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Canada (161,660)
BUS 478 (20)
Chapter 4

Chapter 4: Building competitive advantage through functional-level strategy

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Business Administration
BUS 478
Larry Wosk

Chapter 4 Building competitive advantage through functionallevel strategy Overview Functional Level Strategies Strategies aimed at improving the effectiveness of a companys operations and thus its ability to attain superior efficiency quality innovation and customer responsivenessDistinct competencies shape the functional level strategiesDifferentiation and low cost structure determines a companys ability to attain superior efficiency quality innovation and customer responsiveness moreover differentiation creates value which leads to a competitive advantage and superior profitability and profit growthAchieving Superior Efficiency Here we look at the steps that companies can take at the functional level to increase their efficiency and thereby lower their cost structureEconomics of Scale Economies of scale are units cost reductions associated with a large scale of output If there are significant economies of scale a company may benefit by keeping prices down and increasing volumeFixed Costs Economies of scale spread fixed costs over a large production volume mass productionSpecialization Economies o
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