Industrial Marketing Strategies
MBA-ProMa Industrial Marketing
Staffan Brege, Professor
A. Dynamic Effectiveness
Porter: Five Forces Framework
New
entrants
Suppliers
Competitive
rivalry
Substitutes
Customers
New Industrial Structures and
Dynamic Effectiveness
New industrial
structures
Dynamic
effectiveness
Dynamic Effectiveness =
Strategic Positions + Operative Plattforms
Increased operative
effectiveness
Strategic positions
- markets/segments
- market shares
- product assortments
- value chain position
- competitive
advantage
Operative plattforms
- effecient sales org.
- effecient marketing
channel
- CRM-systems
- global logistics
- purchasing portals
New strategic positions
Mats Abrahamsson & Staffan Brege, 2000
To Overcome Strategic and Operational
Barriers
Dynamic
Effectiveness
Electrolux
Tries to exploit
operational synergies
from acquisitions
Atlas Copco
Expansion from an
efficient logistical
plattform
Ericsson
Adapts logistical
structures to new
industry and new
tehnology
Strategic
Effectiveness
New DELL
companies
Affärsmodell som bygger på
Goes directly
into the dynamic position
- Direktförsäljning
Quick expansion
based onproduktion
efficient logistics - Kundorderstyrd
- Skalfördelar
no old-fashioned
infra-structure
- Stark positionering
Operative
Effectiveness
Dynamic corner
Strategic opportunities
Operational platforms
6. Internet
strategy
5. Administrative center
4. Expansion to new
markets
3. Global logistics platform
2. New products in the
same production system
1. Flexible production
B. The Business Model Concept
The Business Model Concept
What do we offer –
value proposition?
What are our resources?
The
Offering
Operational
Platforms
Market
Positions
Market channel
How are we selling/
marketing?
Partners
What does the
customer want?
Supply
Three cornerstones for success
 Customer intimacy
 Innovation
 Operational excellence
C. Porter M: What is Strategy?
Definitions
 Activities, then, are the basic units of competitive
advantage. Overall advantage or disadvantage results from
all a company´s acitivities, not only a few.
 Operational effectiveness means performing similar
activities better than rivals perform them. Operational
effectiveness includes but is not limited to efficiency.
 In contrast strategic positioning means performing
different activities from rivals or performing similar
activities in different ways.
Productivity Frontier
 Relative cost position
 Nonprice byuer value delivered
Three Strategies
 Strategic positions – can be based on
customers´needs, customers´accessibility, or a
variety of a company´s products or services
D. Prahalad and Hamel: Core Competence
Definition
 Core competencies are the collective learning in
the organization, especially how to coordinate
diverse production skills and integrate multiple
streams of technology
 Unlike physical assets, competencies do not
deteriorate as they are applied and shared. They
grow.
 Few companies are likely to build world
leadership in more than five or six fundamental
competencies.
The Tree Metaphor
 Core competences are the root system
 Core products are the trunk and the major limbs
 SBUs are the smaler branches
 Products are the flowers and the leaves
Core Competence vs SBU Organisation
 The tyranny of the SBU
Core competence
 Unique
 Used in many markets
 Value to customers
Treshold capabilities and competences
Unique resources and core competences
Central vs Decentral
Corporate
Marketing
X
Sales
Service
(X)
Development
X
Production
X
Logistics
X
IT-Systems
X
Education
X
Country
Local
X
X
X
X
X
(X)
X
E. Stalk et al: Competing on Capabilities
Four principles of capability-based
competition
 The building blocks of corporate strategy are not products
and markets but business processes
 Competitive success depends on transforming a company´s
key processes into strategic capabilities that consistently
provide superior value to the customer
 Companies crate these capabilities by making strategic
investments in a support infrastructure that links together
and transcends traditional SBU´s and functions.
 Because capabilities necessarily cross functions, the
champion of a capabilities-based strategy is the CEO.