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In order to implement a cost-leadership strategy effectively, a ________ structure is preferred in a firm. functional and organic functional and mechanistic simple and organic simple and m-form

Respuesta :

In order to implement a cost-leadership strategy effectively, a functional and mechanistic structure is preferred in a firm. The cost leadership strategy in business was developed by Michael Porter regarding competitive advantage. The ultimate goal is to achieve the lowest cost of manufacturing and operating your product within the industry. 

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The answer to filling in the missing parts is functional and mechanistic

Further explanation

The cost leadership strategy is a low-cost competitive strategy aimed at broad markets and requires "aggressively building, efficient scale facilities, intense price reductions, strict cost and cost control, avoidance of marginal customer-customer delays, and minimizing costs such as R&D, services, salespeople, advertisements and so on. Low prices serve as a barrier to competitors entering the industry, and only a few can match the cost advantage of leaders.

To carry out this strategy, companies must ensure that the total cost across the entire value chain is lower than the total cost of competitors in two ways, namely:

  1. Carrying out value chain activities more effectively than competitors and controlling various factors that might boost the costs of value chain activities.
  2. Update the company's entire value chain to eliminate or cut activities that add costs.

Low-cost leadership strategies will be very effective in the following conditions:

  1. when competing prices between competing sellers are very tight
  2. When competing seller products are essentially the same and supplies are available from all sellers.
  3. When there are several ways to achieve product differentiation that has value for buyers.
  4. When most buyers use the product in the same way.
  5. When the buyer only incurs a small cost to move to buy from one seller to another seller.
  6. When buyers are so large and have the significant bargaining power to ask for a price reduction.
  7. When new industrial entrants use low introductory prices to attract buyers and build a consumer base.

Learn more

Cost leadership strategy https://brainly.com/question/6214273, https://brainly.com/question/7425242

Details

Class: High School

Subject: Bussines

Keyword: Cost leadership strategy.

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