General Electric

60506 Words243 Pages
Chapter 1 explores the concepts surrounding organizational strategy. It begins with an explanation of the term strategy and offers a basis for how to identify a company’s particular strategy. Next, it explores the importance of striving for competitive advantage in the marketplace and examines the role strategy plays in achieving this advantage. The chapter then explores the idea that strategy is partly proactive and partly reactive. Next, a discussion on strategy and ethics is given. This is followed by a close look at the relationship between a company’s strategy and its business model. The chapter proceeds forward with a look at what makes strategy a winner and then presents reasons for why crafting and executing strategy are important.…show more content…
B. Strategy and the Quest for Competitive Advantage

1. Generally, a company’s strategy should be aimed either at providing a product or service that is distinctive from what competitors are offering or at developing competitive capabilities that rivals cannot quite match.

2. What separates a powerful strategy from an ordinary or weak one is management’s ability to forge a series of moves, both in the marketplace and internally, that makes the company distinctive, tilts the playing field in the company’s favor by giving buyers reason to prefer its products or services, and produces a sustainable competitive advantage over rivals.

CORE CONCEPT: A company achieves sustainable competitive advantage when an attractive number of buyers prefer its products or services over the offerings of competitors and when the basis for this preference is durable.

3. Four of the most frequently used strategic approaches to setting a company apart from rivals and achieving a sustainable competitive advantage are:

a. Being the industry’s low-cost provider.

b. Outcompeting rivals based on such differentiating features as higher quality, wider product selection, added performance, better service, more attractive styling, technological superiority, or unusually good value for the money.

c. Focusing on a narrow market niche.

d. Developing expertise

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