168  Blockchain

The focus strategy has two types:

1. Cost focus: In this type, a company tries to seek a cost advantage

within its target segment of the market.

2. Differentiation focus: In this type, a company tries to seek differentia-

tion of its products and services within its target market segment.

Recommendation to achieve Focus strategy:

• First and foremost, an advice is to spend a substantial amount of time

before selecting focus strategy. This also depends on the analysis of

niche market segments in the industry, where our company can deliver

value compared to its competitors.

• Once the market segment has been selected, the company needs to

apply similar rules of broader cost versus differentiation strategy, but

on a narrow market segment.

• Continue to expand the market segments by analysing the capability

against the customer needs in new market segments.

Selection of the strategy

Although there are multiple strategies available, we will select Michael

Porter’s competitive advantage strategy and apply the various models dis-

cussed within his book to assess and apply them on blockchain strategy.

We will then formulate an appropriate strategy for a business trying to get

into blockchain business or would like to expand on the existing business

model.

Strategic models

There are various models to assist in formulating a strategy of the company.

We will go through some of the most appropriate ones in this section and

try to apply them on blockchain adoption.

Michael Porter’s five forces strategy model

Michael Porter’s five forces framework was first published in the Harvard

Business Review in 1979. This model has become de facto to analyse

competitiveness in any industry which determines the overall profitabil-

ity/attractiveness of a firm within that industry. This model looks at

the firm in question from the macro-environment (industry-specific)

(Figure 6.3).