National University of Singapore
BMA 5013
Corporate Strategy
Semester 2, spring 2013
Instructor: WANG, Lihua
Office Location: MRB, #6-28
Telephone: 6516 6805
Email: bizlw@nus.edu.sg
Textbook and Reading Materials
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Case Packet (required)
Grant, Robert M. Contemporary Strategy Analysis. Seventh Edition (Wiley)
(optional).
Additional readings will be made available on IVLE.
COURSE DISCRIPTION
This course is about the formulation of competitive strategy—the goals and functional
policies that define the way a business position itself in its environment. Formulating a
competitive strategy involves identifying structurally attractive industries and building
positions of sustainable competitive advantage in industries a firm chooses to compete.
Corporate Strategy is an integrative course. It takes a broad view of the environment and
adopts a firm-level perspective. By examining how policies in each functional area can be
integrated into an overall strategy, the course illustrates how ideas from other core
courses, such as Marketing, Finance, and Organizational Behavior, need to be drawn
together to craft a competitive advantage.
Two broad concerns are central to the formulation of strategy. The first is gaining a
complete understanding of the firm's environment, particularly the dynamic forces that
contour the economics of the industry or industries in which a firm competes. Industry
structure is affected by a wide range of influences, including the macroeconomic
environment, technology, consumer tastes, and government policy. Because industries
offer heterogeneous opportunities for sustained profitability, and their structures evolve
over time, the returns to participation in different industries vary markedly.
The second major component of competitive strategy is a firm's position within its
industry. Competitive position determines a firm's long-run financial performance
relative to the industry average. A firm obtains a competitive advantage that allows it to
earn superior returns when the configuration of its product mix and functional activities
generate superior value for customers. Such a superior competitive position is sustainable
over the long run only if the firm invests in a set of resources, assets and other
capabilities that support its competitive advantage.
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Strategy must also be set at multiple levels in companies. One level is an individual
business unit competing in a specific industry. In addition, diversified firms must develop
strategies at the corporate level that delineate their geographic, product market, and
vertical scope. These questions of corporate strategy have become increasingly important
and challenging parts of companies' strategic agendas since the 1970s, and we will
address them during the third part of the course.
COURSE OBJECTIVES
The primary objective of this course is to develop the tools necessary to analyze industry
structure and to comprehend the forces that underlie competitive advantage. This calls for
the mastery of a body of analytical tools, and the development of an integrative point of
view that allows for their synthesis when making strategic choices. The course will cover
the analysis of industries and competitors, predicting competitor behavior, and techniques
for analyzing how firms can develop and sustain advantages over time.
This course also addresses the way in which the general manager can integrate functional
policies into an overall competitive strategy that creates and sustains a competitive
advantage. The course will examine how to identify a firm's strategy, test it for
consistency, develop strategic alternatives, and probe those alternatives for likely
competitive reactions. It will provide tools for examining the economic underpinnings of
competitive advantage, and how it can be extended.
The course is divided into five sections. After the introductory session, the first major
section is on Industry Analysis. This section explores techniques for analyzing the
environment of the firm. The objective of this section is to develop an understanding of
how different industry structures affect the expected average profitability of an industry
and offer varying opportunities for firms to achieve competitive advantage. The second
section, Creating Competitive Advantage, examines why individual firms prosper within
a particular industry setting. This section develops ideas on how to identify and evaluate
a strategy and how firms create value for their customers in unique ways. The third
section, Technology and Innovation Management, examines strategies in industries
where technology and innovation are important. The fourth section is Advantages from
Scope. This module builds on the preceding modules to examine how firms create
competitive advantage by virtue of their scope in two primary dimensions: product —
extending into closely related product segments; and geographic— moving into new
geographic markets. Finally, this course will discuss how a firm can structure itself to
implement a well-developed strategy.
COURSE ADMINISTRATION
The required reading list for each class, including cases, assignment questions and
readings will be posted in the course site on IVLE. I will frequently communicate with
you via IVLE and emails. Please make sure your IVLE account and NUS email account
work as they will be our primary communication tools for the class. I am available to
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meet you during office hours or by appointment. I am easily reached by email,
bizlw@nus.edu.sg.
PERFORMANCE MEASURES AND FEEDBACK
Grading will be based on 5 components. These components of your grade are weighted as
follows:
Individual assessment:
1. Class Participation
2. Short Case Write-up (8*2)
3. Final Exam
20%
16%
29%
Group assessment:
4. Group case presentation
5. Group project
10%
25% (paper: 15%; presentation: 10%)
CLASS PARTICIPATION (20%)
Because this is a case-based course, it is important that you attend every class session.
