Page 33 - APM Integrated Workbook STUDENT S18-J19

Introduction to strategic management accounting

6.4 Porter’s generic strategies

An important part of strategic choice is deciding on what basis to compete in order to
maximise performance.

Competitive stance

Strategic scope Broad Cost leadership Differentiation

Narrow
Focus

 Cost leadership – organisation is the lowest cost producer.

 Differentiation – organisation charges a premium for, say, image, support,
branding.

 Focus – positions business in one niche of the market.

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