In the first few blogs, we delved into the Logic of Strategic Analysis, from firm performance and competitive advantage to understanding and analyzing environmental threats. Now, we are going to shift our focus to Business Strategies.
To kick off this new knowledge foundation, we will begin with a look at Cost Leadership and how that relates to Medtronic's day to day operations.
A key generic business strategy Medtronic employs in the market is cost leadership. Cost leadership characterizes an organization focused on allocating resources to lowering the pertinent direct and indirect economic costs whereby creating sustained competitive advantage in the market. A key to this cost leadership are these economies of scales, which Barney describes as essentially cost savings yielding from varied scaling in the operations or production side of the business.
Medtronic is well-versed in acquisition of new technologies, but the magnanimous investment into R&D, clinical testing, and actual optimization of production process allows Medtronic to remain THE dominant player in the market.
To kick off this new knowledge foundation, we will begin with a look at Cost Leadership and how that relates to Medtronic's day to day operations.
A key generic business strategy Medtronic employs in the market is cost leadership. Cost leadership characterizes an organization focused on allocating resources to lowering the pertinent direct and indirect economic costs whereby creating sustained competitive advantage in the market. A key to this cost leadership are these economies of scales, which Barney describes as essentially cost savings yielding from varied scaling in the operations or production side of the business.
Medtronic is well-versed in acquisition of new technologies, but the magnanimous investment into R&D, clinical testing, and actual optimization of production process allows Medtronic to remain THE dominant player in the market.
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