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PP6 2024 1S Strategic Management

The document outlines the concept of business level strategy, emphasizing its role in competitive positioning and resource allocation within a specific industry. It details key components such as market segmentation, value proposition, and competitive scope, along with types of strategies including cost leadership, differentiation, and focus strategies. The implementation process involves strategic planning, execution, and evaluation to ensure effectiveness and adaptability to market changes.

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3 views12 pages

PP6 2024 1S Strategic Management

The document outlines the concept of business level strategy, emphasizing its role in competitive positioning and resource allocation within a specific industry. It details key components such as market segmentation, value proposition, and competitive scope, along with types of strategies including cost leadership, differentiation, and focus strategies. The implementation process involves strategic planning, execution, and evaluation to ensure effectiveness and adaptability to market changes.

Uploaded by

Ms nobody
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

Business Level Strategy


1. Introduction
 Objective: Understand what constitutes a
business level strategy, its importance, and how
it influences a firm's competitive positioning
within its industry.
 Focus: Key components of business level
strategy, strategic types, and their
implementation.
2. Definition of Business Level Strategy
 Business Level Strategy: The plan a
company uses to compete successfully
within a specific industry or market
segment. It outlines how a firm will position
itself to gain a competitive advantage and
achieve superior performance.
3. Importance of Business Level Strategy
 Competitive Advantage: Defines how a firm differentiates
itself from competitors to gain an edge in the market.
 Market Positioning: Helps in targeting specific market
segments and meeting customer needs more effectively than
competitors.
 Resource Allocation: Guides where and how to allocate
resources to maximize impact and achieve strategic goals.
4. Key Components of Business Level Strategy
4.1. Market Segmentation
 Definition: Dividing a broad market into smaller, distinct groups of consumers with similar
needs or characteristics.
 Purpose: Allows firms to target specific segments more effectively and tailor their strategies to
different customer needs.
4.2. Value Proposition
 Definition: The unique value a company promises to deliver to its customers, distinguishing its
products or services from competitors.
 Components: Features, quality, performance, and pricing that provide value to customers.
4.3. Competitive Scope
 Definition: The breadth of the market or segment in which a company chooses to compete.
 Types:
o Broad Scope: Competing in multiple market segments with a broad range of products.
o Narrow Scope: Focusing on a specific niche or segment with specialized products or
services.
5. Types of Business Level Strategies
5.1. Cost Leadership
 Objective: Achieve the lowest cost of production or operation in the
industry.
 Strategies:
o Economies of Scale: Reducing cost per unit through increased
production.
o Efficient Operations: Streamlining processes and minimizing
waste.
 Example: Walmart’s strategy of offering low prices through efficient
supply chain management.
5. Types of Business Level Strategies…
5.2. Differentiation
 Objective: Offer unique products or services that are perceived as
distinct and superior in value compared to competitors.
 Strategies:
o Innovation: Developing new and unique products or features.
o Quality: Providing high-quality products or exceptional customer
service.
 Example: Apple’s differentiation strategy with innovative technology
and premium design.
5. Types of Business Level Strategies…
5.3. Focus Strategy
 Objective: Target a specific market segment or niche more
effectively than competitors.
 Types:
o Cost Focus: Achieving cost leadership in a specific market
segment.
o Differentiation Focus: Offering specialized products or services
tailored to a particular segment.
 Example: Rolls-Royce’s focus on luxury and high-performance
vehicles for a niche market.
6. Implementation of Business Level Strategy
6.1. Strategic Planning
 Action Plans: Develop detailed plans to implement the chosen
business level strategy.
 Resource Allocation: Ensure resources are allocated effectively to
support strategic objectives.
6.2. Execution
 Operational Tactics: Implement strategies through daily operations
and activities.
 Monitoring and Control: Track performance metrics and adjust
strategies as needed to stay on course.
6. Implementation of Business Level Strategy…
6.3. Evaluation
 Performance Metrics: Assess the effectiveness of the strategy using
key performance indicators (KPIs) such as market share, profitability,
and customer satisfaction.
 Feedback Mechanism: Gather feedback to make necessary
adjustments and improvements to the strategy.
7. Case Studies and Examples
7.1. Cost Leadership Example
 Example: McDonald’s strategy of offering affordable fast food
with standardized operations globally.
7.2. Differentiation Example
 Example: Tesla’s strategy of producing high-performance
electric vehicles with cutting-edge technology and design.
7.3. Focus Strategy Example
 Example: Patagonia’s focus on high-quality, environmentally-
friendly outdoor apparel for niche market segments.
8. Conclusion
 Summary: Business level strategies are crucial
for achieving competitive advantage and
meeting customer needs in specific market
segments.
 Next Steps: Firms should regularly review and
adjust their business level strategies based on
market conditions, competition, and internal
capabilities.

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