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Strategic Management and Competitive Strategy

The document outlines key concepts in strategic management and competitive strategy, emphasizing the importance of translating strategic goals into actionable objectives and ensuring alignment across teams. It discusses Michael Porter's three generic competitive strategies: cost leadership, differentiation, and focus, along with their objectives and examples of companies that exemplify each strategy. Additionally, it highlights the role of policies in aiding strategy execution by promoting consistent behavior and streamlining decision-making.

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jeanellemiraflores
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5 views

Strategic Management and Competitive Strategy

The document outlines key concepts in strategic management and competitive strategy, emphasizing the importance of translating strategic goals into actionable objectives and ensuring alignment across teams. It discusses Michael Porter's three generic competitive strategies: cost leadership, differentiation, and focus, along with their objectives and examples of companies that exemplify each strategy. Additionally, it highlights the role of policies in aiding strategy execution by promoting consistent behavior and streamlining decision-making.

Uploaded by

jeanellemiraflores
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Strategic

Management
and
Competitive
Strategy
Insights from Michael E. Porter and OpenStax
Principles of Management

Jay Jay F. Miraflores


Ways to Lead the
Implementation and
Execution Process
• Translate strategic goals into specific objectives
and actions.

• Ensure alignment across departments and teams.

• Establish metrics for tracking progress and


performance.

• Foster leadership involvement and accountability.

• Use feedback loops to refine execution.


Role of Policies in
Aid of Strategy
Execution
• Policies ensure consistent behavior
aligned with strategy.

• Help prevent deviations and


streamline decision-making.

• Translate abstract strategies into


operational guidelines.

• Encourage innovation within strategic


boundaries.
What is Competitive
Strategy?
A competitive strategy out-lines how
a company seeks to gain a distinct
advantage over its rivals in the market-
place. It's a long-term plan that
considers a company's strengths,
weaknesses, and unique features
relative to competitors, aiming to create
a winning course of action. Essentially,
it's about developing and exploiting
competitive advantages to outperform
rivals and achieve superior profitability.
The Concept, Objectives, and
Concerns of Competitive Strategy

Concept Objective Concerns


Long-term plan to Profitability, market Rival imitation, market
outperform rivals and positioning, value shifts, tech change,
create a market creation, sustainability unclear strategy, quality
advantage. risk
Michael
Porter’s Three
Generic
Competitive
Strategies
1. Cost Leadership Strategy (Overall
Low-Cost Provider)
2. Differentiation Strategy
3. Focus Strategy (Can be Cost Focus
or Differentiation Focus)
1. Cost Leadership
Strategy (Overall Low-Cost
Provider)
Objective:
Become the lowest-cost producer in the industry while still
offering acceptable value.

How it works:
• Focus on efficiency, scale, and tight cost control.
• Offer products at lower prices than competitors to
attract price-sensitive customers.
• Success depends on maintaining cost advantages
without sacrificing essential product quality.

Example:
Walmart – Achieves cost leadership through massive scale,
supply chain optimization, and low operational costs,
allowing it to offer “Everyday Low Prices.”
2. Differentiation
Objective: Strategy
Offer unique products or services that are perceived
as superior in ways that matter to customers.

How it works:
• Focus on innovation, brand image, customer
service, or special features.
• Justifies charging a premium price because of the
added value.
• Requires continuous innovation and brand
management to maintain uniqueness.

Example:
Apple – Differentiates through sleek design, ecosystem
integration (hardware + software), and a strong
emotional connection with its users.
3. Focus Strategy (Can be
Cost Focus or Differentiation
Focus)
Objective:
Concentrate on serving a specific market niche better
than competitors who target a broader audience.

How it works:
•Select a narrow segment (e.g., a specific geography,
customer type, or product line).
•Offer tailored solutions through either low cost or
differentiation.
•Builds customer loyalty by meeting unique needs more
effectively than general competitors.

Example:
Rolex – Focuses on a niche luxury market with high-end
watches, using a differentiation focus strategy.
Thank You

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