The Different Business Strategies
According to business theory there are basically four different business strategies that exist. There is the Prospector Strategy, the Analyzer Strategy, the Differentiated Defender strategy, and the Low-Cost Defender Strategy. Each strategy, if implemented effectively, making use of all favorable external factors, can make for an industry leading company. Additionally, each business strategy focuses in on a select segment of the market; therefore it is possible for two competitors in the same industry to be equally successful if they are using different business strategies to target different segments of the market.
Business Strategy Development
Take for instance the vehicle manufacturers
Business Management Strategy
This of course leads to the concept of the Analyzer and the Low-Cost Defender. This business strategy is well known for its goal of increasing customer lifetime value. Interestingly to the auto industry the big three auto makers, Ford, GM, and Chrysler, have all had their problems of late. One might expect them to be low cost defenders but I would argue they are acting like Analyzers as though they are mature companies they are undeveloped in certain key markets. They also are not quite financially savvy enough o be considered low-cost either as their current balance sheets suggest they can't really drop their sales tags much these days; their sales and marketing strategy is fairly limited.
Hyundai might be an excellent example of a low-cost defender as they
offer a quality vehicle in the
Each business strategy has its own strengths and they all have valid places in the business environment. So long as management employs proper total quality management and customer retention marketing and adapts its strategy to sound industry forecasting methodology then the company should succeed. Not all business strategies are the way to go obviously but identifying one specific strategy and following it is a great start.