Wednesday, June 19, 2013

Formulating Strategy: It Can Be a Crime

While many of the concepts of corporate strategy are being reviewed by the ‘giants corporations’, I see little to no promise in the future for the “little guy’s” or smaller companies.  In the article: (Harvard Business Press Chapters, 2005), discusses four unique different approaches for which fits your business strategy. The first being:

1. Leadership Cost

The key measureable delivery is what the customer’s perceive as adequate level of profitability. Most customer’s, believed that the corporations with the “bigger-ticker” on Wall Street, has the best prices against the much smaller companies attempting to compete in the pricing wars.  This article better explain how executive’s approaches to driving business success and how they are put together, for example:

  • Continuous improvement in operating efficiency and process reengineering. An example could be how Wall-Mart is well-known for its efficiency.
  • Supply chain power of Dell skipping the middleman, while it has completely eliminated the cost associated to inventory.

2. Differentiation

Differentiation targets how the customer values that particular good.  Who can remember the McDonald’s slogan, “Two all-beef patty, special sauce, lettuce, cheese, pickles, onions, on a sesame seed bun?” To Wendy's, “Where’s the beef?” marketing campaign.  Allowed for faster delivery that permitted these companies to charge based on the strategy on that particular good.

3. Customer Relationship

Some businesses survive in a low-cost environment by offering special care to their customers:

  • Simplifying customer’s life or work with better call centers.
  • Ongoing benefits update for software
  • Personalized services
  • Personal contact
  • Continuous learning

4. The Network Effect

It’s a phenomenon in which the value of a product increases as more products are sold. As eBay became valuable as more and more users took part in buying and selling goods. Harvard Business Press Chapters, 2005 called this, “winner-take-all strategy.”

So, in closing, we must understand which strategy fits your company best: Is it the mission, the goals to achieve or the company’s SWOT analysis. Key take on this matter is that every successful company tailors its own strategy to align to the customer’s you plan to address (O'Houlihan).

Works Cited

Bertschy, P. (2011, September 23). Prepare to Profit From The Next Market Crash. Readings and Learnings.

Harvard Business Press Chapters. (2005, June 16). Types of Strategy: Which Fits Your Business? Harvard Business Review (HBR), 1.

O'Houlihan, M. (n.d.). What Are the Four Major Type of Competitive Strategies? Business & Entrepreneurship. Demand Media. Retrieved June 20, 2013, from


No comments:

Post a Comment

Note: Only a member of this blog may post a comment.