Chapter 1 Introduction to Strategy * Strategy: Theory of how to gain competitive advantages. (How competition is going to evolve, and how that evolution can be exploited for competitive advantage.) Based on knowledge of the marketplace and based on the firm’s capabilities and resources. a) Being different from your rivals b) Creating value while containing costs c) Deciding what to do and what NOT to do d) Combining activities to land in a unique market position e) Making long-term commitments that may not be easily reversible f) A constant decision-making process * Theories answer, “If we do X, then we will get Y.” * Strategy management process: a sequential set of analyses and choices that can increase the likelihood that a firm will choose a good strategy. * Why do we exist? (MissionObjectives) Can we compete? (External/ Internal Analysis) How do we succeed? (Strategic ChoiceStrategy Implementation)Competitive Advantage
Success = Sustained Competitive Advantage

* Strategy and the Strategic Management Process * Mission: long-term purpose, define both what a firm aspires to be in the long run and what it wants to avoid in the meantime. * Mission Statements: written down form; strategic decisions fail when mission statement is not followed * Key question to address:
What is our business? What is our reason for being? Whom do we want to serve? * Is it good? An excellent mission statement will: a. Identify the utility of a firm’s products to its customers b. Define priorities, plans, and work assignments c. Determine job descriptions and organizational structure d. Guide employee action e. Unify the company f. Establish organizational culture * Impact: a) No affect: whether having a mission statement even creates value for a firm? Whether say