What characteristics are associated with firms that follow a cost leadership strategy and a differentiation strategy? Illustrate your answer with examples of firms that follow these two different strategies.

Cost leaders' products are highly standardized,with no frills,and are usually produced for mass markets.Operational efficiency and process improvement are critical-the cost leader must excel in these areas.A cost leader typically offers a standardized,no-frills product; adding 'frills' adds costs.Walmart is the classic cost leader,continuously innovating to reduce costs in its procurement,distribution,and logistics systems.A differentiation strategy requires almost the opposite skills and organizational characteristics than a cost-leadership strategy.Differentiation requires continuous innovation and exceptional brand management; otherwise there is the chronic risk that a competitor will imitate or surpass the firm's offerings.Dominant values of the organizational culture are risk taking,speed,flexibility,and experimentation-these are the ingredients of innovativeness.Firms such as Starbucks and Apple adhere to a differentiation strategy.