How Can Manager Against Risk of Associated with Integrated Cost Leadership/Differentiation Strategy

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Manager can adopt following issue to mitigate those risks associated with Integrated Cost Leadership/Differentiation Strategy.

To mitigate the risk of falling into the trap of “stuck-in-the-middle”, the firm should regular review its product line whether its process is efficient and is a leader in the market. Besides, the firm should conduct complete and proper market research such that it can have a clear picture on the marketing positioning of its differentiated product and adjust its strategy accordingly.

To mitigate the risk of product or service obsolete, the firm should regular review its product line and invest sufficient resource on the research to have new innovative or value added products.

To overcome the risk of incorrect understanding of customer’s perception of “competitive levels of differentiation, the manager can invite his customers to join into focus group for firms’ product development. From this focus group, the firm can fully understand customer’s perception on the product.

To eliminate the risk of imitation, the manager should increase the value of the goods. For example selling the goods with lower price or adding differentiated features to the customer.

To mitigate the risk of the firm cease to provide value for which customers are willing to pay and offer differentiated features that exceed target customer’s need, the firm should have a complete and intensive market research. For example, when the firm ceases to provide the some value to customer, it can establish a separate product line and the new product will replace the existing product gradually.

To eliminate the risk of customer’s thinking of the price is too high to buy the differentiated goods, the firm should have a thorough understanding of what its target customers are willing to pay. A small pilot sell promotion program can be in place before the product launch to obtain the real market expectation before mass launch.

To mitigate the risk of customer...
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