UofP - MBA580 - DQs - Week Four - 09-18-06

UofP - MBA580 - DQs - Week Four - 09-18-06 - Your initial...

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Your initial response is due in the 2 Main news group by the end of the day 09/19/06. Week 4,DQ1 1. Given the nature of its industry and key competitors, how does your company generate a cost 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- cost advantage? 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. References Marketing Teacher. (2006). Generic strategies . Electronically retrieved September 18, 2006, from http://www.marketingteacher.com/Lessons/lesson_generic_strategies.htm Pearce, J. & Robinson, R. (2005). Strategic management (9th ed.). New York: McGraw-Hill. Tutur2U. (2006). Strategy – competitive advantage . Electronically retrieved September 17, 2006, from http://www.tutor2u.net/business/strategy/competitive_advantage.htm Robert (Robb) Sikes 520.245.0662 rsikes3@cox.net
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Your initial response is due in the 2 Main news group by the end of the day 09/19/06. Week 4,DQ2 2. How well does your multi business company capitalize on its core competencies (see Pearce and Robinson, pp. 219-224)? Explain your response. A major focus in determining a firm’s resources and competencies is comparison with existing
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UofP - MBA580 - DQs - Week Four - 09-18-06 - Your initial...

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