CH66A
CH66A
CH66A
Charles W. L
University of Washington
Gareth R. Jones
Texas A&M University
: Strategy in Action 4.4: General Electric's Six Sigma Quality Improvement Process 129
Improving Quality as Excellence 133
I Strategy in Action 4.5: Six Sigma at Mount Carmel Health J33
; Achieving Superior Innovation 135
!. The High Failure Rate of Innovation 135
| Building Competencies in Innovation 137
I Achieving Superior Responsiveness to Customers 142
? Focusing on the Customer 142
?• Satisfying Customer Needs 144
% Summary of Chapter 145 I Discussion Questions 146
f. Practicing Strategic Management 146
Small-Group Exercise: Identifying Excellence I Article File 4 I Strategic Management
Project: Module 4 I Exploring the Web: Visiting Applied Materials I General Task
Closing Case: Redesigning the American Car 147
PART 3 Strategies
Strategy in Action 7.1: Where Is the Standard for DVD Recorders? 233
Establishment of Standards 234
Network Effects, Positive Feedback, and Lockout 235
Strategy in Action 7.2: How Dolby Became the Standard in Sound Technology 237
Strategies for Winning a Format War 239
Ensure a Supply of Complements 239
Leverage Killer Applications 239
Aggressively Price and Market 240
Cooperate with Competitors 240
License the Format 241
Costs in High-Technology Industries 241
Comparative Cost Economics 242
Strategic Significance 243
Strategy in Action 7.3: Lowering Costs Through Digitalization 244
Managing Intellectual Property Rights 244
Intellectual Property Rights 245
Digitalization and Piracy Rates 245
Strategies for Managing Digital Rights 246
Capturing First-Mover Advantages 247
First-Mover Advantages 248
First-Mover Disadvantages 249
Strategies for Exploiting First-Mover Advantages 250
Technological Paradigm Shifts 253
Paradigm Shifts and the Decline of Established Companies 253
Strategy in Action 7.4: Disruptive Technology in Mechanical Excavators 257
Strategic Implications for Established Companies 258
Strategic Implications for New Entrants 259
Summary of Chapter 260 I Discussion Questions 260
Practicing Strategic Management 261
Small-Group Exercise: Burning DVDs I Article File 7 I Strategic Management
Project: Module 7 I Exploring the Web: Visiting Kodak I General Task
Closing Case: Battling Piracy in the Videogame Market 262
Vertical Integration: Entering New Industries to Strengthen the "Core" Business Model 315
Increasing Profitability Through Vertical Integration 317
Strategy in Action 9.3: Specialized Assets and Vertical Integration in the Aluminum Industry 319
Problems with Vertical Integration 320
The Limits of Vertical Integration 322
Alternatives to Vertical Integration: Cooperative Relationships 322
Short-Term Contracts and Competitive Bidding 322
Strategic Alliances and Long-Term Contracting 323
Building Long-Term Cooperative Relationships 324
Strategy in Action 9.4: DaimlerChrysler's U.S. Keiretsu 325
Strategic Outsourcing 326
Strategy in Action 9.5: Cisco's $2 Billion Blunder 328
Benefits of Outsourcing 329
Risks of Outsourcing 331
Summary of Chapter 332 I Discussion Questions 332
Practicing Strategic Management 333
Small-Group Exercise: Comparing Vertical Integration Strategies I Article File 9 I Strategic
Management Project: Module 9 I Exploring the Web: Visiting Motorola I General Task
Closing Case: The Rise of WorldCom 334
Case 11: The Music Industry in the Age of the Internet: From Napster to Apple's iPod C173
Charles W. L. Hill, University of Washington
The Internet has thrown the music industry into turmoil. Why is Apple succeeding where Napster failed?
Case 12: Staples C187
Charles W. L. Hill, University of Washington
How did Staples revolutionize the office supplies industry? Can it keep growing?
Case 13: Gap International: A Specialty Apparel Retailer C200
Robert J. Mockler, St. John's University
What is this fashion retailer's secret to success?
Case 14: Charles Schwab C230
Charles W. L. Hill, University of Washington
Discusses the rise of discount stockbroker Charles Schwab and its current strategic challenges.
Case 15: Li & Fung—The Global Value Chain Configurator C245
S.S. George, ICFAI Center for Management Research
Li & Fung has become a textile-industry powerhouse by creating and coordinating a global supply for its
customers: clothing companies.
Case 16: Starbucks Corporation: Competing in a Global Market C267
Suresh Kotha and Debra Glassman, University of Washington
Can Starbucks repeat its domestic success in the global marketplace?
Case 17: Kentucky Fried Chicken and the Global Fast-Food Industry C289
Jeffrey A. Krug, Appalachian State University
KFC was an early mover in the global fast-food industry. What must the company do to continue to prosper
in this competitive industry?
Index II