Strategic Management: Formulation and Implementation

Stuck In The Middle

Porter argued that there is fourth state of affairs in business-level competitive strategy; he labelled it "stuck in the middle" It is not a deliberate strategy per se. Rather, it is the result of not being able to successfully pursue any of the three generic strategies. The result of not having the lowest costs, not being really differentiated in the minds of the consumer, or not successfully targeting a market segment results in a weak profitability and market picture. The firm stuck in the middle is almost always associated with lower profitability and mediocre market share. The firm stuck in the meddle must make a fundamental strategic decision.

Organizational Requirements For Generic Strategies

To be successful, according to Porter, companies need to select and focus on one of the three proceeding courses of action and the rigorously pursue its application.

"Successfully executing each generic strategy involves resources, strengths, organizational arrangement, and managerial style... Rarely as a firm suited for all three" (Michael E. Porter ).

The implementation of any of the generic strategies entails different skills, resources, and organizational requirements. Some implications for organizations using one of these strategies are summarized in Figure 9-3.