Market Strategy of Palm - Essay Example

? Palm’s Strategy Table of Contents Introduction: 3 Nadler and Tushman’s Congruence Model: 3 Porter’s Generic Competitive Strategies Applied By Palm:5 Cost Leadership: 5 Differentiation: 6 Focus: 7 Reference 9 Palm’s Strategy Introduction: There are various factors that shape the ultimate outcomes of an organization. The performance of a company is based on many external and internal factors. The strategies applied by the company to harness the resources available to the company, eventually decides the success of the company. These factors that have direct implications on the performance of the company must be considered seriously by the management while making any business decision. Having clarity regarding the level of performance and the factors affecting the performance helps the organization to comprehend the bottlenecks that exists in the organization. The organization than can utilize the resources in a more effective way. Nadler and Tushman’s Congruence Model: David Nadler and Michael Tushman at Columbia University formulated a simple yet effective approach to assess the organization dynamics based on the systems theory. The efforts taken by Nadler and Tushman to develop a theory to chalk out the flow of productive work in a company created the congruence model. The congruence model systematically breaks each step of the basic systems model to explain the systems model. The congruence model developed by Nadler and Tushman depicts the outcome of strategies applied on the inputs namely Environment, Resources and History. The outcomes are assessed in the level of organizational performance, Group /unit performance and individual performance (Nadler, Tushman&Hatvany, 2007) The entire model aims at assessing the application and strategy applied by the company on their key resources like Human resource, the background or the history they have and the environmental resource available to the company. Most companies that have been successful have been able to apply strategies on these three key inputs to acquire outcomes that can be shown in terms of individual achievements, group achievements and as whole achievement of the company. Strategies applied by the company on the key inputs ascertain the functioning of the company as an organization. Palm has been able to apply the strategy of generic competitiveness on the inputs to achieve the outcomes that it enjoys. Fig: Nadler and Tushman’s Congruence Model, Source: Cameron and Green (2009) Porter’s Generic Competitive Strategies Applied By Palm: A number of theories have been developed in the area of strategic management. Porter’s Generic competitive strategies define the three standards on which an organization can base their growth strategies. Cost Leadership, Differentiation and Focus. The cost leadership is the strategy applied by the company to be different from their competitors in pricing. Offering products at a lower price than their competitors without compromising with the quality of the product. Differentiation strategy implies strategies applied by organization to differentiate their products in such a way that they stand out in comparison to their competitor’s product. Focus is the area on which the company decides to place more stress on to achieve either cost leadership or product differentiation. Cost Leadership: When a company aims at cost leadership, cost reduction becomes a major goal for the company. A low cost strategy applied by Palm Inc. is increasing the scale of production. The company makes provision to cut costs that occurs due to unplanned reasons. One of Palm’s main business strength is the ability of Palm to produce cost effective products. Cost effectiveness allows Palm to generate better revenue. In a competitive market having a technologically sound product does not always guarantee better market share. Even the most high end customers look for cost effective bargain and Palm has been able to recognize this factor. The software technology developed by Palm is produced in such a way that they appeal to their end customers for their cost effectiveness also (Palm, 2000). Differentiation: Product differentiation is the most important strategy applied by Palm. Palm has been able to target the market segment it wants to cater in a good manner. The products offered by Palm are all advanced and have been designed for customers who are keen on technology. The product range of Palm involves mobile phone with cutting edge technology. Palm operating system is hailed as one of the most advanced operating software system programs. This technology is preferred in hand-held electronic devices. PDA’s and smart phones are few of the devices which utilizes this software system. Palm Inc. has been always ahead in their research and technology. When HP acquired Palm, they incorporated the web OS developed by Palm in their smart phones. Palm has been intelligent in using the employee resource and the environmental resource in such a manner that their inputs have been able to add value to their products. The input of Palm in terms of the Human resource and the environmental resource gives Palm a cutting edge over its competitors. Palm stresses equal importance on keeping it production environmental friendly. Most of their production processes are planned keeping preservation of environment in mind (Pressroom Palm, 2010). Focus: Initially when potter sketched the focus generic strategy, it was meant to be the third dimension of the competitive generic strategy, however later it was manifested as a combination of both the first two generic strategies. Cost effectiveness and differentiation factor. Palm has been always concentrating in having technologically advanced products. This has been the prime focus of Palm. However Palm has also recognized the fact that technologically advanced devices have to be also economical to have a competitive advantage. Palm after being acquired by HP has been very careful regarding the direction in which they want their Research and Development team to work. The company has been able to develop Web OS for integration in smart phones and PDA. The company has been able to have a strategy that is moderately congruent to the inputs applied by the company. The company has applied the strategy of keeping their USP specialized products i.e. the company has focused on product differentiation by applying its key human resource in research and development. They have utilized their infrastructure to develop better and advanced technology for their products. The company has also kept its focus mainly on the telecom sector and has developed several softwares to cater its end customers in a cost effective way. Reference: Cameron. E and Green. M (2009). Making Sense of Change Management: A Complete Guide to the Models, Tools and Techniques of Organizational Change. Kogan Page Publishers Nadler, D. A., Tushman, M. L. & Hatvany, L. G. (2007). Managing Organizations Readings and Cases. Retrieved on May 27, 2011 from http://cpmcnet.columbia.edu/dept/pi/ppf/Congruence-Model.pdf. [Accessed on May 27, 2011]. Palm. (2000). Palm Aligns with Leading Providers of Mobile Field Sales Solutions. Retrieved on May 27, 2011 from http://files.shareholder.com/downloads/PALM/1270332763x0x240331/c9282a2b-6f01-41f2-acdf-fdf36996ffb7/PALM_News_2000_11_6_General.pdf Pressroom Palm. (2010). Palm Aligns with Leading Providers of Mobile Field Sales Solutions. Retrieved on May 27, 2011 from http://investor.palm.com/releasedetail.cfm?releaseid=339875. Bibliography Palm-a. 2010. Palm Reports Q1 FY 2010 Results. Retrieved on May 27, 2011 from http://files.shareholder.com/downloads/PALM/1270332763x0x319971/faa32aea-75eb-49d5-9328-9b314dc4e4f5/PALM_News_2009_9_17_General.pdf. Read More