Digbly has been using the broad differentiation strategy for a long period of time and its tactical and operational planning is properly devised to accommodate this type of strategy. The broad differentiation refers to competing especially in the top premium areas of each product, bringing something new each time a product is launched and addressing customers who are less price sensitive and more quality sensitive. As I have said, the broad differentiation strategy created an emphasis on departments such as research and development or marketing, where the top management has invested heavily and which actually guide the product's evolution towards success.
As such, the company's vision statement clearly points out that Digbly "wants more, shows more, creates more, offers more." The maximal situation in which the company sells top quality, high tech products to the market is requiring a department network capable of facing such a situation. The vision statement creates the proper introduction to the market: this is our company, this is what you can expect of it. The maximal factor, a company always offering more, is what we want to pass on to our customers.
External Analysis
The external analysis comprises an overlook both on the political, economical, social, demographical or technological factors that affect the sensor industry, but also on the factors that affect the industries in which Digbly sells its product, namely the armament industry or the medical/health care one.
The political factors refer to political or military actions that the current government and the administration are taking in order to pursue certain goals. We need to point out that a political move that may encourage the development of the industries in which Digbly operates is a clear sign that the sensor industry and market may be expanding as well. The reason for this is quite simple. As we have seen in history, some administrations tend to encourage the development of such industries. The Bush Jr. administration, for example, has favored large armament producers, not only because of the political, international actions it had pursued, namely the war on terrorism, in Iraq and Afghanistan, but also because several members of the administration have close connections with large corporations that operate in the industry. This has led to a certain spending in the armament industry and the impact was well received on the sensor market as well, with sales increasing gradually in the last couple of years.
Referring to the economic factors, we should briefly enumerate some of the factors that may impact any industry and the sensor industry as well, such as the variation of the interest rate, inflation, the evolution of the currency rate, but the most important issue to debate in this case is the governmental spending. The more the government decides to spend in the markets and industries that are closely linked to the sensor industry, the more this will prosper as well. On the other hand, Republicans or Democrats tend to have, in their economic and political programs, different targets. The Democrats have always concentrated more on the development of educational, medical or health programs, which also positively impacts the sensor market.
One of the very important issues we need to mention in the analysis of the external environment and its most important factors is the technological factor. As I have previously stated, the development of the company greatly relies on its technological competitive advantages over other companies. We always aim to bring out high tech products and new technologies before other companies have the chance to. On the other hand, such an approach provides for a serious challenge, because it means that the research and development department, but also departments in charge with the market's overlook and supervision (analysis, marketing), needs to be able to always provide the appropriate solutions in given cases. Because spending in research and development is high, we may be faced with a situation that a rival companies offers a new product or new technology before we do, which may prove disastrous in some cases.
The demographical factors, most importantly, the socio-psychological factors are not to be neglected either. We are referring here to the customers' propensity towards the new, new products, new devices, new technologies. Certainly, the fact that we are currently working in general with other companies helps out, because it means that we encounter the same willingness towards using new sensors in their line of work. On the other hand, the technological factors is something worth considering and to be kept in mind for future analysis.
Digbly International Inc. has been successfully using throughout the year a Broad Cost Leader Strategy, which permits it a presence in both markets. The Broad Cost Leader Strategy implies obtaining a cost competitive advantage over other companies. For Digbly, it is also equivalent to producing highly qualitative sensors for the market, but keeping in mind a cost efficiency which means lower R& D. spending and scale economies where possible. Company History The
Chester has been using for several years a "Cost Leader with product life cycle focus" strategy, which implies a focus on the product life cycle diagram, with the introduction of products in the high tech area of consumers and their continuance in the low tech area, until they become obsolete and have to be drawn out of the market. The strategy that Chester has been using implies, first of all, a
7, a figure that is much higher than it should actually be. In my opinion, this shows that the inventory value is too small and could be a clue that the company will not be able to handle any raise in sales, simply because it will not be able to cover them. It would have been interesting to have an analysis of the stock evolution for Digby. However, given the fact
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