ADM 4311 Lecture Notes - Lecture 8: Market Power, Global Sourcing, Creative Destruction

• School: University of Ottawa
• Department: Administration
• Course: ADM 4311
• Professor: Alan O' Sullivan

Document Summary

> blocks market entry, potential competitors must also integrate. > create a new product and new opportunities. > full control over quality and customer service. > prevents technological imitation because the company manufactures itself. > restricts exibility: hard to get out of the business because there are a lot of xed assets. > suppliers have no incentive to keep costs down (customers are guaranteed) > require a balance of capabilities: bottleneck or excess capacity. > new products or new activities (this is not intended to extend activities related to a product or activity) > most large companies are: linked diversi cation - diversi cation with existing assets, conglomerate diversi cation - portfolio of activities with no common point (ge) > limited growth: mature market, decline or intensity of competition. > market power: using the pro ts of a sector to support a price war.