Frameworks
Porter's generic strategies
Compete on lowest cost, on being different, or by focusing on a niche.
Facts checked against sources onWhat does Porter's generic strategies mean?
The generic strategies (1980) are three ways to compete: cost leadership (be the lowest-cost producer), differentiation (offer something customers will pay more for), and focus (apply either one to a narrow segment). A firm that tries all at once risks being "stuck in the middle". In a case, do not pick a label; show with numbers which customers the client can win and whose costs it can match.
Where does it come up in case interview prep?
Related terms
- Competitive advantageWhat lets a firm earn more than its rivals over time.
- Porter's Five ForcesFive pressures on how profitable an industry is; vocabulary, not a case structure.
- FrameworkA ready-made list of buckets for a common kind of case; know the words, do not recite them.
- BCG growth-share matrixSorting businesses by market growth and relative market share.
- Ansoff matrixFour growth routes: existing or new products in existing or new markets.
- McKinsey 7S frameworkSeven parts of an organization that must fit together.
- SWOT analysisStrengths, weaknesses, opportunities and threats.
- PESTEL analysisPolitical, economic, social, technological, environmental and legal factors.
Learn it in context
See Porter's generic strategies at work in a lesson from Why some businesses win: competitive advantage and the economics of strategy, with checks as you go.
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