Competitive strategy options
Cost Leadership – The lowest cost producer in an industry. So company can compete on price.
Differentiation – Here the firm creates a product that is perceived to be unique in the market.
Focus – Position one-self to uniquely serve one particular niche in the market.
Sustaining Competitive advantage
Once a competitive advantage is achieved it will be important that it is sustained. Competitive advantage can best be sustained by strategic capabilities which are:
Valued,
Rare, and
Robust
However, organisations can also take strategic steps to protect their competitive position through:
Price based strategies,
Further differentiation, or
Differentiation through Innovation
Ansoff Matrix
Ansoff matrix is the tool that helps form future growth strategies for leaders of organization.
He describes four growth alternatives for growing an organization in existing or new markets, with existing or new products. Each alternative poses differing levels of risk for an organization
Strategy Evaluation
The choices need to be evaluated to determine which the best one for a particular organisation is.
Johnson, Scholes and Whittington (JSW) argue that for a strategy to be successful it must satisfy three criteria:
1- Suitability –
whether the options are adequate responses to the firm’s assessment of its strategic position.
2- Acceptability –
considers whether the options meet and are consistent with the firm’s objectives and are acceptable to the stakeholders.
3- Feasibility –
assesses whether the organisation has the resources it needs to carry out the strategy.