Business strategy

1. BUSINESS STRATEGY AND ENTERPRISE
“Business Strategy”
CHRISTIAN HAMONANGAN
NIM: 29113025
Program Magister Administration Business
School of Business and Management
INSTITUT TEKNOLOGI BANDUNG
2014

2. Business-level strategy: an integrated and coordinated set of commitments and actions the firm uses to gain a competitive advantage by exploiting core competencies in specific product markets. The resources and capabilities that have been determined to be a source of competitive advantage for a firm over its rivals An integrated and coordinated set of actions taken to exploit core competencies and gain a competitive advantage Actions taken to provide value to customers and gain a competitive advantage by exploiting core competencies in specific, individual product markets
Fundamental constraints
 Scope
– What good or service to offer, to which customers
• Value chain
– How and where to create the good or service
– How to distribute the good or service in the marketplace(s)
The purpose of a business-level strategy is to create differences between the firm’s position and those of its competitors. To position itself differently from competitors, a firm must decide whether it intends to perform activities differently or to perform different activities. In fact, “choosing to perform activities differently or to perform different activities than rivals” is the essence of business-level strategy. Thus, the firm’s business-level strategy is a deliberate choice about how it will perform the value chain’s primary and support activities to create unique value. Indeed, in the complex twenty-first–century competitive landscape, successful use of a business-level strategy results only when the firm learns how to integrate the activities it performs in ways that create superior value for customers.

3. When selecting a business-level strategy, firms evaluate two types of potential competitive advantages: “lower cost than rivals, or the ability to differentiate and command a premium price that exceeds the extra cost of doing so.” Having lower cost derives from the firm’s ability to perform activities differently than rivals; being able to differentiate indicates the firm’s capacity to perform different (and valuable) activities. Thus, based on the nature and quality of its internal resources, capabilities, and core competencies, a firm seeks to form either a cost competitive advantage or a uniqueness competitive advantage as the basis for implementing its business-level strategy.
The differentiation strategy is an integrated set of actions taken to produce goods or services (at an acceptable cost) that customers perceive as being different in ways that are important to them. While cost leaders serve a typical customer in an industry, differentiators target customers for whom value is created by the manner in which the firm’s products differ from those produced and marketed by competitors. Product innovation, which is “the result of bringing to life a new way to solve the customer’s problem through a new product or service development that benefits both the customer and the sponsoring company’s is critical to successful use of the differentiation strategy.
The first ASIA, or Southeast Asia premiere Carrier who successfully executes the dual strategy, the strategy is offers a world-class service on long-haul flight, and is a cost leader. Eventually it used focus strategy in Singapore Airlines. They must do different things among the competitors. Singapore Airlines Achieve Service Excellence Cost-Effectively, it’s because the Singapore Airlines (SIA) good maintain of two main assets, planes and people, so that its service is better than rivals and its costs are lower. Singapore Airlines follows a 4- 3-3 rule of spending, 40% on training, 30% on revising process and procedure, and 30% on creating new products and services every year. Using standardization for Personalization, SIA’s service processes like those of most other airlines, are highly standardized. SIA is a pragmatic innovator, quickly stopping the use of technologies that customers don’t like. How to dual Strategies is use by SIA, is Harness the power of Your People and Culture, Make a good use of Technology, Utilize the power of Business Economy, Make Investment decisions strategically, and How SIA’s execute the dual-strategies is difficult and SIA’s know that as challenge, so that’s what makes the approach so valuable, by being different in ways that customers like, companies that do so rise from the pits of commoditization and make profits even in highly competitive industries.