2009 Forecast Lunch Douglas Reid
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Transcript of 2009 Forecast Lunch Douglas Reid
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General Environment Analysis• Analyze minimum number of factors
– Economic
– Demographic
– Political/legal
– Technological
– Global
– Sociocultural
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Economic
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Demographic
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Canada USA
China India
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Political/Legal
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Technological
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Global
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Sociocultural
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Breadth of Competitive Scope
Source of Competitive Advantage
BroadTargetMarket
NarrowTargetMarket
Cost
Focused Differen-
tiation
CostLeadership
Differen-tiation
Focused Low Cost
Uniqueness
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Breadth of Competitive Scope
Source of Competitive Advantage
BroadTargetMarket
NarrowTargetMarket
Cost
Focused Differen-
tiation
CostLeadership
Differen-tiation
Focused Low Cost
Uniqueness
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Cost Leadership -- Definition
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Characteristics of Low Cost Competitor
• Cost conscious organizational culture
• Spartan facilities
• Limited perks and frills for executives
• Intolerance of waste
• Intensive screening of budget requests
• Employees enlisted in cost control efforts
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Breadth of Competitive Scope
Source of Competitive Advantage
BroadTargetMarket
NarrowTargetMarket
Cost
Focused Differen-
tiation
CostLeadership
Differen-tiation
Focused Low Cost
Uniqueness
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AlignmentARENAS• Inexpensive, contemporary furniture• Young, white-collar customers• Worldwide
VEHICLES• Organic expansion• Wholly-owned stores
DIFFERENTIATORS• Very reliable quality• Low price• Fun, non-threatening shopping experience• Instant fulfillment
STAGING• Rapid international expansion, by region• Early footholds in each country, fill in later
ECONOMIC LOGIC• Scale (global, regional, and individual store)• Efficiencies from replication
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Round or Flat?
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Research
Source: Rugman,, 2005; Ghemawat, 2007; Reid, 2008
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