Introduces students to the technique of comparative cost analysis, a center technique of strategists. Among the byzantine quantitative investigations that strategists undertake, relative cost analysis may be the most common. The goal of a relative cost analysis is simply to estimate how a firm's costs compare to a rival.
Businesses analyze comparative prices for a host of motives: to anticipate how a competition is likely to respond to a price change; to forecast how a price war may evolve; to analyze whether a cost advantage it considers it's is real and sustainable; to determine how low a corporation must bid in order to win a competitive agreement from a competitor; to identify opportunities for internal cost reduction; to estimate, in the context of an acquisition, how much the costs of an acquired business might be reduced and what a fair price might be for the firm; and so forth.
PUBLICATION DATE: October 26, 2007 PRODUCT #: 708462-PDF-ENG
This is just an excerpt. This case is about STRATEGY & EXECUTION
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