Empowering Students and Teachers through AI: Mastering Porter's Generic Strategies

Introduction

Strategic management concepts like Porter's Generic Strategies provide a useful framework for high school students to analyze businesses and think critically about competition. By applying tools like natural language processing (AI or LLMs), students can conduct in-depth strategic analyses and effectively communicate their findings. Conversely, teachers can use them to develop effective learning activities. 

We divided this blog post into three sections: exploring a concept, classroom learning activity and individual learning activity, with respective unedited output and matching prompt. We have shown that with efficient prompts, and reference to the context, output barely needs editing. Of course, tailoring to the context, and students or groups specific needs in the final edit, remains a responsiblity for the teacher.

Created by Bing Image Creator 26 Nov 2023

1) Exploring a concept: Porter's Generic Strategies (PGT)

Output Exploring PGT:

Porter's generic strategies outline three approaches for businesses to gain competitive advantage: cost leadership, differentiation, and focus. A cost leadership strategy involves being the lowest cost producer in the industry. To achieve this, a business must find ways to minimize expenses in all areas including operations, procurement, distribution and administration.

Some examples of companies that have successfully pursued a cost leadership strategy include:

• Walmart - As one of the largest retailers globally, Walmart achieves huge economies of scale which allows it to negotiate low prices from suppliers. It also keeps operating costs low through efficient distribution and store layouts.
• Southwest Airlines - By utilizing a single fleet type of aircraft (Boeing 737), offering no meals or assigned seating, and turning aircraft quickly, Southwest has consistently lower unit costs than competitors.
• IKEA - The furniture retailer minimizes expenses through flat-pack assembly kits that reduce distribution and retail space costs. It also negotiates directly with manufacturers to cut procurement prices.
• Ryanair - The European low-cost carrier maintains cost advantage through high aircraft utilization, online-only bookings/payments, and flying point-to-point to airports with lower fees.

Some companies pursue a focused cost leadership strategy by targeting a narrow market segment. Examples include Redbox (DVD rentals from kiosks), Papa John's (home delivery pizza), and Checkers Drive-In (drive-thru only restaurants). By specializing their offering, these companies keep costs low while fulfilling niche customer needs.

In summary, Porter's cost leadership strategy requires finding innovative ways to minimize expenses across the value chain in order to offer the lowest overall price. When done well at scale or within a focused segment, it can deliver sustainable competitive advantage through a cost-benefit proposition.

Prompt: 

Acts as an AI research assistant to explore Porter's Generic Strategies of Cost. Include specific examples of application to businesses. Use these documents as guidance:

https://en.wikipedia.org/wiki/Porter%27s_generic_strategies

https://www.mindtools.com/azb8kpl/porters-generic-strategies

https://opentextbc.ca/strategicmanagement/chapter/focused-cost-leadership-and-focused-differentiation/

(links provided as an example)

2) Classroom Learning Activity

For teachers, I recommend to generate activities, learning objectives and assessments in one go in order to make sure they are all aligned.

 

Output instructions classroom activity:

Hi Students,

Today we will be exploring Porter's Generic Strategies framework to help you understand different approaches businesses take to gain competitive advantage. By the end of the lesson you will:

1. Be able to describe Porter's three generic strategies of cost leadership, differentiation, and focus. (Bloom's Level: Remember - Recall or recognize terms and definitions.)
2. Understand the key aspects of each generic strategy including their advantages and disadvantages. (Bloom's Level: Understand - Explain ideas or concepts.)
3. Be able to analyze real world company examples and identify which generic strategy they employ.(Bloom's Level: Analyze - Draw connections among ideas.)
4. Recognize how generic strategies can be applied at both a business and corporate level. (Bloom's Level: Understand  - Explain ideas or concepts.

So in summary, objective 1 targets the remember level of recalling definitions, objectives 2 and 4 target the understand level of explaining concepts, and objective 3 targets the analyze level of making connections between concepts and examples.

To assess your learning, we will do three types of activities. 

• First, you will take 5-minutes to write down the three generic strategies and their key characteristics.
• Second, in pairs you will analyze case studies of different companies and decide which strategy each uses. 
• Finally, you will reflect individually on how generic strategies could apply to a business of your choice.

Here are the instructions: 

1. You each have a worksheet with descriptions of the three generic strategies from our course readings. 
2. Take 5 minutes to read through and record the core aspects of each one. 
3. Then we will break into pairs. I will give each pair a case study of 2-3 companies and you will discuss which strategy you believe each employs and why. Be prepared to present your analysis back to the class. 
4. Finally, think of a local business you are familiar with and write one paragraph explaining how they could potentially apply generic strategies at a business or corporate level. Make sure to consider advantages and limitations. 

Please be respectful in your presentations and stay focused on the task. Are there any questions before we begin? Let's get started!

Prompt:

Write instructions for a class learning activity for grade 11, 16-year old high school students in a business management course on the Porter Generic Strategies framework. Include 3 learning objectives with their Bloom level and descriptor, and list 3 different assessment methods.

Act as an experienced high school teacher and learning expert. Tone is formal and temperature is precise.

