There are many ways to conduct business and succeed at it. However before we actually start any business or even if it is already operational, the biggest foundation of managing it lies in defining the right strategies. Strategies help us chart the roadmap for management of our organizations in the most effective and optimal manner. There are many business strategy courses in India which ensure that we can gain in-depth insights into the management aspect of business. Let us take a look at one of the most prevalent models that organizations use – Michael Porter’s Generic Strategies.
- Cost Leadership – This is based on the price of your final product or service. As an organization, your strategy will be to try and minimize costs and hence acquire a larger chunk of your target market. Your internal business strategy is to always focus on cost optimization and find ways to be a leader in the space of lowest cost incurred for development of your product.
- Differentiation – This is a strategy wherein you create a product or service that is special and different. There is nothing similar to what you offer and hence your product becomes unique. That is what differentiates you from the competition and attracts customers to you. This is the kind of management strategy that might work for companies which spend time and effort on research related to their products, as well as marketing them in a way that they are positioned to be different.
- Cost Focus –As a result of cost reduction, you can transfer those savings from your internal strategy to your customers by offering them the lowest price. As a strategy you reach out and position yourself only in that kind of market which has a specific demand for your product. This strategy approach is linked to transferring the cost benefit to the customer and hence acquiring them, for business growth.
- Differentiation Focus – This strategy is linked to reaching out to a market where your service or product’s differentiated features can make a big difference. This strategy is aligned to creating a strong and unmatched link to the brand that the organization wants to promote. The manner in which customers are acquired and retained is through the product’s uniqueness and ability to meet a market need that no other can meet.
These are the main strategies of business management at a macro level. All other forms of strategy will emerge and then apply, from any one of these. The idea is to make sure that the strategy is chosen based on the organization’s actual requirements and its character.