Competitiveness based on a firm’s market share

The experience curve is both a management tool and an indication of competitiveness based on a firm’s market share. On this basis Toyota should never have become competitive with General Motors or Ford. Yet factually this obviously happened. Explain how experience curve analysis was adapted to deal with this logical contradiction. Also describe how Toyota has changed the traditional assembly line model pioneered by Henry Ford to stay competitively ahead of other auto producers and further manage its movement down the curve in terms of unit costs.? 2. BCG, Bain and McKinsey each have different approaches to Business Strategy consulting. Please briefly explain these and then compare how these differences might affect their approach to clients. 3. Each team has chosen a consulting client. Please briefly describe your chosen firm or its division in terms of its business, major competitors and the strategic problem or problems the team plans to address including the analytics that will be used to do this. 4. The auto industry has featu​‌‌‌‌‍‌‍‌‍‌‌‌‍‌‍‌‍‍‌​red prominently in our discussion of business strategy including the impact of technology on the car itself. Indeed, as noted in the lectures the car has become more of a consumer electronics product. Please assess how you would advise Apple to leverage its growing role in the delivery of electronic entertainment as an entry strategy to increasing its electronic footprint in the smart car of the future. 5. Please Read the following arithmetic problem and then answer the five questions posed; The idea is to quantitatively evaluate your firm’s strategy to grow faster than the market and grow share. Your firm has a 20% market share in a high growth market [25% annual growth] where the major competitor [50% market share] is pursuing a conservative financial policy of only growing using internal financial resources. Your firm on the other hand has unlimited access to external debt funding at 5%. Assume then that your firm decides to initially price below the lead competitor at $22 per unit. The product is subject to experience effects. Market Growth [Units]: 25% Market Growth [$]: 20% [This assumes lead competitor lowers prices to $24 as costs decline to gain market share directly through market expansion and competitive pressures on 10% firms.] That is it prices at the prospective cost of the 10% producers. Market Size [units]: 250K Market Size [$]: $7.5 million [initial price is $30 per unit or cost 10% producers] Elasticity Demand: elastic and price elasticity equals 2 [1% change price leads 2% rise quantity] Elasticity Supply: elastic Industry Accumulated Experience: 250K Cost Reduction Each Doubling Experience: 20% Annual Production Of Lead Firm: 125K Market Share [units]: 50% Firm’s Market Share [units]: 20% [others 10% each] Asset Turnover: ½ Depreciation Assets: 10% Taxes: 30% Based on this information indicate: Firm’s Competitive Position? Dog, $, ?, * Competitive Strategy [Grow, Maintain or Divest]? Gain, Hold or Reduce Market Share? Costs per unit? Prici​‌‌‌‌‍‌‍‌‍‌‌‌‍‌‍‌‍‍‌​ng Strategy?    

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