Workflow Structure

Mgt 301-90

Midterm Exam

Docia Megan Wilson

Question 1

Generic Strategies- 3 Business level strategies were discovered by Michael Porter. These strategies include focus, differentiation, and price leadership. When a company uses a focus strategy, they are focusing on a limited geography, product line, or number of buyers. One example of this would be fast, expensive Italian race cars. The makers of these vehicles are focused on a very limited number of buyers. Differentiation is another generic strategy. Differentiation is marked by being the same as other companies in your strategic group, and being different at the same time. A good example of differentiation is BMW. BMW is like other high end vehicles, but differentiates itself by line of elite cars as well as its recent foray into the electric market. It has become known for advocating an eco friendly agenda, a first among elite luxury cars. Price Leadership is the last of these generic strategies. It is marked by the company being the same companies in its strategic group, but being cheaper than everyone else. Two examples of price leadership are KIA and generic brands in grocery stores. Both of these offer the same product as the rest of their strategic group, but do so at a cheaper price than the rest of the strategic group.

Corporate Level Strategies- Corporate level strategies are the strategies that a firms make in order to add value to the existing organization. There are six main reasons why a company would buy another company.

1. Purchase an underperforming firm (Mercedes/Chrysler- Chrysler wasn’t realizing full potential).

2. The corporation merges or acquires a business in order to support the company’s core operations. (KSU bought a computer company or a book store, Toyota & Suzuki)

3. Horizontal integration (merger or acquisition)- buys competitors for market share or proprietary knowledge (Exxon and Mobil merged in 1999. Ironically, they were...