UCAM MBA Programme

TÍTULO
Subtítulo
Building Strategic Options

Nalin Anthony
MBA, M.Sc.(Fin), MCIM,ACMA,CFS,LLB
 Strategic Alignment

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Source : Chartered Institute of Management Accountants (CIMA-UK)
Strategic Alignment

Mission
⚫ Why do we exist ?

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 Strategic Alignment

“To educate, inform and entertain”

“To make people happy”

To bring inspiration & innovation to sports

Strategic Alignment

Vision
⚫ A realizable dream

⚫ Art of seeing the invisible

Unique Position
 Avoid Everting for Everyone ?
Many businesses believe that in order to maximize profits, they
must be all things to all types of customers.
However, this approach could have a detrimental impact on
business In fact, relegate to a commodity status leaving little
room for expansion and growth.

“Being a master of everything makes you a

master of none.”
What Makes A Unique Position
 Cost Leadership
• In a cost leadership strategy, the objective is to become the
lowest-cost producer. This is achieved through large-scale
production where companies can exploit economies of scale.

• If a company is able to utilize economies of scale and produce

products at a cost lower than competitors, the company is then
able to establish a selling price that is unable to be replicated by
companies. Therefore, a company adopting a cost leadership
strategy would be able to reap profits due to its significant cost
advantage over its competitors.
Differentiation Strategy
• In a differentiation strategy, a company’s products
or services are differentiated from that of its
competitors. This can be done by delivering
high-quality products or services to customers or
innovating products or services.

• If a company is able to differentiate successfully,

the company would be able to set a premium price
on its products or services.
 Bases for Differentiation

According to the Harvard Business Review, there are three core values
disciplines that differentiate a business from the competition:

•Operational excellence - Amazon

•Customer intimacy - Apple
•Product leadership – 3M

Rather than trying to excel in all three, major industry leaders typically
focus their differentiation strategies on one value discipline, while meeting
industry standards in the other two.
Manufacturing Value Chains for Cost Leadership & Differentiation

Value Points Cost Leadership Differentiation

Engineering & designed & engineered for ease of designed & engineered to provide superior
Design manufacture quality / unique features for which
customers are willing to pay a premium.

Purchasing Lowest possible raw material cost & High quality raw material and from best
fever suppliers suppliers who assist to differentiate the end
product

Assembly & Lowering cost through mechanisation Best craftsmanship, sound processes,
Production and efficient production to lower the compliances to make high quality products.
cost

Sales & Marketing Low cost sales initiatives and Creative marketing aimed at superior
outsourced distribution customer satisfaction & value addition

After Sales Services Largely outsourced after-sales Dedicated after sales aligned to company
services if any image and customer expectations
 Focus Strategy
A focus strategy involves offering the
niche-customers a product customized to
their tastes and requirements.
It is directed towards serving the needs of a
limited customer group.
Generic Business Strategies of Companies in Various Industries

Industry Cost Leadership Differentiation Focus

Airline Southwest British Airways Kiwi

Automobile Kia General Motors Rolls-Royce

Ratiling Wal-Mart Target Starbucks

Wristwatch Timex Seiko Rolex

 Stuck in the Middle
Porter argued that competitive advantage is derived from one
of two strategies; Cost leadership or Differentiation of products
or services.
The problem, Porter said, was in trying to do both and thus
doing neither very well. He seemed to be saying, “find what
you are good at and stick to it.
Porter wrote, “the firm stuck in the middle is almost
guaranteed low profitability”
Warfare Strategies
 Chose to be Unique
Whilst conventional marketing believes that the businesses
should be customer-centric, the concept of Warfare argues
that the businesses should be competitor-focused.

Meeting customer needs may be not difficult

but offering what your competitors cannot
offer is absolutely difficult.

In the long run, what creates values is not

what your customers want you to produce
but what your competitors allow you to do.

Al-Reis & Jack Trout - Marketing Warfare (1980)

4 Positions to Settle
Defensive Flanking

Offensive Guerrilla
Defensive Mode - Leaders’ Domain
Offensive Mode - Attacker’s Domain