Foundations of Strategy

Foundations of Strategy, Second Edition is a concise text aimed at both undergraduate and Masters students. Written in an accessible style with the needs of these students in mind, the second edition of this popular text has a clear, comprehensive approach, underlined by sound theoretical depth. The text has been fully revised and updated to reflect recent developments in the business environment and strategy research.

Extensive learning and teaching materials to accompany this text include aninstructor manual, case teaching notes, test bank and PowerPoint slides are available for instructors. Resources for students include self-test quizzes and glossary flashcards to test understanding.

From the Reviews of the Second Edition...

"This second edition of Foundations of Strategy is a concise but comprehensive strategic management textbook for both undergraduate-level and graduate-level students. The book covers some of the most fundamental challenges organizations face as they strive to gain and sustain competitive advantage. The book is full of contemporary case studies that include a balanced mix of theory and application in strategic management. This new edition provides a very useful tools and resources to the increasingly important discipline of strategic management."
—Dr Jay Lee, California State University, Sacramento

"Foundations of Strategy explains current theory clearly and carefully, with a good range of examples. The quality of my students’ strategic analyses has improved perceptibly since I started using it."
—Dr Adrian Haberberg, University of East London

Preface to 2nd edition ix

Preface to 1st edition x

Online teaching and learning resources xi

Case list xii

1 The concept of strategy 1

The role of strategy in success 6

A brief history of strategy 8

Strategy today 11

Strategic management of not‐for‐profit organizations 25

The approach taken in this book 27

2 Industry analysis 39

From environmental analysis to industry analysis 42

The determinants of industry profit: Demand and competition 45

Analysing industry attractiveness 47

Applying industry analysis to forecasting industry profitability 57

Using industry analysis to develop strategy 60

Defining an industry 62

Reviewing the five forces of competition framework 64

Segmentation analysis 66

Dealing with dynamic competition 68

From industry attractiveness to competitive advantage: Identifying key success factors 68

3 Resources and capabilities 81

The role of resources and capabilities in strategy formulation 87

Identifying the organization’s resources and capabilities 89

Appraising resources and capabilities 100

Developing strategy implications 106

4 The nature and sources of competitive advantage 119

How competitive advantage emerges and is sustained 123

Types of competitive advantage: Cost and differentiation 131

Porter’s generic strategies and being ‘stuck in the middle’ 140

5 Industry evolution and strategic change 151

The industry lifecycle 157

Managing organizational adaptation and strategic change 167

Managing strategic change 170

6 Technology‐based industries and the management of innovation 193

Competitive advantage in technology‐intensive industries 198

Strategies to exploit innovation: How and when to enter 204

Competing for standards 210

Implementing technology strategies: Creating the conditions for innovation 215

7 Corporate strategy 233

The scope of the firm 238

Key concepts for analysing firm scope 239

Diversification 241

Vertical integration 249

Managing the corporate portfolio 258

8 Global strategies and the multinational corporation 271

The implications of international competition for industry analysis 277

Analysing competitive advantage in an international context 280

The international location of production 285

How should firms enter foreign markets? 288

Multinational strategies: Global integration vs. national differentiation 292

Strategy and organization within the multinational corporation 297

9 Realizing strategy 309

From strategy to execution 313

Organizational design: The fundamentals of organizing 318

Organizational design: Choosing the right structure 325

Organizational culture 332

10 Current trends in strategic management 343

The new environment of business 344

New directions in strategic thinking 349

Redesigning organizations 354

The changing role of managers 358

Glossary 365

Index 371

ROBERT M. GRANT is Eni Professor of Strategy Management at Bocconi University in Milan and a Visiting Fellow at Georgetown University, Washington and City London University.

JUDITH JORDAN is Teaching Associate in Management at the University of Bristol.

Foundations of Strategy, Second Edition is a concise text aimed at both undergraduate and Masters students. Written in an accessible style with the needs of these students in mind, the latest edition has a clear, comprehensive approach, underlined by sound theoretical depth. The content has been fully revised and updated to reflect recent developments in the business environment and strategy research.

Features of the text include:

• 10 chapters covering all the topics in a typical one-semester course.
• Concise and integrated treatment of strategy implementation focusing on strategy in practice.
• Integration of the not-for-profit sector.
• Opening and closing chapter case studies covering a range of real-world, global examples.
• Featured Example and Case Insight boxes throughout chapters to give an additional dimension to the subject matter.

An extensive range of learning and teaching materials accompany this text including instructor manual, case teaching notes, test bank and PowerPoint slides, for instructors. Resources for students include self-test quizzes and glossary flashcards to check understanding. Access the full resources online at www.foundationsofstrategy.com.