Part 1

Concepts and Techniques for Crafting and Executing Strategy

substitute for doing cutting-edge strategic thinking about a company's external situationanything less weakens managers' ability to craft strategies that are well matched to industry and competitive conditions.

ASSURANCE OF LEARNING EXERCISES

1. Using your favorite Internet search engine, do some research on competitive forces and driving forces that are at work in the snack food industry. Draw a five-forces diagram for the snack food industry and briefly discuss the nature and strength of each of the five competitive forces. Make a list of the driving forces operating in the snack foods industry and draw some conclusions about whether the likely impact of these driving forces on snack foods companies will be favorable or unfavorable. 2. Refer back to the strategic group map in Illustration Capsule 3.1: Who are Toyota's closest competitors? Between which two strategic groups is competition the strongest? Why do you think no automobile manufacturers are positioned in the upper right corner of the map? Which company/strategic group faces the weakest competition from the members of other strategic groups? 3. Using the information provided in Table 3.2 and your knowledge as a casual dining patron, what are the key success factors for restaurants such as Outback Steakhouse or Carrabba's Italian Grill? Your list should contain no more than si industry key success factors. In deciding on your list, it's important to distinguish between factors critical to success in the industry and factors that enhance a company's overall well-being.

EXERCISES FOR SIMULATION PARTICIPANTS

I. Which of the five competitive forces is creating the strongest competitive pres-, sures for your company? 2. What are the "weapons of competition" that rival companies in your industry c a use to gain sales and market share? Refer back to Figure 3.4 to help you identify the various competitive factors. What are the factors affecting the intensify ofrivalryin the industry in which \ company is competing. Use Figure 3.4 and the accompanying discussion to hej you pinpoint the specific factors most affecting competitive intensity. Would characterize the rivalry and jockeying for better market position, increased sale and market share among the companies in your industry as fierce, very stron strong, moderate, or relatively weak? Why? Are there any driving forces in the industry in which your company is competi What impact will these driving forces have? Will they cause competition to I more or less intense? Will they act to boost or squeeze profit margins? List at lea two actions your company should consider taking in order to combat any negs impacts of the driving forces.