Strategic Business Management: Questions and Answers

Strategic management consists of the analysis, decisions, and actions an organization undertakes in order to create and sustain competitive advantages. It gives the organization a sense of its objectives and a sense of how it will achieve these objectives. For Michael Porter, one of the leading strategy gurus, strategy is about achieving competitive advantage through being different. This means offering buyers a unique value, to increase their number and keep them as customers. For example, Southwest Airlines, and Ikea have developed unique, internally consistent, and difficult to imitate systems that have provided them with sustained competitive advantage..

The cost leadership strategy seeks to improve profit margins by bringing down the costs of producing while enabling the organization to still charge market prices. They also focus on increasing the market shares through lower pricing, enabling the organization to continue to reach profits because of reduced costs. As with any organization the goal is to minimize cost directly to the organization providing the delivery of products or services. According to Barney (2007) low cost leadership strategy takes pride in initiating its costs advantage abilities to charge lower prices while reaping the rewards of higher profits.

The purpose of my assignment has been done in terms of strategic analysis, its formulation and implementation of Ryanair organization. The assignment is developed by three parts which includes variety of questions in the each part.

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

This report demonstrates the evaluation of current performance of JD Sports Company. Method of Analysis includes Ansoff’s matrix and Porter’s generic growth strategies to discuss the nature of the market which JD Sports invest in. The financial methods are including the flexibility and stability of JD sports which judged by the liquidity, current ratio, operation capital, gearing and profit margin of this company. These figures could be collected from the annual report or balance sheet. This report analyzed the JD sport’s position in the market, and used generic and external growth method to expand market size. Such as acquired a lot stores to improve business profitability. Obviously, JD has expanded to the European

Change in one of the market risk may result in changes in another, which can affect how Walmart price the product for consumers and it also affect the value of the cost leadership initiatives. By using cost leadership to leverage operating expenses, increasing productivity and sourcing goods globally at low, low cost will maximize returns on capital invested. Walmart execute a tight financial expense control and a strong inventory management along with cost leadership and financial discipline will gives Walmart more profitable returns (Walmart 2010 annual report).

Cost leadership strategy is used by firms to surpass their competitors by reducing their cost from production of goods or services and is part of the business level strategy (Hills et al, 2007). There are four factors that influence a company’s ability to build and sustain a competitive advantage: efficiency, quality, innovation and responsiveness to customers. These factors allow a company to (1) differentiate its product offering to create greater perceived customer value and (2) lower its cost structure, which will then build a competitive

Riordan’s organization sells heart valves, plastic bottles, fans, and medical stents. Clearly, they have a large variety of products. According to Valdehueza, cost leadership is a competitive strategy with which the organization aggressively seeks efficient facilities, cuts costs, and employs tight cost controls to be more efficient than the competition. Decreasing business costs

When a business erroneously records expenses as assets, it has violated the measurement issue of A. communication. B. classification. C. valuation. D. recognition.

The cost Leadership strategy is able to provide products and services at a lower rate than competitors. The reason for Amazons strength is the fact that Amazon has a large variation of products to achieve economies of scale.

While the cost leadership strategy can be highly successful, it can be difficult to employ. It involves marketing the company as the cheapest source for a good or service. This means that costs need to be minimized and the savings are passed onto the customers. The overall cost leadership strategy focuses on becoming the low cost producer in an industry (Porter, 2016). Firms that generally succeed in cost leadership often have access to the capital required to make a significant investment in production assets, which would represent a barrier to entry that many firms would be unable to overcome. As technology improves, competition could potentially be able to jump ahead in production capabilities, eliminating the competitive advantage.

Globalization changes have impacted Burger King in the following ways; since the company began in 1953 with its first restaurant in Jacksonville, Florida and opened several locations across the United States, the company began its international expansion in 1969 with its first international franchise location in Canada, followed by Australia in 1971, and Europe in 1975. The setting up of franchises outside the United States was as a result of fast food opportunities arising outside the United States. So as to fully integrate in the international market, Burger King had to adopt and embrace

A successful cost leadership strategy usually provides the entire firm with high efficiency, low overhead, limited perks, intolerance of waste, intensive screening of budget requests, and wide span of control efforts. However, some risks of pursuing this strategy are that competitors might imitate the strategy, thus, driving overall industry profits down; that technology breakthroughs in the industry may make the strategy ineffective; or that buyer’s interest may swing to other differentiating features besides price.

Cost leadership, in which the firm strives to be the low cost producer in the industry

Future- oriented: Strategic management encompasses forecasts, what is anticipated by the managers. In such decisions, emphasis is placed on the development of projections that will enable the firm to select the most promising strategic options. In the turbulent environment, a firm will succeed only if it takes a proactive stance towards change.