MONA BSTM

ACTIVITY

1. Which phase in the evolution of strategic management is present in the given case?

 The phase in the evolution of strategic management is Phase 4: Strategic Management. This is
because Procter & Gamble (P&G) is already established company and they have already
implemented their company strategy. They do not have to think of budget plans or think of
long-term planning systems anymore. They achieved their market leader position through top
management commitment with the collaboration of lower-level managers. They are well-known
and patronized by the public. P&G is in Phase 4 of strategic management evolution because
although they have been in the industry for a while, their strategic position has weakened
because of their lackluster performance. People are no longer consuming their products, which
affects their performance in the financial statements, which the affects their position.

2. Which type of strategy is being employed by P&G based on the given case study?

 The Procter & Gamble Company applies its generic strategy to achieve competitive advantage in
the consumer good industry. Michael Porter’s model for generic competitive strategies focuses
on business approaches that lead to competitiveness and resilience amid competition. In the
case of Procter & Gamble’s generic strategy, the emphasis is on product quality and value. These
factors are significant in supporting P&G’s efforts to achieve and maintain a leadership position
in the consumer good industry. Procter & Gamble uses differentiation as its generic strategy for
competitive advantage. Differentiation involves developing the uniqueness of the business and
its products to attract target customers. In this case, Procter & Gamble highlights quality and
value in its consumer goods. For example, the company offers high quality cleaning agents, like
Tide laundry detergent, at affordable prices. Based on this generic competitive strategy, a
suitable strategic objective is to maintain P&G’s high investments for R&D to ensure high-quality
and valuable products.

3. How will P&G regain its market position based on the concept of competitive advantage?

 To remain competitive, it is imperative for P&G Group to consider improving its competitive
advantage. According to Davidson and Keegan (2004) “competitive advantage is achieved
whenever your company does something better than competitors. Thus, it is fundamental for
P&G to develop its competitiveness by adopting the strategies proposed by the Ansoff Matrix.
The advantages of these strategies are discussed herein. The Procter & Gamble Company uses
market development as a supporting intensive growth strategy. Market development
contributes to the company’s growth through entry into new markets or market segments.