Business Level Strategy is concerned more with how a business competes successfully in a particular market. It relates to strategic decisions about the choice of products, identifying and fulfilling the needs of customers, building competitive advantages over competitors, exploiting or creating new opportunities etc. Business level strategies are essentially positioning strategies whereby businesses tend to secure for themselves an identity and position in the market. The aim here is to increase the business value for the corporate and stakeholders by increasing the brand awareness and value perceived by the customers. They can either focus on pricing or product differentiation to increase the perceived customer value. Customers are the foundation of successful business-level strategy – Who will be served by the strategy? What needs shall the strategy satisfy? How will the strategy satisfy those needs? The low cost strategy emphasizes having the lowest costs, not necessarily the lowest price, in a Continue reading
Strategic Management Terms
Hypercompetition
Hypercompetition is a relatively new term in strategic management, coined by Richard D’Aveni, professor of business strategy at the Amos Tuck School at Dartmouth College, in his book “Hypercompetition: Managing the Dynamics of Strategic Maneuvering.” In this book he defines hypercompetition as; “an environment characterized by intense and rapid competitive moves, in which competitors must move quickly to build advantage and erode the advantage of their rivals.” Richard D’Aveni (1994: 217-218) Hypercompetition results from the dynamics of strategic maneuvering among global and innovative combatants. It is a condition of rapidly escalating competition based on price-quality positioning, competition to create new know-how and establish first-mover advantage, competition to protect or invade established product or geographic markets, and competition based on deep pockets and the creating of even deeper pockets dalliances. In hypercompetitions the frequency, boldness, and aggressiveness of dynamic movement by the players accelerates to create a condition of constant disequilibrium Continue reading
The Concept of Business Growth
Meaning of Business Growth Business growth is a natural process of adaptation and development that occurs under favorable conditions. The growth of a business firm is similar to that of a human being who passes through the stages of infancy, childhood, adulthood and maturity. Many business firms started small and have become big through continuous growth. However, business growth is not a homogeneous process. The rate and pattern of growth varies from firm to firm. Some firms grow at a fast rate while others grow slowly. Also, not all enterprises survive to grow big. This may be due either to the nature of the firm or the entrepreneur. Some entrepreneurs do not want to grow their ventures, choosing instead to pursue other interest, spend more time with family or develop other business activities. Generally, the term ‘business growth’ is used to refer to various things such as increase in the Continue reading
Platform Leadership – Meaning and Examples
Platform Leadership is a new concept in strategic management, introduced by Annabelle Gower and Michael Cusumano in their book , “Platform Leadership: How Intel, Microsoft, and Cisco Drive Industry Innovation,” HBS Press, 2002. Platform leadership enables companies to exert influence over the direction of innovation that is taking place in their industry, thus extending their weight over the network of firms and customers involved with the industry. In the initial phase of many industries, the early movers tend to develop most of the components necessary to make the products. But later, specialized firms typically emerge to develop different components. Along with components, evolve platforms, which consist of various components made by different companies. Some companies become platform leaders. They ensure the integrity of the platform by working closely with other firms to create initial applications and then new generations of complementary products. “Becoming a platform leader is like winning the Continue reading
Strategic Lenses
Organisations strategic issues are commonly analysed from different strategy lenses. Strategic lenses are a concept of strategic management. The lenses are different ways of viewing strategy development. It examines the flow of tasks and information, or how you get things done. Each lens reveals many different traits and qualities. Using the strategic lens, one looks to optimize workflow to meet the goals and objectives of the company. This article a will cover four angles from which strategy can be viewed and implemented on a corporate level; they are strategy as design, strategy as experience, strategy as ideas and strategy as discourse. 1. Strategy as a Design This takes the view that strategy development can be a local process in which the forces and constraints on the organisation are weighted carefully through analytic and evaluative techniques to establish clear strategy direction. This creates conditions in which carefully planned strategy implementation should Continue reading
Difference Between Strategic Planning and Management Control
Briefly, here are some ways in which the strategic planning process differs from the management control process. A strategic plan usually relates to some part of the organization lather than to the totality; the concept of a master planner who constantly helps all part of the organization at some coordinated optimum is a nice concept an unrealistic one. Strategic planning is essentially irregular problems, opportunities, and bright ideas do not arise according to some- set timetable; rather, they are dealt with whenever they happen to be; perceived. The appropriate analytical techniques depend on the nature of the problem being analyzed, and no over all approach (such as a mathematical model) has been developed that is of much help in analyzing all types of strategic, problems emphasis on a systematic approach is quite likely to stifle the essential element of creativity. In strategic planning, management, works, now on one problem, then Continue reading