Question

Assuming that you were the CEO and starting a new business enterprise, which business level strategy would you choose and why? Cite examples from your own business experiences, including as a customer, that support your position.

Briefly research and describe a merger or acquisition that took place in the last three years that was not discussed either in the text or by me. Explain the potential benefits and risks of this particular deal based on the chapter materials.Briefly research and describe a merger or acquisition that took place in the last three years that was not discussed either in the text or by me. Explain the potential benefits and risks of this particular deal based on the chapter materials.

Answer 1

As the new CEO of the business it is important to know the steps to get consumers interested to the product/service. Naturally depending on the product of service, we would choose the strategy. However let us consider that we are starting a laundry service in a locality where there are already several laundry services present. The best approach will be to stand apart from the regular laundry and probably offer something extra. Let’s say all organic products used – fully biodegradable process – and name the company Green Laundromat. This would be an example of a differentiated strategy. We have established that our market is quite populated. Naturally the best course of action will be stand apart from the generic competitors and provide some value add that the consumers of this time and age will prefer.

As a customer I am keen on using products and services that take care of the environment or make an effort to be environment friendly. In that matter, even if the service costs slightly more, I am willing to pay for the additional benefit. This is why I think, a differentiated strategy with a benevolent value addition will work.

(P.S. I am not aware of which merger and acquisitions were discussed in the class and is present in the text)

According to me one of the notable mergers and acquisition that took place this year was Twilio’s acquisition of SendGrid for $2 billion. Now, Twilio is a well-known startup organization that has been doing quite well in the field of cloud communication services. They provide various API to integrate SMS, voice, etc. services into apps, and web applications. SendGrid on the other hand had been completely focused on email. Through acquisition, Twilio brings in the capability to provide email services to their customers as well. If we notice, the most common ways that companies communicate with their customers are through SMS, Voice or Email. The olden methods of mails have long been forgotten. Through acquisition Twilio becomes pretty much a one stop shop for all internet based communication needs. The benefit is immense for Twilio and the customer who would like a complete solution from them. However there are certain drawbacks. The underlying technology structure of Twilio and SendGrid will need to be merged and so will their customers. This is going to cause some interruption in services and give rise to new possible bugs. The existing customer may not be too happy about that.