Strategic Management

JEFFREY H. DYER (Ph.D., UCLA, 1993) is the Horace Beesley Professor of Strategy at the Marriott School, Brigham Young University, where he serves as Chair of the Department of Organizational Leadership and Strategy. PAUL C. GODFREY (Ph.D., Washington, 1994) currently serves as the William and Roceil Low Professor of Business Strategy in the Marriott School of Management at Brigham Young University. ROBERT J. JENSEN (Ph.D., Wharton, 2006) is an associate professor of Strategy and International Business and is a Whitman Faculty and Peery Research Fellow at the Marriott School of Management, Brigham Young University. DAVID J. BRYCE (Ph.D., Wharton, 2003) is Associate Professor of Organizational Leadership and Strategy at the Marriott School of Management and has been an adjunct Associate Professor of Management at the Wharton School where he has taught strategy in the MBA program for executives.

ABOUT THE AUTHORS iii

PREFACE v

1 What Is Business Strategy? 1

2 Analysis of the External Environment: Opportunities and Threats 19

3 Internal Analysis: Strengths, Weaknesses, and Competitive Advantage 45

4 Cost Advantage 62

5 Differentiation Advantage 81

6 Corporate Strategy 100

7 Vertical Integration and Outsourcing 121

8 Strategic Alliances 137

9 International Strategy 156

10 Innovative Strategies that Change the Nature of Competition 180

11 Competitive Strategy and Sustainability 196

12 Implementing Strategy 217

13 Corporate Governance and Ethics 236

14 Strategy and Society 253

APPENDIX A Data Sources for Analysis 269

APPENDIX B 20 Valuable Financial Ratios for Strategic Analysis 279

GLOSSARY 283

COMPANY INDEX 288

NAME INDEX 291

SUBJECT INDEX 292

CASE 1 Walmart Stores: Gaining and Sustaining a Competitive Advantage C-1

CASE 2 Blue Raven Solar: Competing in a Fragmented Growth Industry C-12

CASE 3 ESPN in 2023: Choices for the Future C-20

CASE 4 Southwest Airlines: Flying High With Low Costs C-30

CASE 5 Harley-Davidson: Growth Challenges Ahead C-45

CASE 6 Vivint SmartHome: Finding New Pathways for Growth C-57

CASE 7 Nike: Sourcing and Strategy in Athletic Footwear C-69

CASE 8 Tencent: Using Partnerships to Grow from a Single App to a Super App. What's Next? C-78

CASE 9 Samsung: Overtaking Philips, Panasonic, and Sony as the Leader in the Consumer Electronics Industry C-85

CASE 10 Tesla Motors: Disrupting the Auto Industry? C-101

CASE 11 AI Disruption in Search: Google's Battle for Dominance Against ChatGPT C-111

CASE 12 Lincoln Electric: Aligning for Global Growth C-119

CASE 13 ICARUS Revisited: The Rise and Fall of Valeant Pharmaceuticals C-127

CASE 14 Ethics and Capitalism—The Other Side Academy C-138

CASE 15 Meta's Facebook: Preparing for the 2024 Election Cycle C-150

CASE 16 Ecolab and the Nalco Acquisition: Sustainable Advantage Through Shared Values C-160

CASE 17 Competing with Free in Video Communications: Zoom vs. the tech giants—Microsoft Teams, Google Meet, Apple FaceTime, and WhatsApp (Facebook) C-170

CASE 18 Uber C-177

ADDITIONAL CASES CAN BE FOUND IN YOUR WILEY COURSE