What Is Strategy?
■ A firm’s strategy refers to the actions that managers
take to attain the goals of the firm
■ Firms need to pursue strategies that increase
profitability and profit growth
– Profitability is the rate of return the firm makes on its invested
capital
– Profit growth is the percentage increase in net profits over time
■ To increase profitability and profit growth , firms can
– add value
– lower costs
– sell more in existing markets
– expand internationally