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Faculty Development Programme: Branch MBA Subject:Corporate Strategy Subject Code: 576411 (76) Semester - 4

This document provides an overview of business-level strategy and the concepts of core competencies, cost leadership strategy, and differentiation strategy. It discusses core competencies as the resources and capabilities that provide competitive advantage. Cost leadership strategy aims to produce goods or services at the lowest cost relative to competitors. Differentiation strategy produces goods or services that customers perceive as adding unique value beyond price. Examples of strategies that lower costs or differentiate are also provided.

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30 views10 pages

Faculty Development Programme: Branch MBA Subject:Corporate Strategy Subject Code: 576411 (76) Semester - 4

This document provides an overview of business-level strategy and the concepts of core competencies, cost leadership strategy, and differentiation strategy. It discusses core competencies as the resources and capabilities that provide competitive advantage. Cost leadership strategy aims to produce goods or services at the lowest cost relative to competitors. Differentiation strategy produces goods or services that customers perceive as adding unique value beyond price. Examples of strategies that lower costs or differentiate are also provided.

Uploaded by

VijitaSingh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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Faculty Development Programme

Branch MBA
Subject :Corporate strategy
Subject Code : 576411(76)
Semester – 4th

Presented By:
Parmeet Singh Bagga
Asstt. Professor,
Department of Business Administration
Business-Level Strategy
Business-level strategy: an
integrated and coordinated set of
commitments and actions the firm
uses to gain a competitive
advantage by exploiting core
competencies in specific product
markets

2
Core Competencies and
Strategy
The resources and capabilities that have
Core been determined to be a source of
competencies competitive advantage for a firm over its
rivals

An integrated and coordinated set of


Strategy actions taken to exploit core competencies
and gain a competitive advantage

Actions taken to provide value to customers


Business-level and gain a competitive advantage by
strategy exploiting core competencies in specific,
individual product markets
3
Strategy
Fundamental constraints
 Scope
 What good or service to offer, to which
customers
 Value chain
 How and where to create the good or service
 How to distribute the good or service in the
marketplace(s)

4
Cost Leadership Strategy
An integrated set of actions designed to
produce or deliver goods or services at the
lowest cost relative to competitors with
features that are acceptable to customers
 relatively standardized products
 features acceptable to many customers
 lowest competitive price

5
Value-Chain example:
Cost Leader
6
Differentiation
Strategy
An integrated set of actions designed by a
firm to produce or deliver goods or services
that customers perceive as adding
value
 price may exceed what the firm’s target
customers are willing to pay
 Non-commodity products
 customers value differentiated features more
than they value low cost

7
Differentiation
Strategy
 Add downstream value
 lower buyer cost
 raise buyer performance
 Cost
 Add value to buyer’s value: reduce downstream
processing time, search time, transaction costs,
defect rates, direct costs, learning curves,
labor, space, installation, etc. (e.g., CRM
software)

8
Differentiation and the
Five Forces
• Rivalry - brand loyalty to differentiated
products reduces price competition
• Buyers – differentiated products less price
elastic
• Suppliers – absorb price increases (higher
margins), pass along higher prices (buyer
loyalty)
• Entrants – must surpass proven products or
be equivalent at lower price
• Substitutes – diff raises switching costs
9
Thank you

Any queries

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