1. EXHIBIT 1 THE VALUE CHAIN

2. COMPONENTS OF THE VALUE CHAIN u Primary activities u Support activities u Upstream and downstream

3. SUSTAINING COMPETITIVE ADVANTAGE u Sustainable means that strategies are not easily neutralized, copied, or attacked by competitors

4. MULTINATIONAL DIVERSIFICATION u A quick way to gain a market presence u Coordinate and use resources from any location u Establishes global brand names u Cross subsidization

5. INDUSTRY EFFECTS ON STRATEGY SELECTION u Market size u Ease of entry and exit u Whether there are economies of scale in production u Driving forces of change u Nature of competition in industry

6. EXAMPLE KEY SUCCESS FACTORS u Innovative technology u Broad product line u Distribution channel effectiveness u Price advantages u Promotion effectiveness

7. CORPORATE STRATEGY SELECTION u Deciding which businesses in the portfolio are targets for growth and investment and which are targets for divestment or harvesting