Competitive Strategies

Paper Summary:

This paper critically examines the current competitive strategies of Nike and New Balance and analyzes whether an organization can simultaneously follow a cost leadership strategy and a differentiation strategy. The paper compares the various approaches used in both organizations in light of the five generic competitive strategies as laid out by Michael Porter. The paper concludes that Nike and New Balance cannot implement both a cost-leadership strategy and a differentiation strategy in each of their businesses. The paper relates that under Porter's analysis, both companies will continue to be successful in the future.

Outline:
Introduction
Brief Overview of Nike
Brief Overview of New Balance
Competitive Forces Model (Porter)
Entry of Competitors
Threat of Substitutes
Bargaining Power of Buyers and Suppliers
Cost Leadership Strategies and Differentiation Strategies as Competitors
Differentiation Strategy
Conclusion

From the Paper:

"In the past few years, competition among organizations that manufacture and sell athletic apparel and athletic shoes has dramatically increased. As a result, competitive strategies have emerged as key factors in determining the long- term success or ultimate failure of such organizations. Two large rival companies that have demonstrated extreme success as well as periods of instability and weak sales are Nike and New Balance. An analysis and comparison of their cost leadership strategy and differentiation strategies provides a clearer picture of what types of competitive strategies are essential for an organization to survive in today's cut-throat economy."

Sample of Sources Used:

• Bass, B.M. (1985). Leadership and Performance Beyond Expectations. New York: Free Press.
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• Dusen, S. (2006). The Manufacturing Process of the Footwear Industry: Nike vs. the Competition. Retrieved November 6, 2006, from http://www.unc.edu/andrewsr/ints092/vandu.html.
• Fiol, R.J. & Luch, C.H. (1992). The influence of individual differences on the perception and categorization of leaders. Leadership Quarterly, 3, 55-66.
• Hartog, D., House, R., Hanges, P. Dorfman, P., Ruiz-Quintanilla, A. (1999). Emics and Ethics of Culturally Endorsed Implicit Leadership Theories: Are Attributes of Charismatic/Transformational Leadership Universally Endorsed? Retrieved November 12, 2006, from http://jonescenter.wharton.upenn.edu/papers/1999/wp99-02.pdf.

More papers on Competitive Strategies:

• Case Study # 148789 : "Competitive Strategies for Kmart"
• Book Review # 103133 : "Porter's Generic Competitive Strategies"
• Article Review # 108597 : "Competitive Strategy and the External Environment"

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