Case Study Of Porter 's Generic Strategies And Its Later Development

In 1980 and later in 1985 Michael Porter wrote two books. First one is “Competitive Strategy” and the second one is “Competitive Advantage” which are emphasized in explaining strategies which guides companies through analyzing themselves in their industries and by that analysis he guides them to choose the best strategy in order to be successful and achieve sustain competitive advantage their existing market. This paper focus on two of Porter's strategies that are “Five Force Analysis” and “Generic Strategies”. These strategies are still using by some of the company, but they are started to be replaced by new approaches. They became outdated for today’s highly competitive marketplace because they only focus on competing in existing market. In 2005, W. Chan Kim and

A company or an organization can create competitive advantage only when it is able to distinguish itself from the rivals by implementing value creating strategy over a longer period of time. It is said to have sustainable competitive advantage when other rival firms are unable to duplicate the value creating strategy of firm which has led to achievement of

The automotive industry globally involves the processes of manufacturing as well as sales of cars and other automobiles. The business of this industry is also inclusive of retailing activities like services; sale of spare parts, gas-station retails etc. by the year 2015, and the growth rate of the industry is expected to have a rise of 5.5% (Market Line, 2012). Moreover, as per International Organization of Motor Vehicle Manufacturers, this industry is the leading driver in terms of global economic progress and the largest employer. The changing trends and rising demand for technically advanced cars are giving out more opportunities. This essay is going to be a presentation on the analysis of the Volkswagen positioning strategy with respect to the Porters models of competitive strategies. This essay would be vital, as this analysis would help in revealing the company’s competitive and strategic position in the industry.

Differentiation and cost leadership are two strategies chosen because they are the most common between the different companies. Amazingly these leading organizations from different industries are using the same competitive strategies and tactics. The two competitive strategies may be the reason both organizations are leading within their industries. “Differentiation is a type of competitive strategy with which the organization seeks to distinguish its products or services from competitors” (Valdehueza, 2009).

To survive and thrive, an organization must create a competitive advantage. A competitive advantage is a product or service that an organization’s customers place a greater value on than similar offerings from a competitor. Unfortunately, competitive advantages are typically temporary because competitors often seek ways to duplicate the competitive advantage. In turn, organizations must develop a strategy based on a new competitive advantage.

To investigate if the generic strategies which Porter developed with are applicable in such an industry as the telecommunication sector.

In cost leadership a firm will set out to become a low cost producer in its industry. A low cost producer must find and exploit all sources of cost advantage. If a firm can achieve and sustain overall cost leadership then it will become an above average performer within its industry. The sources of cost advantage are varied and depend upon the

Competitive strategy, after Porter, came to be defined as the strategy of a business unit which seeks to achieve sustainable Competitive Advantage (SCA). The literature on strategy deems the market-based view (MBV) and the resource –based view (RBV) as two approaches to giving businesses the competitive edge they need to compete in their industries. Aside from having competitive advantage as their ultimate goal, the two approaches are also similar in the sense that they both make use of particular tools and models in their undertakings. They also differ in numerous ways,

According to Dess, Lumpkin, Eisner & McNamara (2014) Porter identified three generic business strategies that can be utilized to combat and overcome the five forces present in the business environment and achieve a competitive advantage. These generic

1. What is competitive advantage, and how does it relate to a company’s business model?

Competitive advantage(CA) is an advantage competitors gain by providing or offering customers or consumers greater value for their money through product and service differentiation or through lower prices. Maintaining competitive advantage is crucial to many businesses or organizations' success in order to survive in the market. Competitive advantage is characterized by superior performance which could be an attribute to outperform the competitors whether current or potential; or gaining a higher market share in a particular industry thereby ensuring market leadership; or ultimately, maximization of profit.(JOBBER 2010)

Competitive advantage is a position of a company in a competitive landscape that allows the company earning return on investments higher than the cost of investments. Competitive advantage should be relevant, unique and sustainable. Therefore sustainable competitive advantage, it’s a long-term competitive advantage that a company own over others in the same sector that is not easily duplicated or surpassable by its competitors (wikipedia, 2009). Competitive advantage can also be seen as a superiority gained by an organization when it can provide the same value as its

Competitive advantage is explained by Mahoney and Pandian (1992) as the function of industry analysis, organizational governance and the firm’s effects in the form of resource advantages and strategies. In order for a firm to be competitive it must adapt to the volatile business environment and through strategic management decisions establish a competitive advantage that will ultimately produce superior performance relative to its competitors (Akimova 2000).

In order to achieve competitive advantage, a firm must perform one or more value-creating activity that is more superior compared to other competitors. Superior value is created through lower costs or superior benefits to the buyers.

Cost leadership emphasizes producing standardized products at a very low per unit cost for consumers who are price sensitive. Differentiation is a strategy aimed at producing products and services considered unique industry wide and directed at customers who are relatively price insensitive. Focus means producing products and services that fulfill the needs of small groups of customers (niche market).