Strategic Terms

Michael Porter discussed how companies achieve competitive advantage in his book on “Competitive Advantage: Creating and Sustaining Superior Performance”. This advantage comes from a company’s products and services. Through competitive advantage, companies can increase their market share and generate more revenues. This book also suggests some strategies through which companies can achieve it. Porter’s generic …

How to Achieve Cost Leadership Strategy? – Explained READ MORE

All companies want to grow their operations to expand their businesses. Various methods can help them achieve this goal. Usually, companies can grow organically, which can be significantly beneficial in understanding a market and its customers. Sometimes, however, companies may also use other methods for expansion. These methods involve growing through acquiring or merging with …

Forward Integration: Definition, How it Works, Advantages and Disadvantages READ MORE

Some companies produce a wide variety of products. Usually, these products differ from each other and cater to different market segments. In some cases, however, these products may act as a supplementary or complementary products to a company’s existing items. For most companies, producing these products may be crucial in providing customers with the best …

Economies of Scope: What Is It and How to Achieve Economies of Scope? READ MORE

In the past, the world did not have many technological advancements. Therefore, it was more challenging to live in than it is today. World economies were also independent of each other. While it had some pros, it also limited the facilitation of goods and services, technology, flow of investment, people, and information. Usually, all of …

Globalization: Definition, How It Works, Top 5 Reasons for Globalization and More READ MORE

Companies are separate legal entities that can perform operations on their own. They are independent of their shareholders and other parties. Legally, these business structures can stand on their own without the need for support. These are the features that make companies one of the most complex yet impactful types of businesses. Sometimes, however, companies …

Strategic Alliance: Definition and How it Works READ MORE

When companies start their operations, they have a smaller base. Usually, companies enter a single market and seek to increase their market shares. Once these companies grow, they may want to explore new ventures and customers. Therefore, they will contemplate entering new markets. It allows companies to grow in size and generate more revenues. Entering …

Market Entry Strategies: Exporting vs Overseas Production READ MORE

Market entry strategies allow companies to expand their operations to new markets. When companies contemplate entering new markets, they will utilize these strategies. Usually, companies will have several requirements when it comes to their expansion. These requirements will also dictate the specific strategy that they will use. Overall, these strategies fall into three categories. There …

Horizontal Integration: Definition and How it Works READ MORE

Once companies achieve a specific level, they will aim to expand their operations. However, the process is not as straightforward. Usually, companies must use a market entry strategy to ensure their success in new markets. There are several strategies that companies may use to do so. These categories fall into three classifications, which dictate when …

Backward Integration: Definition and How it Works READ MORE