1. Which parts of the value chain does Wal-Mart target in order to achieve a low-cost advantage over its rivals?
2. Best Buy is the largest consumer electronics retailer in the United States with 2011 sales of more than $50 billion. The company competes aggressively on price with rivals such as Costco Wholesale, Sam's Club, Wal-Mart, and Target, but is also known by consumers for its first-rate customer service. Best Buy customers have commented that the retailer's sales staff is exceptionally knowledgeable about products and can direct the customer to the exact location of difficult to find items.
Best Buy customers also appreciate that demonstration models of PC monitors, digital media players, and other electronics are fully powered and ready for in-store use. Best Buy's Geek Squad tech support and installation services are additional customer service features valued by many customers.
How would you characterize Best Buy's competitive strategy? Should it be classified as a low-cost provider strategy? a differentiation strategy? A best-cost strategy? Explain your answer.
3. Explore BMW's website at www.bmwgroup.com and see if you can identify at least three ways in which the company seeks to differentiate itself from rival automakers. Is there reason to believe that BMW's differentiation strategy has been successful in producing a competitive advantage? Why or why not?
4. Discuss the basis for Amazon competitive advantage and how they leveraged first-mover advantages.
5. One of the big dangers in crafting a competitive strategy is that managers, torn between the pros and cons of the various generic strategies, will opt for "stuck in the middle" strategies that represent compromises between lower costs and greater differentiation and between broad and narrow market appeal. True or false? Explain your answer.
6. What are the merits of strategic alliances and collaborative partnerships for companies racing for global market leadership? Under what circumstances do they make sense? How do they contribute to competitive advantage? What are the merits of strategic alliances and collaborative partnerships for companies racing to seize opportunities in an industry of the future? Under what circumstances do they make sense? How do they contribute to competitive advantage?
7. Using Taft's URN library, perform a search on "acquisition strategy." Identify at least two companies in different industries that are using acquisitions to strengthen their market positions. How have these acquisitions enhanced the acquiring companies' competitive capabilities?
8. Using Taft's LIRN library, find two examples of how companies have relied on strategic alliances or joint ventures to substitute for horizontal or vertical integration.
9. What is Panera Bread's strategy? Which of the five generic competitive strategies discussed in Chapter 5 most closely fit the competitive approach that Panera Bread is taking? What type of competitive advantage is Panera Bread trying to achieve?