Business Strategies in Different Organisations

Subject: Strategy
Pages: 2
Words: 297
Reading time:
< 1 min

A business strategy is concerned with many aspects of the growth of an organisation. It is primarily concerned with the direction the business should take to achieve growth. It is also concerned with scope, competitiveness, profitability, social and environmental issues, resources, environment and values. This makes it clear that a strategy involves a wide range of issues and is extremely important for an organisation to have the right strategy. “Strategy is the direction and scope of an organisation over the long-term: which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations.”

Many companies have proved time and time again that innovative strategies can be extremely profitable. An ideal example would be the ‘big box discounted retailing’ developed by Wal-Mart where the company realises its profits from low-profit margins and high volume. “The first, Sam Walton, earned his legendary status by helping invent the concept of big-box discount retailing.”

Some companies have gone a step further. For example, Gillette’s profits are not from the razor it sells, but from the disposable blades that people repeatedly buy once the razor is bought. This practice is also followed by printer manufacturers like Epson and Hewlett Packard. They sell their printers at or near to break even price but derive enormous gains from consumables like ink, which has to be bought by a customer once he owns a printer. Contrasting strategies also can be to the advantage of a company. Red Hat Linux, the champion of free software, charges its customers only a subscription fee for customer service, and the product is given virtually free. Microsoft charges for its software, but its service is free.