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Bowman's Strategy Clock

Making Sense of Eight Competitive Positions

In many open markets, most goods and services can be purchased from any number of companies, and customers have a tremendous amount of choice. It's the job of companies in the market to find their competitive edge and meet customers needs better than the next company. So, how, given the high degree of competitiveness among companies in a marketplace, does one company gain competitive advantage over the others? When there are only a finite number of unique products and services out there, how do different organizations sell basically the same things at different prices and with different degrees of success?

This is a classic question that has been asked for generations of business professionals. In 1980, Michael Porter published his seminal book, "Competitive Strategy: Techniques for Analyzing Industries and Competitors", where he reduced competition down to three classic strategies:

• cost leadership
  
• product differentiation; and
  
• market segmentation.

These generic strategies represented the three ways in which an organization could provide its customers with what they wanted at a better price, or more effectively than others. Essentially Porter maintained that companies compete either on price (cost), on perceived value (differentiation), or by focusing on a very specific customer (market segmentation).

Competing through lower prices or through offering more perceived value became a very popular way to think of competitive advantage. For many businesspeople, however, these strategies were a bit too general, and they wanted to think about different value and price combinations in more detail.

Looking at Porter's strategies in a different way, in 1996, Cliff Bowman and David Faulkner developed Bowman's Strategy Clock. This model of corporate strategy...(Sign in to read more.)

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New Articles (Not included in the Mind Tools E-book.)
* Shows articles available in full only to Career Excellence Club Premium members

Porter's Diamond - Shaping strategy to reflect national strengths and weaknesses*
Using the TOWS Matrix - Developing strategic options
Scenario Analysis - Exploring different futures*
The McKinsey 7S Framework - Ensuring all parts of your organization work in harmony
ADL Matrix - How industry position influences your strategy
The Boston Matrix - Focusing effort to get the greatest returns
The Ansoff Matrix - Understanding the different risks of different options
Porter's Generic Strategies- Choosing your route to competitive advantage
Core Competence Analysis - Get ahead. Stay ahead.
The Pyramid of Purpose - Concisely communicating your strategy*
Hoshin Planning System - Steering everyone in the right direction*
The Balanced Scorecard - Motivating employees to deliver your strategy
The Triple Bottom Line - Measuring your organization's wider impact*
Practical Business Planning - Understanding the components of future success*
The Cultural Web - Aligning your organization's culture with strategy
Deal and Kennedy's Cultural Model - Understanding rites and rituals*
Congruence Model - Aligning the drivers of high performance*

A full list of Mind Tools articles is available here.

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