ADMS 4900 Chapter Notes - Chapter 5: Prestige Brands, Holt Renfrew, Cost Leadership
28 Jan 2017
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Chapter 5: business level strategy: creating and sustaining. Business-level strategy is about the particular ways a firm competes in its chosen business. A firm presumably chooses to compete in certain ways to create superior value compared with its competitors. A firm also strives to sustain such superiority over a long period. Sustainability usually results from the ongoing relevance of the competitive advantage against the assaults of competitors. Michael porter identified three generic strategies that a firm can use to align best with the five forces and achieve competitive advantage: When a firm decides to pursue one type of competitive advantage (e. g. low cost) it must attain parity on the basis of other competitive advantages (e. g. differentiation) relative to competitors in order to achieve higher than average returns. 90 % of companies will want both differentiation and cost leadership. M. porter suggests you cannot have both, b/c you will be stuck in the middle and want have a clear focus.
