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Managing a Business Strategically
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Question:
How can industry leaders stabilize favorable pressure systems?
Author: Pim BodzingaAnswer:
1. Checks and balances: Simultaneously use competitive pressure to hold ambitious competitors in check 2. Tit for tat: Individual leaders can attack smaller rivals threating the existing pressure system 3. Sharing power: Leaders achieve a consensus that no major competitor will attempt to disrupt the pressure system; each is free to pursue growth in new areas and to poach on nondominant players that are not cooperating with the coalition 4. Polarized blocs: When there are two or more leaders in an industry, they can enter into shared power arrangements in separate blocs of opposing alliances 5. Collective security arrangements: Relationships among industry leaders and among lesser firms give all players an incentive for peaceful coexistence (e.g. Bluetooth)
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