HOS801 – Strategic Management in Tourism and

Transcript:HOS801 – Strategic Management in Tourism and:
HOS801 – Strategic Management in Tourism and Hospitality Week Five – Business and Functional Strategy Define Business Level Strategy. Discuss the relationship between customers and business-level strategies in terms of who, what and how. Explain the differences among business-level strategies. Use the five forces of competition model to explain how above-average returns can be earned through each business-level strategy. Describe the risks of using each of the business-level strategies. Functional Strategy. Learning Objectives 2 An integrated and coordinated set of commitments and actions a firm uses to gain a competitive advantage by exploiting core competencies in specific product markets. (Hanson, 2014 5th Edition) The choices the firm has made about how it intends to compete in individual product markets. (Hanson, 2014 5th Edition) Business-level strategy choices matter because long-term performance is linked to a firm’s strategies. Every firm must form and use a business-level strategy for each one of its businesses. It is the core strategy. Business Level Strategy 3 Business-level strategies are intended to create differences between a firm’s position relative to those of its rivals. To position itself, a firm must decide whether it intends to - perform activities differently or - perform different activities compared to its rivals. The Purpose of Business Level Strategy 4 Business Level Strategy 5 Satisfying customers is the foundation of successful business strategies - Who will be served? - What needs will be satisfied? - How those needs will be satisfied? Deliver value and utility through acceptable product benefits and features. Managing relationships with customers. - Reach. - Richness. - Affiliation. Customers and Their Relationship to Business Level Strategy 6 Managing Customer Relationships 7 RICHNESS Depth and detail of two-way flow of information between the firm and customer. Consumer Markets Demographic factors e.g. gender, age and income. Socioeconomic factors e.g. social class and stage in the family life cycle. Geographic factors e.g. cultural, regional and national differences. Psychological factors e.g. lifestyle and personality traits. Consumption patterns e.g. heavy, moderate and light users. Perceptual factors e.g. benefit segmentation and perceptual mapping. Market Segmentation Consumer Markets 8 Industrial Markets End-use segments – identified by Standard Industrial Classification (SIC) code. Product segments – based on technological differences or production economics. Geographic segments – defined by boundaries between countries or by regional differences within them. Common buying factor segments – cut across product market and geographic segments. Customer size segments. Market Segmentation Industrial Markets 9 Customers