Bowman's Strategy Clock
Bowman's Strategy Clock is a model used in marketing to analyse the competitive position of a company in comparison to the offerings of competitors. It was developed by Cliff Bowman and David Faulkner[1] as an elaboration of the three Porter generic strategies. As with Porter's Generic Strategies, Bowman considers competitive advantage in relation to cost advantage or differentiation advantage. Bowman's Strategy Clock represents eight possible strategies in four quadrants defined by the axes of price and perceived added value. The resulting star shape is reminiscent of a clock face, giving this tool its name.
There are six core strategic options:
| Value \ Price | Low price | Medium price | High price |
|---|---|---|---|
| High added value | Hybrid Low cost base and reinvestment in low price and differentiation |
Differentiation Perceived added value by user, yielding market share benefits or allowing price premium |
Focused differentiation Perceived added value to a particular segment warranting a premium price |
| Mediocre added value | Cost leader | \ | / -- * -- / | \ |
Raise prices to get higher margins. Works in de facto industry standard position. Risk losing market share to competitors. |
| Low added value | Segment specific | Increased price & low value Risks losing market share; only feasible in monopoly position. | |
By looking at the different combinations of price and perceived value, you can begin to choose a position of competitive advantage that makes sense for you and your organization’s competencies. This is a powerful way of looking at how to establish and sustain a competitive position in a market driven economy. By understanding these eight basic strategic positions of Bowman’s Strategy Clock, you can analyze and evaluate your current strategy and determine if adjustments might improve your overall competitive position.
Criticism of Bownman's Strategy Clock
Bowman is challenging Michael Porter’s ideas on generic strategies and suggests that a differentiated, low cost hybrid position may be an achievable position. Porter himself admits this is the case under certain conditions but Bowman’s Strategy Clock doesn’t make these conditions clear.
The strategy clock is a tool that has a bias towards helping to direct competitive strategy to increase market share. Positions above the fair value line should increase share, positions below will probably cause market share to fall. Its prescriptions are not so clear on the profit impact of moves around the customer matrix.
References
- ↑ Bowman, C. and Faulkner, D. (1997), “Competitive and Corporate Strategy”, Irwin, London.