ADMS 1000 Study Guide - Final Guide: Acculturation

• School: York University
• Department: Administrative Studies
• Course: ADMS 1000
• Professor: Peter Modir

Document Summary

Industry: a group of organizations/firms that share similar resource requirements (raw materials, labour, technology, customers). Allows us to systematically assess the industry environment. The relationships between the five forces determines attractiveness of the industry environment. Used to make strategic decisions that leave the firm in the best position to defends itself: threats of new entrants. Two forms; new start-ups, or diversification of existing firms in other industries. New entrants bring new capacity, desire to gain market share, substantial resources, and capabilities which can reduce profitability. Economies of scale: spreading costs of production over the number of units produced cost advantages. Capital requirements: extremely high for a new firm, threat of new entrants is reduced as the level of required capital increases. Switching costs: refers to the costs (monetary or psychological) associated with changing from one supplier to another from the buyer perspective.