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Strategy for Specific Strategy for Specific Industry and Company Industry and Company
Situations Situations
Strategy for Specific Strategy for Specific Industry and Company Industry and Company
Situations Situations
Dr. Sanjay JainAssociate Professor
Pacific Institute of Management & Technology, [email protected]
+91-9950-9950-74
RoadmapRoadmapRoadmapRoadmap
Strategies for Competing in Emerging Industries Strategies for Competing in Turbulent, High Velocity
Markets Strategies for Competing in Maturing Industries Strategies for Firms in Stagnant or Declining Industries
Features of anFeatures of anEmerging IndustryEmerging Industry
Features of anFeatures of anEmerging IndustryEmerging Industry
New and unproven market Proprietary technology Which of several competing technologies will win out? Low entry barriers Experience curve effects may permit
cost reductions as volume builds Buyers are first-time users and marketing involves inducing initial
purchase and overcoming customer concerns First-generation products are expected to be rapidly improved so
buyers delay purchase until technology matures Possible difficulties in securing raw materials Firms struggle to fund R&D, operations and build resource
capabilities for rapid growth
Strategy Options for Strategy Options for Competing Competing
in Emerging Industriesin Emerging Industries
Strategy Options for Strategy Options for Competing Competing
in Emerging Industriesin Emerging Industries Win early race for industry leadership by employing a bold,
creative strategy
Push hard to perfect technology, improve product quality, and develop attractive performance features
Move quickly when technological uncertainty clears and a dominant technology emerges
Form strategic alliances with
Key suppliers or
Companies having related technological expertise
Strategy Options for Strategy Options for Competing Competing
in Emerging Industriesin Emerging Industries (continued)(continued)
Strategy Options for Strategy Options for Competing Competing
in Emerging Industriesin Emerging Industries (continued)(continued)
Capture potential first-mover advantages
Pursue
New customers and user applications
Entry into new geographical areas
Focus advertising emphasis on
Increasing frequency of use
Creating brand loyalty
Use price cuts to attract price-sensitive buyers
Features of High-Features of High-Velocity (Growing) Velocity (Growing)
MarketsMarkets
Features of High-Features of High-Velocity (Growing) Velocity (Growing)
MarketsMarkets Rapid-fire technological change
Short product life-cycles
Entry of important new rivals
Frequent launches ofnew competitive moves
Rapidly evolvingcustomer expectations
Fig. 8.1: Meeting the Challenge of High-Velocity ChangeFig. 8.1: Meeting the Challenge of High-Velocity ChangeFig. 8.1: Meeting the Challenge of High-Velocity ChangeFig. 8.1: Meeting the Challenge of High-Velocity Change
Strategy Options for Strategy Options for CompetingCompeting
in High-Velocity Markets in High-Velocity Markets
Strategy Options for Strategy Options for CompetingCompeting
in High-Velocity Markets in High-Velocity Markets Invest aggressively in R&D Develop quick response capabilities Use strategic partnerships to develop
specialized expertise and capabilities Initiate fresh actions every few months Keep products/services fresh and exciting
Industry Maturity: Industry Maturity: The Standout FeaturesThe Standout Features
Industry Maturity: Industry Maturity: The Standout FeaturesThe Standout Features
Slowing demand breeds stiffer competition More sophisticated buyers demand bargains Competitors emphasis on cost and service Difficult to create new product feature/s International competition increases Industry profitability falls Mergers and acquisitions reduce number of industry rivals
Strategy Options for Strategy Options for CompetingCompeting
in a Mature Industryin a Mature Industry
Strategy Options for Strategy Options for CompetingCompeting
in a Mature Industryin a Mature Industry
Prune marginal products and models
Emphasize innovation in the value chain
Strong focus on cost reduction
Increase sales to present customers
Purchase rivals at bargain prices
Expand internationally
Build new, more flexible competitive capabilities
Demand grows more slowly thaneconomy as whole (or even declines)
Competitive pressures intensify –rivals battle for market share
To grow and prosper, firm musttake market share from rivals
Industry consolidates to a smaller numberof key players via mergers and acquisitions
Stagnant or Declining Stagnant or Declining Industries:Industries:
The Standout FeaturesThe Standout Features
Stagnant or Declining Stagnant or Declining Industries:Industries:
The Standout FeaturesThe Standout Features
Strategy Options for Strategy Options for CompetingCompeting
in a Stagnant or Declining in a Stagnant or Declining IndustryIndustry
Strategy Options for Strategy Options for CompetingCompeting
in a Stagnant or Declining in a Stagnant or Declining IndustryIndustry
Pursue focus strategy aimed atfastest growing market segments
Stress differentiation based on qualityimprovement or product innovation
Work diligently to drive costs down Cut marginal activities from value chain Use outsourcing Redesign internal processes to exploit e-commerce Consolidate under-utilized production facilities Add more distribution channels Close low-volume, high-cost distribution outlets Prune marginal products