Michael Porter (1980) described three main 'generic' competitive strategies that businesses use to achieve and maintain competitive advantage (Wikipedia 2010).
Expanding upon this concept, a business may choose to create competitive advantage on one of several ways (Chase, Jacobs, et al 2006):
- Cost leadership - producing high volumes of standardized products in hopes of taking advantage of economies of scale and experience curve effects (Wikipedia 2010).
- Differientiation - creation of a product or service that is perceived as unique (Wikipedia 2010).
- Quality - "conformance to requirements or fitness for use" (APICS Dictionary 2008).
- Transcendent quality - an ideal, a condition of excellence
- Product-based quality - based on a product attibute
- User-based quality - fitness for use
- Manufacturing-based quality - conformance to requirements
- Value-based quality - degree of excellence at an acceptable price
- Delivery speed - how quickly operations or supply chain function can fulfill a need once identified
- Delivery reliability - the ability to deliver products or services when promised
- Mix flexibility - ability to produce a wide range of products or services
- Changeover flexibility - ability to provide a new product with minimal delay
- Volume flexibility - ability to produce whatever volume the customer needs
- Focus strategy - focus on a few target market segments, tailoring the marketing mix to these specialized markets (Wikipedia 2010).