Your initial response is due in the 2 Main news group by the end of the day 09/19/06.
1. Given the nature of its industry and key competitors, how does your company generate a
leadership competitive advantage
(see Pearce and Robinson, pp. 190-193)?
If your answer is yes, what are some of the specific risks and rewards it creates in pursuing a low-
If your answer is no, would you advise your company’s strategic managers to
embrace this approach? Why?
Stewart does not allow its strategic plan to employ more than one generic strategy. From
research, I learned that Stewart’s view on selecting one generic strategy avoids them being
“stuck in the middle” without a competitive advantage. Organizations that select one or more
approaches—and then fail to achieve them—get stuck in the middle without a competitive
advantage (Marketing, 2006). A competitive advantage is an advantage over competitors gained
by offering consumers greater value, either by means of lower prices or by providing greater
benefits and service that justifies higher prices (Pearce and Robinson, 2006).
Stewart’s Strategy—Cost Leadership
With this strategy, Stewart’s objective is to become the lowest-cost producer in the industry. Many
market segments are supplied with the emphasis placed minimizing costs. If the achieved selling
price can at least equal (or near) the average for the market, then the lowest-cost producer will (in
theory) enjoy the best profits. Stewart’s cost leadership strategy is one that is usually associated
with large-scale businesses offering "standard" products (Pearce et al., 2006) with relatively little
differentiation that are perfectly acceptable to the majority of customers. Occasionally, low-cost
leaders will discount its product to maximize sales, particularly if it has a significant cost
advantage over the competition and, in doing so, it can further increase its market share
(Tutor2U, 2006). Stewart can adjust its pricing at the leadership level upon acceptance and
approval by state banking and other fiduciary-guideline authorities.
Marketing Teacher. (2006).
. Electronically retrieved September 18, 2006, from
Pearce, J. & Robinson, R. (2005).
(9th ed.). New York: McGraw-Hill.
Strategy – competitive advantage
. Electronically retrieved September 17, 2006,
Robert (Robb) Sikes