Changing from a Cost Leadership Strategy Into Differentiation

Competitive Advantage
Knowledge Center

Best Practices
Nguyen Anh Tuan, MBA
Management Consultant, Viet Nam

Changing from a Cost Leadership Strategy Into Differentiation

I'm wondering how enterprises which have a cost leadership strategy turn into a differentiation strategy. Please advise.

  Ching Yang
Teacher, United Kingdom

Re: Changing from a Cost Leadership Strategy Into Differentiation

Differentiation means doing things differently.
There is a common misunderstanding that differentiation means a different type of product or service. When a company does things differently, say like Toyota's just-in-time management. This helps Toyota manage its inventory and store cars more effectively than its competitors (basically when you compare a Toyota show room with it's competitors you will see a significant difference in the stock level and the resulting space used to store these cars).
So, in this case Toyota management of inventory is different from it's competitors.
But this change was brought about by Toyota in order to keep it's costs low - hence, why Toyota had to do "something" differently to achieve cost leadership. Another example is Walmart's SCM.

  Nguyen Anh Tuan, MBA
Management Consultant, Viet Nam

Chaging from a Cost Leadership Strategy Into Differentiation

Thanks. Very good examples for a combined differentiation and cost leadership strategy from Toyota and Walmart. Do you h...

  Vishal Acharya
Consultant, India

Short Term versus Long Term

Cost leadership may be achievable in a relatively short term and be better than competitors in many cases. However diff...

  Javier Elenes
Business Consultant, Mexico

How Turn Into a Differentation Strategy?. Delivering a Different AND BETTER VALUE Than Competition

@Nguyen Anh Tuan: Any enterprise have two alternatives to be competitive: 1. Give the SAME VALUE at a LOWER PRICE. You ...


More on Competitive Advantage:
Life Cycle Approach to Competitive Advantage
Focus your Efforts in Building Competitive Advantage
Competitive Advantage in Tough Times
🔥Is Superior Value to Customers a Competitive Advantage?
Knowledge Management is more important than CA
Why are Firms Different? Why Successful Firms Differ?
Cost and Value in Analysis of Competitive Advantage: 2 Sides of the Same Coin?
Successful Companies: Only Three Rules Needed?
The Role of AI in Competitive Advantage
Best Practices
Quotes Competitive Advantage
10 Routes to Competitive Advantage
Case studies in "Cost Leadership"
Stuck in the Middle?
How Can Logistics Help to Achieve a Competitive Advantage?
👀Changing from a Cost Leadership Strategy Into Differentiation
Competition versus Cooperation
Competitive Advantage or Die?
What is Competitive Advantage?
Competitive Advantage in a Monopolistic Market?
Health/Fitness Club Industry Analysis
What are the Risks of a Differentiation Strategy?
Weaknesses of Porter's Three Basic Types of Competitive Advantage
4 Stages of Hypercompetition
Special Interest Group

Do you have a keen interest in Competitive Advantage? Become our SIG Leader

Competitive Advantage
Knowledge Center

About 12manage | Advertising | Link to us / Cite us | Privacy | Suggestions | Terms of Service
2022 12manage - The Executive Fast Track. V15.8 - Last updated: 9-8-2022. All names of their owners.