Syllabus

The basic structure of the course is as follows:

• Sessions 1-2: Introduction. What is Strategy? Mission, Vision and Coherence.
• Sessions 3-6: Industry Analysis: Porter’s five forces, cost leadership versus differentiation strategies, and value chain analysis. Game theory
• Sessions 7-8: Developing internal capabilities and the resource based view.
• Sessions 9-12 are about putting it all together: integrative cases, syndicate assignment, course summary.

Weekly Schedule

Topic

Readings and Cases

8 Feb 2012

Introduction

We begin the session with a discussion on "What is Strategy?"

I then present a course overview (scope, resources, deliverables) and we discuss how to approach a case study using Argyle Diamonds as a "mini case" to illustrate this.

• Reading: Lewis, “The Case Study Method of Learning”.
• Case: Argyle Diamonds

• Video: The Oppenheimer Diamond Empire & Artificial Scarcity (1994)
• Discovery and Mining of the Argyle Deposit
• Optional: Ghemawat, “Competition and Business Strategy in Historical Perspective”, HBS Press, 1997.

Vision, Mission and Articulating your Strategy

In this session we discussion Vision, Mission and Strategy, and how they fit together. We analyze the case of Narayana Hrudayalaya Heart Hospital to understand the tradeoffs in defining vision, mission and strategy.
We also discuss the use of cognitive maps in strategy (using the McKinsey issue tree), again applying it to the Narayana case in proposing a way forwards for the hospital.

• Reading: Collis + Rukstad, Can you say what your Strategy Is, HBR, April 2008.
• Case: Narayana Hrudayalaya Heart Hospital.
• Quickly skim The Mckinsey Mind, Chapter 1.

• Thompson & Strickland, "Establishing Company Direction", Chapter 2 of Strategic Management Concepts and Cases, pp 31-41 only.
• Steve Jobs discusses the path dependent nature of his becoming a CEO

Industry Analysis - Porter's Five Forces

This week we begin the section of the course on Industry analysis. We use Porter's 5 forces to analyze the Crown Cork and Seal case and discuss how Porter's framework can be used to analyze industry attractiveness.

• Grant, “Industry Analysis: The Fundamentals”, Chapter 3 in ‘Contemporary Strategy Analysis’, 6th Edition.
• Case: Crown Cork & Seal Company, Inc (HBS 378-024)

• Video interview with Michael Porter
• CCS website

Cost Leadership

We continue we our discussion on industry analysis, focusing on competitive positioning. The Ghemawat & Rivkin article flows on from the concepts you learnt in Managerial Economics, as applied to Strategy. It provides a good way to think about reducing opportunity cost or increasing willingess-to-pay as ways to create value and compete effectively. This week we focus on cost, using the Honda case as an example.

• Ghemawat & Rivkin, “Creating Competitive Advantage”, HBS 9-798-062.
• Case: Honda A. HBS-9-384-049(1989)

Honda

• Honda adverts
• Honda CB350
• Recent Honda ad (The Cog)in which 2 of only 6 existing hand-made Accords are taken apart and used .
• Honda Choir: original vs spoof

Optional Articles:

• Besanko, et al., Strategic Positioning for Competitive Advantage, Chapter 11 in Economics of Strategy, 4th Edition. Only pages 343 – 378.
• Wikipedia on Learning and Experience Curves.

Differentiation

Today we discuss competitive positioning via differentiation, in contrast to cost-based positioning discussed last week.

• Case: Ducati: In Pursuit of Magic (A). IESE Case 168 by Mitchell & Cassiman

Ducati

• Ducati Legacy
• Don't try this at home!
• Ducati Financials 2001
• Ducati info on Wikipedia

Advanced: Saloner, Shepard and Podolny book: Appendix of Chap. 7, A model of product differentiation.

Game Theory and Industry Analysis

We discuss game theory and how it is used in industry analysis, both by including co-opetition alongside the "5 Forces", as well as ideas of equilibrium and multi-stage games.

Joshua Gans, Game Theory Chapter 5.

Brandenburger and Nalebuff, "The Right Game: Use Game Theory to Shape Strategy", Harvard Business Review (July-Aug 1995).

Case: Google, Inc. HBS-9-910-036(2009).

Optional:

• Erhun & Keskinochak (2003), Game Theory in Business Applications, Stanford Working Paper, pp 1-35 only.
• Traveller's Dillema, Scientific American, 2007.
• Gametheory.net
• Boeing/Airbus Example by Nicholas Economides
• Bob Gibbons (MIT):
• Intro by Dixit and Nalebuff

Resources and Capabilities

Having focused during the first half of the course on industry analysis, we now move within the organization to consider internal resources and competencies as a source of competitive advantage.

• Hoskisson, Hitt and Ireland, "The Internal Organization", Chapter 4 of Competing for Advantage.
• Case: Wal*Mart Stores, Inc. HBS-9-794-024.
• Stalk, Evans and Shulman, Competing on Capabilities: The New Rules of Corporate Strategy, Harvard Business Review (1992).

Wal*Mart

• Wal*mart- High Cost of Low Price
• Wikipedia: Wal-mart
• Google Finance: Wal-mart
• Wal-mart Investor Information

Generating new capabilities

We delve deeper into our discussion of how to develop new resources and capabilities. We learn about "Blue Ocean" strategies and compare the approaches taken by two different companies, Zespri and WCBF.

• Kim and Mauborgne, Blue Ocean Strategy: HBR, Oct 2004 Article and Chapter 2 of their book.
• Case: Zespri (HBS).

• TBD

Today we begin integrating the lessons learnt over the past 8 weeks, and applying them to analyze a case

• Porter, M.(1996), What is Strategy? Harvard Business Review, p 61-78.
• Case: Cola Wars 2010

• Saloner, Shepard & Podolny, “Strategic Management”, 2001, Chapter 3, pp39-63.

Presentation and discussion of Syndicate Assignments.

• Each syndicate will discuss the report written by another syndicate.

Putting it all together (II)

In this session, we put together the key concepts learnt during the term to analysis a case study used in previous exams. We also discuss how to critically evaluate good versus bad strategies using these.

Look at past exam questions under "Assessment"

• Links to past exam papers
• Case: Ice Fili(previous exam)

Important: This session is on 13 April instead of 25 April (Anzac Day)

• Rumelt's book: Good Strategy / Bad Strategy

Course Summary

This final session is a course summary. We revisit the key concepts in Business Strategy and discuss how they fit together. We discuss examples of "good" and "bad" strategy, using student writeups from prior exams as examples. We also discuss views of strategy as an "emergent" process and the importance of coherence in crafting strategy.

• Mintzberg, “Crafting Strategy”, HBR, 1996.
• The Coherence Premium, HBR.
• Past exam questions are on the LMS and Strategic Thinking. Please review them.
• Case: Target (previous exam)

Q&A on topics covered this semester; thoughts on the syndicate assignment

• Hamel & Prahalad, “Strategic Intent”, HBR, 1989.
• Ed Barrows on the fatal flaws of strategic planning.

Exam: Tuesday 2nd May at 2pm. Open book.
It starts 2pm with 15 mins of reading time. Writing time of 2 hrs starts at 2:15pm