group c report chapter 6 hill and jones
TRANSCRIPT
![Page 1: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/1.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 1/52
BUSINESS LEVEL STRATEGYINDUSTRY ENVIRONMENT
![Page 2: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/2.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 2/52
DIFFERENT
INDUSTRY
ENVIRONMENT
OPPORTUNITIES THREATS
BUSINESS
MODEL
BUSINESS
STRATEGY
SUSTAINABLE ENVIRONMENT
![Page 3: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/3.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 3/52
THE INDUSTRYENVIRONMENT
![Page 4: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/4.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 4/52
COMPANIES MUST FACE THE CHALLENGES OF DEVELOPING
AND MAINTAINING A COMPETITIVE STRATEGY IN:
• FRAGMENTED INDUSTRIES
• EMBRYONIC INDUSTRIES
• GROWTH INDUSTRIES
• MATURE INDUSTRIES
• DECLINING INDUSTRIES
![Page 5: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/5.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 5/52
FRAGMENTEDINDUSTRIES
![Page 6: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/6.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 6/52
LARGE NUMBER OF SMALL ANDMEDIUM-SIZED INDUSTRIES
![Page 7: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/7.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 7/52
CAUSES FOR FRAGMENTED ENTRIES:
• Low barriers to entry: lack of economies of scale
• Low entry barriers > constant entry by new companies
• Specialized customer needs - require small job lots of
products no room for a mass-production
• Diseconomies of scale
![Page 8: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/8.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 8/52
FRAGMENTED INDSUTRIES - STRATEGIES:
CHAINING
linked outlets form networks to achieve cost
leadership
FRANCHISING
for rapid growth (proven business concepts, reputation,management skills, and economies of scale)
![Page 9: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/9.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 9/52
FRAGMENTED INDSUTRIES - STRATEGIES:
HORIZONTAL MERGER
acquisition to obtain economies and growth
IT AND INTERNET
to develop new business models
![Page 10: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/10.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 10/52
CAUSES FOR FRAGMENTED ENTRIES:
• Low barriers to entry: lack of economies of scale
• Low entry barriers > constant entry by new companies
• Specialized customer needs - require small job lots of
products no room for a mass-production
• Diseconomies of scale
![Page 11: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/11.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 11/52
EMBRYONICINDUSTRIES
![Page 12: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/12.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 12/52
JUST BEGINNING TO DEVELOP WHEN TECHNOLOGICALINNOVATION CREATES NEW MARKET OR PRODUCT
OPPORTUNITIES.
![Page 13: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/13.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 13/52
GROWTHINDUSTRIES
![Page 14: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/14.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 14/52
WHEREIN DEMAND IS EXPANDING RAPIDLY AS MANY NEWCUSTOMERS ENTER THE MARKET.
![Page 15: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/15.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 15/52
REASONS FOR SLOW GROWTH IN MARKET DEMAND:
• Limited performance and poor quality of first
products
• Customer unfamiliarity
• Poor distribution channels
• Lack of complementary products
• High production costs
![Page 16: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/16.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 16/52
DEVELOPMENT OF MASS MARKETS:
TECHNOLOGICAL PROGRESS
product is easier to use; customer value is increased
DEVELOPMENT OF KEY COMPLEMENTARY PRODUCTS
REDUCTION OF PRODUCTION COSTSlower prices.
![Page 17: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/17.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 17/52
MARKET DEVELOPMENTAND CUSTOMER GROUPS
![Page 18: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/18.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 18/52
BOTH INNOVATORS AND EARLY ADOPTERS ENTER THE MARKETWHILE THE INDUSTRY IS IN ITS EMBRYONIC STATE.
![Page 19: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/19.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 19/52
MARKET SHARE OF DIFFERENTCUSTOMER SEGMENTS
![Page 20: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/20.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 20/52
MOST MARKET DEMAND AND INDUSTRY PROFITS ARISE DURINGTHE EARLY AND LATE MAJORITY CUSTOMER SEGMENTS.
![Page 21: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/21.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 21/52
INNOVATORS AND EARLY ADOPTERS
• Technologically sophisticated
•Tolerant of engineering imperfections
• Reached through specialized distribution channels
• Relatively few in number
• Not particularly price-sensitive
![Page 22: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/22.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 22/52
STRATEGICIMPLICATIONS
![Page 23: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/23.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 23/52
CROSSING THE CHASM (EARLY ADAPTERS & EARLY MAJORITY)
Identify correctly the needs of the first wave
of early majority users.
Alter the business model in response.
Alter the value chain and distribution channels
to reach the early majority.
![Page 24: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/24.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 24/52
CROSSING THE CHASM (EARLY ADAPTERS & EARLY MAJORITY)
Design the product to meet the needs of the
early majority so that the product can be
modified and produced or provided at low cost.
Anticipate the moves of competitors.
![Page 25: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/25.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 25/52
AMERICAN ONLINE (AOL) VS.PRODIGY COMMUNICATIONS
![Page 26: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/26.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 26/52
WHY PRODIGY FAILED:
Target Customers: Typical middle-class
Americans; not computer-oriented
They did not understand the full range of needs
customers were trying to satisfy by using the internet
![Page 27: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/27.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 27/52
STRATEGIES OF AOL
• Unlimited email
• Chatrooms
• Quickly redesigned its software to fit the
Microsoft Windows Systems
![Page 28: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/28.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 28/52
THE COMPANY CORRECTLY SENSED THE WAY CUSTOMER
NEEDS WERE CHANGING AND THEY PROVIDED A
DIFFERENTIATED PRODUCT THAT MET THOSE NEEDS.
