Question

What is your understanding of the following existing strategic plan?
a. Growth strategy
b. Stability Strategy
c. Renewal Strategy
d. Competitive Strategy

Answer 1

Growth strategy:

This is the plan taken by the top management of a firm how to capture an increasing market share. This may depend on capacity of the firm in terms of capital and finance, the market in which it operates, and industrial facilities. It has been witnessed that a firm sacrifices its short-term profit initially for implementing such strategy.

Stability strategy:

This is just opposite of growth strategy where a firm doesn’t want to change its present condition and is satisfied with its market share, profit margin, consumer groups, market condition, and the existing products or services. The firm wants to hold such stability and makes plan accordingly.   

Renewal strategy:

A firm may become poor in terms of a decreasing profit, an increasing cost, or declining revenue; if such things happen, the firm has to take a strategy which may re-impose stability and productivity, called renewal strategy. Acquisition of a poorly performing firm by a big firm is an example of it.

Competitive strategy:

In an industry (such as mobile phone), there may be several firms operating. Those firms must be in competition in order to gain higher market share and returns on their investments; in order to get a competitive edge, firms offer discounts, improving features of product (like an increasing features of mobile phones), better customer care service, etc. These are competitive strategies.