6.10 (Related to the Apply the Concept on page 391) Suppose that Henry Ford had continued to experience economies of scale, no matter how large an automobile factory he built. Discuss what the implications of this would have been for the automobile industry. 6.11 In recent years, the United States has experienced large increases in oil production due in large part to a new technology, hydraulic fracturing (“fracking”). Fracking involves injecting a mixture of water, sand, and chemicals into rock formations at high pressure to release oil and natural gas. An article in the Wall Street Journal indicates that economies of scale in fracking may be considerably smaller than in conventional oil drilling. If this view is cor- rect, what would the likely consequences be for the num- ber of firms drilling for oil in the United States? Source: Russell Gold and Theo Francis, “The New Winners and Losers in America’s Shale Boom.” Wall Street Journal. April 20, 2014. . 1

Applying Strategies to Achieve Competitive Advantage

How do business leaders know how to choose the best strategy for an organization? This question can be complex and nearly impossible to answer because there are multiple strategies that organizations can integrate, and some may work better in certain situations than others. For example, if a company produces luxury cars, it may not want to pursue a strategy that includes offering the lowest price in the market because that could be interpreted as a compromise on quality or some other aspect that consumers in that market might expect. Likewise, a company that competes in a market that is saturated with other brands of the same product might find that creating a cost-cutting strategy would allow it to be more profitable and to achieve a competitive advantage.

In this Discussion, you will play the role of consultant and will give a selected organization some recommendations for what strategic approaches they should take to achieve competitive advantage.

To prepare for this Discussion:

• Identify an organization with which you are familiar that is in need of a change in its strategy in its pursuit of competitive advantage.

Analysis of how your selected organization can use competitive business strategies to create a competitive advantage. In your analysis, include the following:

• Examine two strategies that the organization could take to create and sustain a competitive advantage. Explain why these strategies could be effective for the organization’s achievement of competitive advantage.
• Devise recommendations for how the organization could implement a Blue Ocean strategy or strategic approach to achieve and sustain competitive advantage.