STRATEGIC IMPLICATIONSOF GROWTH RATES
![Page 29: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/29.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 29/52
DIFFERENT MARKETS DEVELOP AT DIFFERENT RATES
![Page 30: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/30.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 30/52
NEW PRODUCT GROWTH-RATE ACCELERATION
• Use of mass media
•Low-cost mass production
![Page 31: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/31.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 31/52
FACTORS AFFECTING MARKET GROWTH RATES:
• Relative advantage
• Complexity
• Observability
•Compatibility
• Trialability
![Page 32: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/32.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 32/52
Navigating Through the LifeCycle to Maturity
2 Crucial Factors in Choosing anInvestment Strategy:
1. Competitive advantage of company’s
bus iness model 2. Stage of the industry l ife cyc le
![Page 33: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/33.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 33/52
EMBRYONIC STAGES:
IMPLICATIONSshare-building strategies
-Development of distinctive competencies and competitiveadvantage
-Weak companies requires capital to develop R&D andsales/service competencies
![Page 34: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/34.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 34/52
GROWTH STAGES:
IMPLICATIONSmaintain relative competitive position
-Strengthen business model to prepare to survive industryshakeout
-Requires investment to keep up with rapid growth of the
market
![Page 35: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/35.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 35/52
SHAKEOUT STAGE:
IMPLICATIONSincrease share during fierce competition
- Invest in share-increasing strategies at expense of weakcompetitors
- Weak companies should exit the industry during theharvest stage
![Page 36: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/36.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 36/52
MATURITY STAGE:
IMPLICATIONShold-and-maintain to defend business model
- Dominant companies want to reap the reward of priorinvestments
- Company’s investment depends on the level of competition
and source of the company’s competitive advantage
![Page 37: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/37.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 37/52
MATURE INDUSTRIES
![Page 38: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/38.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 38/52
SMALL NUMBER OF LARGE COMPANIES DOMINATE THEINDUSTRY AND DETERMINE THE NATURE OF COMPETITION
![Page 39: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/39.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 39/52
ABOUT MATURE INDUSTRIES:
BUSINESS LEVEL STRATEGY
Based on how established companies collectively
try to reduce strength of competition.
INTERDEPENDENT COMPANIES
Try to protect industry profitability.
![Page 40: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/40.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 40/52
SOME STRATEGIES
DETER ENTRY INTO INDUSTRYProduct Proliferation, Maintaining Excess Capacity , PriceCutting,
MANAGE INDUSTRY RIVALRYPrice signaling, Price Leadership, Capacity Control,Nonprice Competition
![Page 41: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/41.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 41/52
RESTAURANT INDUSTRY:PRODUCT PROLIFERATION
![Page 42: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/42.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 42/52
PRODUCT PROLIFERATION IN THERESTAURANT INDUSTRY
“FILLED SPACES”
•Difficult for
companies togain foothold
•Difficult for companies todifferentiate itself
![Page 43: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/43.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 43/52
FOUR NON-PRICE COMPETITIVE STRATEGIES
![Page 44: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/44.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 44/52
The Game Theory
![Page 45: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/45.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 45/52
Basic Principles
Look forward, reason backanticipate what rivals will do, then let it guide youDecision trees: think 3 steps ahead
Know your rivalput yourself in their shoes: what would you do?
Dominateuse the most advantageous strategypay-off matrix: if-then situations
Strategy dictates the structure of payoff
![Page 46: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/46.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 46/52
Decision Trees
Adidas gets D. Rose asan endorser
Adidas doesn’t get D. Rose
as an endorser
Probability: 80%
Probability: 20%
Profit: $200M
Profit: $100M
Profit: $400M
![Page 47: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/47.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 47/52
Payoff Matrix
5, 5 10, 0
0, 10 0, 0
Offer rewards
O f f e r r e
w a r d s
No rewards
N o r e w a r d s
C
I
T
I
B
A
NK
BDO
![Page 48: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/48.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 48/52
Declining Industries
![Page 49: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/49.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 49/52
MARKET DEMAND HAS PLATEAUED AND TOTAL MARKETSIZE IS DECREASING
![Page 50: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/50.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 50/52
Causes of intense competition
Speed of declinerapid spike in decrease vs gradual
High fixed costsfrom fixtures and furniture assets, etc
Height of exit barriers
when it’s hard to pull out of the industry
Commodity nature of productsif there are lots of substitutes
![Page 51: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/51.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 51/52
Possible Strategies
Leadershipseek to become the biggest player
Nichefocus on pockets of demand falling more slowly
Harvest
analyze expenses and income
Divestiture sell the business
![Page 52: Group C Report Chapter 6 Hill and Jones](https://reader031.vdocuments.us/reader031/viewer/2022021220/577cd8ce1a28ab9e78a2059e/html5/thumbnails/52.jpg)
7/29/2019 Group C Report Chapter 6 Hill and Jones
http://slidepdf.com/reader/full/group-c-report-chapter-6-hill-and-jones 52/52
STRATEGY SELECTION FOR DECLINING INDUSTRIES