Strategic managenment Essay Example | Topics and Well Written Essays - 3000 words

Strategic managenment - Essay Example For example, a company may decide to lower the costs and prices of its products, in comparison to its competitors. An example is Wal-Mart, which is a chain of supermarkets and it is known to sale low cost products. This is when compared to its major competitors such as Target, Kmart, Meijer, etc. Because of its low cost products, Wal-Mart has emerged as one of the biggest and most profitable retailing units in the world (Babitsky and Mangraviti, 2013). However, this comes with a disadvantage. The main disadvantage is that Wal-Mart is forced to reduce the cost its production. This includes overhead costs such as labor, etc. Wal-Mart is a company that is known for paying its employees very low wages, and hence it has a high turnover. This is not beneficial to the company because it losses experienced labor or workforce. Another type of a competitive strategy a company may choose to follow is differentiation. This normally occurs through the various dimensions that are valued by the target customer of the organization. This is for purposes of commanding a high price or value for the product under consideration. Apple’s is a communications hardware company that uses this strategy for purposes of penetrating its target market (Gil and Reyes, 2013). Under focus, an organization would either choose to offer its products to a specific target market or segments within a market, or it may choose to offer its product to the entire market segment. A good example in this scenario is in the car industry. Mercedes Benz offers luxurious motor vehicle products to its target population. The people who can afford to drive these luxurious vehicles are the rich and the upper middle class people (Maria, 2012). This is the segment in which Mercedes Benz sales its products to. It is important to understand that the generic strategy developed by porter gives a reflection of the choices that a company makes, with the intention of gaining a competitive