Strategy is the creation of a unique and valuable position, involving a different set of activities.

Approaches to differentiating can take many forms: design or brand image, technology, features, customer service, dealer network, or other dimensions.

The more competitors perceive the prospect of dogged, bitter retaliation to the point of severely hurting everyone’s profits, the less likely they are of initiating the chain of events in the first place. This is analogous to the situation in which the robber says, “stick ’em up, I want your money,” and the deranged-looking victim says “If you take it, I will explode this bomb and kill us both!

A production line with high levels of model variety is more valuable when combined with an inventory and order processing system that minimizes the need for stocking finished goods, a sales process equipped to explain and encourage customization, and an advertising theme that stresses the benefits of product variations that meet a customer’s special needs.

Cash Cows: Businesses with high relative share in low-growth markets will produce healthy cash flow, which can be used to fund other, developing businesses.

If a firm can spot an industry in which the fragmented structure does not reflect the underlying economics of competition, this can provide a most significant strategic opportunity. A company can enter such an industry cheaply because of its initial structure. Since there are no underlying economic causes of fragmentation, none of the investment costs or risks of innovations to change underlying economic structure need be borne.

This is analogous to the situation in which the robber says, “stick ’em up, I want your money,” and the deranged-looking victim says “If you take it, I will explode this bomb and kill us both!

Indeed, one of the most important functions of an explicit, communicated strategy is to guide employees in making choices that arise because of trade-offs in their individual activities and in day-to-day decisions. Improving.

Understanding industry structure is also essential to effective strategic positioning P. 26.

Competition on dimensions other than price – on product features, support services, delivery time, or brand image, for instance – is less likely to erode profitability because it improves customer value and can support higher prices. p.32.