The three different types of strategies are Cost leadership, differentiation and focus strategies. In a company pursuing a low-cost strategy, every activity of the organization must examine with respect to cost. For example, favorable access to raw materials must be arranged, products must be designed for ease of manufacturing, manufacturing facilities and equipment must continual be upgraded, and production must take advantage of economies of scale. In addition, a low-cost strategy requires a company to implement tight controls across its operations, avoid marginal customer accounts, and minimize spending on advertising and customer service. Companies that pursue a strategy of differentiation try to create a product or service that is consider unique within their industry. They may attempt to differentiate themselves because of product design or features, brand image, technology, customer service, distribution, or several of these elements. The idea behind a differentiation strategy is to attract customers with a unique offering that meets their needs better than the competition, and for which they will be willing to pay a premium price. Companies undertaking a focus strategy direct their full attention toward serving a particular market, whether it is a specific customer group, product segment, or geographic region. However, the idea behind the focus strategy is to serve a particular market effectively than competitors based on the product differentiation and low cost.
Some of the factors that affect the choice of strategy to pursue by the organization include the company's strengths and weaknesses. Therefore, its profile of assets and skills relative to competitors, including financial resources, technological posture, brand identification, and personal values of organization's leadership, competitive scenario, government policies, economic scenario, and social