Assistant Professor: Ankit Gandhi

Offensive and Defensive Strategy

 Offensive Strategy
 Used to Build new or stronger market position and/or
create competitive advantage
 Defensive Strategy
 Used to protect Competitive Advantage
(Rarely lead to creating advantage)
Principle of Offensive strategy
 Focus relentlessly on
 Building competitive advantage
 Employ the element of surprise as opposed to doing
what rivals expect
 Apply resources where rivals are least able to defend
themselves
 Be impatient with the Status quo (Existing Condition)
and display a tendency for swift, decisive actions to
boost a firms competitive position vis-a-vis rivals
Types of Offensive Strategy Options
1. Offer an equally good or better product at a lower
price
2. Jumping around competitors by being
1. First adopter of next-gen technologies or
2. First to market with next-gen products.
3. Pursue continuous product innovation to draw
sales and market share away from less innovative
rivals.
4. Adopt and improve on the good ideas of other
companies.
Cont...
6. Deliberately attack market segments where a key
rival makes big profit.
7. Attack competitive weaknesses of rivals
8. Maneuver around competitors and concentrate on
capturing unoccupied market territory.
9. Use hit-and-run or guerrilla warfare tactics to grab
sales and market share from rivals
10. Secure an advantageous position that rivals are
prevented from duplicating.
Choosing Rivals to Attack
Best Targets for
Offensive Attacks

Runner-up firms with

Struggling Small local
Market leaders weaknesses
enterprises on and regional
that are in areas where
the verge of firms with limited
vulnerable the challenger
going under capabilities
is strong
Using Offensive strategy to achieve
Competitive Advantage
 Strategic Offensive offering strongest basis for
competitive advantage entail:
 An important core competence
 A unique competitive capability
 A better known brand name
 A cost advantage in manufacturing or distribution
 Technological superiority
 A superior product
Defensive Strategy

Purposes of Defensive Strategies

Influence
Weaken the impact
Lower the firm’s risk challengers
of an attack
of being attacked to aim their efforts
that does occur
at other rivals
Cont...
Approaches;
 Block ways open to Challenger
 Signal Challengers vigorous
retaliation (Counterattack) is likely
 Block ways Open to Challenger
 Participate in alternative technologies
 Introduce new features, add new models, or broaden
product line to close gaps rivals may pursue
 Maintain economy-priced models
 Increase warranty coverage
 Offer free training and support services
 Reduce delivery times for spare parts
 Make early announcement about new products or
price changes
 Challenges quality or safety of rivals products using
legal tactics
 Sign exclusive agreement with distributors
 Signal Challengers Vigorous Retaliation is
likely

 Publicly announce managements strong

commitment to maintain present market
share.

 Publicly commit firms policy of matching

rivals terms or policies
TIMING A FIRM’S OFFENSIVE AND
DEFENSIVE STRATEGIC MOVES
 Timing’s Importance:
 Knowing when to make a strategic move is as crucial as
knowing what move to make.
 Moving first is no guarantee of success or competitive
advantage.
 The risks of moving first to stake out a monopoly
position must be carefully weighted.