Much of the learning will take place in our collective discussion of the business cases. I
expect that every student will arrive prepared and willing to participate in the discussion.
I do expect that you will be able to respond when cold-called, and that you will make
every effort to engage in classroom debates.
Case discussions work best when students are prepared; actively listen to other people;
make logical and extensive arguments rather than short, offhand remarks; and when
students are willing to engage in debate with one another. Disagreement is neither a sign
of disrespect nor a violation of norms, but a process of interactively arriving at more
accurate understandings. It is perfectly acceptable to argue with one another, provided the
tools of engagement are logic. You will quickly find that your peers appreciate your
interventions and that together we get more rapidly to a correct answer.
I typically use the following questions to evaluate class participation:
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Does the participant attend classes?
Is the participant a good listener?
Do the comments reflect careful analysis?
Do the comments add to our understanding of the situation?
Is there a willingness to try new ideas (beyond repeating case facts)?
Is the participant considerate of other class members?
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SHORT-CASE WRITE-UPS (16%)
We will have 9 cases on various topics. You are required to choose 8 cases and write a
report for each case of your choice answering the discussion questions I provide before
the class on IVLE. Writing case reports encourages you to prepare the cases properly.
You earn up to 2 points for each case. In the event that you write all 9 cases, I will choose
8 highest grades as your final grades for the cases. Each case analysis report should be at
least 600 words. Reports less than 600 words will receive 0 points. The report is expected
to be submitted on IVLE before the deadline (9am on the day we discuss the case).
Assessment of the case reports are based on the effort and understanding of the topic,
rather than accuracy of the answers. Late online submission will not be accepted and will
result in zero points. Note that these are strict rules with no exceptions.
Please also note that the case reports that copy extensively from other sources (such as
previous student papers, online sources, etc.) will not gain any points.
FINAL EXAM (29%)
Final exam will be held on May 4th (subject to the approval of MBA Office). The exams
will cover your class lectures, discussions, reading assignments, and case study analysis.
The format will likely be a combination of multiple-choice questions, essay questions,
and/or case analyses. You are expected to take the exams at the designated time. Should
you have a compelling legitimate reason, illness with a doctor’s note or death of a close
family member that precludes you from being able to take the exam at the scheduled
time, it must be approved by the instructor PRIOR to the exam date via a documented
means, such as emails. The highest possible grade for make-up exams is 90% of total
possible score.
It is considered an honor code violation to consult any materials (e.g., class notes or
lecture slides) from past sections of Corporate Strategy. It will similarly be
considered an honor code violation to share class materials with future students.
GROUPS
Class members will form groups of four to five people (the group size may be adjusted
based on the class enrollment). The composition of the groups can be determined by the
students in the class. Groups will be formed in the first class but we may have some
adjustment of group members in the first few weeks. Although I will allow you to form
your own groups, I reserve the right to change/modify groups. To prevent “free-riding,”
each group will name a group leader. Group leaders will be the group-instructor liaison
and will also be responsible for calling to my attention any problems within the group,
such as non-participation of members. With the support of at least half of the group,
every member has the right to request the instructor to remove a non-participative
member from the group. The removed party will have to work on your own or find
another group yourself that will adopt you. The final decision rests with the instructor.
With a simple majority, the group can impeach the group leader, with final decision made
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by the instructor. The instructor reserves the right to deduct points (for the group project)
to students who did not or make little contribution to the group project based the
feedback of the team members. Team members who fail to show up on the date of team
presentations will receive zero for the project, unless some severe circumstances happen
during the time. It is important if there is a problem, that you do not wait until the
end of the semester to discuss it with me.
GROUP CASE PRESENTATION (10%)
Each group is expected to make a short presentation on a strategic analysis of a relevant
news article appeared in the press in the past year. The group is also expected to answer
any questions posed by the audience in class. Your group will pick an article that is
relevant to that day’s main topic and email me ahead of time for approval. You are
encouraged to get in touch with me if you need any clarifications or suggestions on the
preparation of your presentation.
The presentation and class discussion should be around 15 -20 minutes. Submit a hard
copy of your slides before your presentation and post a copy of your article and slides on
IVLE as well. You are graded based on the relevance of the article, the insights
demonstrated in your analysis, and the interaction you have in leading the discussion in
class. One point will be deducted if your group fails to post your slides and the
article on IVLE.