Use these documents as guidance: <insert links or text here>

Output worksheet

You can follow this up by creating a matching worksheet.

Porter's Generic Strategies Worksheet

Cost Leadership Strategy

• Low cost producer
• Economies of scale
• Standardization
• Market share
• Price competition

Differentiation Strategy

• Unique
• Brand image
• Customer perception
• Premium price
• Non-price competition

Focus Strategy

• Expertise
• Target niche market
• Customization
• Loyal customers
• Limitations on growth

Instructions: Use this worksheet to take notes on the characteristics of each generic strategy based on today's lesson. Refer back to these keywords in your analysis activities.

Prompt:

Generate a worksheet for Porters Generic Strategies, listing 5 keywords for each of the 3 strategies cost leaderships, differentiation and focus.

Output pairs of companies:

Here are 15 pairs of companies for students to analyze using Porter's Generic Strategies:

1. Walmart vs. Target - Walmart focuses on low prices through huge supply chains and private label brands. Target pursues trendier merchandise and limited selection within each product category.
2. Apple vs. Samsung - Apple focuses on premium brand image and seamless user experience across different devices. Samsung offers a wide range of products at various price points to appeal to different customer segments.
3. Southwest Airlines vs. American Airlines - Southwest keeps costs low through high aircraft utilization and uniform fleet. American offers a traditional full-service experience on frequent domestic and international routes.
4. etc.

Prompt

Create 15 pairs of companies so that students to compare their positioning using Porter Generic Strategies. Each pair should be part of a similar industry. Describe each company's strategic positioning in 2 or 3 sentences.

3) Individual Learning Activity

Output individual learning activity

Dear students,

For this individual home work assignment, I'd like you to analyze two competing companies using Michael Porter's framework of generic business strategies. Here are the steps:

    1. Select two companies that directly compete in the same industry. For example, McDonald's and Burger King, Apple and Samsung, Walmart and Target, etc.

    2. Conduct research on each company. Look at their websites, annual reports, news articles, and analyst reports. Try to understand their business model and strategies.

    3. Analyze each company using Porter's three generic strategies - cost leadership, differentiation, and focus. Determine which strategy (or combination of strategies) each company appears to follow based on your research.

    4. Specifically consider aspects like their pricing, product/service uniqueness, target customer segments, revenue sources, costs and economies of scale. You can use  internet and textbook resources shared to help with this analysis.

    5. Present your findings visually in a 5-slide presentation. Each slide should analyze one company, connecting the company's approach to the relevant generic strategy.

    6. In your conclusion slide, evaluate which company currently has the more effective strategic approach based on their industry/market context. Explain your reasoning.

    7. Upload your final slideshow to the assignment folder on the class in our Learning Management System by <date, time>. I'm excited to read your analyses! Let me know if you have any other questions.

Remember, the goal is to think strategically about how companies compete. Take your time with research and clearly explain your strategic logic. Have fun with this project and be ready to discuss your findings in our next class.

Prompt

Write instructions for grade 11 16-year old high school students, asking them to conduct research on two rival companies and map them onto the Porter framework.

Act as an experienced high school teacher and learning expert.

They then evaluate which firm has the more effective strategic approach currently. They should produce a slideshow of max. 5 slides and upload it to your Learning Management System.

Use these documents as guidance: <insert links or text here>

Conclusions and recommendations

Porter's framework provides an accessible yet rigorous model for students to analyze real businesses strategically. By mapping companies onto cost leadership, differentiation, and focus strategies, students practice critical thinking and evidence-based evaluation.

The activities outlined allow students to develop key competencies. Exploring examples collaboratively helps solidify their understanding. Conducting independent research cultivates information literacy. Communicating findings develops presentation skills.

To maximize learning, assessment methods should be varied, aligned to objectives, and provide feedback. The worksheet, group discussion, and individual project integrate knowledge, comprehension, and application levels of Bloom's taxonomy.

For teachers, generating learning activities, objectives and assessments in one integrated plan ensures rigor and coherence. Scaffolding independent research builds students' capacity over time. Rubrics and grading criteria maintain standards and recognize effort. Rubrics can easily be generated with LLMs.

To extend the lesson, teachers could have students identify strategy shifts over time, compare multi-business firms, or debate strategy effectiveness. Competitions between researched company analyses motivate higher-order thinking.

#PortersGenericStrategies #positioning #ResearchSkills #PresentationMastery #AIinEducation

#AIforTeachingandLearning #AI4TL #PortersGenericStrategiesAI #DigitalPedagogyAI #StudentLearningwithAI

References

Edwards, J. (2014). Focused Cost Leadership and Focused Differentiation. BCcampus. Retrieved from https://opentextbc.ca/strategicmanagement/chapter/focused-cost-leadership-and-focused-differentiation

Mindtools Porter's Generic Strategies. (2023, November 16). Mindtools. Retrieved from https://www.mindtools.com/azb8kpl/porters-generic-strategies

Wikipedia (2023, November 01). Porter's generic strategies - Wikipedia. Retrieved from https://en.wikipedia.org/w/index.php?title=Porter%27s_generic_strategies&oldid=1183001372