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21download_doc-12.php - B us iness Level St ra tegy: compan...

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Business Level Strategy: companies pursue a business-level strategy to gain a comp. adv that allows them to outperform r ivals and achieve above average returns. They can choose from 3 basic generic approaches: cost leadership, differentiation, and focus. They are generic because all businesses or industries can pursue them regardless of whether they are manufacturing, service or not- for private enterprises I. Cost-Leadership Strategy a. Basic i. Goal 1. To outperform competitors by doing everything it can to produce goods or services at a cost lower than theirs ii. Two advantages 1. Due to lower costs the cost leader is able to charge a lower price than its competitors yet make the same level of profit 2. If rivalry within the industry increases and companies start to compete on price, the cost leader will be able to withstand competition better than the other companies because of its lower costs iii. How a company achieves the position of being a cost leader 1. By means of the product/market/distinctive-competency choices that it
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This note was uploaded on 04/18/2011 for the course BUS 370 taught by Professor Camp during the Fall '09 term at Indiana.

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21download_doc-12.php - B us iness Level St ra tegy: compan...

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