MNG3701: STRATEGIC PLANNING

Every business that operates in the modern world need to set and implement operating strategies that will lead to growth and success of the business. The changing and high competitive business markets, makes it important that business leaders makes informed decisions while developing organisational plans and strategies. They must ensure that their ideas are unique enough to attract clients and also ensure high quality to keep their customers loyal to them. In this essay Porter’s business level strategies namely Cost Leadership, Differentiation, Focused Low Cost, Focused Differentiation, Best-Cost provider strategy will be discussed related to Woolworth case study given on tutorial MNG3701/101/3/2019:23-28 Woolworths falls underneath retail. It’s three major in operation division namely: • Woolworths South Africa (Woolworths or WSA) primarily based in South Africa and operating across eleven countries in geographic region. • David Jones (David Jones or DJ) primarily based and commercialism in Australia and New Zealand • Country Road cluster (Country Road cluster or CRG) primarily based in Australia and commercialism New Zealand and South Africa // 2. BUSINESS LEVEL STRATEGIES By business level strategies we mean suitable and detailed plans that will ensure customer satisfaction at the same time positioning the business as a best competitor in the business market. Business level strategies are being discussed below: 2.1 Cost Leadership According to Wikipedia cost leadership means establishing competitive advantages by having lowest operating cost in the business. This business level strategy ensure that a company provides high quality products while offering reasonable prices that attracts more customers and increasing its returns. This can happen when a business decides to upgrade to latest technologies that will make operations more effective and cost saving. Negotiating low prices with suppliers can also be an advantage and reduce operation cost. Eg Boxer always offer low prices since they also buy in bulk to get discounts. The discounts they get also allow them to reduce prices for their customers. They say “We buy in bulk so that we can help our customers save even more when they do their bulk purchases.”( 2.2 Differentiation Differentiation means a firm seeks to be unique in its industry along some dimensions that are widely valued by buyers. (Porter 1985:14). It is about the business selling premium products to develop customer loyalty. This strategy focus on customers who prefer quality than quantity and those who are willing to pay premium price for high quality products. Business like McDonald focus on offering loyal customers quality food that is desirable and valuable, and the fact that they have kid’s games in most of their stores, make them unique and special to families with kids. Customers don’t hesitate to pay premium prices for McDonald products and services since they are convinced by the good image and uniqueness of the business that the business is the best among other competitors. .................CONTINUED.................