Corporate Strategies
Essential idea: Companies and businesses can utilize a range of different strategies to develop products, services, and systems.
Pioneering strategy
A pioneering strategy indicates a product led or technology led approach, in other words the product is being pioneered by a designer or design team and an associated manufacturer who may become a product champion. A pioneering style of approach to product design and development may be indicative of the use of new materials, production processes, or technology.
Being the first to market with a new innovation
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| Dyson - new vacuum technology |
DISADVANTAGES - risky, may not work. need a lot of money from extensive market research; risky and costly
Imitative strategy
An imitative strategy for a product designer /manufacturer would be to look at and thoroughly research existing products within a sector and use a very similar format (almost copying) for their won product development using similar technology, materials and production techniques. this approach enables the manufacturer to reduce design and development time and therefore cost.
Developing products that are similar to an existing new product.
REVERSE ENGINEERING is a process that imitative manufacturers use to extract knowledge or design information from products & systems and reproduce it. The process often involves dissembling something and analyzing its components and workings in detail.
Market development
This strategy involves looking at the existing market which a product ids placed in and then researching other markets or market segments that the product could be additionally placed in. The product may require minor adjustment or re-packaging. Research is required based around product analysis and consumer awareness.
Increasing sales to existing customers or finding new customers for an existing product.
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| Starbucks - opening new stores around the world |
Product development
This approach involves taking an existing product (maybe one you already produce or a competitors) and doing a significant product analysis and then changing the product or developing it to more appropriately fit a changing market. These could be minor or major design and functionality changes.
The creation of new, modified or updated products aimed mainly at a company's existing customers.
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| Variations to a product - Coca-Cola and its variations |
Market penetration
Market penetration is a strategy which a business uses for existing products in current market. In this strategy there is no need to produce new products or offer products in new markets - the business will try to sell more products to existing consumers or find new consumers for their product which will increase their sales.
Increasing sales to existing customers or finding new customers for an existing product. Selling more things
Trying to increase sales to customers that we already have
Product diversification
Increasing sales from new products or markets. Diversifying a product / product offerings
For example, Kelloggs, widely known for breakfast cereals diversified in the mid 80's into cereal snack bars, this meant they could sell a product that could be consumed at any time of the day without milk/bowl/spoon and the product is manufactured using the same or similar raw materials.
- Involves a company both in the development of new products and in selling those products to new companies.
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| Ansoff Matrix |
Hybrid approaches
Hybrid approaches is defined to be using more than one of the previously mentioned strategies in accordance with each other. In actuality, the majority of product developments that are brought to market evolve through elements of the sections listed previously. There is no exact formula than enables a product to succeed in the market, this is why new products from inexperienced designers and manufactures with low capital find it harder to enter significant markets which are already served by large manufacturers/suppliers.
Corporate social responsibility
This can be defined as the corporate belief or objective that a company needs to be responsible for tis actions, socially, ethically, and environmentally. Businesses will publish a CSR report, which describes its efforts in being economically, socially, and environmentally responsible (triple bottom line).
Corporate social responsibility is a form of self-regulation for a company and centres around the development of goals related to three areas; social, economical, and environmental.
Companies that consider corporate social responsibility as a goal need to assess the impact of their operations in relation to these three areas in order to maximize the benefits and minimize the disadvantages. Students need to consider the ways in which a company might achieve this and the evidence of effective corporate social responsibility for a major multinational corporation.
Nike Sustainability Report
Coca-cola Sustainability Report
Lego CSR Report
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