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Hello Sir,
in the below paragraph it is mentioned how generic strategies could be used for not for profit org , could you please clarify how differentiation and focus strategies could be used ?
Generic strategies apply to not-for-profit organizations too.
A not-for-profit can use a Cost Leadership strategy to minimize the cost of getting donations and achieving more for its income, while one pursuing a Differentiation strategy will be committed to the very best outcomes, even if the volume of work it does, as a result, is smaller.
Local charities are great examples of organizations using Focus strategies to get donations and contribute to their communities.thanks
Focus means specialising on a relatively small interest group so in a charitable context this could be like a charity to support a local hospital compared to an international charity like Oxfam.
I don’t think that cost leadership v differentiation works particularly well with charities. We would hope that any we donate to use our money carefully and keep costs down. The missing element in applying Porter’s strategies to charities is that in commerce customers decide to buy either a basic, ordinary product, or an expensive differentiated product. In charities, however, the dynamic is that the charity decides to whom to give. I suppose, for example, the charity might support basic education whereas another might support specialist music training, but I don’t think its particularly useful to analyse these using Porter’s generic strategies.
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