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Business Strategy in Action Introduction

Essay by   •  September 13, 2012  •  Essay  •  1,163 Words (5 Pages)  •  1,477 Views

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Topic: Business strategy in action Introduction

In the continuously evolving and changing scenario of global economy, the different corporate sectors all over the world are always in an endeavour to find the perfect business strategy or set of strategies which would be able to reap high financial benefits as well as appreciate their goodwill and market shares in the long run.

There is no question about adopting a 'right' strategy; however, the real question arises about what is the 'right' strategy. In the past, we have seen that whichever corporate strategy or policy has worked wonders for a certain company, more specifically - for a big business house, has been treated as the right policy worldwide.

But when that particular strategy or set of strategies failed to provide a positive impact on the performance level of another business firm, people and the management experts realized the hard way that a certain corporate strategy cannot be treated as the panacea for all sorts of problems for the corporate world as a whole irrespective of geographical location, socio - economic and political - legal factors of the nations in the world.

According to Professor Costas Markides[1], a good strategy is dependent on a given set of parameters which should be treated as the building blocks of a 'well - planned' strategy. Markide's parameters are:

(a) Who will be the targeted group of customers for the company? - According to Markides, a business firm should always go to the basics to find out its proper customer base. It cannot cater to each and every section of the customer base. In other words, the company should prioritize among the groups of the consumers at the beginning. Even in case of a company which is a manufacturer of an essential commodity like cellular phone (The prime example would be Nokia), the management should keep in mind of classifying its product ranges within the consumer base depending on the level of incomes and varied purchasing powers;

(b) What products or services it would be offering to its customers and also what not to offer - This business decision actually points toward the completely specialized offering of products or services to the consumers. To put it simply - it is always prudent to work within your limits first and not showing foolhardiness to tread in unknown waters; and

(c) How it will try to demarcate between the proper strategy to do so and what functions it will try to avoid - It refers to the most critical part of the decision - making. It is not always prudent to ape any particular business strategy which has been already adopted by some other firm. It may or may not yield results. However, the wisest decision would be attack its competitors in the same playing field by finding out their weaknesses and cash on those areas. In order to support his view on the demarcation and framing of proper strategy, Markides has pointed out the difference of strategies between Xerox and Canon.

Xerox, being a household name in photocopying, lost its Numero Uno position to Canon after 20 years of fierce rivalry in the market. Xerox, being the leader in photocopying business, concentrated on high - profile big corporate houses and emphasized on the fact that its machines are faster in doing the required jobs than any other machines in the market. However, Canon, on the other hand, being a newcomer in the field of photocopying business (diversified its business from making photographical instruments like camera and hardware like computer printer) concentrated on high quality and economical pricing. The end result was the thorough penetration of the entire market share by Canon within various segments of consumer base with varied income - levels and purchasing powers. This innovative move in the field of strategy - making helped

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