GMS 200 Lecture Notes - Horizontal Integration

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Published on 31 Mar 2011
School
Ryerson University
Department
Global Management Studies
Course
GMS 200
Page:
of 4
Week 11 GMS Lecture notes
Final exam
Total time: 120 minutes
Number of questions: 120
Chapters 1,4,5,7 30 questions
Chapters 2,6,8,9,10,13 90 questions
April 27, 12 PM at MTCC
Business level strategies
Two generic strategies:
1.Cost Leadership
a.Timex
b.BiC
2.Differentiation
a.Rolex
Corporate level strategies (important for exam)
Many types, but here we have divided them into three:
1. Integrative strategies
a.Gaining ownership of increased control over distributors or retailers (forward
integration)
i.McDonalds and other fast food chains
1.Owns 23% of its 32,000 restaurants worldwide
ii.Boise Cascade
1.Forest products firm
2.Owns 2.3 million acres of timber-lands
3.Distributes the Cascade line of products to Office Depot,
Staples, and OfficeMax (office furniture)
4.Recently acquired OfficeMax (drawback their customers are
now their competitors, so now their reach has been limited to
OfficeMax
b.Seeking ownership or control of a firms suppliers (backward integration)
i.Arcelor Mittal UK based, largest steel company in the world
1.Presence in 60 countries
2.Own 47% of iron ore mines (removing the mark up from the
mines to the steel products, ensures their supply, huge barrier
to entry competitors will have to pay premium)
3. Intends to increase it to 75%
www.notesolution.com
c.Strategy of seeking ownership of or increased control over a firms
competitors. Mergers, acquisitions, and takeovers among competitors
(horizontal integration)
i.Oracle / Sun Microsystems
ii. IBM acquired Cognos (Cognos had Canadian markets which IBM
wanted to tap into)
2. Intensive strategies
a.Market penetration strategy seeks to increase market share for present
products and services in present markets through greater marketing efforts.
It includes increasing the number of salespersons, advertising expenditures,
and sales promotions.
b.Market development strategy introducing present products or services into
new geographic areas. E.g. General Motors and Ford have greater revenue
and profits from businesses outside the US. Starbucks has opened thousand
of stores in China.
c.Product development strategy seeks increased sales by modifying and
improving present products or services in existing markets. Entails large
research and development expenditures.
3.Diversification strategies
E.g. United Technologies *unrelated
a.Aviation: core business
i.Acquired carrier
ii.Related Diversification
a.Google acquired YouTube
iii.Unrelated Diversification
a.GE acquired NBC
Next Chapter:
Leadership
Textbook definition: leadership is the process of inspiring others to work hard to accomplish
important tasks.
Another definition: Leadership is both a process and a property
The process of leadership is the use of non-coercive influence to direct and coordinate the
activities of the members of an organized (textbook)
As a property, leadership is the set of qualities or characteristics attributed to those who
are perceived to
Managers: Rational
www.notesolution.com
Complexity
Planning and budgeting target/goals
Organizing and staffing
Controlling and problem solving
Leaders: Intuitive
Change
Setting direction visions
Aligning people
Motivating inspiring/moving
A good leader may not be a good manager, and a good manager may not be a good leader
Leadership Studies time line
To 1930s
Trait theories leader selection
If you have certain traits, you can be a leader. Leaders are born.
1940-mid 1960s
Behavioral theories leader training
May not have the traits, but you can be trained
Mid 1960s 1980s
Contingency theories leader-situation matching
The type of leadership traits that one must possess depends on each unique situation
1990s on
Newer theories charisma and beyond
Example: Obama
Universal vs. Contingent theories
Universal - one best way to lead offers universal prescription for leadership
Contingent prescriptions for leadership that are contingent on situational factors
Traits vs. Behaviour theories
Traits view leadership primarily in terms of relatively stable and enduring characteristics
of people
Behaviour it is possible to focus on observable leader behaviours rather than on inherent
traits
What are considered some important traits for leaders?
Energetic
Intelligent
Technical competence
www.notesolution.com

Document Summary

Two generic strategies: cost leadership, timex, bic, differentiation, rolex. Many types, but here we have divided them into three: Staples, and officemax (office furniture: recently acquired officemax (drawback their customers are now their competitors, so now their reach has been limited to. 3. www. notesolution. com: strategy of seeking ownership of or increased control over a firm"s competitors. Mergers, acquisitions, and takeovers among competitors (horizontal integration: oracle / sun microsystems ii. Ibm acquired cognos (cognos had canadian markets which ibm wanted to tap into) Intensive strategies: market penetration strategy seeks to increase market share for present products and services in present markets through greater marketing efforts. I t includes increasing the number of salespersons, advertising expenditures, and sales promotions: market development strategy introducing present products or services into new geographic areas. General motors and ford have greater revenue and profits from businesses outside the us.