To Overcome Strategic and Operational Barriers Operative Effectiveness Strategic Effectiveness Dynamic Effectiveness Atlas Copco Expansion from an efficient logistical plattform Electrolux Tries to exploit operational synergies from acquisitions Ericsson Adapts logistical structures to new industry and new tehnology DELL Affärsmodell som bygger på - Direktförsäljning - Kundorderstyrd produktion - Skalfördelar - Stark positionering New companies Goes directly into the dynamic position Quick expansion based on efficient logistics - no old-fashioned infra-structure
Dynamic corner 1. Flexible production 2. New products in the same production system 3. Global logistics platform 4. Expansion to new markets 5. Administrative center 6. Internet strategy Operational platforms Strategic opportunities
The Business Model Concept Market Positions The Offering Operational Platforms What does the customer want? What do we offer – value proposition? What are our resources? Market channel Partners Supply How are we selling/ marketing?
Three cornerstones for success Customer intimacy Innovation Operational excellence
Definitions Activities, then, are the basic units of competitive advantage. Overall advantage or disadvantage results from all a company´s acitivities, not only a few. Operational effectiveness means performing similar activities better than rivals perform them. Operational effectiveness includes but is not limited to efficiency. In contrast strategic positioning means performing different activities from rivals or performing similar activities in different ways.
Productivity Frontier Relative cost position Nonprice byuer value delivered
Three Strategies Strategic positions – can be based on customers´needs, customers´accessibility, or a variety of a company´s products or services
Definition Core competencies are the collective learning in the organization, especially how to coordinate diverse production skills and integrate multiple streams of technology Unlike physical assets, competencies do not deteriorate as they are applied and shared. They grow. Few companies are likely to build world leadership in more than five or six fundamental competencies.
The Tree Metaphor Core competences are the root system Core products are the trunk and the major limbs SBUs are the smaler branches Products are the flowers and the leaves
Core Competence vs SBU Organisation The tyranny of the SBU
Core competence Unique Used in many markets Value to customers Treshold capabilities and competences Unique resources and core competences
Central vs Decentral CorporateCountry Local Marketing X X Sales X X Service (X) X X Development X Production X Logistics X (X) IT-Systems X Education X X
Four principles of capability-based competition The building blocks of corporate strategy are not products and markets but business processes Competitive success depends on transforming a company´s key processes into strategic capabilities that consistently provide superior value to the customer Companies crate these capabilities by making strategic investments in a support infrastructure that links together and transcends traditional SBU´s and functions. Because capabilities necessarily cross functions, the champion of a capabilities-based strategy is the CEO.