At present, IBM’s primary generic strategy is cost leadership.

In Michael Porter’s model, the

generic strategies are what companies use to ensure competitive advantages. In this case, the
cost leadership generic competitive strategy supports IBM’s competitive advantages through
cost-effectiveness of its operations. For example, the company’s strategic objectives are
focused on reducing the costs of production. The cost difference enables IBM to minimize its
selling prices and, consequently, make its products more attractive to target customers. Also,
the lower costs allow the company to keep a higher profit margin if product prices are
maintained. Nonetheless, the differentiation generic strategy continues to play a strategic role
in supporting the company’s competitive advantages despite business emphasis on cost
leadership. It is worth noting that IBM has shifted its generic strategy through the years. Initially,
the company used differentiation focus as its generic competitive strategy. Differentiation
focus involves differentiation of products through uniqueness or value to customers, and focus
on a specific segment or segments of the market. In this case, IBM’s initial strategy was to focus
on businesses as its target customers, and hence the name International Business Machines.
However, as the business grew, the company started emphasizing cost reduction to ensure
competitiveness in its current markets. This condition shifted IBM toward using the cost
focus generic strategy. Cost focus involves focusing on a segment or number of segments of
the market, but relying more on cost minimization to ensure competitive advantages. Today,
IBM has shifted toward using the cost leadership generic competitive strategy. The company
no longer limits its product offerings to businesses as its target customers.

http://panmore.com/ibm-generic-strategy-intensive-growth-strategies.
DELL's success builds on direct sales and their build-to-order strategy for producing and selling PCs.
Originally targeting individual PC-users they, by the end of the 1980's, evolved targeting the corporate
market. Developing their own sales force and starting dealing with CIOs and other top executives
directly, they penetrated corporate accounts that long were dominated by established IT-vendors such
as HP, IBM or Compaq. The immanent advantages of their business model enabled quick growth by
offering competitive prices, customised products and high levels of support.

Their sophisticated supply-chain-management-system is the key advantage of their build-to-

order and direct sales model. Expensive inventory is not building up in warehouses and therefor
not losing value before sold and as well new products can be introduced without the obligation to
clear old inventory. Dell's inventory turnover rate of 60 times per year compares to 12-15 times
for most indirect vendors. Customers at DELL often pay the final product before suppliers are
paid for the parts that go into a PC, so that DELL operates on a negative cash conversion cycle.
Probably most important are the benefits that Dell gains from the direct relationship to their
customers.
DELL, ahead of its competitors, enthusiastically converted to the Internet early, creating their
first web site 1994 and moving many of its activities online. They recognised that their direct
model provided an advantage in selling online. DELL, unlike indirect sellers as IBM, Apple and
HP, need not worry about conflicts with resellers and distributors when they started selling
online. Their build-to-order manufacturing processes were already in place which made offering
opportunities for the consumer to configure products online just as they already did on the phone
easy.
By the early 2000s, DELL's daily internet sales went up to $50m, but not enough, DELL also
developed extranets called 'Premier Pages' (now 'Premier Dell.com') using the actual Internet
link to their customers. By the mid-2000s DELL had over 50,000 Premier Pages for thousands of
large business customers, these being used to configure, order, service and support the customer's
systems and needs. Small and medium customers could buy hard- and software online from
Dell.com and receive technical support and other services through the DELL.com web sites.
Probably as important is DELL's effort using the Internet to coordinate their complete value
network, including suppliers, third-party-product-distributors and system integrators, logistics
providers and service providers which is only possible because of the tight information linkages
between DELL and its customers
https://www.kazmaier-translations.com/business-strategy/an-analysis-of-the-marketing-
strategy-of-dell-inc/
1. Market segmentation Market segmentation is a strategic method to divide the market based on
volume and capacity of buyers and using appropriate methods to maximise sales and thereby, earning
profits from each segment. Coca Cola used this technique to segment the market according to emerging
markets, developing markets and developed markets since every country in the 200 plus countries play
a crucial rolein the growth. In emerging markets, the primary focus was on increasing the sales volume
rather than profits so that it increased its customer domains and make a strong foundation for future
business. This was made possible by selling beverages at economical rates so that higher no. of masses
can enjoy it

Brand establishment and Customer relationship Brand establishment becomes vital while expanding an
organization’s portfolio. Consumers tend to trust a branded product and often spend an extra penny
upon it rather than choosing an unheard product. Brand name is also viewed as a status quo in
developed markets. Coca Cola made a right decision to invest in developing the brand value by
improving and modernizing the advertisements by investing over $250 million. These ads focused on
creating an impact upon people and changed the perspective of Coca Cola from an occasional drink to
an integral part of people’s life. At the same time, investment was made to improve the position in
energy drink category, juices and also healthy drinks by making strategic partnerships with Monster
Beverage Corporation,

3. Increasing financial efficiency For any business, the ultimate goal is to have maximum returns for the
investments with maximum productivity. In order to achieve this, financial efficiency plays an important
role. Coca Cola made efforts to achieve financial flexibility by implementing a solution known as „zero-
based work‟- wherein annual budget is revised from zero and must be justified annually at the end
rather than simply carrying over at levels established in the previous years.

4. Increasing process efficiency An organization can be termed to be fully efficient when its process time
is minimized without affecting the quality. Process time plays an important role when the demand is
suddenly increased. Inefficient pre-planning and process planning will lead to disruption in supply of
high demands

http://www.iosrjournals.org/iosr-jbm/papers/Conf.ADMIFMS1808-2018/Volume-
1/12.%2077-85.pdf
Market Penetration. PepsiCo implements market penetration as its primary intensive growth
strategy. This intensive strategy supports business growth through increased sales, such as
from a bigger market share. For example, PepsiCo uses aggressive marketing to attract more
consumers. A strategic objective linked to this intensive growth strategy is to minimize costs and
prices to attract more consumers despite market saturation. As such, PepsiCo’s generic
competitive strategy of cost leadership supports this intensive strategy for growth.

Product Development. PepsiCo’s secondary intensive growth strategy is product development.

This intensive strategy requires offering new products to capture more consumers. For example,
PepsiCo continues to develop products or variants of existing ones, such as low-calorie,
reduced-salt, or low-saturated-fat variants of its food and beverage products

Market Development. PepsiCo applies market development as its supporting intensive growth
strategy. This intensive strategy supports business growth by capturing new markets or market
segments. For example, PepsiCo continues to expand its distribution network to reach the last
remaining markets or segments, especially in developing regions. However, market
development is only a supporting intensive growth strategy because PepsiCo already has
significant presence in all regional markets worldwide. A strategic objective for this intensive
strategy is to expand PepsiCo’s supply chain to support the growth of its distribution network.
The cost leadership generic competitive strategy enables PepsiCo to effectively use this
intensive growth strategy through cost minimization despite additional investments used for
expansion to new markets or market segments.

http://panmore.com/pepsico-generic-strategy-intensive-growth-strategies