Strategy and the Quest for Competitive Advantage

483 Pages·2017·18.26 MB·English

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CONNECT FEATURES
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automatically graded exercises that require students
to apply key concepts. Whether the assignment
includes a click and drag, video case, or decision
generator, these applications provide instant
feedback and progress tracking for students and
detailed results for the instructor.
Case Exercises
The Connect platform also includes author-developed
case exercises for all 12 cases in this edition that require
students to work through answers to assignment questions
for each case. These exercises have multiple components
and can include: calculating assorted fi nancial ratios to
assess a company’s fi nancial performance and balance
sheet strength, identifying a company’s strategy, doing
fi ve-forces and driving-forces analysis, doing a SWOT
analysis, and recommending actions to improve company
performance. The content of these case exercises is
tailored to match the circumstances presented in each
case, calling upon students to do whatever strategic
thinking and strategic analysis is called for to arrive at a
pragmatic, analysis-based action recommendation for
improving company performance.
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Your students can insert and review their own notes,
highlight the text, search for specifi c information,
and interact with media resources. Using an eBook
with Connect Plus gives your students a complete
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Essentials of
Strategic
4e
Management
The Quest for Competitive Advantage
John E. Gamble
Texas A&M University–Corpus Christi
Margaret A. Peteraf
Dartmouth College
Arthur A. Thompson, Jr.
The University of Alabama
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ESSENTIALS OF STRATEGIC MANAGEMENT: THE QUEST FOR COMPETITIVE ADVANTAGE,
FOURTH EDITION
Published by McGraw-Hill Education, 2 Penn Plaza, New York, NY 10121. Copyright © 2015 by
McGraw-Hill Education. All rights reserved. Printed in the United States of America. Previous
editions © 2013, 2011, and 2009. No part of this publication may be reproduced or distributed in any
form or by any means, or stored in a database or retrieval system, without the prior written consent
of McGraw-Hill Education, including, but not limited to, in any network or other electronic storage
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Some ancillaries, including electronic and print components, may not be available to customers
outside the United States.
This book is printed on acid-free paper.
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ISBN 978-0-07-811289-8
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All credits appearing on page or at the end of the book are considered to be an extension of the
copyright page.
Library of Congress Cataloging-in-Publication Data
Gamble, John (John E.)
Essentials of strategic management : the quest for competitive advantage/John E. Gamble,
Arthur A. Thompson, Jr., Margaret A. Peteraf.—4e [edition].
pages cm
Includes bibliographical references and index.
ISBN 978-0-07-811289-8 (alk. paper)—ISBN 0-07-811289-3 (alk. paper)
1. Strategic planning. 2. Business planning. 3. Competition. 4. Strategic planning—Case studies.
I. Thompson, Arthur A., 1940- II. Peteraf, Margaret Ann. III. Title.
HD30.28.G353 2015
658.4’012—dc23
2013045409
The Internet addresses listed in the text were accurate at the time of publication. The inclusion of a
website does not indicate an endorsement by the authors or McGraw-Hill Education, and McGraw-
Hill Education does not guarantee the accuracy of the information presented at these sites.
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ABOUT THE AUTHORS
John E. Gamble is a Professor of Management and Dean of the College of Busi-
ness at Texas A&M University–Corpus Christi. His teaching and research for nearly
20 years has focused on strategic management at the undergraduate and graduate
levels. He has conducted courses in strategic management in Germany since 2001,
which have been sponsored by the University of Applied Sciences in Worms.
D r. Gamble’s research has been published in various scholarly journals and he
is the author or co-author of more than 75 case studies published in an assortment
of strategic management and strategic marketing texts. He has done consulting on
industry and market analysis for clients in a diverse mix of industries.
Professor Gamble received his Ph.D., Master of Arts, and Bachelor of Science
degrees from The University of Alabama and was a faculty member in the M itchell
College of Business at the University of South Alabama before his appointment to
the faculty at Texas A&M University–Corpus Christi.
Margaret A. Peteraf is the Leon E. Williams Professor of Management at the Tuck
School of Business at Dartmouth College. She is an internationally recognized scholar
of strategic management, with a long list of publications in top management journals.
She has earned myriad honors and prizes for her contributions, including the 1999
Strategic Management Society Best Paper Award recognizing the deep influence of
her work on the field of strategic management. Professor Peteraf is on the Board of
Directors of the Strategic Management Society and has been elected as a Fellow of the
Society. She served previously as a member of the Academy of Management’s Board
of Governors and as Chair of the Business Policy and Strategy Division of the Acad-
emy. She has also served in various editorial roles and is presently on nine editorial
boards, including the S trategic Management Journal, the Academy of Management Review,
and O rganization Science. She has taught in Executive Education programs around the
world and has won teaching awards at the MBA and Executive level.
Professor Peteraf earned her Ph.D., M.A., and M.Phil. at Yale University and
held previous faculty appointments at Northwestern University’s Kellogg Gradu-
ate School of Management and at the University of Minnesota’s Carlson School of
Management.
A rthur A. Thompson, Jr., earned his B.S. and Ph.D. degrees in economics from
The University of Tennessee, spent three years on the economics faculty at Virginia
Tech, and served on the faculty of The University of Alabama’s College of Commerce
and Business Administration for 25 years. In 1974 and again in 1982, Dr. Thompson
spent semester-long sabbaticals as a visiting scholar at the Harvard Business School.
