How Turn Into a Differentation Strategy?. Delivering a Different AND BETTER VALUE Than Competition
Javier Elenes, Business Consultant, Mexico, Member
@Nguyen Anh Tuan: Any enterprise have two alternatives to be competitive:
1. Give the SAME VALUE at a LOWER PRICE. You need a Cost Leadership Strategy, in which you provide the same value package with less use (abuse) of key resources, time and money.
2. Give a DIFFERENT and BETTER VALUE for the SAME PRICE. You need a Differentiation Strategy, in which you provide better value (as perceived by the customer) than the competitor.
If your QUALITY and SERVICE (perceived by the Customer) is 75%, and the competitor has the same levels, your Q Index is 1 (75 / 75 = 1) and your S index is 1 (75 / 75 = 1)... This means you're not different
Now, trying to answer your question HOW TO TURN INTO A DIFFERENTATION STRATEGY? You need to be different and better in quality and service than the competition. You need to give a differntial value.
In our example, let's say you increase your quality to 90% and your service too and the competitor remains at 75%). Your Q index is 1.20, and your S index is 1.20. This means you are now different and 20% better than your competitor in value delivery to your customer.
So in brief the answer to your question is: provide a differential and better value than than the competition to the customers.