A company’s competitive strategy lays out the specific efforts of the company to position itself

in the marketplace, please customers, ward off competitive threats, and achieve a particular
kind of competitive advantage. The chances are remote that any two companies – even
companies in the same industry- will employ competitive strategies that are exactly alike in
every detail. However, when one strips away the details to get at the real substance, the two
biggest factors that distinguish one competitive strategy from another to boil down to (1)
whether a company’s market target is broad or narrow and (2) whether the company is
pursuing a competitive advantage linked to lower costs or differentiation. These two factors give
rise to four distinct competitive strategy options, plus one hybrid option.

1. A broad, low-cost strategy. Striving to achieve broad lower overall costs than rivals on
comparable products that attract a broad spectrum of buyers, usually by underpricing
rivals.
2. A broad differentiation strategy. Seeking to differentiate the company’s product offerings
from rivals’ with attributes that will appeal to a broad spectrum of buyers
3. A focused low-cost strategy. Concentrating on the needs and requirements of a narrow
buyer segment (or market niche) and striving to meet these needs at a lower cost than
rivals. (Thereby being able to serve niche members at a lower price)
4. A focused differentiation strategy. Concentrating on a narrow buyer segment (or market
niche) and offering niche members customized attributes that meet their tastes and
requirements better than rivals’ products.
5. A best-cost strategy. Striving to incorporate upscale product attributes at a lower cost
than rivals. Being the “best-cost” producer of an upscale, multifeatured product allows a
company to give customers more value for their money by underpricing rivals whose
products have similar upscale, multifeatured attributes. This competitive approach is a
hybrid strategy that blends elements of the previous four options in a unique and often
effective way. It may be focused or broad in its appeal.

Ford’s generic strategy has changed over time. Initially, Ford’s generic strategy was cost
leadership. This generic
strategy supports business competitive advantage on the basis of cost reduction and low prices
to attract customers. In the early 1900s, Ford’s vision was to make its automobiles affordable for
working-class Americans.
To apply this generic strategy, the firm developed the assembly line method to minimize costs
and maximize productivity. Ford succeeded in attracting customers based on this generic
strategy. A strategic objective for
competitive advantage based on this generic strategy is cost minimization through process
streamlining However, Ford Motor Company’s generic strategy did not protect the business
from competition with GeneralMotors. By 1927, GM overtook Ford to become the largest
American automobile manufacturer. GM used its generic strategy of broad differentiation to
offer a wider array of products. Americans were gaining higher wages and started valuing style
and design, and not just low prices. Today, given its current One Ford plan, Ford MotorCompany
has been moving its generic strategy to emphasize differentiation for competitive advantage.
Ford stillmaintains its cost leadership generic strategy. However, the firm is moving toward the
broad differentiationgeneric strategy to compete against firms like GM and Toyota. Thus, a
strategic objective based on Ford’s currentgeneric strategy adjustment is product innovation to
gain stronger competitive advantage