Lecture Contemporary strategy analysis: Concepts, techniques, applications (5th edition): Chapter 10 – Robert M. Grant

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Chapter 10 – Industry evolution. This chapter presents the following content: The industry life cycle; industry structure, competition, and success factors over the life cycle; anticipating and shaping the future. | Industry Industry Evolution Evolution OUTLIN E The industry life cycle Industry structure competition and success factors over the life cycle. Anticipating and shaping the future. The The Industry Industry Life Life Cycle Cycle Industry Sales Introduction Growth Maturity Decline Time Drivers of industry evolution demand growth creation and diffusion of knowledge Product Product and and Process Process Innovation Innovation Over Over Time Time Product Innovation Rate of innovation Process Innovation Time Standardization Standardization of of Product ProductFeatures Featuresin inCars Cars FEATURE INTRODUCTION GENERAL ADOPTION Speedometer 1901 by Oldsmobile Circa 1915 Automatic transmission 1st installed 1904 Introduced by Packard as an option 1938. Standard on Cadillacs early 1950s Electric headlamps GM introduces 1908 Standard equipment by 1916 All-steel body GM adoptes 1912 Standard by early 1920s All-steel enclosed body Dodge 1923 Becomes standard late 1920s Radio Optional extra 1923 Standard equipment 1946 Four-wheel drive Appeared 1924 Only limited availability by 1994 Hydraulic brakes Introduced 1924 Became standard 1939 Shatterproof glass 1st used 1927 Standard features in Fords 1938 Power steering Introduced 1952 Standard equipment by 1969 Antilock brakes Introduced 1972 Standard on GM cars in 1991 Air bags GM introduces 1974 By 1994 most new cars equipped with air bags How How Typical Typical is is the the Life Life Cycle Cycle Pattern Pattern Technology-intensive industries e.g. pharmaceuticals semiconductors computers may retain features of emerging industries. Other industries especially those providing basic necessities e.g. food processing construction apparel reach maturity but not decline. Industries may experience life cycle regeneration. Sales Sales Color Portable B amp W HDTV 1900 50 60 90 1930 50 60 90 MOTORCYCLES TV s Life cycle model can help us to anticipate industry evolution but dangerous to assume any common pre- determined pattern of .

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