Competitive Rivalry and Dynamics

These flashcards cover key concepts related to competitive rivalry and dynamics, including definitions and explanations of important terms.

Competitive Rivalry

Describes competitive actions and responses among firms as they maneuver for an advantageous market position.

Competitive Behavior

The set of competitive actions and responses a firm takes to build or defend its competitive advantages and improve its market position.

Multipoint Competition

Occurs when firms compete against each other in several product or geographic markets.

Competitive Dynamics

The total set of competitive actions and responses taken by all firms competing within a market.

Interdependence of Firms

Firms are mutually dependent; competitors' actions and responses affect one another.

Model of Competitive Rivalry

A framework that includes factors like likelihood of attack, likelihood of response, and outcomes such as market position and financial performance.

Market Commonality

The number of markets in which a firm and a competitor are jointly involved.

Resource Similarity

The extent to which a firm's tangible and intangible resources compare favorably to a competitor's in terms of type and amount.

Drivers of Competitive Behavior

Factors such as awareness, motivation, ability, and specific factors like first-mover benefits, organizational size, and quality that affect competitive actions.

Likelihood of Response

The probability that a firm will respond to a competitor's action based on the potential impact of that action.

Slow-cycle Markets

Markets where competitors lack the ability to imitate the focal firm’s competitive advantages which can last for long periods.

Fast-cycle Markets

Markets where competitors can quickly and cheaply imitate a firm’s capabilities that contribute to its competitive advantages.

Standard-cycle Markets

Markets where competitive advantages can be somewhat sustained, with imitation being moderately costly.