Question

In your own words, discuss the similarities and differences in the strategies described in Porter’s competitive strategies and Miles and Snow’s typology.

Answer 1

Porter’s: managers first decide whether they are competing on a broad or narrow scope. In a differentiation strategy, organizations attempt to distinguish their products or services from others in the industry. The low-cost leadership strategy tries to increase market share by emphasizing low cost compared to competitors. Focus strategy, the organization concentrates on a specific regional market or buyer group. The company will try to achieve either a low-cost advantage or a differentiation advantage within a narrowly defined market. Focused differentiation or Focused low-cost leadershipMiles and Snow typology based on the idea that managers seek to formulate strategies that will be congruent with the external environment. Organizations strive for a fit among internal organization characteristics, strategy, and the external environment. Prospector strategy is to innovate, take risks, seek out new opportunities and grow. Creativity is more important than efficiency (compare to differentiation strategy)Defender strategy almost opposite of the prospector, rather than taking risks and seeking out new opportunities, the defender strategy is concerned with stability or even retrenchment. (compare to low-cost)Analyzer tries to maintain a stable business while innovating on the periphery, lies midway between prospector and defender

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