Strategic Management for Eco Entrepreneurs

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Strategic Management for Eco Entrepreneurs

• Terms
• Strategic competitivenessCompetitive advantage
  earned through a value creating and capturing
  strategy.
• Strategyintegrated and coordinated set of
  commitments and actions to achieve competitive
  advantage.
• Competitive Advantageposition vis a vis
  competitors that allows the organization to earn
  above normal rates of return (ROS, ROA, ROI) at a
  point in time. Not permanent.
• How is competitive advantage achieved?
• Strategic use of resources and capabilities to
  achieve core competencies and to exploit them.
• Resources are the firms critical inputslabor,
  management and other human capital physical
  capital funding IP location culture. Some of
  these are easily competed away. Others are not.
  Focus on the latter. Why? Consider key location
  or individualsstars. What are the competitive
  advantage implications?

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Strategic Management for Eco Entrepreneurs

• Capabilitiesdirecting those resources toward
  achieving a competitive advantage.
• Core competenciesthose resources that advantage
  the firm relative to its competitors. (key IP,
  key people, key leadership, key culture, key
  location).
• Vision a short statement that communicates the
  organizations value, to whom, and why.
• Mission Statementa more lengthy statement about
  the organizations value creation, to whom (the
  clients), why (its core capabilities), and how
  (what it provides).

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Strategic Management for Eco Entrepreneurs

• Stakeholdersthose centrally affected by the
  organizationcustomers investors input
  suppliers (contractors, other) labor
  management communities. Interests may conflict.
  How to manage them.
• Strategic leaderssenior management who formulate
  the vision, mission, and competitive strategies,
  and monitor that they are carried out.

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Strategic Management for Eco Entrepreneurs

• Achieving competitive advantage.
• Industry analysis
• Identify the market. (what is the market?
  Segmented?) Who are the major competitors?
• What are their key advantages? Weaknesses? What
  opportunities? Threats? SWOT analysis.
• Once the industry has been identified, then
  analyze the 5 major competitive factors
• New entrants
• Supplier power
• Buyer power
• Substitutes, switching costs
• Rivalry
• Each of these will affect your ability to achieve
  competitive advantage. Value can be competed
  away.

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Strategic Management for Eco Entrepreneurs

• Rememberit is not enough to organize a venture
  that provides environmental benefits.
• If another organization can capture that value,
  it reduces incentives to promote and invest in
  it.
• Why?
• The external environment
• Broadly and how it impacts your industry and
  target market.
• Industry characteristics, size of competitors,
  tech change, growth.
• Demographicsage, location, ethnicity, size,
  income
• Macro economicsinterest rates, employment,
  exchange rates, GDP growth
• Political/legal
• Technological change
• Cultural
• Global

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Strategic Management for Eco Entrepreneurs

• Barriers to Entryessential for competitive
  advantage.
• Economies of scale, capital requirements
• Product/service differentiation (what does this
  mean?)
• First leaderreputation, information (downsides?)
• High switching costs
• Distribution access
• Government policy
• IP
• Other core competencies

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Strategic Management for Eco Entrepreneurs

• For Monday, February 25, each team must hand in
  and present their competitor analysis and their
  target market definition.
• Industry definition
• List of competitors, analysis of 5 key
  competitive factors
• Characteristics of the target market location,
  income, age, ethnicity, education.
• Identify how you would contact them.
• For Wednesday, February 20, each team must
• Provide vision and mission statements
• A statement as to how you might achieve a
  competitive advantagebarriers to entry for your
  venture.