GROUP PROJECT (25%)
There will be two components to the Group Project: a written submission and a
presentation. The strategy report should be an application of the concepts that we discuss
in class in the context of an Asian company. A good project will identify something a
counter-intuitive situation and then explain it using one or more of the frameworks
discussed in the course.
The paper can be written on the basis of 1) findings of personal interviews of senior
managers and information gathered from secondary sources; or 2) information from
secondary sources only. You are strongly encouraged to use primary sources (i.e., talk to
managers) for this project. It is critical that you make references to each source from
which you obtain information.
The maximum length of the group paper is 15 pages (double-spaced, 12 font size and 1
inch margin on all sides) excluding references, tables and charts. The group paper is due
on 20th of April, 2013, 9 AM, and the presentations are to be made during the classes held
on April 20th and April 27th.
All students are expected to attend the presentation sessions irrespective of whether their
group is making the presentation.
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Each group member’s contribution will be taken into account, through peer review,
before the group’s marks are apportioned to each individual group member.
OTHER ADMINISTRATIVE DETAILS
Since faculty members tend to have somewhat different expectations as to class behavior
and course norms, I'd like to outline a few of my expectations concerning such matters.
1.
I plan to be prepared for every class and I expect you to do the same. Since I
frequently call on individuals whose hands are not raised, you should let me know
before the start of the class if some emergency has made it impossible for you to
be prepared adequately for that class.
2.
I consider attendance at every class to be very important. Please schedule other
activities at times other than those during which this class meets. In the event that
you do have to miss a class during the semester, I would appreciate it if you
would let me know in advance of that class.
3.
I will be happy to discuss the course, your progress, or any other issues of interest
to you on an individual basis.
4.
Given the importance of this course, I will do everything that I can to use class
time effectively and ask that you do the same. This will include arriving, starting,
and ending on time.
5.
Group work is acceptable and strongly encouraged for purposes of case
preparation for classroom discussion.
6.
Laptops, smart phones, and other electronic devices may not be used in class.
Please see next page for the detailed course outline.
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Date
Session 1
19‐Jan
Session 2
26‐Jan
Session 3
2‐Feb
Session 4
9-Feb
Session 5
16-Feb
23-Feb
Session 6
9‐Mar
Session 7
16‐Mar
Course Plan
Course Introduction: The Concept of Strategy
Session 8
23‐Mar
International Strategy for Firms in Emerging Markets
Session 9
30‐Mar
The Scope of the Firm: Alliances & Acquisitions
Session 10
6‐Apr
Session 11
13‐Apr
Session 12
20-Apr
Session 13
27‐Apr
Organization Structure & Strategy Implementation
Industry Analysis
Industry with Network Effects
Cost Leadership & Differentiation Advantage
Technology and Innovation Management
Semester Break
The Scope of the Firm: Diversification & Portfolio Planning
International Strategy for Firms in Developed Markets
Article/ Case
Reading: What is Strategy (Porter)
Think exercise before the class: The strategy of the company you are working for
Reading: The five competitive forces that shape strategy (Porter)
Case: Cola Wars Continue: Coke vs. Pepsi in 2006 (9-706-447)
Reading: The Art of Standard Wars (Shapiro & Varian)
Case: Rivalry in Video Game (Grant)
Reading: Creating Competitive Advantage (Ghemawat & Rivkin) (9-798-062)
Case: AirAsia: Flying low cost with high hopes (HKU833)
Reading: Managing your innovation portfolio (Nagji and Tuff)
Case: Design Thinking and Innovation at Apple (9-609-066)
Reading: Grant, Ch. 16
Case: The Walt Disney Company: The Entertainment King (9-701-035)
Reading: Distance still matters (Ghemawat)
Case: Hong Kong Disneyland (Ivey: 907M13)
Readings:
(1)Going global: Lessons from the later movers (HBR)
(2)Tomorrow’s global giants: not the usual suspects (HBR)
Case: Haier: Taking a Chinese company global (HBS 9-706-401)
Readings:
(1) When to ally and when to acquire (Dyer, Kale & Singh)
(2) Mergers and acquisitions: Overcoming pitfalls, building synergy, and creating
value (Hitt, et al.)
Case: The Acquisition and Restructuring of KIA Motors by Hyundai Motors
(Ivey: 909M15)
Case: Alibaba
Project Presentations
Project Presentations
Final Exam
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