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What is Business Level Strategy? And Its Types - Ponnusamy Karthik

What is Business Level Strategy? And Its Types

What Is Business Level Strategy

  • Business-level strategy is the strategic planning for a business to create an organization to create value for its customers. It is a new way to help the company act as a whole unit to reveal its unique assets and increase competitiveness.
  • The ultimate goal of business-level strategy is to achieve sustainable competitive advantage and win through plan execution.

Types Of Strategies

There are 3 types of strategies,

  • Corporate Level Strategy
  • Business Level Strategy
  • Functional level Strategy
Types Of Strategies - Ponnusamy karthik

Corporate Level Strategy

The corporate-level strategy gives the business the power to stay where it wants. It has three levels,

  • Development
  • Stability
  • Downsizing

The corporate level is complex in nature, as it usually has multiple ways to achieve its goal, which tends to be long-term.

Business Level Strategy

Business position strategy focuses on developing a competitive advantage. There are several ways to do this, let’s take a look at them.

  • Cost Leadership
  • Differentiation
  • Focus
Business Level Strategy - ponnusamy Karthik

Cost Leadership

  • A cost leadership strategy is to focus on a broader market. The company continuously strives for cost reduction in many areas. To gain cost efficiency, the company pursues more forward and horizontal integration. All businesses compete on price. A lower-priced product will attract more and more customers, but it will absolutely affect profitability. The company can follow some ways to reduce its cost:
  • Use the easy process
  • Buy products in bulk
  • Use the fixed part
  • Train employees well


  • Differentiation strategy is the opposite of cost in a sense. This strategy is usually well-focused on creating competition by offering unique products and services.
  • High-cost differentiation strategy is adopted by big businesses to give particular importance. It provides them with assistance and earns a good profit.
  • Being low-cost and different caters to a large market and achieves straight growth.


  • This type of strategy is usually used by the company to produce product and service that meets the needs of small groups. It relies on the segmentation of the industry. This strategy is used in small and medium-sized companies.
  • In this business-level strategy companies focus on specific groups and targets with good offers. As the number of visitors decreases, the company can give a unique experience and serve well.

Functional Level Strategy

It’s about moving the business toward the goal made by the corporate-level strategy. You need to set a business-level strategy to maximize your quality.

Functional Level Strategy - Ponnusamy karthik

Developing A Business Level Strategy

  • Developing a business-level strategy is a continuous process. This level requires frequent information as per the changing market and customer demand. We have suggested several categories in this business-level strategy. Also, it is a part of planning the overall business strategy.
  • The company’s strengths require evaluating external opportunities that could affect your business.
  • Conduct a swot analysis
  • Identify key success factors
  • Formulate the strategy
  • Implementation & execution
  • Monitor & evaluate
Developing A Business Level Strategy - Ponnusamy karthik

Benefits Of Business Level Strategy

1) Ensure all departments are aligned with corporate strategy

Business-level strategy is put in place to examine whether every department in the business is working towards the corporate-level strategy.

2) Uniting toward a common goal

The success of a business is about the work between the individual, department, managers, and the owner. It is a business-level strategy that integrates the different works to make them work towards a common goal.

3) Developing specific skills

When establishing a corporate-level strategy, the marketing department must do the work of the product manager. Business-level strategy often determines a shortfall and the capabilities to be used to achieve a goal.

4) Establishing priorities

  • Business-level strategies are usually told to work for you and which way to go.
  • And it also tells when to take action by establishing priorities for work. Business strategy can say what each department needs to do first to move the company in the right direction.
Benefits Of Business Level Strategy - Ponnusamy Karthik

Examples Of Business-Level Strategies

  • Cost Leadership Strategy: Cost leadership strategy forces the business to look at the costs associated with the production process and the customer’s offering. Its goal is to reduce the cost and sell to the customer by finding the best cost-effective way.
  • Low-Cost Strategy: Low-cost strategy is selling to a specific market and business. This adds cost leadership throughout. This often undercuts the competition and makes it more cost-effective for businesses to purchase products.
  • Differentiation strategy: It is used to improve product quality while working against the competitor. Consumers will evaluate their products on quality rather than price.
  • Integrated strategy: This type of strategy is to produce a product of medium quality. It is based on price and differentiation strategy. A company uses this strategy to attract middle-class customers.

Importance Of Business Level Strategy

Business level strategy is part of the strategy to articulate the multifaceted action it takes to achieve a broader business goal. There are many reasons why every business should be part of their mission to thrive.

  • Makes it easy to differentiate from competitors
  • Guides good decision making
  • Improves focus and defines the goal
  • Planning for the long term
  • Simplifies development

How To Implement Business-Level Strategy

To run a business successfully you need to identify and implement your goals in every part of the company. There are many ways to make your company profitable.

  • Identify the target market and consumers
  • Find out what their needs are
  • Discuss how to meet their needs
  • Compare with competitor strategies
  • Set common goals to be achieved by the entire organization
  • Set individual department goals
  • Complete routine checks at each organizational level
How To Implement Business-Level Strategy - Ponnusamy Karthik


  • Businesses have three strategies namely cost, differentiation and focus. Businesses focus on offering products at low prices to capture the market.
  • Each company is unique, and the company should choose a business level strategy  based on its strengths. The business should choose a strategy to excel well. The goal should be to have a different product and be unique in the competition, serve the customer well, and make a profit.

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