(p. 96) They are pivotal in generating competitive advantage because they reinforce an organization’s functions such as marketing, production or research and development. For instance, in the marketing department, the strategy would work by featuring real-life customers in direct-response print and television advertisements that would steer them towards the company website. In the application of a functional management strategy, the functions as well as the roles assigned will be able to manage corporate level strategies and their activities in such a way that they optimize their functional performance resulting to positive results that contribute to the overall company performance.
Ray maintained that there are two kinds of competitive management strategies: the offensive and defensive strategies. The first is concerned with the strategy that usually takes place in an established competitor’s market location, while the latter takes place in the organization’s own current market position as a defense against possible attacks by a rival. (p. 13) However, the case is, the goal is the same: to secure market share, acquire new customers, maintain current ones and cultivate customer loyalty. In the case of this company, a combination of these two strategies would be used, although with more emphasis on the offensive strategy, considering the fact that most of its products claim less than 3 percent of the market, with only one product dominating 40 percent in its own market location. In terms of offensive strategy, the competitive advantage that drives the attraction of new customers is fuelled by innovation and customer value. Currently, the focus of the organization on innovation has been reaping rewards already.
According to Pieper, corporate strategy is the setting of a company’s long-term goals, major policies and plans, and the