The Description of a Business-Level Strategy

Topics: Strategic management, Management, Customer Pages: 4 (1248 words) Published: March 8, 2006
A business-level strategy is an integrated and coordinated set of commitments and actions that firms use to gain a competitive advantage by exploiting core competencies in specific product market. Only firms that continuously upgrade their competitive advantages over time are able to achieve long-term success with their business-level strategy.

Effective management of customer relationships help the firms answer questions related to the issues of who, what, and how. Customers are the foundation or essence of an organization's business-level strategies. Who will be served, what needs have to be met, and how those needs will be satisfied are determined by the senior management. To make this decision, companies divide customers into groups based on differences in the customers' needs called market segmentation, this process clusters people with similar needs into individual and identifiable groups. This leads us to who.

WHO: Who are the customers? Demographic, geographic, lifestyle choices, personality traits, consumption patterns, industry characteristics, and organizational size. A crucial business-level strategy decision is the one made about the target customers for the firm's goods or services (who). To make this decision companies divide customers into groups based on differences in the customers' needs called market segmentation as mentioned before. WHAT: What are the goods and services that potential customers need? Knowing ones customers is very important in obtaining and sustaining a competitive advantage. Being able to successfully predict and satisfy future customer needs is important. After the firms have decided who it will serve, it must identify the targeted customer group's needs that its goods or services can satisfy. Needs which are also considered to be what in this topic, are related to a product's benefits and features. Having close and frequent interactions with both current and potential customers helps the firms...

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Jones, Gareth R., and John E. Butler. "Academy of Management Review." Costs, Revenue, and Business-Level Strategy 13 (1988): 202-213. 31 Jan. 2006 .
Shapiro, Carl. "The RAND Journal of Economics." The Theory of Business Strategy 20 (1989): 125-137. 1 Feb. 2006 .
"Strategy." Business-level competitive strategy: a contingency link to internationalization (2006). 25 Jan. 2006.
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