MGTA05H3 Chapter Notes - Chapter I: Retained Earnings, Strategic Management, Learning Curve

• School: UTSC
• Department: Management (MGT)
• Course: MGTA05H3
• Professor: Murphy Lawrence

Document Summary

Strategic management consists of analysis, decisions, implementations and evaluations a firm undertakes in order to create and sustain its competitive advantages: can be an ongoing process, critical to performance and survival of the firm. Goals of most publicly traded firms are normally to maximize shareholders" returns through various means. Industry a group of organizations/firms that share similar resource requirements: requirements: raw materials, labour, technology, customers. Cost of a product per unit declines as the # of units per period increases. Entry barrier is increased existing firms benefits (cost advantages to compete with new entrants on the price: capital requirements. Required capital in some industries are significantly high. The level of required capital for entering the industries creates a barrier to entry: switching costs the costs (monetary or psychological) associated with changing from one supplier to another from the buyer perspective. Minimal customers can easily switch buying products from one firm to another.