I would recommend that you read all postings labelled 101. I will also make some summary postings to guide you through the material that I have already posted. You should follow all the hyperlinks in the summary postings.
We have used the who-what-how framework to describe a business-unit strategy. To understand whether a business-unit strategy is good or bad other models are needed. The most important of these models is the three generic strategies:
- Low cost. Note that the strategy refers to cost and not price. Naturally, a company with a low cost strategy only can offer low prices to its customers.
- Uniqueness. What is considered unique is defined by the customers.
- Niche. Note that niche is one strategy. Cost and uniqueness should be configured to maximise profits for the chosen customer and/or product niche.
Companies that fail to choose one strategy will become stuck in the middle within a relatively short period of time.
The Singapore food retailing industry provides a detailed example of how to apply the generic strategy model in practice.
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