MGT499 Mod 4 - TD Global Logistics And Single Sourcing – Coursework Example
Cost Leadership or Differentiation A cost leadership strategy is one which was developed by a scholar by the Porter which aims at giving an organization a competitive edge on the basis of the fact that it utilizes minimum costs for its operation. An organization makes use of this strategy by employing such mechanisms as seeing to it that all its production processes are efficient; all the purchases are made from the optimal sources; all the employees are at their best; there is almost or absolute zero wastage and errors in the operation among others. This strategy indeed puts a firm at the fore front in the market.
The Differentiation strategy on the other hand is that whereby an organization strives to make its products or services to be unique in the industry. This is also quite effective as it gives the consumers a sense that they are dealing with a completely new item while in essence it is actually the same old product packaged in a different way. In this regard the organization tends to sell more and gets at the helm in the industry.
Based on the dynamics of the strategies of differentiation and that of cost leadership, it is indeed quite possible for a single organization to employ both strategies simultaneously in an effort to put its self at the forefront in the competition in the industry. This shall however demand quite a lot of determination and dedication. It shall mean that the organization both makes its products or services look like it is a completely new product that is different from what is readily available in the market and at the same time conduct its production process in an optimum efficient manner with no losses or errors. Upon achieving this, the organization is with no doubt poised to be at the helm of the industry.
Hertog, F. ., & Huizenga, E. (2000). The knowledge enterprise: Implementation of intelligent business strategies. London, UK: Imperial College Press.
Kess, S., & Westlin, B. (1987). Business strategies. Chicago, Ill: Commerace Clearing House.