Unformatted text preview: Moreover, improving firm infrastructure helps in cost-effective management information systems and relatively few managerial layers in order to reduce overhead costs and simplified planning practices to reduce planning costs. The advantage of CL is that it makes the firm hold an attractive position in term of product substitutes, with the flexibility to lower prices. However, GE must be aware of the risks, which are the source of cost advantage may become obsolete, focusing on cost reduction may cause GE to overlook the importance of customer preferences, and imitation. If CL strategy works, the company will become more competitive against its existing competitors because those competitors may hesitate to complete with GE’s low prices. It also will gain more customers with low prices....
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- Spring '11
- Management, future business-level strategy