chapter  10
40 Pages

The formulation of strategy – 2: generic strategies and the significance of competitive advantage

Having used the techniques discussed in Chapter 9 to identify the strengths and weak-

nesses of the product portfolio, the strategist should be in a far stronger position to focus

upon the ways in which the organization is most capable of developing. Against this

background, we now turn our attention to an examination of some of the principal fac-

tors that influence marketing strategy. We begin by examining Michael Porter’s work, in

which emphasis is given to the need for a clear statement of a generic strategy and for

this to be based upon a detailed understanding of corporate capability and competitive

advantage. The remainder of the chapter then focuses upon the nature, significance and

sources of competitive advantage, the ways in which, in many markets, competitive

advantage is being eroded, and how competitive advantage might possibly be lever-

aged. We then build upon this in Chapter 11, with an examination of the ways in which

market leaders, followers, challengers and nichers might make use of this thinking.