Modern Management: concepts and skills, 14/e

Competitive Dynamics

In the previous sections, we examined the first two components of strategic planning: strategic and tactical actions. In this section, we discuss the final component of strategic planning, which is gaining more attention from both researchers and practitioners: competitive dynamics. Competitive dynamics refers to the process by which firms undertake strategic and tactical actions and how competitors respond to these actions.³⁷ Although the previous sections do distinguish between and classify different types of strategic and tactical actions, the study of competitive dynamics is important in order to understand why managers undertake such actions. Inevitably, it is these actions and reactions that influence a firm’s ultimate ...