Bowmans Strategic Clock

Bowman's Strategic Clock Method

Firstly, you should think about the two dimensions: value and price of a product or service. These method will guide you and help you to arrive at one of eight positions on the clock. See Figure 1 below.

Figure 1. Bowman’s Strategic Clock, StudySmarter

1. Low Price and Low Value Added

In this strategy, the price and value of a product or service is very low. It is probably the least competitive strategy in Bowman’s Strategic Clock.

2. Low Price

This strategy is about providing customers with a product or service at the price lower than the price of the competition. Usually, businesses using this strategy focus not on quality but on quantity. They aim to minimise production costs in order to sell as many units as possible at the lowest price.

3. Hybrid

This strategy combines low price and product differentiation. Companies using this strategy aim to make their product or service highly valued in the market and in the eyes of their customers. However, the price of the product is low and, therefore, highly competitive.

4. Differentiation

Companies following this strategy try to make their product or service different from the products offered by their competition. Typically they offer the same product or service but with some unique features.

5. Focused differentiation

This strategy combines high value and high price. Here companies produce distinguished and highly valued products or services and sell them at the highest price possible. Businesses using this strategy usually make high profits, but they have to put in a lot of effort to make it work successfully.

6. Risky High Margins

This strategy combines high price and low value. Here companies offer a low-valued product or service but sell it at the highest price possible. It is a fairly risky strategy that is usually used by businesses with a strong brand name.

7. Monopoly Pricing

In this market, there is only one business that controls a product or service and its price. There is no competition, but companies using monopoly pricing should keep an eye on the market since all monopolies come to an end.

8. Loss of Market Share

This is a strategy for companies exiting a market or being in decline. It is used when companies lose their customers, become less profitable and therefore are forced to lower the prices of their products.

Bowman's strategic clock examples

Let's take a look at a couple of real companies and their strategies based on Bowman's Strategic Clock:

Advantages and disadvantages of Bowman’s Strategic Clock

While Bowman's Strategic Clock is a useful tool for analyzing a company's strategic position and has many advantages, you need to consider its limitations. The table below shows the main advantages and disadvantages of the model.

Let's talk about the advantages first. Simplicity of the model provides an easy-to-understand framework that also allows to analyse a variety of strategies. Bowman's clocks can also be easily adapted to different industries and market conditions. On the other hand, disadvantages include limited scope - it focuses only on price and differentiation and does not consider other factors like product quality or brand reputation. Bowman's Strategic Clock also does not provide guidance on the implementation of the strategy or on ways to improve it. Its simplicity might become and disadvantage when a company needs to consider the more complex nature of the strategy.