Ultimate_Writer
Monika Klingler June 13, 2009
Porter, M.E. (1996, November-December). What is strategy? Harvard Business Review, 61-78.
Cat Care of Fayette, my former employer, maintains its competitive advantage and enjoys over six years of profitable growth by adhering to two of Michael Porter’s strategic principles, positioning and trade-offs. They have a viable competitive position, with sustainable profitability, because they perform different activities than their competitors and perform similar activities differently than their competitors. Cat Care’s owner and senior veterinarian, Dr. Lori Stearns, describes their strategic positioning in relation to their customers: “We cater only to felines and small furry exotics.”
As a “no dog allowed” establishment, Cat Care practices variety and needs-based positioning, targeting cat-owning customers with specific requirements and requests. Cat Care offers pet owners an array of services: they have feline specialists; feline-friendly medical equipment; feline pharmaceuticals; feline grooming/spa services; feline playrooms, and quiet feline boarding. The combined activities relate and reinforce one another (fit). The average Cat Care customer will pay higher prices for tailored services and perceived expertise. Pet owners believe that their cats are receiving personal, superior, and advanced healthcare. Their ultra-focus on cats affords them the added reputation and credibility as cat “experts.” Since Cat Care purchases only feline medical supplies, they do not waste resources on other animal species. As stated earlier, Cat Care also caters to small furry exotic animals (ferrets, guinea pigs, hamsters, and gerbils). Unlike dogs, these small animals have similar physiology to cats. Since these small animals do not require different medical equipment, staff training, pharmaceuticals, or boarding facilities, Cat Care’s positioning remains unaffected.
In order to sustain their strategic position, Cat Care recognizes the trade-offs with other positions. Cat Care has not repositioned itself to match other successful veterinarian hospitals, nor has it tried to “straddle” other positions. Customers that own both cats and dogs have to choose to go to another veterinarian, or they can subdivide their vetting services, using more than one office. Many choose the latter. If Cat Care were to choose to treat other animals, it would reduce their efficiencies. Their technicians and reception staff would need additional training. They would need to purchase new medical/operational equipment, separate boarding facilities, more land for dog walking, and different pharmaceuticals. Additionally, they would lose many of their current customers if they were to treat/groom canines—unhappy customers, unhappy cats.
A rival hospital would find it difficult, if not impossible, to match Cat Care’s interlocked activities. I would encourage Cat Care to maintain their current strategy and resist the temptation of the growth trap; attempting to compete with other veterinarian offices (i.e. services/grooming for small dogs) undermines the company’s motivation, focus, and uniqueness. Moreover, trying to “be all things to all customers” reduces fit and competitive advantage. Cat Care will not move toward competitive convergence, because they have not confused operational effectiveness with strategy.
