Following the identification of customer
groups and customer needs, companies must determine how to bundle resources and
capabilities to form core competencies and then use these core competencies to
satisfy customer needs by implementing value-creating strategies. This means that:
In the new competitive landscape, companies
must improve their ability to convert innovation and new technologies into
commercial products.
New products ideally should be based on the
company's core competence or core technology.
New products and new product innovations
must meet either present or future customer needs.
We will now talk about generic business-level strategies that can be implemented to
provide customers with distinctive products that meet customer needs and enable
the company to achieve a competitive advantage and earn above-average returns.
Business-level strategies are considered to be generic because they are
generally believed to be applicable across industries, products, and the public
and private sectors.
The discussion of business-level strategies
will focus on four features of generic business-level strategies:
- the relationship of each to the five competitive forces
- how the value chain concept can be used to select primary and
secondary activities necessary to implement each strategy
- risks associated with each
- a fifth or hybrid generic strategy that is being used more
frequently
