Business strategies

Evelina Nordin
 Outline
 What is strategy?
 Industrial organization view
 PESTEL-analysis
 Porters five forces
 Porters generic strategies
 Resource-based view
 Industrial organization view or resource- based view?
 What is strategy?
 Strategy is all that is necessary for a company to
function successfully (Pascale, 1984).

 Porter (1983) emphasizes the need for strategy to

define and communicate an organization's unique
position, and says that it should determine how
organizational resources, skills, and competencies
should be combined to create competitive advantage.
 Industrial organization view
 By using this outside in perspective the organizations
build strategies by identifying forces in the
environment.

 A company's environment and industrial structure has a

major influence on the company's survival and
characteristics of the competitors (Porter, 1983).
 PESTEL- analysis
 Political
 Economic
 Socio-cultural
 Technological
 Ecological
 Legal
 Porter´s five forces
• Bargaining power of Suppliers
• Bargaining power of buyers
• Threat of new entrants
• Threat of substitute
• Competitive rivalry
 Porters generic strategies
 Cost leadership

 Differentiation

 Focus strategy
 Resource- based view

 In comparison to Porters theories the supporters of the

resource- based view argue that organizations should
look inside the company to find the sources of
competitive advantage instead of looking at competitive
environment (Wernerfelt, 1984).
(Grant, 1991)
Industrial organization view or
resource- based view?

 The industrial organization view lacks the internal

factors in the apporach of creating strategies.

 The resource based view lacks the external

environmental factors in the approach of building
competitve strategies.
 References
 Andersén, J. (2005) Strategiska resurser och långvarig lönsamhet- en
resursbaserad modell för varaktiga konkurrensfördelar i små
tillverkningsföretag. Västerås: Mälardalen University Press.

 Bains, P., Fill, C. & Page, K. (2011) Marketing. Oxford: Oxford

University Press.

 Grant, R. M. (1991). The Resource-Based Theory of Competitive

Advantage: Implications for Strategy Formulations. California
Management Review, 33, 114-135.

 Hamel, G. & Prahalad, C.K. (1994) Competing for the future, Harvard
business Review, 113-132.

 Mintzberg, H. (1978) Patterns in strategy formation. Management

science, 24, 934-948.
 References
 Murray, A. I. (1988) A Contingency View of Porter’s Generic
Strategies, The Academy of Management Review, 13, 390-400.

 Pascale, R. T. (1984) Perspectives and strategy: the real story behind

Honda´s success. California management review, 1, 47-72.

 Penrose, E. T. (1959) The theory of the growth of the firm. Oxford:

Blackwell.

 Porter, M. E. (1980) Competitive strategy, techniques for analyzing

industries and competitors. New York: Free Press.

 Wernerfelt, B. (1984) A Resource-based View of the Firm. Strategic

Management Journal, 5, 171-180.

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