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Submitted by wcmar on April 16, 2008
Category: Technology
Words: 1041 | Pages: 5
Views: 94
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In “What is Strategy,” Michael Porter writes that “strategy is creating fit among a company’s activities (75).” He delineates success of a strategy through a company’s ability to do many unique things well, and align them in a way that makes it very difficult for competitors to replicate. The core themes (such as high level of service, endless customization) that comprise company’s strategy are therefore so tightly integrated that one could not be separated from another. Competitive advantage emerges from the entire system of activities that is different from that of rivals. The three sources of strategy as identified in the article are customers’ needs, accessibility, and or the variety of a company’s products or services. Needs -based positioning targets a specific group of customers and caters to all of their needs. Ikea presents an excellent example of this as their strategy is to be a one-stop, convenient shop for all furniture needs of price-sensitive consumers who often work and have children and do not require high levels of customized service. Secondly, access-based positioning segments customers by access, which is anything that requires a different set of activities to reach customers in the best way. Carmike utilizes an access-based strategy as a function of geography by operating movie theaters only in underserved rural locations. Lastly, variety-based positioning is based on the choice of product or service varieties, such as Jiffy Lube, which specializes in speedy, low-cost oil changes only.
I agree with Porter’s statement that the “Competitive value of individual activities cannot be separated from the whole.” Individual activities are easily identified and copied by competitors. Porter illustrates how Continental, a full-service airline, attempted to copy individual activities of a highly successful rival, Southwest. Continental created Continental Lite, which directly replicated some of Southwest’s...
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