ABSTRACT

Companies can implement one of four basic strategies—cost leadership, differentiation, focus, and value. These strategies fall at different points of the value—price—cost framework, with differentiation emphasizing the value part of the framework, and cost leadership emphasizing the cost part of the framework. Implementing these strategies means targeting different activities along the value chains of companies. Each of these strategies has advantages and drawbacks. While some strategies fits some conditions better than other strategies or appear more attractive than others, the ultimate success of any strategy depends on the effectiveness of its implementation.