Class Name and Section: ISEM-501-50MGMT 510-50-2016
Student Name Suyachhya Shrestha
Date 07-18-2016
Assignment Discussion Forum-1
Chapter 5 Questions:
1. Describe low-cost strategy. How does this relate to differentiation?
It is one of the pricing strategy used by companies to generate demand or gain market share when the product has no completion or the production is high in volume. [1]
Low cost strategy is more focused on cost cutting measure whereas differentiation is focused on providing a good product or service that users are willing to pay. Low cost strategy requires strategy and operation policy whereas differentiation requires innovation to keep your product distinct from competition. [2]
[1] What is low cost strategy? Definition
…show more content…
(n.d.). Retrieved July 19, 2016, from http://aviationweek.com/blog/gaining-advantage-consolidating-market
[3]Hill, C. W., & Jones, G. R. (2013). Strategic management: An integrated approach. Mason, OH: South-Western, Cengage Learning
3. Describe horizontal and vertical integration. Why do businesses leverage these vehicles for growth, and how can they aid in gaining competitive advantage?
When a company expands in same industry or sector by gaining control of the supply, production and distribution is called vertical integration. [3]When a company merges or acquires a company from same industry or sector is called horizontal integration. [2]
Business leverage these vehicles for growth because they allow the business to provide quality goods with low cost. Also business don’t have to build products from scratch. They can simply continue to work with current successful product. In a long run company’s profit can outgrow the running cost. [1]
[1] Difference between a Vertically Integrated Company & a Horizontally Integrated Production Company. (n.d.). Retrieved July 19, 2016, from