His areas of specialization are business strategy, competition and market
analysis, and the economics of business enterprises. In addition to publishing
over 30 articles in some 25 different professional and trade publications, he has
authored or co-authored five textbooks and six computer-based simulation exer-
cises that are used in colleges and universities worldwide.
Dr. Thompson spends much of his off-campus time giving presentations,
p utting on management development programs, working with companies, and
helping operate a business simulation enterprise in which he is a major partner.
Dr. Thompson and his wife of 52 years have two daughters, two grandchildren,
and a Yorkshire terrier.
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BRIEF CONTENTS
PART ONE CONCEPTS AND PART TWO CASES IN CRAFTING
TECHNIQUES FOR CRAFTING AND EXECUTING STRATEGY
AND EXECUTING STRATEGY
Case 1 Mystic Monk Coffee 243
Section A: Introduction and Overview Case 2 Under Armour’s Strategy in 2013—Good
Enough to Win Market Share from Nike
1 Strategy, Business Models, and Competitive
and adidas? 248
Advantage 1
2 Charting a Company’s Direction: Vision Case 3 Lululemon Athletica, Inc. 271
and Mission, Objectives, and Strategy 13
Case 4 Coach Inc. in 2012: Its Strategy in the
Section B: Core Concepts and Analytical Tools “Accessible” Luxury Goods Market 287
3 Evaluating a Company’s External Case 5 Chipotle Mexican Grill in 2013: Can It Hit
Environment 37 a Second Home Run? 299
4 Evaluating a Company’s Resources, Capabilities,
Case 6 Google’s Strategy in 2013 315
and Competitiveness 68
Case 7 Nucor Corporation in 2012: Using
Section C: Crafting a Strategy
Economic Downturns as an Opportunity
5 The Five Generic Competitive Strategies 92 to Grow Stronger 330
6 Strengthening a Company’s Competitive Case 8 Tata Motors: Can It Become a Global
Position: Strategic Moves, Timing, and Scope Contender in the Automobile
of Operations 115 Industry? 360
7 Strategies for Competing in International
Case 9 The Walt Disney Company: Its
Markets 137
Diversification Strategy in 2012 372
8 Corporate Strategy: Diversification and the
Multibusiness Company 159 Case 10 Robin Hood 388
9 Ethics, Corporate Social Responsibility,
Case 11 Herman Miller Inc.: Unrelenting Pursuit
Environmental Sustainability, and Strategy 189
of Reinvention and Renewal 390
Section D: Executing the Strategy
Case 12 Frog’s Leap Winery in 2011—the
10 Superior Strategy Execution—Another Path to Sustainability Agenda 411
Competitive Advantage 207
Photo Credits 427
Appendix Key Financial Ratios 240 Indexes 428
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PREFACE
T
he standout features of this fourth edition of Essentials of Strategic Man-
agement are its concisely written and robust coverage of strategic man-
agement concepts and its compelling collection of cases. The text presents a
conceptually strong treatment of strategic management principles and ana-
lytic approaches that features straight-to-the-point discussions, timely exam-
ples, and a writing style that captures the interest of students. While this
edition retains the 10-chapter structure of the prior edition, every chapter has
been reexamined, refined, and refreshed. New content has been added to keep
the material in line with the latest developments in the theory and practice of
strategic management. Also, scores of new examples have been added, along
with fresh Concepts & Connections illustrations, to make the content come
alive and to provide students with a ringside view of strategy in action. The
fundamental character of the fourth edition of Essentials of Strategic Manage-
ment is very much in step with the best academic thinking and contemporary
management practice. The chapter content continues to be solidly mainstream
and balanced, mirroring both the penetrating insight of academic thought and
the pragmatism of real-world strategic management.
Complementing the text presentation is a truly appealing lineup of 12
diverse, timely, and thoughtfully crafted cases. All of the cases are tightly
linked to the content of the 10 chapters, thus pushing students to apply the
concepts and analytical tools they have read about. Eight of the 12 cases were
written by the coauthors to illustrate specific tools of analysis or distinct stra-
tegic management theories. The four cases not written by the coauthors were
chosen because of their exceptional linkage to strategic management concepts
presented in the text. We are confident you will be impressed with how well
each of the 12 cases in the collection will work in the classroom and the amount
of student interest they will spark.
For some years now, growing numbers of strategy instructors at business
schools worldwide have been transitioning from a purely text-cases course
structure to a more robust and energizing text-cases-simulation course struc-
ture. Incorporating a competition-based strategy simulation has the strong
appeal of providing class members with an immediate and engaging opportunity
to apply the concepts and analytical tools covered in the chapters in a head-to-head
competition with companies run by other class members. Two widely used and
pedagogically effective online strategy simulations, T he Business Strategy Game
and G LO-BUS, are optional companions for this text. Both simulations, like
the cases, are closely linked to the content of each chapter in the text. The Exer-
cises for Simulation Participants, found at the end of each chapter, provide
clear guidance to class members in applying the concepts and analytical tools
covered in the chapters to the issues and decisions that they have to wrestle
with in managing their simulation company.
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