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Please use our Rothaermel textbook as the preferred first source – I notice you
Please use our Rothaermel textbook as the preferred first source – I notice you didn’t cite it at all, and the description of generic business strategies in Cleverism.com seems to have mistaken some important concepts. First, per Rothaermel, companies choose one generic business strategy, not all of them. There are a few companies that seem to use both differentiation and cost leadership, but very few have done it successfully over time. Second, containing costs has nothing to do with cost leadership. Cost leadership means the lowest prices to the customer – think Walmart. Companies that follow a differentiation strategy – Rolex, Apple, Mercedes – all control their production and overall costs very carefully, as any well-run company should. Cost leadership means the cheapest prices, while differentiation means the better quality or unique aspects of service delivery that make paying more worth it.
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