Unit 5 Discussion
1. Describe the similarities and differences among generic strategies. Provide an example of an organization using a generic strategy.
Michael Porter’s “Generic Strategies” can be offensive or defensive with respect to competitive forces. The Generic Strategies are cost leadership, differentiation, and focus.
The first strategy, the cost leadership refers to the ways of gaining a competitive advantage over the rival company. When a company sets out to become a leader in cost, it produces its products or services at a lower cost compared to similar industries. For example, the grocery store called Aldi is a leader in offering low-cost products. The cost advantage varies depending on the industry. In order to have a cost advantage and sustain cost leadership, the company could pursue economies of scale, increase profits by reducing production costs, offer lower prices to …show more content…
Compare and contrast a broad and narrow focus strategy. Provide an example of an organization using a broad or narrow focus strategy.
A broad focus strategy is applied industry wide and it refers to the cost leadership and differentiation strategy. The broad focus strategy concentrates on developing products that are unique and of low cost for a broad market.
On the other hand, a narrow focus strategy is applied to specific market segment and it refers to the low-cost focus and differentiation focus strategy. Even though the focus is on a specific market segment they still have to offer products or services that are value added and low cost.
An example of an organization that uses broad focus strategy is McDonald. The fast-food chain applies cost leadership and differentiation strategy. Normally, food in McDonald’s is of low-price and its product and service are different from other fast food restaurants.
On the other hand, an example of an organization that uses narrow focus strategy is Redbox. This company rents movies and video games through vending machines at
1. Describe the similarities and differences among generic strategies. Provide an example of an organization using a generic strategy.
Michael Porter’s “Generic Strategies” can be offensive or defensive with respect to competitive forces. The Generic Strategies are cost leadership, differentiation, and focus.
The first strategy, the cost leadership refers to the ways of gaining a competitive advantage over the rival company. When a company sets out to become a leader in cost, it produces its products or services at a lower cost compared to similar industries. For example, the grocery store called Aldi is a leader in offering low-cost products. The cost advantage varies depending on the industry. In order to have a cost advantage and sustain cost leadership, the company could pursue economies of scale, increase profits by reducing production costs, offer lower prices to …show more content…
Compare and contrast a broad and narrow focus strategy. Provide an example of an organization using a broad or narrow focus strategy.
A broad focus strategy is applied industry wide and it refers to the cost leadership and differentiation strategy. The broad focus strategy concentrates on developing products that are unique and of low cost for a broad market.
On the other hand, a narrow focus strategy is applied to specific market segment and it refers to the low-cost focus and differentiation focus strategy. Even though the focus is on a specific market segment they still have to offer products or services that are value added and low cost.
An example of an organization that uses broad focus strategy is McDonald. The fast-food chain applies cost leadership and differentiation strategy. Normally, food in McDonald’s is of low-price and its product and service are different from other fast food restaurants.
On the other hand, an example of an organization that uses narrow focus strategy is Redbox. This company rents movies and video games through vending machines at