Chapter 6
Discussion Question 6.1
What are some drawbacks and risks to a broad generic business strategy? To a focused strategy? Having a generic business strategy will cover a vast amount of products or services, but in the end will not stand out due to it being so broad. With this type of strategy businesses will find themselves in an undesirable predicament because the consumers of the organization will not have an understanding of the firms core competencies. Incorporating to many strategies as seen from a cost perspective, is not a sound solution for any organization to engage upon. That’s due to the rise in cost will negatively impact value created, by suddenly limiting it. Also, not differentiating between products will cause a
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What strategy might the firm use to unseat Windows in this market? This is a difficult market to engage. Looking at the likes of a Google and Apple, which are in this market, their systems are just as beneficial. In addition, a better operating system than Windows would come from the likes of Apple. This company has been abele to produce an operating system like no other, by appealing to those individuals such as early adopters and convincing them that that there technology is the next best thing. With that said, it will be hard for Apple to unseat Windows due to their ability to allow a compatibility with any system no matter the computer or device, which reduces inefficiency within the organization. Apple can take one thing into consideration when trying to implement their OS amongst the world, which is focus on the target audience and organizations for which a market share can be built. This may include the likes of the military due to Apples OS being one of the fastest thus allowing for lower levels of viruses. Also the youth, seeing that are appealed to new technology. In the end Apple have controlled the hardware & software bundles and model updates, so every Mac operates smoothly without worry on lagging,
Microsoft has their dominance of the industry at stake. They could potentially come out on top if left to continue their current tactics. They are masterfully “marketing their products” and it is paying off for them (Love, 1997).
Each organization has or should have a distinct business strategy to ensure they reach their desired goals and objectives. Uniquely, the business strategy, or competitive strategy, should include their target consumers, the product or service desired by their consumers, and their roadmap to remain competitive in the market (Parnell, 2014). However, strategies may be difficult to determine when the organization is engrossed in one industry, but decides to dip their toe in another industry (Bethel, 2016).
A Following a different generic business strategy within the same industry can lead to a competitive
Viewed together, three main facts indicate that Microsoft enjoys monopoly power. First, Microsoft's share of the market for Intel-compatible Personal Computer (PC) operating systems is extremely large and stable. Second, Microsoft's dominant market share is protected by a high barrier to entry. Third, and largely as a result of that barrier, Microsoft's customers lack a commercially viable alternative to Windows, the operating system of all PC's.
7. Which one of the following generic types of competitive strategy is typically the best strategy for a company to employ?
Discussion Question 6.1: What are some drawbacks and risks to a broad generic business strategy? To a focused strategy?
According to Slack et al. The corporate strategy or business strategy is the guide lines for the whole corporation’s businesses in relation to its markets, customers, and the competitors (2007). In the same context, the same authors discussed the link between the corporate strategy and
A competitive strategy, or business-level strategy, is the way a business used to successfully enter and penetrate into a market (Eastwood et al, 2006), and also, to succeed in this chosen market against its competitors (Johnson et al, 2014). A company needs to develop and apply appropriate strategy to help the company to generate distinctive competences (David, 2007). Compared with the strategies implemented in other levels of operation, competitive strategy is more focused on the competition against other competitors and strategic choices to better attain market share (Harrison and St. John, 2009). According to
Alfred Chandler(1963) defines strategy as ‘ the determination of the long-run goals and objectives of an enterprise and the adoption of courses of action of an enterprise and the adoption of courses of action and the allocation of resources necessary for carrying out these goals’. And Michael porter(1996) sees it as ‘Competitive strategy is about being different. It means deliberately choosing different set of activities to deliver a unique mix of value’.
Another generic competitive strategy is broad differentiation strategies. According to Thompson, Strickland, and Gamble, in “Crafting and Executing Strategy”, broad differentiation strategy is seeking to differentiate the company’s product offering from rivals in ways that will appear to a brad spectrum of buyers. A company attempting to succeed through differentiation must study buyers’ needs and behavior carefully to learn what buyers consider important, what they think has value, and what they are willing to pay for. Then the company has to incorporate buyer-desired attributes into its product or service offering
“Competitive strategy involves positioning a business to maximize the value of the capabilities that distinguish it from its competitor’s” (Porter 1980:47). A successful business plan requires first and foremost the formation of an appropriate strategy. Through the implementation of a suitable strategy, the company is able to obtain its own industry niche and gain an understanding of its customers (Porter 1985). Whichever strategy is adopted it must be adequately integrated within the firms goals and missions to achieve a competitive advantage (Parker and Helms 1992).
A company 's strategy consists of the competitive moves and business approaches that managers are employing to grow the business, attract and please customers, compete successfully, conduct operations, and achieve the targeted levels of organizational performance.
According to Porter, strategies allow organizations to gain competitive advantage from three different bases: cost leadership, differentiation and focus. Porter calls these bases as generic strategies.
The generic strategy allows the firm to react to the five forces better than their competitors (Worthington & Britton, 2006). According to Porter (1985), an organization can enjoy competitive advantage by focusing on the generic competitive strategies. The organization could enjoy competitive edge by either offering the product at low cost or differentiating the product from the competitors or by focusing on a specific market. Porter (1985) emphasized that the generic strategies should be at the centre of the strategic plans.
As per the Hambrick and Fredrickson article, most strategic plans only emphasize one or two of the five elements of a good strategy