porter Essays

porter Essays porter Essay porter Essay According to Porter (1985), the sustainability of a firms competitive advantage was, firstly, dependent on the ability of a firms strategies to resist erosion by competitive activities and, secondly, the firms ability to anticipate the evolution within the industry which it competed in. By strategies, Porter refers specifically to the three generic strategies of low cost, differentiation and focus which Porter posits could be a source of competitive advantage for the firm. However, for the strategy to ucceed the firm must possess some barriers that make imitation of the strategy by competitors difficult. The evolution within the industry refers to changes or challenges within the industry structure that could render the abovementioned competitive advantage ineffective. In addition, having a competitive strategy was insufficient. It must be translated into an above-average performance in the long run a sustainable competitive advantage. Porters generic strategy matrix, which highlights cost leadership, differentiation and focus as the three basic choices for irms, has dominated corporate competitive strategy for the last 30 years (Pretorius, 2008). According to this model, a company can choose how it wants to compete, based on the match between its type of competitive advantage and the market target pursued, as the key determinants of choice (Pretorius, 2008). Porters (Porter, 1998 and Porter, 1985), generic strategy typology remains one of the most notable in the strategic management literature (Salavou, 2010). A business can maximize performance either by striving to be the low cost producer in an industry or by ifferentiating its line of products or services from those of other businesses; either of these two approaches can be accompanied by a focus of organizational efforts on a given segment of the market. Any organization that fails to make a strategic decision to opt for one of these strategies was in danger of being stuck in the middle. The organization in failing to decide, tries both to be the cost leader and differentiator and achieved neither, and in the process confused consumers.