Porsche Strategic Management

            Question 1

            The moral of the fable is that in achieving development one must hold a strategic plan. It is inappropriate for the individuals to be involved in quick decisions which are not based on plans. Having a strategic plan means that all the decisions must be laid down and evaluated strategically while analyzing the associated benefits as well as risks.  Taking decisions that do not incorporate an additional plan in case of the occurrence of risk means that the business may fall into a loss. In generating income a business should additionally hold long term objectives and approaches which the couple did not have as they only thought of the present. This resulted in ignoring the capable risks which led to their fall.  Poor organization strategies are ineffective as they result to poor decision development due to lack of clearly stated objectives (Rothaermal, 454).

            Porsche is killing its golden goose because it is at the end of adopting a broad differentiation approach.  This is because the corporation is aiming for objectives that are too high for its capabilities.  The strategy, therefore, fails in assessing the associated risks as it is more based on maximization of revenue from the increased sales (Rothaermal, 455).

            Question 2

            The broad differentiation may result in the reduced market segment for the corporation. This is because the strategy requires much innovativeness which is associated with high production costs. This may, therefore, generate quality issues which may damage the reputation of the company as increased production may not priorities quality.  The corporation will therefore not be successful in achieving a fresh competitive position as the broad differentiation strategy will increase its responsibility thus damaging its market segment.  This is because the focused differentiation strategy works at ensuring that the customers are fully satisfied while broad differentiation approach is targeted at increasing sales and profit (Rothaermal, 454).

            Question 3

            The geographical diversification strategy that is being utilized by Porsche is successful. This is because the strategy helps in creating a wider market range for the corporation.  This is achieved through market integration where the corporation is able to obtain new trends in the diversified market (Rothaermal, 254). This is effective in developing quality products which are aimed at meeting the general needs of the consumers.  The major source of success for Porsche in the geographic diversification strategy is the fact that it is customer centric. This element helps in growing its market base as it produces products that with high capability of meeting the diverse needs of the customers in the diverse markets. Products differentiations based on the different geographies helps in maintaining a competitive advantage for the organization.

            Question 4

            Volkswagen is pursuing a brand differentiation strategy.  The strategy is advantages as it helps in generating a high level of satisfaction to the corporation’s consumers because it encompasses innovation (Rothaermal, 454).  This strategy ensures that the products are of high quality and are more developed in terms of technology that those from the competing companies. This helps in sustaining the competitive advantage.  However, the strategy is a disadvantage because it requires more research on innovation as well as technology adoption.  This implies that the strategy requires a lot of capital to sustain thus resulting in high-cost products. The products, therefore, fail in incorporating the diverse consumers that failing to obtain a larger market segment.

            Question 5

            In attempting to be a leading company leader Volkswagen should prioritize quality with the incorporation of appropriate marketing strategies.  This will help in ensuring that the market segment continuous to increase thus maintain and growing its reputation. Volkswagen may avoid quality issues as well as capital issues by adopting a customer centric production and marketing.  This strategy ensures that the consumers provide feedback which is essential in drawing solutions (Rothaermal, 454). The company should additionally focus on diversified products in terms of cost to avoid producing the given products at very high prices. This will help in ensuring that production is not rushed and the generated products are of high quality to grow its market. This will additionally help in attaining customers’ loyalty thus maintaining the competitive advantage.

 

 

            Work cited

Rothaermal Frank. Strategic management: Concepts. 2016.