Business strategy
Chapter 7
Strategic options
Shaheduzzaman Choudhury FCA
Shaheduzzaman Choudhury FCA 2
SWOT analysis
Strengths are its Weaknesses are Opportunities are Threats are external
characteristics that company external factors that factors that could
give it an advantage characteristics that may affect a company’s cause trouble for the
over others place a company at a performance positively. company in the future.
(competitors) disadvantage relative
to others.
Shaheduzzaman Choudhury FCA 3
SWOT, PESTEL & Porter’s Five Forces
[Link]
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Weirich's TOWS matrix
SO situation: Maxi-Maxi strategy: SO strategies employ
strengths to seize opportunities
ST situation: Maxi-Mini strategy: ST strategies employ
strengths to counter or avoid threats
Shaheduzzaman Choudhury FCA
WO situation: Mini-Maxi strategy: WO strategies address
weaknesses so as to be able to exploit opportunities.
WT situation: Mini-Mini strategy: WT strategies are
defensive, aiming to avoid threats and the impact of weaknesses
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Gap Analysis
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Strategies to fill the gap
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Competitive advantage
Porter’s Generic Strategies
Low Cost Differentiation
Total Market
Cost Leadership Differentiation
Scope
Stuck in the middle
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Niche Market
Differentiation
Cost Focus
Focus
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Porter’s Generic Strategies
Competitive advantage
The lowest cost producer within its industry Low Cost Differentiation
Methods
Total Market
• leveraging economies of scale
Cost
• creating low-cost production facilities Differentiation
Leadership
• selling a barebone version of a product or service
• employing tight cost control
Scope
Stuck in the
middle
Niche Market
Differentiation
Cost Focus
Focus
Shaheduzzaman Choudhury FCA
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Porter’s Generic Strategies
Competitive advantage
Unique to stand apart from your competitors Low Cost Differentiation
Methods
Total Market
• unique product features
Cost
• unique branding or design Differentiation
Leadership
• higher quality
• higher customer service levels
Scope
Stuck in the
middle
Usually, priced higher than competitors
Niche Market
Differentiation
Cost Focus
Focus
Shaheduzzaman Choudhury FCA
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Porter’s Generic Strategies
Competitive advantage
The most unique and desirable provider for a Low Cost Differentiation
specific niche within an industry
Total Market
The only difference between this strategy and
Cost
differentiation is that firms with a differentiation focus Differentiation
Leadership
target a narrow slice of an industry at the exclusion of
all other segments
Scope
Stuck in the
middle
Niche Market
Differentiation
Cost Focus
Focus
Shaheduzzaman Choudhury FCA
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Porter’s Generic Strategies
Competitive advantage
The lowest cost producer for a specific niche Low Cost Differentiation
within an industry
Total Market
The only difference between this strategy and the cost
Cost
leadership is that firms within this category target and Differentiation
Leadership
narrow niche of an industry at the exclusion of all
other segments
Scope
Stuck in the
middle
Niche Market
Differentiation
Cost Focus
Focus
Shaheduzzaman Choudhury FCA
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Porter’s Generic Strategies
Competitive advantage
No one generic strategy Low Cost Differentiation
When you chase more than one generic strategy, but
Total Market
failed to achieve any of them
Cost
Differentiation
Leadership
Scope
Stuck in the
middle
Niche Market
Differentiation
Cost Focus
Focus
Shaheduzzaman Choudhury FCA
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Generic strategies and the Five Forces
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Generic strategies and the Five Forces
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Ansoff’s Product Market Growth Matrix
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