50. 4-50 Achieving Superior Responsiveness to Customers Focusing on the customer Customization My Amazon iGoogle Response time

51. 4-51 Functions in Achieving Superior Responsiveness

Chapter Four

Chapter Four

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Chapter four

Chapter Four:

Chapter Four

Chapter Four

Chapter Four

Chapter Four Day Four

Chapter Four

Chapter Four

Chapter Four

Chapter Four

CHAPTER FOUR

Chapter Four

Chapter Four

Chapter Four

Chapter Four

Chapter Four

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