Business Level Strategy

According to Peter and Waterman (1982, p.2) emerging and mature companies search for growth as a key objective and goal. Management must look carefully at ways that can help bring together all the core competencies f functional departments so that a workable strategy is arrived at for obtaining and sustaining a competitive advantage in the selected market.
Hitt et al. (2012, p. 107) state that the real purpose of a business level strategy is to clearly differentiate the posture of an entity from that of its competitors. To create its own niche separate from competitors, it must decide whether to perform different activities or to just perform the activities differently so that the right direction to be taken by leaders can be illustrated. 
A business level strategy is a set of actions and commitments that are coordinated and integrated and that the business employs to gain competitive advantage through exploiting the selected competencies in the select product markets. There are five business level strategies that entities must choose from in order to find and protect the strategy position that is desired. These include; integrated cost leadership/differentiation, focused differentiation, focused cost leadership, differentiation and cost leadership. Each of these makes it possible for the entity to find and pursue individual competitive advantage within some competitive scope (Hitt et al, 2012, p. 102).

Cost leadership strategy:

Is an integrated set of actions taken to produce goods or services with features that are acceptable to customers at the lowest cost, in relation to that of competitors 


Differentiation Strategy:

Focuses on developing a unique product or (equally useful) a perception of a unique product that customers are willing to pay a premium for. 


Focused cost leadership strategy:

Requires competing based on price to target a narrow market 


Focused Differentiation:

Organizations not only compete based on differentiation, but also select a small segment of the market to provide goods and services. 


Integrated  Cost Leadership Differentiation:

Simultaneously pursue low cost and differentiation

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