tailieunhanh - Lecture Strategic management: Competitiveness and globalization, concepts and cases (4/e): Chapter 7 - Michael A. Hitt, R. Duane Ireland, Robert E. Hoskisson

Chapter 7 - Acquisition and restructuring strategies. Studying this chapter should provide you with the strategic management knowledge needed to: Explain the popularity of acquisition strategies in firms competing in the global economy, discuss reasons why firms use an acquisition strategy to achieve strategic competitiveness, describe seven problems that work against developing a competitive advantage using an acquisition strategy,. | Chapter 7 Acquisition and Restructuring Strategies Michael A. Hitt R. Duane Ireland Robert E. Hoskisson ©2000 South-Western College Publishing 1 Chapter 3 Internal Environment Chapter 2 External Environment The Strategic Management Process Strategic Intent Strategic Mission Strategic Competitiveness Above Average Returns Feedback Strategy Formulation Chapter 4 Business-Level Strategy Chapter 5 Competitive Dynamics Chapter 6 Corporate-Level Strategy Chapter 8 International Strategy Chapter 9 Cooperative Strategies Chapter 7 Acquisitions & Restructuring Strategy Implementation Chapter 10 Corporate Governance Chapter 11 Structure & Control Chapter 12 Strategic Leadership Chapter 13 Entrepreneurship & Innovation Strategic Inputs Strategic Actions Strategic Outcomes 2 Mergers and Acquisitions Merger A transaction where two firms agree to integrate their operations on a relatively coequal basis because they have resources and capabilities that together may create a stronger competitive . | Chapter 7 Acquisition and Restructuring Strategies Michael A. Hitt R. Duane Ireland Robert E. Hoskisson ©2000 South-Western College Publishing 1 Chapter 3 Internal Environment Chapter 2 External Environment The Strategic Management Process Strategic Intent Strategic Mission Strategic Competitiveness Above Average Returns Feedback Strategy Formulation Chapter 4 Business-Level Strategy Chapter 5 Competitive Dynamics Chapter 6 Corporate-Level Strategy Chapter 8 International Strategy Chapter 9 Cooperative Strategies Chapter 7 Acquisitions & Restructuring Strategy Implementation Chapter 10 Corporate Governance Chapter 11 Structure & Control Chapter 12 Strategic Leadership Chapter 13 Entrepreneurship & Innovation Strategic Inputs Strategic Actions Strategic Outcomes 2 Mergers and Acquisitions Merger A transaction where two firms agree to integrate their operations on a relatively coequal basis because they have resources and capabilities that together may create a stronger competitive advantage Acquisition A transaction where one firm buys another firm with the intent of more effectively using a core competence by making the acquired firm a subsidiary within its portfolio of businesses Takeover An acquisition where the target firm did not solicit the bid of the acquiring firm 3 Problems in Achieving Success Integration difficulties Inadequate evaluation of target Too much diversification Large or extraordinary debt Inability to achieve synergy Managers overly focused on acquisitions Too large Increased market power Overcome entry barriers Lower risk compared to developing new products Cost of new product development Increased speed to market Increased diversification Avoid excessive competition Acquisitions Reasons for Acquisitions 31 Reasons for Acquisitions Example: Belgian-Dutch Fortis’ acquisition of American Banker’s Insurance Group Example: Watson Pharmaceuticals’ acquisition of TheraTech Example: British Petroleum’s acquisition of . Amoco Increased Market .