“The best strategy for a given firm is ultimately a unique construction reflecting its particular circumstances.”(Michael Porter). This assignment will focus on fabricating fundamental strategies suitable for a particular industry and a specific organization’s situations, and the different dynamics that managers face when implementing them. Mainly looking into two particular industries namely emerging industries which will be addressed in section a, and Turbulent, high-velocity Industries which will be addressed in section b of the assignment discussing extensively the appropriate strategies firm must adopt to achieve their corporate goals. Section A: Emerging Industries
Characteristics of an Emerging Market
An emerging industry is one in the formation stage, and is usually totally fresh or modernized industry, which is developing at a high rate compared to other industries in the economy. Industries of this nature generally originate when consumers want change as innovative technologies bring efficient and economic alternatives that substitute older ones, or when new socio-economic circumstances arise (businessdictionary.com, 2013).Characterized by Low entry barriers and is a new and untested industry. Section A of this assignment will focus on Skype now a Microsoft Corporation subsidiary after a $8.5 billion deal in May 2011 as a firm that operates in the Voice over Internet Protocol (VoIP) industry an example of a firm that operates in an emerging industry(bbc.co.uk, 2011). Skype is a computer software program that permits users to make free voice and video calls and chats making use of an internet connection. It is typical example of a firm that operate in an emerging industry because it is a new modernized industry which is growing at an exponential rate recording all time high of 300 billion minutes of Skype calls in 2011 shown in the graph below (Steve Ballmer, 2011).It uses Voice over Internet Protocol an innovative technology substituting the more expensive old telephone system. According to the definition of an emerging industry provided above Skype suits the criteria of an emerging.
2.1. Determinants of Strategy Formulation for Skype
Considering the high telephone and cellular phone tariffs and setup costs that consumers face compare to the low alternative high tech service option offered by Skype. Skype have a competitive advantage in that they have reasonably lower customer switching costs in that all that is need to setup a Skype account is a computer or a smartphone and an internet connection which most people already in this evolving “computer age” in the developed economies but the developing economies, this will affect which strategies managers at Skype will adopt. Considering the exponential growth that Skype is experiencing, considering the an article write in the Forbes magazine by Elizabeth WoIyke saying that currently 37% of Skype calls are business allied implying that the majority of Skype's traffic is made up of personal communications between family members and friends, who pay little--often nothing--to use the service (Elizabeth Woyke, 2010). With information it is of prime importance how managers at Skype exercise their marketing communication to businesses. Considering that Skype software operates on computer and smartphone interfaces it is of key significance how managers of Skype relates to suppliers of such products.
Strategy Option for Emerging Industries
To compete in an emerging industry a firm must adopt a set of unique strategies that give them a competitive advantage amongst its competitors so as to win the early race for industry leadership by employing a bold, creative strategy. Firstly they have to develop flawless technology, improve their product’s quality and create attractive performance features in the case of Skype they have to develop their software to match the above. Secondly they have to build strategic alliances for...
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