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PORTER’S GENERIC STRATEGIES
Michael Porter’s Generic Strategies
How should we compete in our chosen business(es)? Competitive strategies involve determining the basis of customer or client decision-making. ... Porters generic strategy typology is one of the most popular competitive strategies by far. According to Porter, low cost and differentiation are generic business-level strategies. ...
Michael Porter suggested in his book Competitive Advantage, published in 1980 that there were three main ways in which a company could achieve a competitive advantage that was lasting. These recommended strategies are developed to out-perform competitors or maintain a market position against competition. ...
CRITIQUE OF PORTER’S STRATEGIES
“Stuck In The Middle” Concept
According to Porter, the firm that carries off that strategy best will make the most profits. ... These generic strategies are not necessarily compatible with one another. ... For this reason, Michael Porter argued that to be successful over the long-term, a firm must select only one of these three generic strategies. Otherwise, with more than one single generic strategy the firm will be "stuck in the middle" and will not achieve a competitive advantage. ... These strategies though may lead to an initial competitive advantage for the company, could be copied without difficulty by competitors. ...
Aarker, on the other hand, claims that it is not practical anymore for businesses in today’s society to focus just on a single generic category. Porter’s generic strategies are merely a platform to achieving competitive advantage, but it does not show how this advantage can be further sustained and maintained once it has been achieved.
According to Aarker, firms can still adopt Porter’s recommendation of selecting one generic strategy that fits their company’s resources and capabilities. ...
CONCLUSION
Although Michael Porters Generic Strategies framework serves as a very useful tool for achieving competitive advantage, it can be argued that this platform may not be able to withstand new challenges brought about by an increasingly competitive and fast-paced technological environment that is evolving so rapidly. ...
Although this may go against Michael Porters principle of choosing only one generic strategy, recent research has shown that with the increasing complexity and sophistication of consumers today, such "value innovation" strategies of combining low cost with differentiation are quite critical to a firms survival. It may be a "middle of the road" kind of strategy, but contrary to what Michael Porter believes, this new strategy may very well be the one that future companies should adopt if they want to achieve sustainable competitive advantage. ...
(3, 413 words)
REFERENCES
1. ... (1984) Porters (1980). Generic Strategies as Determinants of Strategic Group Membership and Organizational Performance. ... 3, p. ... Porter, Michael E (1990). ...
3. ... Porter, Michael E.
Approximate Word count = 3498
Approximate Pages = 14
(250 words per page double spaced)
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